2.4 UN Principles For Responsible Banking

Question 1

The United Nations Environment Programme Finance Initiative (UNEP FI)

Answer 1

Launched the principles of responsible banking in 2019 to accelerate a positive global transition.

Start of 2023, more than 300 banks had signed up to the principles.

Question 2

Purpose of signatory banks

Answer 2

Transform the banking industry so it can play a leading role in achieving society’s goal

Question 3

Vision of signatory banks

Answer 3

Responsible banking industry as it serves and contributes to an inclusive society that uses its natural resource’s sustainably

Question 4

Mission of signatory banks

Answer 4

Use products, services and relationships to support and accelerate the fundamental changes in our economies and lifestyle necessary to achieve shared prosperity for both current and future generations.

Question 5

Six principles for responsible banking:

Answer 5

1. Alignment
2. Impact and target setting
3. Clients and customers
4. Stakeholders
5. Governance and culture
6. Transparency and accountability

Question 6

Principle 1: Alignment

Answer 6

Align business strategy to be consistent and contribute to individuals needs and society’s goals

(As expressed in SDGs and Paris climate agreement)

Question 7

Principle 2: impact and target setting

Answer 7

Managing risk to people and the environment resulting from our activities, products and services.

Setting and publishing targets where can have the best impacts.

Increase positive impacts = reducing negative

Question 8

Principle 3: clients and customers

Answer 8

Work responsibly with our clients and customers to encourage sustainable practises and enable economic activities that create shared prosperity for current and future generations

Question 9

Principle 4: stakeholders

Answer 9

Consult, engage with relevant stakeholders to achieve society’s goals

Question 10

Principle 5: Governance and culture

Answer 10

Implement our commitment to these principles through effective governance and a culture of responsible banking

Question 11

Principle 6: Transparency and accountability

Answer 11

Review individual and collective implementation of these principles and be transparent with the positive and negative impacts and contribute to society’s goals

Question 12

Key features of the principles are:

Answer 12

• providing a comprehensive framework (strategic, portfolio and transactions level across all the banks business areas)
• alignment with the SDGs and the Paris climate agreement
• target setting in the areas of the most significant +- impact
• transparency through public reporting and review
• guidance, expert advice and peer lending to support implementation

Question 13

Implementing the principles ( a 3 step process)

Answer 13

1. Impact analysis
2. Target setting
3. Reporting

Question 14

Impact analysis

Answer 14

Identifying the most significant impacts of products and services on the societies, economies and environments in which the bank operates

Question 15

Target setting

Answer 15

Setting measurable and achieving targets in a banks areas of most significant impact

Question 16

Reporting

Answer 16

Publicly report progress on implementing the principles, being transparent about the impacts and contributions