DBS adopts global framework in sustainability push
Singapore
DBS Bank said it has become the first bank in Singapore and South-east Asia to adopt a globally recognised framework for financial institutions to determine, assess and manage environmental and social risk in projects.
These Equator Principles in the framework also outline environmental and social standards for large-scale developments, and are based on the International Finance Corporation (IFC) Performance Standards published by the World Bank Group.
DBS's adoption of the framework means it will "go the extra mile" to disclose information on large-scale developments it is involved in, the lender said in a statement on Monday.
This will be on top of the bank's existing adherence to due diligence processes in accordance with IFC's Performance Standards when assessing large project financing deals.
In April, the bank announced that it will stop financing new coal-fired power plants in any market once its existing commitments are completed by 2021, and is stepping up financing of renewable energy projects.
The latest initiative by the bank, a Temasek-linked company, also comes as Temasek Holdings flagged last week that it would like to "shape a carbon neutral portfolio sooner rather than later", and to go carbon neutral by 2020.
"We believe the South-east Asia region will see significant infrastructure development over the next few years, and financing will play a central role," Tan Su Shan, group head of institutional banking group at DBS, said in a statement on Monday.
"As that happens, we acknowledge the importance of incorporating environmental and societal considerations into our lending decisions, and to managing our business in a balanced and responsible way, contributing to a more sustainable future."
DBS believes that Singapore's position as a global financial centre and legal hub will also help create an inclusive environment to facilitate infrastructure projects in the region.
Over the years, the bank has advanced its sustainability agenda based on three main areas: responsible banking, responsible business practices and creating social impact.
In the area of responsible financing, this year, the bank expects to close more than S$4 billion of sustainable finance transactions comprising green loans, sustainability performance-linked loans and renewable energy financing.
