Shinhan Bank Publishes Equator Principles Implementation Report... Strengthening ESG Management

[Asia Economy Reporter Kwangho Lee] Shinhan Bank announced on the 11th that it has published the Equator Principles Implementation Report for the first time among commercial banks since adopting the Equator Principles in September to strengthen ESG (Environmental, Social, and Governance) management.

The Equator Principles are an environmental and social risk management framework designed to identify and manage environmental and social risks such as severe environmental pollution, ecosystem destruction, and human rights violations that may arise from large-scale planned projects. As of May, 118 financial institutions in 37 countries have adopted the Equator Principles.

For financial transactions subject to the Equator Principles, compliance is reviewed through document examination such as environmental impact assessments. Loans are only granted after improvements are made and the project meets the Equator Principles compliance requirements.

Since becoming the first domestic commercial bank to join the Equator Principles last year, Shinhan Bank reviewed a total of 22 financial supports subject to the Equator Principles by the first quarter of this year. Among project financing, there were 2 cases rated B, 17 cases rated C, and 3 cases of project finance advisory services rated C, all of which were confirmed to comply with the Equator Principles requirements.

The dedicated Equator Principles department minimizes negative environmental and social impacts arising from projects by conducting final compliance judgments through reviews of management plans for identified environmental and social risks by grade, acquisition of major permits and approvals, mitigation measures for environmental and social risks, verification of greenhouse gas emissions during construction and operation phases, and implementation of environmental impact assessment management plans.

Meanwhile, financial institutions that have adopted the Equator Principles are required to report to the Equator Principles Association and disclose publicly at least once a year regarding their compliance with the Equator Principles in accordance with 'information disclosure and transparency.'

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