•
harmful or illegal tree felling,
•
ship dismantling activities without the appropriate environmental certification,
•
operations located in UNESCO World Heritage sites, wetlands listed in the Ramsar Convention or significantly
affecting these areas or critical habitats registered by the International Union for Conservation of Nature (IUCN).
We support clients on their journey towards environmentally sustainable operations. We help them to build
awareness of:
•
environmental impact of their business and the impact of ESG factors on their financial situation,
•
take action to eliminate or reduce negative impacts and implement (where possible) sectoral best practice.
We require credit clients operating in sectors with significant environmental risk or significant exposure to
environmental risk – in the standard credit process
(Normal Track
), commensurate with the size of the client, type of
transaction and materiality of risk:
•
transparency as to the client’s environmental impact,
•
as far as possible – have a policy/strategy/plan to move towards an environmentally sustainable economy,
•
information on environmental objectives/activities – undertaken and planned, as well as the extent to which ESG
risk mitigation actions have been implemented.
Under social risk management, the full funding ban applies to the following areas:
•
human rights violations/abuses, including in forced labour situations, child labour, inadequate working conditions,
use of violence,
•
the risk to the health of workers and local communities, including contact with harmful chemical materials,
transmission of animal diseases to humans, non-compliance with labour laws,
•
production of and trade in controversial weapons, including: anti-personnel mines, cluster munitions, phosphorus
bombs, depleted uranium munitions, nuclear, chemical, biological weapons,
•
cultivation, processing, production and sale of tobacco and tobacco products and e-cigarettes,
•
asbestos-related activities, fur farming, gambling.
We have a detailed policy on defence financing and activities related to the arms industry. We are not opposed to
establishing relationships with this type of client. We believe that sovereign states, within the limits of the law,
regulations, national and international conventions, have the right to maintain public order, to participate in joint
military missions or peacekeeping missions, and to defend themselves and to have armed forces properly equipped.
However, we believe that certain companies, weapons and activities violate our values and business ethics. We do
not engage with controversial weapons because of their particularly destructive nature and the results of their use:
mass casualties and destruction in the area under attack, from which it is difficult to exclude civilians. By key
components of controversial weapons we mean infrastructure, equipment parts and materials, services and
programmes and systems (mechanical, electronic and digital) specifically designed for controversial weapons.
In the
ESG Manual
, we have identified selected standards, guidelines and initiatives whose application can be an
important reference in the social risk assessment process, such as:
Universal Declaration of Human Rights, UN Guiding
Principles on Business and Human Rights, International Labour Organisation Conventions on Labour Standards, UN
Global Compact, Guiding Principles on Business and Human Rights, ILO Tripartite Declaration of Principles concerning
Multinational Enterprises and Social Policy, OECD Guidelines for Multinational Companies
.
The exclusions and restrictions in the
ESG Manual
also apply to our bank’s suppliers (KYS process –
Know Your
Supplier
).
We also pay increased attention to the credit analysis of corporate clients who operate in sectors we have identified
as higher environmental and social risk.
We have prepared RAS limits for credit risk for the Business Banking segment, taking into account transformation
risk (based on average GHG intensity). We have introduced regular monitoring and warning signals for climatic RAS,
in line with our existing practice of controlling RAS limits.
We are developing our approach to creating climate risk appetite limits
(Climate RAS
) for the corporate client
segment. Within the sectoral RAS limits in the corporate segment, we have introduced a transformation risk
component for the first time (this risk is part of environmental/climate risk). We apply a proportional reduction in the
credit risk limit, the amount of which depends on the ratings given to individual sectors in the
climate change
mitigation
risk materiality assessment or the average greenhouse gas emissions intensity for individual sectors.
Management of potential exceeded values of approved RAS limits is carried out in accordance with the procedures in
