With Ten-year Practices Turned into texts, IB Consistently Explores Green Development

On January 19, 2018, the financial seminar of Offering Solution to Construct Ecological Civilization and Beautiful China cum the Book Launch Event of Green to Gold: Empirical Research on Sustainable Development Based on Equator Principles were held by IB in Beijing. Dozens of specialists and scholars from universities, scientific research institutes, financial institutions and non-governmental organizations attended the meeting to have a common view on the future prospects of the sustainable development of financial services.

In 2017, the Chairman Xi Jinping made a new statement on the construction of ecological civilization in the 19th National Congress of the Communist Party of China, where he emphasized the strategic deployment of relying on the market mechanism to promote the construction of ecological civilization, provide a guidance for financial industry to play a key role in promoting the reform of ecological civilization and activating the market mechanism. During the seminar, keynote speeches on "Opportunities and Challenges Faced by the Banking Industry under the Background of Ecological Civilization" were respectively given by Li Yang, the member of the Chinese Academy of Social Sciences and the chairman of National Finance and Development Laboratory, Yang Chaofei, the former chief engineer and the member of Ministry of Environmental Protection, Ma Jun, the director of Green Finance Specialized Committee of China Finance Society and the former chief economist of People’s Bank of China Research Bureau, as well as Lu Zhengwei, the chief economist of Industrial Bank.

2018 is exactly the tenth year for IB's adopting Equator Principles. In the past ten years, IB had accumulatively carried out 344 projects suitable for the Equator Principles, with the total investment amounting to 1.4 trillion yuan, covering 25 provinces and cities across China, indicating a wider Equator Principles path for IB. At the meeting, IB published one of its research achievements on "the equator principles and sustainable development of banks" - a book named Green to Gold: Empirical Research on Sustainable Development Based on Equator Principles.

The book contains 450,000 words in 10 chapters. Industrial Bank integrated its decades of exploration results in sustainable finance, looked up millions of foreign academic literature and research materials, studied equator principle projects, conducted field investigation on green finance business and absorbed the suggestions of senior professionals from China Banking Regulatory Commission (CBRC), Ministry of Environmental Protection, Chinese Academy of Social Sciences, University of Waterloo, International Finance Corporate (IFC), Mizuho Corporate Bank, Ltd. (MHCB) and other government regulating authorities, research institutions and financial organizations, thus gaining the research outcomes composed of research data, analysis model and various modules.

As for the expounding structure, the book demonstrates that the financial industry, as an indispensable part of the modern economy and society, must seek sustainable development from the aspects of theoretical origin, industry experience and industrial practice, respectively. It also proves the positive role of the Equator Principles in bank risk management and financial performance by building a sustainable financial evaluation and measurement system. Besides, the book also discloses in detail the cases and management process of Industrial Bank's Equator Project and the key projects and program analysis of green leasing, which gives remarkable lesson for domestic and foreign financial institutions to explore sustainable development and improve the experience in green finance.

Li Yang, a member of the Chinese Academy of Social Sciences and the chairman of National Finance and Development Laboratory, considered that "Equator Bank" has become the benchmark for commercial banks to transform their management models and corporate governance concepts into green and sustainable ones. More and more China's financial institutions will adopt the Equator Principle and participate in the green finance development to bring stronger vitality and sustainable development space for China and the whole world. Yang Chaofei, the former chief engineer and the member of Ministry of Environmental Protection, believed that the book Green to Gold had a profound thought and sizable layout by standing on a tactical point of view, hoping it would provoke banks' thinking and actions toward sustainable development and further promote the development of the whole society.

Gao Jianping, the Secretary of the Party Committee and the chairman of IB, declared that business was easy to change and people was unreliable, while only the "Tao" (tenet) lasted forever. The book marks IB's effort for expressing and developing our ideas. IB's sustainable development "tenet" integrates idealism, responsible spirit and innovative awareness, which finds out a road of "Pareto Improvement" and is also an all-win road integrating banks' commercial operation and CSR; by adopting Equator Principles, developing green finance and using advanced finance technologies to manage environment and social risks, we cannot only bring considerable economic benefit to the bank, but generate significant environmental and social benefits.

As the first "Equator Bank" as well as the foregoer of green finance in China, Industrial Bank has adhered to the sustainable development concept of "showing obligations in profits" for many years, and integrated banks' commercial operation and CSR together in the practice of bank operation and management, so as to develop itself towards an IB-featured social responsibility practice road.

Taking green finance as an example, IB has made continuous improvement in the organizational structure and system of green finance, exerted itself to expand the green finance development body from bank to the branches. It has formed a complete and multifarious green product service system covering green financing, green leasing, green trust, green fund, green investment and green consumption, while being committed to "establishing excellent services supplier in green finance and the leading green finance group in the entire market" and fulfilling its responsibilities, as a financial institution, of promoting the reform of ecological civilization and activating the market mechanism.

By the end of 2017, IB had granted green financing totaling RMB 1,456.2 billion for 14,396 corporates, with the financing balance hitting RMB 680.6 billion. Each year, it is estimated that the supported projects could save 29.12 million tons of coal equivalents and reduce 83.78 million tons of carbon dioxide, which is equal to shutting down 192 thermal power plants of 100MW or stopping the running of 100,000 taxis for 40 years. Such acts continuously support the construction of beautiful China.

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