Case study: How CGD 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.

CGD emphasizes the importance of a continuous dialogue with its stakeholders in driving a collective transition towards a low-carbon economy. As part of its Annual Report, CGD highlights the various channels through which it engages with its stakeholders, including customers, employees, shareholders, investors, suppliers, community groups, associations, media, regulators, and supervisors. This stakeholder engagement has been invaluable in understanding their needs and expectations regarding sustainable development and identifying material topics from both societal and internal perspectives for CGD’s Sustainability Strategy.

Furthermore, CGD implements an Environmental Management System (EMS) in accordance with ISO 14001:2015, which has enabled CGD to carry out meaningful engagement with suppliers. For more details on this initiative, please refer to chapter 4.9.2 of CGD’s Annual Report.

In addition to stakeholder engagement, CGD is committed to collaboration with working groups, think tanks, and business associations that aim to develop tools and mechanisms for addressing the challenges of sustainability in business. CGD is also developing a roadmap to implement the requirements of the CSRD (Corporate Sustainability Reporting Directive). This will involve a corporate materiality analysis process based on dual materiality principles, as well as a new consultation with stakeholders.

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

In its 2023 PRB Reporting and Self-Assessment Template CGD reports that it works with its clients and customers to encourage sustainable practices and enable sustainable economic activities as follows:

CGD has introduced a new risk assessment methodology known as ESG Rating, which evaluates counterparties based on their environmental, social, and governance (ESG) criteria, facilitating their integration into decision-making processes.

The ESG Rating model is designed to enhance financial rating information with non-financial criteria that are equally significant regarding risk impact and viability. This enables these criteria to be incorporated into decision-making processes, particularly in the granting of credit to companies. Ultimately, this approach aims to improve risk management and foster returns that are more resilient to ESG risks over the long term.

CGD has also made the ESG Report accessible to its corporate clients, allowing them to identify their primary strengths and weaknesses and guiding them towards the bank’s products that can help address the identified gaps. Additionally, CGD has launched the Caixa ESG Awards to recognize and promote the implementation of initiatives that support ESG criteria. A total of 38 corporate clients were honoured for their performance across various ESG domains.

CGD believes that all improvement suggestions from customers and any feedback regarding dissatisfaction with CGD’s services should be taken seriously. This focus not only helps resolve individual cases but also prepares the bank for future situations. For more details on customer experience, please refer to page 385 of CGD’s 2023 Annual Report.

In terms of relevant policies to support clients’ transitions, CGD has approved three internal corporate ESG policies: the revised Sustainability Policy, the Sustainable Financing and Energy Transition Policy, and the Climate and Environmental Risk Management Policy. For further information, please see chapter 4.5.1 of CGD’s Annual Report, along with the publicly available versions of these policies.

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.

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References:

This case study is based on published information by CGD, 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.cgd.pt/English/Sustainability-CGD/Responsible-Business/Documents/PRB-4th-AssessmentReport.pdf

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