Climate Change Data

Environmental Metrics

ESG Focus Areas

• Sustainability
• Good Governance
• Customer Satisfaction
• Community Development
• Employee Well-being

Environmental Achievements

• Increased employee awareness about recycling initiatives
• Sponsored protective cages for newly planted trees along Galle Road, Colombo

Social Achievements

• Engaged in eight community development programs with an investment of Rs. 7.91 Mn
• Organized annual blood donation campaign
• Assisted 25 private nursery and pre-schools with furniture and educational equipment
• Sponsored cultural and religious events
• Sponsored a musical show and a ballet opera

Governance Achievements

• Prepared the first annual report in accordance with the IIRC Integrated Reporting Framework and applied GRI Standards
• Maintained Non-Performing Loan (NPL) ratio below the industry average at 3.02%
• Strengthened capital base through a rights issue
• ICRA Lanka reaffirmed credit rating at [SL] BBB with stable outlook

Climate Goals & Targets

Environmental Challenges

• Challenging macroeconomic environment
• Changing regulatory directions
• Rising interest rates
• Maintaining brand reputation
• Employee retention, especially among younger generations
• Balancing the needs of diverse stakeholders
• Intense competition in the financial services industry
• Volatility in the socio-economic environment
• Increasing carbon footprint due to business expansion

Mitigation Strategies

• Re-aligned product mix to accommodate external operating conditions
• Focused efforts to maintain NPL ratio at acceptable levels
• Strengthened credit risk management and recovery processes
• Increased digital marketing and social media presence
• Implemented employee training and development programs
• Organized employee engagement events
• Developed a rewards and remuneration system
• Introduced energy-efficient business practices
• Implemented a reduce, reuse, and recycle policy

Supply Chain Management

Responsible Procurement

• Timely payments to suppliers
• Fair treatment of suppliers

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: IIRC Integrated Reporting Framework, GRI Standards

Third-party Assurance: KPMG, Chartered Accountants

Awards & Recognition

• Among Top 20 Most Admired Companies of Sri Lanka 2018
• Fastest Growing Auto Finance Company in Sri Lanka 2018
• Best Leasing Customer Service Company in Sri Lanka 2018
• Certified as a Great Place to Work in Sri Lanka 2019

Environmental Metrics

ESG Focus Areas

• Sustainable Business Growth
• Strong Financial Performance
• Internal Process Efficiencies
• Employee Satisfaction
• Enhanced Customer Experience
• Delivery and Distribution
• Community Upliftment
• Commitment to the Environment
• Impact of COVID-19 pandemic on business operations
• Financial inclusion
• Ethics, Compliance and Good Governance
• Technology-driven innovation

Environmental Achievements

• Reduced overall electricity consumption by 2.55%
• Recycled 2,820 kg of paper
• Reduced per employee water consumption by 0.31%

Social Achievements

• Certified as a Top 40 Best Places to Work in Sri Lanka
• Staff retention ratio 86.82%
• Engaged in 07 community development projects with an investment of Rs. 8.78 Mn
• Increased employee cadre to 1067 as at 31st March 2021
• 347 employees promoted

Governance Achievements

• Maintained the Credit Rating of BBB with Stable outlook
• Compliance with the Listing Rules of the Colombo Stock Exchange and Finance Companies Direction No. 03 of 2008 on Corporate Governance and amendments thereto

Climate Goals & Targets

Environmental Challenges

• Impact of COVID-19 pandemic on business operations
• Changing regulations
• Cost management
• Managing the NPL Ratio
• Ever-changing customer needs and wants and satisfying the Customer
• Addressing customer complaints in a transparent and satisfactory manner
• Rapidly evolving competitive Landscape
• Discovering the ‘right fit’ alliances to help boost value creation for the community while concurrently serving other stakeholders to their satisfaction
• Employee Health and Safety during the COVID-19 pandemic
• Retention of tacit knowledge from loss of key personnel
• Sustaining the brand identity and corporate reputation
• Enhancing process efficiencies
• Reducing paper usage by transferring paper-based systems to electronic/digital systems
• Lowering carbon footprint in all location across in which the Company operates

