Case study: How Produbanco 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.

The structure of Produbanco’s value proposition for its stakeholders is based on understanding their needs and motivations. This approach allows Produbanco to pinpoint opportunities for enhancing its services, products, risk management, and addressing potential conflicts of interest. To gain this insight, Produbanco engages in active dialogue and conducts thorough research, including materiality studies, with assistance from external consultants and its UX team.

In alignment with the Global Reporting Initiative’s 2022 standards, Produbanco completed a stakeholder mapping and materiality study following the newly introduced guidelines. The findings of this effort were published in the 2022 Sustainability and Social Responsibility Report.

Each area of Produbanco manages its relationships with various stakeholders based on defined roles, functions, and competencies. To facilitate this relationship management and dialogue, Produbanco utilizes several mechanisms, including specialized studies on service provision, customer satisfaction, workplace environment, and client visits, particularly at the corporate level, to strengthen its connections.

Collaborating with relevant stakeholders enables the Bank to mitigate negative impacts, enhance positive outcomes, and achieve more collectively than it could individually. Produbanco engages with both public and private sector entities to foster joint initiatives aimed at establishing social and environmental standards locally and also actively participates in discussions and forums focused on sustainability, including:

• Participation in the PRB roadmap for 2030: In 2023, Produbanco was selected from 27 banks worldwide to be part of the core group developing the new banking roadmap.
• Signing of the Sustainable Finance Protocol 2.0: Produbanco contributed to renewing the private banking sector’s commitment to tackling climate change, reducing social inequalities, and addressing new challenges related to inclusive development in Ecuador.
• Coalition for Water Security: As a founding member, Produbanco collaborates with public, private, academic, and civil society sectors to protect the country’s water sources, with a special focus on the productive sector and focusing particularly on influencing public policy and enhancing water management in the business sector.
• Conserving Our Water Sources: Through its partnership with Conservation International, Produbanco has achieved significant milestones, such as publishing the public policy of the National Action Plan for the Conservation, Restoration, and Sustainable Use of Moorlands, in support of MAATE, as well as producing the book “The Moorlands of Ecuador: Past, Present and Future.”
• First Sustainable Finance Forum: This event brought together representatives from the financial system and multilateral organizations, with Produbanco contributing as a speaker on private banks’ contributions to the 2030 development agenda.
• Regional Roundtable 2024 on sustainable finance for Latin America and the Caribbean: This gathering attracted over 400 leaders from finance, investment, academia, and civil society, with Promerica Group representatives serving as panelists to showcase leadership in promoting sustainable financial practices across the region.
• Triple Impact Alliance (A3I): Developed with Sistema B and the Ecuadorian-American Chamber of Commerce, this initiative aims to facilitate ESG management through the first fully virtual training and evaluation program for its members, backed by the continuing education program of the San Francisco de Quito University.

Additionally, Produbanco is a member of the Board of Directors of the Ecuadorian Corporation for Social Responsibility and Sustainability (CERES), serves on the Sustainability Committee of the Ecuadorian-American Chamber of Commerce (AMCHAM), and is a member of the Board of Directors of the Association of Private Banks of Ecuador (ASOBANCA), where it also holds the position of chairman of ASOBANCA’s Sustainable Finance Committee.

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

In its 2024 PRB Reporting and Self-Assessment Template Produbanco reports that it works with its clients and customers to encourage sustainable practices and enable sustainable economic activities as follows:

The creation of strategic alliances supports the achievement of objectives by promoting strong environmental and social practices and enhancing the sustainable value chain. In 2023, partnerships were established with suppliers to assist company clients in reducing greenhouse gas (GHG) emissions and improving resource efficiency

Communicating the sustainability strategy to customers is crucial, which is why providing technical assistance on sustainability for SMEs plays a vital role in helping clients adopt best practices in managing their businesses.

The “Green Talks” initiative also serves as a platform to inspire clients to invest in sustainable initiatives focused on reducing GHG emissions and enhancing resource efficiency. In 2023, Produbanco held 10 events nationwide, attracting an average of 35 clients per event.

Additionally, 6 events specifically targeting female SME clients were organized in Quito, Guayaquil, Ambato, Ibarra, Manta, and Cuenca in 2023. These events emphasized the entrepreneurial contributions of women, addressed relevant issues for each local context, and facilitated valuable networking opportunities, drawing nearly 400 female participants in total.

The Green Lines programme has significantly advanced, growing by 85 million compared to 2022. As of 2023, a total of 689 million has been disbursed through 698 loans for projects in renewable energy, energy efficiency, efficient water use, resource efficiency, and sustainable agriculture, resulting in measurable impacts.

Given that the construction sector accounts for 39% of CO2 emissions, heavily relies on natural resources, and provides 6% of employment opportunities, the sustainable construction program remains a priority. This initiative aims to mitigate the industry’s impact. Produbanco is implementing EDGE certification with the support of external consultants, and has introduced the “Profuturo” green seal (a partnership with CEES) for non-residential buildings.

To address the pressing challenge of financing sustainable development, Produbanco has launched several commendable initiatives, including:

• Produbanco enhanced the usability of digital channels to ensure customers become proficient in using its products, services, and financial channels, ultimately enhancing the overall well-being of society. By the end of 2023, Produbanco successfully reached 79.9% of registered customers.
• Produbanco leveraged technological innovations in digital financial services to promote access and adoption of financial products, aimed at improving social welfare. Consequently, 66.76% of all transactions were conducted digitally, and 73.5% of digital product sales were recorded by the end of 2023.
• A total of 1,036 banking correspondents have been established to enhance financial inclusion and coverage, thereby addressing access disparities in underserved areas across the country.
• Produbanco provided support for financing sustainable housing to encourage the purchase of homes that promote energy and water savings as well as efficient use of building materials. In 2023, Produbanco allocated $2.6 million for this type of financing.
• Produbanco also supported the financing of hybrid and electric vehicles to encourage the adoption of these cleaner alternatives that help reduce harmful emissions. A total of $4.9 million was disbursed for this financing in 2023, following the product’s launch in March of the same year.
• The Green Awareness initiative allows clients to embrace green liability balances to fund sustainable projects, aligning Produbanco’s commercial strategy with the company’s objectives. Since its inception in 2021 through December 2023, over 73,000 individuals have participated, which collectively amounts to $44.7 million.
• In 2023, the Protagonists programme continued to advance, aiming to establish Produbanco as a recognized Financial Group in the region that supports and promotes women—a high-potential segment—both internally and externally. This initiative is designed to enhance operational efficiency and boost Promerica Group’s business through a segment that is not being used at full capacity. Specific growth and monitoring targets were set for individuals, SMEs, and internal clients, to be addressed through various financial and non-financial initiatives.
• Throughout 2023, Produbanco engaged with the community through numerous non-financial activities, including financial education workshops that reached more than 3,900 employees from 51 companies using Produbanco’s payroll services. This is part of the benefits Produbanco offers to this customer segment.

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 Produbanco, 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.produbanco.com.ec/media/715900/prb-self-assessment_produbanco.pdf

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