Green Banking Policy of IBBL - Islami Bank Bangladesh Limited
Green Banking Policy of IBBL - Islami Bank Bangladesh Limited
Green Banking Policy of IBBL - Islami Bank Bangladesh Limited
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<strong>Islami</strong> <strong>Bank</strong> <strong>Bangladesh</strong> <strong>Limited</strong><br />
Risk Management Wing<br />
<strong>Green</strong> <strong><strong>Bank</strong>ing</strong> Department<br />
Head Office, 40 Dilkusha C/A, Dhaka.<br />
We all are aware that the change in climate has direct impact on biodiversity, agriculture,<br />
forestry, dry land, water resources and human health. To safeguard the planet and its Ecosystem<br />
from the adverse effect <strong>of</strong> environmental degradation caused by rising carbon emission,<br />
encroachment <strong>of</strong> rivers, improper disposal <strong>of</strong> industrial, medical & household waste,<br />
deforestation, loss <strong>of</strong> open space etc., <strong>Bangladesh</strong> <strong>Bank</strong> in line with global norms has already<br />
introduced <strong>Green</strong> <strong><strong>Bank</strong>ing</strong> and sustainable practices at all the scheduled banks in <strong>Bangladesh</strong>.<br />
In this connection, <strong>Bangladesh</strong> <strong>Bank</strong> circulated a policy guidelines for <strong>Green</strong> <strong><strong>Bank</strong>ing</strong>, vide<br />
BRPD Circular No. 02 dated 27, February 2011.<br />
The Guidelines segregated the <strong>Green</strong> <strong><strong>Bank</strong>ing</strong> activities for implementing in 03 (three) phases.<br />
1 st Phase time lining was within 31 st December 2011. 2nd phase is within 31 st December 2012.<br />
3 rd phase will be within 31 st December 2013.<br />
<strong>Bangladesh</strong> <strong>Bank</strong> declared the following preferential treatments for the compliant banks:<br />
i. Points will be awarded On Management component while computing CAMELS rating<br />
resulted ultimately in overall rating <strong>of</strong> the bank.<br />
ii. Top 10 (ten) <strong>Bank</strong>s’ name will be declared in the <strong>Bangladesh</strong> <strong>Bank</strong> website.<br />
iii. Consideration will be given while according permission for opening new Branch <strong>of</strong> the<br />
<strong>Bank</strong>.<br />
Also a short note on Phase wise <strong>Green</strong> <strong><strong>Bank</strong>ing</strong> activities as envisaged by <strong>Bangladesh</strong> <strong>Bank</strong> and<br />
our position there against is given below:<br />
Sl<br />
No.<br />
1<br />
2.<br />
3<br />
Phase-I (January - December 2011)<br />
Title Functions (description <strong>of</strong> the Job) Our position<br />
<strong>Policy</strong><br />
Formulation &<br />
Governance<br />
Incorporation<br />
<strong>of</strong> Environmental<br />
Risk in<br />
CRM/IRM<br />
Initiating<br />
In-house<br />
Environment<br />
Management<br />
Establishment <strong>of</strong> a <strong>Green</strong> <strong><strong>Bank</strong>ing</strong> Unit, headed by<br />
Formed under RMW<br />
a Senior Executive.<br />
To formulate a high powered Committee EC has been<br />
comprising directors from the Board.<br />
entrusted<br />
Environmental or <strong>Green</strong> <strong><strong>Bank</strong>ing</strong> policy and<br />
strategy<br />
<strong>Policy</strong> drafted<br />
Fund allocation for green banking.<br />
Allocated a fund <strong>of</strong><br />
Tk. 592.37 million<br />
Quarterly reporting <strong>of</strong> <strong>Green</strong> <strong><strong>Bank</strong>ing</strong> activities Being complied<br />
Environmental and Climate Change Risk rating<br />
along-with Credit/ Investment Risk Grading.<br />
To prepare an inventory <strong>of</strong> the consumption <strong>of</strong><br />
water, paper, electricity, energy etc <strong>of</strong> the<br />
Offices and Branches<br />
To take measures for saving electricity, water<br />
do<br />
Under progress
Sl<br />
No.<br />
4<br />
5<br />
6<br />
Title Functions (description <strong>of</strong> the Job) Our position<br />
Introducing<br />
<strong>Green</strong> finance<br />
Creation <strong>of</strong><br />
Climate Risk<br />
Fund<br />
Introducing<br />
<strong>Green</strong><br />
Marketing<br />
and paper consumption.<br />
To circulate a set <strong>of</strong> general instructions (<strong>Green</strong><br />
Office Guide) to the employees for efficient use<br />
<strong>of</strong> electricity, water, paper and reuse <strong>of</strong><br />
equipments.<br />
To use scrap papers as notepads and to avoid<br />
disposable cups/ glasses to become more Ec<strong>of</strong>riendly.<br />
To install energy efficient electronic equipments.<br />
To use energy saving bulbs in place <strong>of</strong> normal<br />
bulbs in branches/ <strong>of</strong>fices <strong>of</strong> the bank.<br />
To make plan to use solar energy at premises to<br />
save electricity.<br />
To encourage employees to purchase energy<br />
efficient cars (that consume less fuel) for<br />
reducing gas and petroleum consumption.<br />
Arrangement <strong>of</strong> automatic shutdown <strong>of</strong><br />
equipments<br />
Use <strong>of</strong> extensively online communication<br />
Double –side printing.<br />
To apply Eco-font in printing to reduce use <strong>of</strong><br />
ink.<br />
To prefer financing in the Eco friendly<br />
business activities and energy efficient<br />
industries such as:<br />
Renewable energy project<br />
