Commonwealth Bank's new sustainability policies

Commonwealth Bank has announced new and updated environmental, social and governance (ESG) policies and practices that support the bank’s efforts to make a positive impact through the way it does business. The policies and practices have been devised under Commonwealth Bank Group’s 2016–2018 Corporate Responsibility Strategy.

The bank’s Group Environment Policy has been updated to acknowledge international efforts to limit global warming to 2°C and the need to transition from traditional economic models to low-carbon and renewable alternatives. The policy expresses the bank’s commitment to support the transition to a low-carbon economy and will be reviewed annually.

The company is also disclosing the carbon emissions arising from its business lending portfolio, in order to provide transparency on the indirect impacts of its lending. These insights, and the detailed diagnostics behind them, provide the company with a robust quantitative basis to identify and act on key opportunities to improve carbon performance over time.

The bank has developed a new Human Rights Position Statement to affirm its responsibility and commitment to respect human rights across all operations. Guided by the United Nations Guiding Principles on Business and Human Rights, the statement sets out how the company integrates human rights considerations within the organisation, through the supply chain and in its lending and investing activities.

A new Wealth Management Responsible Investing Framework has meanwhile been established to integrate ESG factors across the bank’s investment processes. The company says it will embed ESG considerations into investment decision-making and active ownership practices, as well as build the capacity of employees to understand and assess ESG risks and opportunities.

Finally, the bank has been working to embed its approach to responsible lending in all business lending. In addition to the development of an ESG Risk Assessment Tool, which is integral to the lending decision process, the bank has reported its progress in implementing its ESG Lending Commitments and has disclosed how its Equator Principles III are being applied to lending decisions. Employees have been trained in ESG fundamentals and how to apply the ESG Risk Assessment Tool and the Equator Principles III. They have also been trained to work with customers to identify and mitigate ESG risks.

For more information on Commonwealth Bank’s ESG policies, practices, targets and performance, see the Commonwealth Bank Sustainability Report 2015.