ESG - compliant risk assessment in focus for HDFC …

ESG - compliant risk assessment in focus for HDFC Bank

HDFC Bank, India s largest private lender, has implemented risk assessment practices based on Environmental, Social, and Governance (ESG) frameworks for its wholesale banking loans. This move aims to enhance sustainable finance efforts and promote responsible lending. The bank s ESG Risk Management Framework for Lending requires a detailed environmental and social (E&S) assessment for wholesale borrowers with direct customer risks exceeding Rs 100 crore across facilities. Deputy Managing Director, Kaizad Bharucha, highlighted the bank s Corporate Social Responsibility (CSR) program, Parivartan, which targets to increase the income of 5 lakh marginal farmers earning less than Rs 60,000 annually by 2025. The bank s CSR allocation towards the Parivartan program has grown from Rs 118.25 crore in 2014-15 to Rs 945.31 crore in 2023-24. Bharucha also mentioned HDFC Bank s commitment to becoming climate-neutral by 2032. In the previous financial year, the bank collaborated with over 150 NGOs and implementing agencies as part of the Parivartan program. The bank s goals for 2025 include skill training for around 2 lakh individuals, scholarships for 25,000 underprivileged students, and support for 20,000 institutions to promote local economies. Regarding the Reserve Bank of India s (RBI) green deposit framework, Bharucha stated that while the RBI has not made it mandatory for regulated entities to raise green deposits, HDFC Bank has proactively issued a green bond of $300 million. The bank is prepared to comply with central bank norms as they become formalized. In summary, HDFC Bank is taking significant steps to incorporate ESG frameworks in its lending practices, increase its CSR efforts, and work towards becoming climate-neutral by 2032. The bank s commitment

Source: economictimes.indiatimes.com
Published on 2024-09-15

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