Green Banking Policy of IBBL - Islami Bank Bangladesh Limited

Islami Bank Bangladesh Limited
Risk Management Wing
Green Banking Department
Head Office, 40 Dilkusha C/A, Dhaka.
We all are aware that the change in climate has direct impact on biodiversity, agriculture,
forestry, dry land, water resources and human health. To safeguard the planet and its Ecosystem
from the adverse effect of environmental degradation caused by rising carbon emission,
encroachment of rivers, improper disposal of industrial, medical & household waste,
deforestation, loss of open space etc., Bangladesh Bank in line with global norms has already
introduced Green Banking and sustainable practices at all the scheduled banks in Bangladesh.
In this connection, Bangladesh Bank circulated a policy guidelines for Green Banking, vide
BRPD Circular No. 02 dated 27, February 2011.
The Guidelines segregated the Green Banking activities for implementing in 03 (three) phases.
1 st Phase time lining was within 31 st December 2011. 2nd phase is within 31 st December 2012.
3 rd phase will be within 31 st December 2013.
Bangladesh Bank declared the following preferential treatments for the compliant banks:
i. Points will be awarded On Management component while computing CAMELS rating
resulted ultimately in overall rating of the bank.
ii. Top 10 (ten) Banks’ name will be declared in the Bangladesh Bank website.
iii. Consideration will be given while according permission for opening new Branch of the
Bank.
Also a short note on Phase wise Green Banking activities as envisaged by Bangladesh Bank and
our position there against is given below:
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No.
1
2.
3
Phase-I (January - December 2011)
Title Functions (description of the Job) Our position
Policy
Formulation &
Governance
Incorporation
of Environmental
Risk in
CRM/IRM
Initiating
In-house
Environment
Management
Establishment of a Green Banking Unit, headed by
Formed under RMW
a Senior Executive.
To formulate a high powered Committee EC has been
comprising directors from the Board.
entrusted
Environmental or Green Banking policy and
strategy
Policy drafted
Fund allocation for green banking.
Allocated a fund of
Tk. 592.37 million
Quarterly reporting of Green Banking activities Being complied
Environmental and Climate Change Risk rating
along-with Credit/ Investment Risk Grading.
To prepare an inventory of the consumption of
water, paper, electricity, energy etc of the
Offices and Branches
To take measures for saving electricity, water
do
Under progress

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No.
4
5
6
Title Functions (description of the Job) Our position
Introducing
Green finance
Creation of
Climate Risk
Fund
Introducing
Green
Marketing
and paper consumption.
To circulate a set of general instructions (Green
Office Guide) to the employees for efficient use
of electricity, water, paper and reuse of
equipments.
To use scrap papers as notepads and to avoid
disposable cups/ glasses to become more Ecofriendly.
To install energy efficient electronic equipments.
To use energy saving bulbs in place of normal
bulbs in branches/ offices of the bank.
To make plan to use solar energy at premises to
save electricity.
To encourage employees to purchase energy
efficient cars (that consume less fuel) for
reducing gas and petroleum consumption.
Arrangement of automatic shutdown of
equipments
Use of extensively online communication
Double –side printing.
To apply Eco-font in printing to reduce use of
ink.
To prefer financing in the Eco friendly
business activities and energy efficient
industries such as:
Renewable energy project
Clean water supply project
Waste water treatment plant
Solid & hazardous waste disposal plant, Bio-gas
plant
Bio-fertilizer plant etc.
To promote environmental practices applying
consumer finance program.
Finance in economic activities of the flood,
cyclone and drought prone areas without
charging additional risk premium.
Creation of Climate Change Risk Fund
To use environmental causes for marketing i.e.
financial services to the customer for awareness
development among the common people.
To advise the clients for modifying the product,
changing the production & packaging process
and modifying advertisement for environmental
cause.
do
do
do
do
do
do
Allocated a fund
of Tk. 50 million
Partially
implemented
Implemented and
being practiced
7 Online Banking To allow the customers online banking Implemented
Supporting Arrangement of employee awareness More intensive
Employee development and training program on programs to be
8
Training, environmental and social risk
taken
Consumer Arrangement of customer awareness Steps to be taken

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No.
9
10
11
12
13
14
15
Title Functions (description of the Job) Our position
Awareness and
Green Even
Reporting
Green Banking
Practices
Sector Specific
Environmental
Policies
Green Strategic
Planning
Setting up
Green Branches
Improved
In-house
Environme
nt
Manageme
nt
Formulation of
Bank Specific
Environmental
Risk
Management
Plan and
Guidelines.
Rigorous
Programs to
Educate Clients
to be
undertaken.
development
To take measure to report on the
initiatives/practices to Bangladesh Bank and
disclose in the Bank’s websites.
To be designed
Determine green targets
To determine a set of achievable targets and
strategies.
To disclose these in the annual report and
web-site for green financing and in-house
management.
Target areas for green financing:
i. To reduce loans/investments for
environmentally harmful
activities.
ii. To attain a particular percentage
of environmental loans/
investment.
iii. To introduce Eco-friendly
financial products.
Features of Green Branches:
• To use maximum natural light
• To use renewable energy and energy
saving bulbs and other equipments.
• To reduce water and electricity use.
• To use recycled water.
• A green Branch will be entitled to display a special logo
approved by BB.
To take Strategy of reuse, recycling of materials
& equipments, and source reduction and waste
minimization.
To rely increasingly on virtual meeting through
the use of video conferencing in lieu of physical
travel for saving cost and energy.
Develop and follow an environmental risk
management manual or guidelines for the
assessment/ monitoring of project and working
capital investments.
To set internationally accepted higher
environmental standards.
Encourage the clients and business houses to
comply environmental regulation.
Introduce rigorous program to educate clients
about environmental risk.
Implemented
Under process
Steps to be taken
do
Partially
implemented
do
Under process
do
Steps to be taken
do

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No.
16
Title Functions (description of the Job) Our position
Disclosure and
Reporting of
Green Banking
Activities.
Publishing independent Green Banking/
Sustainability reports
To disclose update and detail information about
Bank’s environmental activities and
performances of major clients.
Phase-III (January - December 2013)
To have a system of Environment Management before initiation of the activities of phase- III
1. Designing and Introducing Innovative Products.
• To introduce environment friendly innovative green products to address the core
environmental challenges of the country.
• To avoid negative impacts on environment through banking activities.
2. Reporting in Standard Format with External Verification.
• To publish independent Green Annual Report following internationally accepted
format like Global Reporting Initiatives (GRI) targeting the stakeholders duly
verified by an independent agency or acceptable third party.
do
do