--------------------------------------------------------------------- AKTUALISIERUNGS-HINWEIS Neu: Weitere Details aus der HV, Studien zu Klimarisiken der Banken ---------------------------------------------------------------------
Erste Group wants to focus even more on its role in the fight against climate change and its responsibility to society in the future. “Responsible leadership has become an indispensable part of the corona world. Economic success is only possible with responsibility,” said Erste Group boss Bernd Spalt at the annual general meeting on Wednesday. The so-called ESG criteria are to be a “strategic focus” of the bank in the future.
ESG stands for Environmental, Social, Governance (in German: Environment, Social and Corporate Management) and describes criteria by which companies measure themselves with regard to their social responsibility in society. The E relates to climate issues (environmental pollution, greenhouse gas emissions), the S to aspects relating to occupational safety, health protection, diversity or social commitment of the company and the G relates to sustainable corporate management. For banks, these criteria are not only important for their own institute, but are also often used for investments in the capital market (for example in shares) or when lending to companies.
Erste Group has been intensively involved in social banking with “Zwei Sparkasse” for years. It was founded in 2006 by the Erste Foundation for people who cannot get an account with conventional banks.
With a view to climate protection, the bank revised its corporate policy regarding the financing of fossil fuels in March and announced that it would phase out coal financing by 2030. In view of this, bank boss Bernd Spalt appealed to the patience of all who are calling for the bank to exit coal financing more quickly. You have an obligation to customers to accompany them “cautiously and responsibly” during the transformation.
“We are in long-term contractual and trust relationships,” said Spalt. Moving too quickly with the switch could cause damage and “could possibly also mean that heating systems stay cold,” said Spalt. In the spring, the bank was criticized by Greenpeace Czech Republic and Fridays For Future for their too lax approach to the coal phase-out.
For large corporate customers, Erste Group is also planning the group-wide introduction of an “ESG scorecard”, which will be used in future when making lending decisions. Currently, the data situation on sustainability factors in companies in some Eastern European countries is still insufficient, but the progressive EU-wide regulations and taxonomy should ensure that the data situation in the CEE region will improve soon, says Spalt.
How banks deal with climate change and climate risks is a big topic across Europe. At the beginning of the week, the European Central Bank (ECB) published a study according to which climate change poses considerable risks for banks, for example caused by extreme weather events such as storms or floods. According to the ECB, around 80 percent of the financial institutions’ credit exposure is distributed among companies that are at least partially exposed to such physical risks. If companies get into trouble because of this, loans could be jeopardized or lost in value.
In a joint study by the Vienna University of Economics and Business and the International Institute for Applied Systems Analysis (IIASA) it was also pointed out that the right structure and timing when introducing climate policies are also of great importance for financial stability. A CO2 tax or lower borrowing costs for green investments (keyword: green supporting factor) could make low-carbon investments more competitive, but at the same time lower the profitability of brown, i.e. carbon-intensive, companies, according to the authors.
This in turn could lead to unforeseen loan defaults at brown companies and thus represent an increased credit risk for banks and investors. This could potentially lead to a credit crunch, which would then also have a negative impact on green companies and thus jeopardize the success of the transformation towards a lower-carbon economy, the study authors said. “The credibility of the policy is crucial for building trust in the banking sector, which in turn determines the successful implementation of the policy and minimizes the negative effects on economic and financial instability through its credit conditions,” said IIASA researcher Nepomuk Dunz, explaining the interactions in one Broadcast.
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