Recently, MSCI, the world’s largest index company, announced the 2023 ESG ratings, upgrading Industrial Bank (IB) from an ‘A’ to an ‘AA’ level, the highest currently available for domestic banks. Consequently, IB has become the first listed bank in China to receive an MSCI ESG rating of ‘AA’ and the only one to maintain the highest rating in the domestic banking industry for five consecutive years.
As a forerunner in the domestic ESG field, IB deeply embodies the political and people-centric nature of financial work. The bank has continually strengthened its ESG governance structure and management system, aiming to achieve a win-win development in economic, social, and environmental benefits, carving a unique path of ESG practices that aligns with international standards while incorporating Chinese characteristics.
In governance (G), IB was among the first in the industry to propose and establish a sustainable development corporate governance concept. In line with ESG trends, the bank continuously refines its top-level design, incorporating ESG strategic planning into its five-year group development plan. This approach includes comprehensive advancement of the ESG management system. In 2022, IB officially renamed its board’s “Strategy Committee” to the “Strategy and ESG Committee,” establishing an industry-leading ESG management decision-making mechanism. This mechanism guides and encourages the management to actively explore comprehensive ways to fulfill environmental and social responsibilities. Additionally, IB consistently adheres to strict governance, continuously improving its integrity risk prevention and internal governance systems. The bank has compiled and published Key Points of Anti-Bribery and Anti-Corruption Systems, actively fostering a culture of integrity in finance.
In the environmental (E) aspect, IB, as one of the first commercial banks in China to explore green finance, has integrated the development of green finance and service into the “Dual Carbon” strategy with its sustainable development. This initiative aligns with the national goals of “reducing pollution, cutting carbon emissions, expanding greenery, and growth,” actively propelling the green and low-carbon transformation of the economy and society. As of September 2023, IB’s green finance balance reached 1.86 trillion yuan, a 250.1 billion yuan increase from the previous year. Green loan balances accounted for 772.4 billion yuan, an increase of 135.3 billion yuan from the previous year, representing over 30% of the new corporate credit loans; The scale of green finance financing in the carbon reduction field reached 1.04 trillion yuan, making up 56% of total green finance, a 7% increase from the end of 2022.
In the social (S) aspect, IB firmly focuses on “major national concerns,” continuously deepening financial supply-side structural reforms and expanding the connotation of its “benefit with righteousness” business model. The bank guides more financial resources toward promoting technological innovation, advanced manufacturing, green development, and SMEs. Leveraging its fintech advantages, IB explores new models of digital financial services, extending financial services from urban to rural areas and from large and medium-sized enterprises to inclusive finance for SMEs. This approach has led to a distinctive path in inclusive finance. As of September 2023, IB’s inclusive SME loan balance neared 500 billion yuan, with loans to science and technology enterprises exceeding 430 billion yuan, and agricultural loans surpassing 640 billion yuan. Additionally, the bank’s human resource development focuses on “scientific human resource management systems” and “comprehensive employee development support.” IB has compiled and published the Key Points of Human Resource Development handbook, committed to creating an inclusive work environment and a diverse employee team. In 2022, IB’s employee turnover rate decreased by 25% compared to 2021.
Furthermore, at the recent Beijing International Sustainability Conference hosted by the International Financial Reporting Standards (IFRS) Foundation’s Beijing office, IB proactively adopted and integrated the framework and requirements of the ISSB standards. The bank received the certificate as one of the first “Early Adopters of the International Sustainability Standards Board (ISSB) Disclosure Standards” in China, demonstrating its commitment to effectively implementing sustainable standards globally through its practices.
IB states that moving forward, it will thoroughly implement the spirit of the Central Financial Work Conference, steadfastly practicing political, economic, and social responsibilities. The bank will continue to deepen financial supply-side structural reforms and perfect the ESG governance framework with Chinese characteristics. Committed to the path of financial development unique to China, IB aims to serve the modernization of China with high-quality financial development.