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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 Eco- system 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:

Phase-I (January - December 2011)

Sl

     

No.

Title

Functions (description of the Job)

 

Our position

   

Establishment of a Green Banking Unit, headed by a Senior Executive.

Formed under RMW

Policy

To formulate a high powered Committee comprising directors from the Board.

EC has been entrusted

1

Formulation &

Environmental

or

Green

Banking

policy

and

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

 

Incorporation

Environmental and Climate Change Risk rating along-with Credit/ Investment Risk Grading.

   

of Environmental

do

2.

Risk in

 

CRM/IRM

 

Initiating

To prepare an inventory of the consumption of water, paper, electricity, energy etc of the Offices and Branches

   

In-house

Under progress

3

Environment

Management

To take measures for saving electricity, water

Sl

     

No.

Title

Functions (description of the Job)

 

Our position

   

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 Eco- friendly.

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

do

equipments

Use of extensively online communication

 

do

Double –side printing.

 

do

To apply Eco-font in printing to reduce use of ink.

do

   

To prefer financing in the Eco friendly business activities and energy efficient industries such as:

   

Renewable energy project

 

Introducing

Clean water supply project

 

4

Green finance

Waste water treatment plant

 

do

Solid & hazardous waste disposal plant, Bio-gas plant

Bio-fertilizer plant etc.

 

To promote environmental practices applying consumer finance program.

 

Creation of

Finance in economic activities of the flood, cyclone and drought prone areas without charging additional risk premium.

 

Climate Risk

do

5

Fund

Creation of Climate Change Risk Fund

 

Allocated a fund of Tk. 50 million

 

Introducing

To use environmental causes for marketing i.e. financial services to the customer for awareness development among the common people.

Partially

Green

implemented

Marketing

6

To advise the clients for modifying the product, changing the production & packaging process and modifying advertisement for environmental cause.

Implemented and

being practiced

7

Online Banking

To allow the customers online banking

 

Implemented

 

Supporting

Arrangement of employee awareness development and training program on environmental and social risk

More intensive programs to be taken

8

Employee

Training,

 

Consumer

Arrangement

of

customer

awareness

Steps to be taken

Sl

     

No.

Title

 

Functions (description of the Job)

 

Our position

 

Awareness and

development

   

Green Even

 

Reporting

To take

measure

to

report

on

the

Implemented

9

Green Banking

initiatives/practices to Bangladesh Bank and disclose in the Bank’s websites.

Practices

 
 

Sector Specific

   

10

Environmental

 

To be designed

 

Under process

Policies

 
   

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:

 

11

Green Strategic

Planning

 

i. To reduce loans/investments for environmentally harmful activities.

ii. To attain a particular percentage of environmental loans/ investment.

Steps to be taken

iii. To introduce Eco-friendly financial products.

     

Features of Green Branches:

   
 

To use maximum natural light

To use renewable energy and energy

12

Setting up

Green Branches

saving bulbs and other equipments.

To reduce water and electricity use.

do

To use recycled water.

 

A green Branch will be entitled to display a special logo approved by BB.

 

Improved

To take Strategy of reuse, recycling of materials & equipments, and source reduction and waste minimization.

Partially

In-house

Environme

implemented

13

nt

To rely increasingly on virtual meeting through the use of video conferencing in lieu of physical travel for saving cost and energy.

 

Manageme

do

nt

 

Formulation of

Develop and follow an environmental risk management manual or guidelines for the assessment/ monitoring of project and working

capital investments.

 

Bank Specific

Environmental

Under process

14

Risk

Management

Plan and

To

set

internationally

accepted

higher

do

Guidelines.

environmental standards.

 
 

Rigorous

Encourage the clients and business houses to comply environmental regulation.

 

Programs to

Steps to be taken

15

Educate Clients

 
   
 

to be

Introduce rigorous program to educate clients about environmental risk.

do

undertaken.

Sl

No.

Title

Functions (description of the Job)

Our position

Disclosure and

Reporting of

Green Banking

Activities.

Publishing independent Green Banking/ Sustainability reports

do

16

To disclose update and detail information about Bank’s environmental activities and performances of major clients.

do

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.