Mitigation Strategies

• Strengthen the Company’s liquidity management processes to retain and/or improve the healthy liquidity position currently achieved
• Pursue sustained growth by diligently monitoring prevailing market conditions and changing consumer needs to focus on offering relevant and non-traditional financial products
• Pursue a cautionary by utilising selective lending strategies combined with extensive screening measures and strict adherence to processes to ensure a viable customer base
• Diversify funding sources to maintain an acceptable funding mix to strengthen the Company’s financial base
• Monitor regulatory channels to get updates on changes as and when they occur
• Continue to regularly review and update external policy changes with internal policies
• Develop long-term relationships with regulators
• Implement measures to proactively optimise costs by adopting technology advancements and improving operational efficiencies through process improvements
• Continue to enhance recovery efforts and strengthen field recovery processes
• Augment the collection monitoring process to better manage re-payment status and changes
• Continuously strengthen the credit evaluation and client investigation processes to maintain a healthy customer base
• Continuously research and develop innovative products and improve operational processes to meet customer requirements in the most efficient manner
• Customer complaint handling process to be streamlined aligned to the Customer Relationship Management system
• Need to focus on digitisation efforts and embarked on process re-engineering initiatives to create more value for our customers
• Identifying the most critical community development projects and uplift the well-being of critical communities
• Continuing to operate with minimum staff and further implementing the work from home basis
• Increase employee motivation and engagement measures
• Increase investment in employee training and development
• Focus on building mentorship programmes for employees with proven leadership abilities
• Develop processes and systems to promote greater workplace collaboration
• Continuously focus on building a brand which becomes synonymous with trust by: Increasing the adoption of voluntary best practices and standards, Improving ethical business processes, and Complying with all applicable regulations in the non-banking financial sector
• Replacing manual processes via system automation
• Focusing on process efficiencies targeting consumer convenience
• Automation of consumer-relevant processes to support online operations
• Introducing new and advanced systems to enable business efficiency
• Providing additional training to employees on new technologies and how to use them effectively
• Involving employees in change management discussions from inception to gain buy-in
• Promote electronic and online communication methods and monitor paper usage
• Educate employees on the importance of reducing energy usage and efficient use of natural non-renewable resources

Supply Chain Management

Responsible Procurement

• Ethical procurement policies

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards: Core Option, International Integrated Reporting Council’s (IIRC) Integrated Reporting Framework

Certifications: Great Place to Work™

Third-party Assurance: KPMG

Sustainable Products & Innovation

• Green lending facilities for hybrid vehicles

Awards & Recognition

• A+ brand rating with a brand value of Rs. 1,458 Mn
• Top 40 Best Places to Work in Sri Lanka

Environmental Metrics

ESG Focus Areas

• Sustainable Business Growth
• Strong Financial Performance
• Internal Process Efficiencies
• Employee Satisfaction
• Enhanced Customer Experience
• Delivery and Distribution
• Financial Inclusion
• Community Upliftment
• Environmental Sustainability
• Ethical Business Practices
• Good Corporate Governance

Environmental Achievements

• Reduced electricity consumption at Head Office by 31.67%
• Reduced per employee water consumption by 15.42%
• Increased paper recycled by 38.87% (3,916 kg)
• 14.2% reduction in A4 paper usage at Head Office

Social Achievements

• Opened 8 new branches, expanding to the Northern Province
• Increased employee base by 19.12% (1271 employees)
• Invested Rs. 0.062 Mn in training and development for 997 employees
• 100% return to work after maternity leave
• Engaged in 8 CSR projects with an investment of Rs. 2.03 Mn

Governance Achievements

• Improved credit rating to BBB+ with a stable outlook
• Appointed first female Board Member
• Maintained NPL ratio well below industry average (2.73% vs 11%)
• Complied with all relevant regulations and corporate governance frameworks

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic disruptions
• Economic crisis in Sri Lanka (high inflation, interest rates, currency depreciation, shortages)
• Political and social unrest
• Import restrictions
• High employee turnover among younger generation
• Maintaining a low NPL ratio in a challenging economic climate
• Balancing short-term results with long-term sustainability

Mitigation Strategies

• Developed focused strategies for sustainable growth
• Implemented stringent cost management measures
• Extended moratoria as per CBSL circulars
• Offered uninterrupted services to customers through digitalization
• Strengthened recovery and credit administration
• Invested in employee training and development
• Implemented employee retention strategies
• Focused on responsible financing and selective lending strategies
• Diversified funding sources
• Strengthened partnerships with local suppliers

Supply Chain Management

Responsible Procurement

• Strengthening partnerships with local suppliers

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards: Core Option, International Integrated Reporting Council’s (IIRC) Integrated Reporting Framework

Certifications: Great Place to Work™

Third-party Assurance: KPMG

Sustainable Products & Innovation

• Green lending facilities

Awards & Recognition

• Best Finance Company 2021 & 2022 (Global Economics Awards)
• Best Auto Finance Company 2021 (Global Banking & Finance Review)

Environmental Metrics

ESG Focus Areas

• Sustainable Growth
• Customer Satisfaction
• Company Brand and Reputation
• Ethics, Compliance and Good Governance
• Managing Human Resources
• Commitment to the Environment
• Community Upliftment
• Inclusive Finance
• Technology-Driven Innovation
• Complaint Management
• Employee Health and Safety
• Economic Instability

Environmental Achievements

• Reduced A4 paper usage at Head Office by 46.76% compared to the previous year.
• Overall fuel consumption decreased by 0.88%.

