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. 1st Phase time lining was within 31st December 2011. 2nd phase is within 31st December 2012. 3rd phase will be within 31st 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: Phase-I (January - December 2011) Sl No. Title Functions (description of the Job) Our position

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 Policy Environmental or Green Banking policy and 1 Formulation & Policy drafted Governance strategy 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 Incorporation do of Environmental along-with Credit/ Investment Risk Grading. 2. Risk in CRM/IRM To prepare an inventory of the consumption of Initiating water, paper, electricity, energy etc of the Under progress In-house 3 Offices and Branches Environment Management To take measures for saving electricity, water

Sl No.

Title

Functions (description of the Job) 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. To allow the customers online banking Arrangement of employee awareness development and training program on environmental and social risk Arrangement of customer awareness

Our position

do do do do

Introducing Green finance

do

Creation of Climate Risk Fund

do Allocated a fund of Tk. 50 million Partially implemented

Introducing Green Marketing 6

Implemented and being practiced Implemented More intensive programs to be taken Steps to be taken

7 8

Online Banking Supporting Employee Training, Consumer

Sl No.

Title Awareness and Green Even Reporting Green Banking Practices Sector Specific Environmental Policies

Functions (description of the Job) development To take measure to report on the initiatives/practices to Bangladesh Bank and disclose in the Banks 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.

Our position

Implemented

10

Under process

11

Green Strategic Planning

Steps to be taken

12

Setting up Green Branches

do

13

14

15

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.

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 environmental standards. accepted higher

Partially implemented do

Under process

do Steps to be taken do

Encourage the clients and business houses to comply environmental regulation. Introduce rigorous program to educate clients about environmental risk.

Sl No.

Title Disclosure and Reporting of Green Banking Activities.

Functions (description of the Job) Publishing independent Green Banking/ Sustainability reports To disclose update and detail information about Banks environmental activities and performances of major clients. Phase-III (January - December 2013)

Our position do do

16

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.