Social Responsibility and Sustainability

Responsible Financing

Responsible Financing Framework

OCBC recognises that promoting long-term sustainable development is fundamental to our continuing success. In this regard, we are committed to advancing environmental and social progress and to conducting our business in a responsible manner.

Specifically, we will not engage in or knowingly finance any activity where there is clear evidence of immitigable adverse impact to the environment, people or communities. We seek to positively influence our customers’ behaviours by engaging them in adopting appropriate sustainable practices. At a minimum, we expect our customers to meet all local ESG laws and regulations, and that they will meet higher ESG industry expectations over time.

Our Responsible Financing Framework sets out our overall approach to integrate environmental, social and governance ("ESG") considerations into our credit and risk evaluation process. We will take a risk-based approach towards managing ESG risk where transactions that are of high ESG risks will be subject to enhanced evaluation and approval requirement.

Policy, Procedures and Risk Assessment Tools

Borrowers are subjected to initial ESG risk assessment and assigned an ESG risk rating. The risk rating depends on the extent to which the borrower is meeting our internal ESG requirements covering areas such as pollution prevention, biodiversity and legally protected areas, occupational health and safety. These requirements reference standards and conventions from organisations such as International Finance Corporation ("IFC"), United Nations ("UN") and International Labour Organisation ("ILO"). Further due diligence is required for borrowers who do not fully meet our ESG requirements.

Transactions with high ESG or reputational risk will be escalated to the Reputational Risk Review Group for review and clearance prior to credit approval. As a credit facility covenant, borrowers will be required to comply with the agreed ESG milestones. Regular Responsible Financing reporting will be submitted to the CEO and Board Risk Management Committee.