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Implementing a comprehensive green finance approach

Project Details

CLIENT

Ma'anshan Rural Commercial Bank

YEAR

2015-2016

COUNTRY / REGION

China / South, Southeast & East Asia

EXPERTISE

Green Finance

Environmental & Social Impact

Digital Solutions

KEY TOPICS

Green Economy Financing

Environmental Management

Advisory Digital Solutions

CONTACT

With the aim of becoming the first mover in the local market for green finance, Ma’anshan Rural Commercial Bank (MRCB) contracted IPC to introduce a comprehensive green finance approach. In this 12-month project, IPC supported the bank in establishing the internal framework necessary to sustain green finance, introducing a green lending methodology to incentivise investment in environmentally friendly technologies, and implementing an environmental management system to reduce MRCB’s resource consumption. The project was implemented through a modular approach. The green lending component focused mainly on industrial clients, public institutions, and emerging mid-caps and SMEs. By the end of the project, MRCB had established a green portfolio totalling USD 70 million and approximately 1,100 staff and senior management had been trained on 11 different topics related to green finance.

Establishing a green finance organisational structure

  • developing a bank-wide green finance policy and strategy
  • creating a Green Finance Committee, comprising MRCB senior management, to approve the strategy
  • hiring and training staff for MRCB’s Green Finance Unit, the department responsible for overseeing and supporting all aspects of the bank’s green finance approach

Green lending

  • analysing MRCB’s loan portfolio to identify target client segments and potential (portfolio screening)
  • conducting walk-though and investment-grade energy audits with target client segments(corporate enterprises, emerging mid-caps and SMEs)
  • developing localised technical eligibility criteria for common investments in Ma’anshan (short list for standardisable investment measures)
  • developing green loan product design and lending strategy,
  • analysing and adapting lending policy, procedures, forms and tools to accommodate green lending
  • adjusting credit management systems to enable reporting on green investments (CO2/energy savings)
  • implementing green lending marketing and awareness-raising strategy
  • developing a training and capacity-building concept and materials
  • providing training to lending staff, future trainers, and audit staff on green lending principles
  • setting green lending incentives and targets
  • supporting green lending product launch, testing, and monitoring

Environmental management system (EMS)

  • developing a comprehensive EMS manual: responsibilities, procedures, resource management guidelines
  • developing data collection processes, including measurement methodology, for resource consumers in MRCB
  • implementing EMS software to track resource consumption in MRCB’s branches and outlets
  • supporting annual environmental management planning (baseline, incentives, targets) based on resource consumption patterns in MRCB, and identifying/implementing/monitoring measures to reduce consumption
  • establishing an internal environmental awareness-raising plan and development of content
  • developing a transparent communication plan for MRCB’s environmental performance and activities
  • implementing training on resource management for front-, middle-, and back-office branch and VTB staff
  • supporting bank compliance with, and application for, ISO-14001:2009 certification

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