On October 18, 2022, Shanghai Rural Commercial Bank officially signed the United Nations Principles for Responsible Banking and joined the United Nations Environment Programme Finance Initiative (UNEP FI), becoming the first commercial bank in Shanghai to commit to the UN Principles for Responsible Banking.
Developed by the United Nations Environment Programme Finance Initiative (UNEP FI), the Principles for Responsible Banking require signatories to embed six basic principles -- alignment, impact&target setting, clients&customers, stakeholders, governance&culture, transparency and accountability -- in all areas of business. They are important international standards for commercial banks to promote sustainable development. So far, more than 300 banks have signed up to the principles all over the world, representing more than $84 trillion in assets, almost 50 percent of the global banking industry's total assets. SHRCB claimed that after becoming a signatory to the UN Principles of Responsible Banking and joining the UNEP Financial Initiative, it will continue to implement the national policies in support of green transformation and development, vigorously support the high-quality development of green finance, and contribute financial resources to the realization of the UN sustainable development goals.
In recent years, as a local bank in Shanghai, SHRCB committed to cultivate good social values, positive practice social responsibility, integrate corporate social responsibility into their business management practice, construct effective stakeholder engagement mechanism, take economic, social and environmental responsibility, actively promote the sustainable development of its own interests and stakeholders. Practicing the national strategy and actively serving rural revitalization; Integrating into the integrated construction of the Yangtze River Delta, improving the level of financial services in the region, especially in counties and rural areas; Helping the construction of new areas in Lingang, focusing on key industries to provide financial support, SHRCB served the construction of Shanghai science and Innovation Center, and provided enterprises with full life-cycle financial services under the brand of "Xin Kinetic Energy" science and innovation service.
Especially in the practice of green finance, SHRCB has set the green finance development goal ——to build the bank with the most green development background in the Yangtze River Delta. The Green Finance Development Strategy 2021-2025 Strategy and Sustainability Committee has been established at the board level, and the Green Finance Leadership Group and working group have been set up at the executive level.
In terms of the development of green finance business, SHRCB firmly grasps the opportunity of industrial reform, actively adjusts its asset structure and customer structure, and assists customers in low-carbon and green transformation. Through public-private linkage, investment and loan linkage, bank-rent linkage and other ways, We will increase support for green and low-carbon development in urban and rural construction, clean and low-carbon energy systems, green transportation systems, green and low-carbon development in the industrial sector, green technological innovation and carbon sinks, and actively promote the development of green credit. By the end of June 2022, the balance of green loans of the whole bank was 26.3 billion yuan, an increase of 33% compared with the end of the previous year; The balance of green bond investment was 4.72 billion yuan, an increase of 31% over the end of last year; The balance of green bond asset management investment was 1.74 billion yuan, up 24% from the end of last year.
In terms of green financial product innovation, SHRCB has initially formed a green financial service model of "whole industrial chain, whole life cycle and whole product service", built a customer carbon credit system, and created and launched the "rural ecological loan" product. Issued the first CCER (China Certified Voluntary Emission Reduction) future income right pledge loan in China, and promoted the implementation of carbon emission right quota pledge products; With the trade union card as the carrier, SHRCB has promoted green services for the people. The bank has issued more than 5.5 million trade union cards and subsidized more than 100,000 green trips per year.
In terms of green financial management support, SHRCB focuses on promoting the application and system construction of quantitative assessment and rating measurement tools based on digital transformation. In the internal rating system for corporate customers, corporate governance, environmental protection and other indicators are included in the rating model; The external ESG rating and climate risk data of credit debtors were introduced to continuously monitor and evaluate credit debtors from multiple dimensions such as environment, society and corporate governance. The physical risk assessment of agriculture-related loans and agriculture-related bonds in the Yangtze River Delta was carried out, and the possible impact of extreme climate disasters on agriculture-related assets was explored and analyzed by econometric models. The construction of green finance business management system, through online chemical tools to help customer managers in the front line to carry out intelligent identification of green credit, carry out analysis and calculation of customers' environmental benefits, greatly improve the ability and efficiency of environmental risk management.
In terms of green operation, SHRCB promotes the establishment of energy monitoring system data in all branches of the bank, improves data filling, and strengthens energy audit, energy conservation supervision and energy consumption information disclosure. Energy-saving measures have been taken in multiple places and in multiple dimensions throughout the bank. For example, photovoltaic panels have been installed above the cross-street flyover in Zhangjiang Data Center, and the average annual photovoltaic power generation is about 480,000 KWH. The Zhangjiang Science and Technology Branch of SHRCB achieved carbon neutral in 2021, becoming the first carbon neutral banking business venue in Shanghai.
In addition, SHRCB has been actively participating in social activities related to sustainable development for a long time. In July 2021, Li XU, chairman of the board of SHRCB, on behalf of banks in Shanghai, read a proposal on helping carbon reach peak carbon neutrality. In October 2021, organized by WWF, SHRCB and 60 global banking financial institutions signed a Joint Statement on the Support of Banking Financial Institutions for Biodiversity Conservation. In November 2021, SHRCB joined the Financial Integration Service Innovation and Development Alliance of the Yangtze River Delta Eco-Green Integrated Development Demonstration Zone as one of the initial members.
Li XU, chairman of the board of SHRCB said:”Joining this organization is a new starting point for our green finance development. SHRCB has always adhered to the principle of making finance better, more positive and more realistic. It is our mission to help people live a better life with inclusive finance. Committing to UNEP FI PRB gives us confidence and motivation to go further.”
Achieving carbon peaking and carbon neutrality is an extensive and profound systemic change for the whole society, the same as the process of green transformation and development of banks. In the report of the 20th National Congress of the Communist Party of China, the requirements for promoting green development, promoting harmonious coexistence between humans and nature, and forming a green and low-carbon mode of production and lifestyle were further clarified. SHRCB will always follow the concept of sustainable development. Taking the opportunity of joining the United Nations Environment Programme Finance Initiative (UNEP FI),SHRCB will continue to explore innovative ways to empower the real economy with green finance and help Shanghai achieve high-quality, green and low-carbon development.
