Case study: How Forbright works with its clients and customers to encourage sustainable practices
Based in Chevy Chase, Maryland, Forbright is a high-performing, comprehensive bank dedicated to decarbonization and actively contributing to accelerating the shift towards a sustainable and clean energy economy. Forbright extends specialty lending and banking services to clients throughout the United States, providing a complete range of direct lending, deposit, checking, and transaction processing services. Forbright is a signatory of the Principles for Responsible Banking (PRB) and is, accordingly, working with its clients and customers to encourage sustainable practices and enable sustainable economic activities. Tweet This!
This case study is based on the 2022 Sustainability Report by Forbright, prepared in relation to its implementation of the PRB, that can be found at this link. Through all case studies we aim to demonstrate what ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.
Which Principles for Responsible Banking have been addressed?
The Principles for Responsible Banking addressed in this case are:
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- Principle 3: Clients and Customers
- Principle 4: Stakeholders
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With this case study you will see:
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- How Forbright proceeded with stakeholder identification and consultation, and
- How Forbright worked with its clients and customers to encourage sustainable practices and enable sustainable economic activities
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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.
In 2022, Forbright established an ESG materiality analysis, a stakeholder engagement plan, and a sustainability strategic plan encompassing the following pillars: (1) advancing sustainable finance; (2) incorporating sustainable business practices; (3) supporting Forbright’s communities; and (4) communicating with Forbright’s stakeholders.
How did Forbright work with its clients and customers to encourage sustainable practices and enable sustainable economic activities?
In its 2022 Sustainability Report Forbright reports that it works with its clients and customers to encourage sustainable practices and enable sustainable economic activities as follows:
Forbright’s Responsible Investment (RI) Policy serves as its guiding framework for assessing ESG factors within its lending platform. Forbright considers ESG factors as crucial components in its credit analysis and decision-making process, viewing effective management of these factors as a means to mitigate credit risk and identify lending opportunities. Forbright’s RI Policy encourages transparency, accountability, and active consideration of the environmental and social implications of its borrowers, as well as their corporate governance standards throughout the life of a loan. Additionally, Forbright’s RI Policy incorporates a negative screening tool outlining industries and activities ineligible for lending, as well as those warranting additional scrutiny during due diligence. Prohibited industries include:
- Tobacco production
- Coal generated power & mining (including thermal coal)
- Oil & gas extraction
- Pornography
- Controversial military weapons (e.g., chemical/biological, nuclear, landmines, cluster munitions)
- For-profit prisons (excluding third-party healthcare services provided to prison population)
- Predatory or deceptive lending
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:
First class PRB assurance services: The result of solid, hands-on ESG/ Sustainability experience
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- FBRH is a GRI Certified Training Partner (Global), ISEP Training Centre and a member of CPD.
- FBRH builds trust. Over 200 reviews from top professionals from around the world demonstrate our ability to build strong, trusting business relationships.
- FBRH possesses a unique skill set that combines ESG/sustainability certified training, experience in advisory services and report preparation, and ESG/sustainability report 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 Forbright, 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.forbrightbank.com/wp-content/uploads/2023/05/Forbright-2022-Sustainability-Report.pdf
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