Case study: How KBank works with its clients and customers to encourage sustainable practices

Stakeholder identification and consultation

Please describe which stakeholders (or groups/ types of stakeholders) you have identified, consulted, engaged, collaborated or partnered with for the purpose of implementing the Principles and improving your bank’s impacts. This should include a high-level overview of how your bank has identified relevant stakeholders, what issues were addressed/results achieved and how they fed into the action planning process.

KBank adopts a comprehensive stakeholder identification approach by assessing the financial and Environmental, Social, and Governance (ESG) impacts of its business activities across the entire value chain. This analysis considers the influence of stakeholders on the bank’s operations and vice versa. The identified stakeholders include shareholders, the Board of Directors, employees, regulatory agencies, customers, business partners, competitors, creditors, communities, the environment, and society. Insights gathered from stakeholder engagement, especially their voices, highlight weather conditions as a significant material issue within the environmental dimension.

In support of sustainable development, KBank collaborates with various organizations through several key initiatives:

United Nations Global Compact (UNGC):
KBank is a member of UNGC, aligning its business practices with internationally recognized principles related to human rights, labor, the environment, and anti-corruption.

Partnership for Carbon Accounting Financials (PCAF):
As a signatory to PCAF, KBank contributes to establishing standards for measuring and disclosing greenhouse gas emissions (GHG) financed through loans and investments.

Science-Based Targets (SBT) Project:
KBank participates in the SBT project, which aims to reduce GHG emissions in the business sector using science-based targets, initiated by the Center of Excellence for Eco-Efficiency at Thammasat University and the Thailand Greenhouse Gas Management Organization (TGO).

Climate Action Leading Organization Initiative:
KBank joins this initiative to demonstrate its leadership in GHG management, in collaboration with TGO and the United Nations Framework Convention on Climate Change (UNFCCC).

Thai Bankers’ Association (TBA) Collaboration:
KBank plays a leading role in advancing sustainability within the TBA, including preparing the ESG Declaration, developing impact assessment tools, and creating an industry handbook.

Thailand Taxonomy Working Group:
Representing the TBA, KBank contributes to the Thailand Taxonomy working group of the Bank of Thailand by providing input and recommendations for developing a ‘green taxonomy’ to classify environmentally sustainable economic activities.

These collaborative efforts reflect KBank’s dedication to sustainable practices, stakeholder engagement, and its leadership in tackling environmental challenges.

How did KBank work with its clients and customers to encourage sustainable practices and enable sustainable economic activities?

In its 2024 Sustainability Report KBank reports that it works with its clients and customers to encourage sustainable practices and enable sustainable economic activities as follows:

In line with its K-Strategy, which focuses on empowering the lives and businesses of its customers, KBank has launched Customer Deep Listening sessions and workshops. These initiatives involve active participation from customers and SME Relationship Managers, enabling a comprehensive understanding of customers’ pain points and needs. The insights gained from these engagements are carefully analysed and used to develop products tailored to address specific customer challenges. This customer-centric approach ensures that KBank’s offerings meet their expectations and enhance their overall experience with KBank.

Additionally, KBank has integrated ESG risks and opportunities into the loan consideration process within its Know Your Customer (KYC) and Customer Due Diligence (CDD) procedures. Post-approval, KBank monitors customers’ loan use in accordance with the objectives communicated to the bank and tracks repayment schedules. KBank also maintains an exclusion list and sector-specific guidelines that incorporate ESG factors relevant to each industry, ensuring compliance with its sustainability targets. KBank’s Relationship Managers engage with customers to align them with the bank’s sustainability direction and support their transition journey. For sectors targeted as part of its decarbonization pathway, KBank actively collaborates with customers in these industries to facilitate their transition through its products and services.

KBank promotes sustainable financing with a target of Baht 100-200 billion by 2030, and has also developed a sustainable finance guideline applicable to various activities and projects that contribute to environmental objectives, such as renewable energy, energy efficiency, eco-friendly and circular economy initiatives, and green buildings. For proceeds with unknown use linked to material sustainability targets (sustainability-linked), KBank considers KPIs related to GHG reductions, resource efficiency, and circular economy principles.

Furthermore, KBank has strengthened customer engagement across multiple segments—including corporate, SME, and retail—with a primary focus on Thailand, its main operating region.

UN Principles for Responsible Banking: Accelerating a positive global transition for people and the planet

With over 300 signatory banks representing almost half of the global banking industry, the Principles for Responsible Banking are the world’s foremost sustainable banking framework. Through these Principles, the banking community takes action to align core strategies, decision-making, lending and investment with the UN Sustainable Development Goals and international agreements such as the Paris Climate Agreement.

FBRH Principles for Responsible Banking (PRB) Assurance:

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The combination of all the above empowers FBRH to provide first class Principles for Responsible Banking (PRB) assurance services.

References:

This case study is based on published information by KBank, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original please revert to the following link:

https://www.kasikornbank.com/en/sustainable-development/SDAnnualReports/y2024-sd-en.pdf

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