Environmental & Social Risk Management
The evaluation of social, economic, and environmental impacts of our actions is necessary to make effective operational and capital investment decisions that positively impact organizational objectives and meet the objectives of multiple stakeholders. As a result, we have incorporated Environmental & Social (E&S) risk considerations into our decision-making processes and developed a corporate policy that ensures that the Bank does not finance or invest in activities that have negative environmental and social consequences.
This approach enables the Bank to consider its impacts on the environment and the society at large in its lending and investment decisions and also ensures that our risk management process is aligned with international best practice in this area. Furthermore, this is consistent with the bank's vision to build a world class risk management culture, in which risk is considered in all business decisions, where the bank protects against unforeseen losses, and maximizes its opportunities.
We now have Environmental & Social risk policies for three main sectors; Power, Agriculture, Oil & Gas. These define the performance requirements that we expect to see as well as the activities which we believe carry E&S risks. These are reviewed and updated regularly to take account of changes in regulation and international best practices. We conduct enhanced due diligence on clients and transactions that involve activities with potentially high environmental and social impacts, and expect our clients to adhere to our standards, for instance in the way they approach managing human rights.
We have also enhanced our E& S policy framework to reflect the new requirements of the Nigerian Sustainable Banking Principles (NSBP). The Nigerian Sustainable Banking Principles was constituted under the auspices of the Central Bank of Nigeria and the Bankers Committee to formulate sustainable banking standards and guidelines for Nigerian banks.