In its 2023 Sustainability Report during its first-ever Sustainability Week, Bank of Ireland has revealed that it is ahead of target on its own ESG goals, has embedded sustainability deep within in its business and published how it is doing against its science-based targets.
A new Sustainability Report published by Bank of Ireland shows how the Group issued €11.1bn in sustainability-related finance in 2023, a 35% increase on the previous year.
Published during what is also its first-ever colleague-led Sustainability Week, the 2023 Sustainability Report reveals how becoming a sustainable company has become one of the Bank’s strategic pillars and highlights how the organisation is doing as it transitions its own business as well as wider society to net zero.
“We are at the heart of the movement towards sustainability in Ireland, particularly in supporting the green transition in line with Ireland’s Climate Action Plan”
In 2023 Bank of Ireland made its first disclosure against its science-based targets. The annual lending goal is 85% of the way towards its own 2030 targets and 90% of its 2025 target for long-term corporate lending.
The Bank also disclosed its new Sustainable Finance Framework for classifying sustainable finance to coincide with the report.
In its first Sustainable Finance Framework, the Bank sets out detailed criteria under which lending can qualify as green finance, social finance or sustainability-linked finance across the Group. The areas covered include residential and commercial buildings, sustainable food and agriculture, energy efficiency, renewable energy, pollution prevention and control, sustainable water management, clean transportation, affordable housing, and access to healthcare.
The E in ESG
As well as issuing €11.1bn in sustainability-related finance in 2023, the Bank issued €2.25bn in green bonds through its green bond framework, bringing the total to date to €4.75bn.
“At Bank of Ireland, we have a pivotal role to play in building a more sustainable economy and society to support the transition to net zero,” explained Eamonn Hughes, chief Sustainability and Investor Relations officer.
“That’s why in 2023, we embedded sustainability as one of the Group’s core strategic pillars, under Sustainable Company, and we continue to deliver practical sustainability solutions that make a difference.
“In March 2023, we extended our sustainable finance lending target to c.€15bn by 2025 and c.€30bn by 2030. In 2023 our sustainability-related lending to households and businesses grew by 35% to €11.1bn. Our aim is to ensure that the products we offer our customers are both environmentally and financially responsible, while also working towards the decarbonisation of our loan portfolio.”
Examples of this include innovative financial solutions like the recently-launched Ecosaver mortgage offering and the launch of the Enviroflex Sustainability Linked Loan in conjunction with Kerry Dairy Ireland to support farmers implementing sustainable farm practices.
Green mortgages, Hughes, explained, now account for more than half of new mortgage drawdowns.
The S in ESG
“It’s not just about the E in ESG,” Hughes explained. “We have also made significant progress on our social commitments. Protecting our customers’ and colleagues’ financial wellbeing is a key focus for us. We hold the leading position as the #1 bank recognised for financial wellbeing in the Irish market. “We strengthened our commitment even further in 2023 by publishing our UNPRB Financial Health and Inclusion targets, the first and only Irish bank and one of currently 24 banks globally to do this.”
The report indicates that in terms of diversity, 46% of appointments to management and leadership positions are female, up from 40% in 2022.
The Bank also achieved an 80% colleague score for cultural embeddedness (+5 points versus global financial services benchmarks).
The G in ESG
The publication of the first Sustainability Report coincided with the Bank’s publication of its Sustainable Finance Framework which sets out to provide transparency to the bank’s stakeholders about the transformation the Bank’s lending portfolios to align with the green transition and Ireland’s Climate Action Plan.
As a large corporation, Bank of Ireland falls in scope for the first wave of firms that must comply with the European Commission’s Corporate Sustainability Reporting Directive (CSRD) by next year. According to the report the report the Bank has completed the Initial Double Materiality Assessment in preparation for CSRD reporting requirements.
The Bank also achieved improved ratings from two ESG ratings agencies in 2023, Sustainalytics and MSCI respectively.
“We are at the heart of the movement towards sustainability in Ireland, particularly in supporting the green transition in line with Ireland’s Climate Action Plan,” Hughes explained.
“Our goal is to help our customers adapt to this change. A key part of our strategy is to develop financial products that support the transition. This aligns with our commitment to the UN PRB (Principles for Responsible Banking).”
Main image at top: Bank of Ireland chief Sustainability and Investor Relations officer Eamonn Hughes
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