CIMB targets RM30bil in sustainable finance by 2024


KUALA LUMPUR: CIMB Group Holdings Bhd announced at its Sustainability Investor Day held today that the Group has committed to a series of strengthened sustainability commitments, including mobilising RM30 billion towards sustainable finance as part of its continued ambition to be an ASEAN sustainability leader by 2024.

Guided by its Green, Social, Sustainable Impact Products and Services ("GSSIPS”) framework, this higher sustainability finance target includes wholesale and commercial financing, bonds and intermediation, wealth products, and products that enable financial inclusion such as affordable home financing and other products catered to the B40 group.

CIMB has made good progress and is ahead of schedule in meeting its original target with over RM10 billion in offerings under its GSSIPS framework already achieved as of 2021.

In addition to the sustainable finance commitment, the Group also announced its commitments towards mitigating climate change, including net zero operational greenhouse gas ("GHG”) scope 1 and 2 emissions by 2030 and net zero overall GHG emissions by 2050, together with a No Deforestation, No Peat, No Exploitation ("NDPE”) commitment.

Furthermore, the Group has committed to invest RM150 million over five years and 100,000 in employee volunteerism hours annually by 2024 to positively impact lives, communities and businesses across ASEAN.

Dato’ Abdul Rahman Ahmad, Group Chief Executive Officer of CIMB Group said, "The COVID-19 pandemic has been a global stress test, worsened further by the increasing occurrences of extreme weather events driven by climate change.

These have had a deep impact on lives and livelihoods, emphasising the urgency for all stakeholders in the public and private sectors and civil society to accelerate sustainable action towards a just transition to a low carbon economy in a measurable and timely manner.”

”CIMB is committed to playing our part to accelerate the sustainability agenda through our commitments announced today, in particular our target to mobilise RM30 billion in sustainable finance by 2024 and achieve net zero emissions by 2050.

Today, sustainability is already core and integrated into our business, and we actively engage clients and all stakeholders to promote financial services that are aligned to sustainability principles,” he added.

To provide greater oversight and accountability in delivering on these commitments, CIMB Group’s Board of Directors has established a Group Sustainability and Governance Committee, chaired by Teoh Su Yin, Senior Independent Director. Under its Forward23+ Strategic Plan, the Group has set a target to be in the top quartile of the Dow Jones Sustainability Index ("DJSI”) by 2024. The DJSI tracks the performance of the world’s leading companies in terms of their sustainability practices, and to date CIMB has improved its position from the 19th percentile in 2018 to 65th percentile in 2020.

The commitments announced at CIMB’s Sustainability Investor Day represent a continuation of the Group’s ongoing journey towards being a sustainability leader in the region since starting its sustainability journey 2019.

CIMB is a founding signatory of the United Nations Environment Programme Finance Initiative ("UNEP FI”) Principles for Responsible Banking, a signatory of the Collective Commitment on Climate Action ("CCCA”) as well as the Net-Zero Banking Alliance ("NZBA”), and an official supporter of the Task Force on Climate-related Financial Disclosures ("TCFD”).

In 2019, CIMB introduced its Group Sustainable Financing Policy and in 2020, the Group introduced its coal sector guide which sets out CIMB’s commitment to phase out coal from its portfolio by 2040 in line with the 1.5-degree Celsius goal of the Paris Climate Agreement. With the issuance of the coal sector guide, CIMB became the first banking group in Malaysia and the first in Southeast Asia to commit to phasing out coal from its portfolio.

As part of its sustainable finance commitment, CIMB has been active in providing sustainability-linked loans ("SLLs”) for corporate clients, with close to RM1 billion already committed out of RM3 billion earmarked through 2024.

As for the bonds/sukuk space, in the first half of 2021, CIMB acted as the lead manager for the government of Malaysia’s dual tranche US$1.3 billion Sukuk Wakala offering, where the US$800 million sustainability tranche was the world’s first US dollar sustainability sukuk offered by a sovereign.

CIMB also launched and priced the government of Indonesia’s US$3 billion global sukuk offering, including a US$750 million green sukuk tranche.

CIMB is also in the process of finalising its internal framework for the identification and classification of climate-aligned assets, economic activities and environmental, social and governance ("ESG”) criteria that is grounded in the Group’s GSSIPS framework and Bank Negara Malaysia’s ("BNM”) Climate Change and Principle-based Taxonomy ("CCPT”).

This internal framework will allow CIMB to assess, monitor, and increase its exposure to green, social and sustainable assets in a more holistic and targeted manner in the next few years.

CIMB’s Sustainability Investor Day was the kickstart to a week of sustainability initiatives by the Group, with its 3rd Cooler Earth Sustainability Summit ("the Summit”) taking place from 23rd to 27th September.

Themed Align, Act, Accelerate, the Summit will feature webinars and masterclasses on a range of sustainability topics from leading sustainability figures and advocates.

The Summit continues to focus on the ASEAN region and aims to convene global experts, leaders, financiers, investors and policymakers in order to encourage greater discourse in sustainability and shape a more sustainable tomorrow.

This year’s Summit will be opened by YB Senator Tengku Datuk Seri Utama Zafrul bin Tengku Abdul Aziz, Minister of Finance, Malaysia while the keynote address will be delivered by Sir Jonathon Espie Porritt, Co-Founder and Founder Director, Forum of the Future, an eminent advisor, writer and campaigner on sustainable development globally.

Recognising the critical role of youth in realising the sustainability agenda, the Summit is dedicating a full day on 27th September to cover topics relevant to the next generation, with the day’s programme being fully curated by the young talents in CIMB’s The Complete Banker ("TCB”) management trainee programme.

The Summit was organised in partnership with knowledge partners WWF-Malaysia, Impacto, ACCA, CEO Action Network and B Corp.

Supporting partners of the Summit include the Joint Committee on Climate Change ("JC3”), CFA Society Malaysia, Institute of Corporate Directors Malaysia, Capital Markets Malaysia, and Climate Governance Malaysia.

The Cooler Earth Sustainability Summit 2021 is complimentary and open to all. - Bernama

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