Sustainability policy


Our sustainability policy defines the principles of our approach and how we manage sustainability risks.
ABN AMRO’s Sustainability Risk Policy sets out the principles that guide our approach towards sustainability risk management related to banking and business relations. Based on this policy, ABN AMRO has put a Sustainability Risk Management Framework in place. Thiscoherent set of policies, guidelines and statements describes how we manage our sustainability risks and embed them in our decision-making processes. It sets out the conditions under which we engage with our clients, suppliers and investors. Through this process, the bank ensures that sustainability risks are adequately identified, analysed, mitigated, managed, monitored and reported. The framework has been approved by the bank’s highest risk assessment body.
Policy for corporate clients
ABN AMRO applies Environmental, Social and Governance (ESG) requirements to its corporate lending clients. These requirements outline the bank's expectations regarding how clients manage ESG risks.
To assess compliance with these requirements, the bank uses tools like the Client Assessment on Sustainability (CASY) questionnaire. CASY maps out where our corporate lending clients stand in terms of ESG themes. It aims to obtain better insights and improve the support we can give to our clients in their sustainability transition. If a client's performance is deemed inadequate to address the inherent ESG risk of their sector or activities and there is a material risk, the bank will engage with the client. The goal is to support the client in improving their performance within a specified timeframe.
The Sustainability Risk Standard with Client Requirements has replaced the Sustainability Risk Standard with Sector Requirements previously used. The new Standard applies the same requirements across sectors. It contains less detail on sector specifics, such as certification schemes that can be used to evidence commitment. These specifics are still used, however, to assess whether the requirements are met. In addition, the size of the client’s business and the sector they operate in are factors that determine which answer we expect from a client on specific topics. In sectors with higher sustainability risks and for larger clients, the client’s performance on specific ESG themes will be given more weight in the CASY’s scoring methodology.
Defence
Our defence sector policy recognises the right of countries to procure means for self-defence.
Project finance
One special lending category is project financing. In project financing, lenders are often confronted with environmental and social issues, especially in emerging markets. The set strict additional requirements for this type of financing. Now that we have introduced this guideline, we are obliged to analyse all project financing deals. And we are not permitted to finance projects if the borrower doesn’t fulfil our social and environmental policy. The Equator Principles apply to project financing worldwide and provide a collective basis for the entire commercial banking sector.
Exclusions
ABN AMRO’s aim is to accelerate the sustainability shift. That’s why the bank is helping its business clients make the change. Some companies, though, are involved in activities ABN AMRO wants nothing to do with. For example, we do not want to be involved in the financing of the production of cigarettes or the development of new coal fired plants. Even though it is permitted by law – we don’t consider this to be ecologically, socially and ethically responsible.By the same token, we were one of the first major Dutch banks to draw up an Exlusion List, which we observe strictly and update regularly in response to new insights on sustainability. In addition, we exclude companies who are involved in controversial weapons.