To better prepare for the market-driven and regulatory trends toward sustainable finance, Financial Intermediaries should equip themselves with a tailored plan for environmental and social risk management, which positions sustainability as a core component of their organisational business strategy.
To that end, EBRD has developed the E&S Applications (Apps) for Financial Intermediaries (FI) and Private Equity (PE) Funds. The introduction of these Apps will enable Financial Institutions to implement environmentally and socially sound investments while also serving to protect their financial and business interests, reputation and legal position.
The Apps present a digitisation of the Environmental and Social Management System required by EBRD’s Environmental and Social Policy and more specifically, the E&S requirements stemming from Performance Requirement 9 (Financial Intermediaries) of the Banks’s Environmental and Social Policy 2019. Through the Apps, our Financial Institution clients can screen, assess and monitor their loans and investments. They thereby access knowledge on best environmental and social management risk management and build internal capacity to meet the Performance Requirement 9.
This App is a one-stop-shop in the format of a ready-made, user-friendly and comprehensive tool for carrying out the main step of the E&S screening, risk identification and management process for loan applications and investee companies. The Apps provide a practical framework for a client to screen environmental, social and governance (ESG) issues and design the central components for Environmental and Social Action Plans. In addition, the tool allows clients to map individual loans or investments or their portfolio to the Sustainable Development Goals (SDGs). .
Users are led through a series of steps performing the essential requirements of screening, categorising and assessing environmental and social risks. They generate a Due Diligence PDF Report together with an Environmental and Social Action Plan (ESAP). Specialised questionnaires for Small and medium-sized enterprises, corporate and project finance transactions as well as Investee Companies and the optional Site Visit Check List allow for a targeted application according to the type of transaction.
The Apps also support the ongoing efforts to digitalise financial and investment operations, thereby improving data gathering, sharing, monitoring and e-filing.