Clean water supply project<br />
Waste water treatment plant<br />
Solid & hazardous waste disposal plant, Bio-gas<br />
plant<br />
Bio-fertilizer plant etc.<br />
To promote environmental practices applying<br />
consumer finance program.<br />
Finance in economic activities <strong>of</strong> the flood,<br />
cyclone and drought prone areas without<br />
charging additional risk premium.<br />
Creation <strong>of</strong> Climate Change Risk Fund<br />
To use environmental causes for marketing i.e.<br />
financial services to the customer for awareness<br />
development among the common people.<br />
To advise the clients for modifying the product,<br />
changing the production & packaging process<br />
and modifying advertisement for environmental<br />
cause.<br />
do<br />
do<br />
do<br />
do<br />
do<br />
do<br />
Allocated a fund<br />
<strong>of</strong> Tk. 50 million<br />
Partially<br />
implemented<br />
Implemented and<br />
being practiced<br />
7 Online <strong><strong>Bank</strong>ing</strong> To allow the customers online banking Implemented<br />
Supporting Arrangement <strong>of</strong> employee awareness More intensive<br />
Employee development and training program on programs to be<br />
8<br />
Training, environmental and social risk<br />
taken<br />
Consumer Arrangement <strong>of</strong> customer awareness Steps to be taken
Sl<br />
No.<br />
9<br />
10<br />
11<br />
12<br />
13<br />
14<br />
15<br />
Title Functions (description <strong>of</strong> the Job) Our position<br />
Awareness and<br />
<strong>Green</strong> Even<br />
Reporting<br />
<strong>Green</strong> <strong><strong>Bank</strong>ing</strong><br />
Practices<br />
Sector Specific<br />
Environmental<br />
Policies<br />
<strong>Green</strong> Strategic<br />
Planning<br />
Setting up<br />
<strong>Green</strong> Branches<br />
Improved<br />
In-house<br />
Environme<br />
nt<br />
Manageme<br />
nt<br />
Formulation <strong>of</strong><br />
<strong>Bank</strong> Specific<br />
Environmental<br />
Risk<br />
Management<br />
Plan and<br />
Guidelines.<br />
Rigorous<br />
Programs to<br />
Educate Clients<br />
to be<br />
undertaken.<br />
development<br />
To take measure to report on the<br />
initiatives/practices to <strong>Bangladesh</strong> <strong>Bank</strong> and<br />
disclose in the <strong>Bank</strong>’s websites.<br />
To be designed<br />
Determine green targets<br />
To determine a set <strong>of</strong> achievable targets and<br />
strategies.<br />
To disclose these in the annual report and<br />
web-site for green financing and in-house<br />
management.<br />
Target areas for green financing:<br />
i. To reduce loans/investments for<br />
environmentally harmful<br />
activities.<br />
ii. To attain a particular percentage<br />
<strong>of</strong> environmental loans/<br />
investment.<br />
iii. To introduce Eco-friendly<br />
financial products.<br />
Features <strong>of</strong> <strong>Green</strong> Branches:<br />
• To use maximum natural light<br />
• To use renewable energy and energy<br />
saving bulbs and other equipments.<br />
• To reduce water and electricity use.<br />
• To use recycled water.<br />
• A green Branch will be entitled to display a special logo<br />
approved by BB.<br />
To take Strategy <strong>of</strong> reuse, recycling <strong>of</strong> materials<br />
& equipments, and source reduction and waste<br />
minimization.<br />
To rely increasingly on virtual meeting through<br />
the use <strong>of</strong> video conferencing in lieu <strong>of</strong> physical<br />
travel for saving cost and energy.<br />
Develop and follow an environmental risk<br />
management manual or guidelines for the<br />
assessment/ monitoring <strong>of</strong> project and working<br />
capital investments.<br />
To set internationally accepted higher<br />
environmental standards.<br />
Encourage the clients and business houses to<br />
comply environmental regulation.<br />
Introduce rigorous program to educate clients<br />
about environmental risk.<br />
Implemented<br />
Under process<br />
Steps to be taken<br />
do<br />
Partially<br />
implemented<br />
do<br />
Under process<br />
do<br />
Steps to be taken<br />
do
Sl<br />
No.<br />
16<br />
Title Functions (description <strong>of</strong> the Job) Our position<br />
Disclosure and<br />
Reporting <strong>of</strong><br />
<strong>Green</strong> <strong><strong>Bank</strong>ing</strong><br />
Activities.<br />
Publishing independent <strong>Green</strong> <strong><strong>Bank</strong>ing</strong>/<br />
Sustainability reports<br />
To disclose update and detail information about<br />
<strong>Bank</strong>’s environmental activities and<br />
performances <strong>of</strong> major clients.<br />
Phase-III (January - December 2013)<br />
To have a system <strong>of</strong> Environment Management before initiation <strong>of</strong> the activities <strong>of</strong> phase- III<br />
1. Designing and Introducing Innovative Products.<br />
• To introduce environment friendly innovative green products to address the core<br />
environmental challenges <strong>of</strong> the country.<br />
• To avoid negative impacts on environment through banking activities.<br />
2. Reporting in Standard Format with External Verification.<br />
• To publish independent <strong>Green</strong> Annual Report following internationally accepted<br />
format like Global Reporting Initiatives (GRI) targeting the stakeholders duly<br />
verified by an independent agency or acceptable third party.<br />
do<br />
do