Social Achievements

• Increased deposit base by 21.06%.
• Launched several community development programs.
• Maintained workforce stability without any retrenchments or pay cuts.
• Increased employee monetary benefits by 10.55%.

Governance Achievements

• Achieved a BBB+ credit rating from Lanka Rating Agency.
• No reported violations contrary to the Company's ethical business practices.

Climate Goals & Targets

Environmental Challenges

• Economic instability in Sri Lanka, including high inflation, rising interest rates, and a depreciating currency.
• Supply chain disruptions.
• High interest expenses.
• Declining interest income.
• Increased operating costs.
• Reduced profit margin.
• Increased Non-Performing Loans (NPLs).

Mitigation Strategies

• Implemented cost control mechanisms.
• Carefully evaluated and adjusted strategies.
• Focused on information technology and digitalization.
• Streamlined processes.
• Maintained a customer-centric approach.
• Customised financial services.
• Expanded branch network.
• Extended loan repayment and moratoriums.
• Enhanced recovery efforts.

Supply Chain Management

Responsible Procurement

• Focus on local procurement and strengthening supplier relationships.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards 2021, International Integrated Reporting Council’s (IIRC) Integrated Reporting Framework

Third-party Assurance: KPMG

Awards & Recognition

• Best Employer Brand Award
• Most Respected Finance/Leasing Company
• Fastest Growing Auto Financing Company
• Brand of the Year
• Most Innovative Finance Product
• Best Auto Finance Company
• Best Finance Company

Environmental Metrics

ESG Focus Areas

• Sustainable Growth of Earnings
• Customer Satisfaction
• Managing Human Resources
• Company Brand and Reputation
• Ethics, Compliance and Good Governance
• Technology-driven innovation
• Community Upliftment
• Commitment to the environment
• Inclusive Finance
• Complaint Management
• Employee Health & Safety
• Macroeconomic Climate and Policy Dynamics

Environmental Achievements

• Paper recycled increased by 198%
• Achieved full compliance with Sri Lankan environmental regulations
• Continued use of energy-efficient appliances and processes

Social Achievements

• Launched various CSR initiatives including Poson dansala, sponsorship of convocation ceremonies, rugby tournaments, and community projects
• Increased female representation in the workforce to 37%
• Maintained workforce stability without any retrenchments or pay cuts

Governance Achievements

• Maintained a BBB+ credit rating from the Lanka Rating Agency
• Full compliance with the Listing Rules of the Colombo Stock Exchange, the Finance Companies Direction No. 03 of 2008 on Corporate Governance and amendments thereto and the subsequent Finance Business Act Direction No. 05 of 2021
• No reported violations contrary to the Company’s ethical business practices

Climate Goals & Targets

Environmental Challenges

• High interest rates
• Uncertain market conditions
• Increased competition
• Managing overhead costs
• Economic conditions
• High inflation
• Skill gaps in the workforce
• Balancing work-life balance for employees
• Demonstrating ROI of HR initiatives
• Managing a multi-generational workforce
• Demonstrating the measurable impact of CSR programs
• Sustainability of social projects
• Building trust and collaboration within communities
• Balancing cost-efficiency with technological advancements
• Adapting to economic and political instability
• Managing innovation costs
• Knowledge retention and sharing
• Fostering a culture of innovation
• Measuring intangible intellectual capital
• Maintaining a high-quality credit portfolio

Mitigation Strategies

• Investing in employee training and development
• Implementing flexible work arrangements and well-being programs
• Developing robust metrics to track HR practices
• Implementing effective cost control mechanisms
• Developing a more robust impact measurement framework for CSR programs
• Finding creative solutions for project financing and community ownership
• Fostering strong connections with local organisations and community leaders
• Streamlining operations and leveraging technology
• Implementing a flexible planning approach
• Maintaining a focus on innovation, operational excellence, and customer experience
• Encouraging knowledge sharing
• Implementing structured knowledge transfer
• Strengthening credit evaluation and client investigation processes
• Prioritising effective management of interest costs and operational expenses
• Implementing strategies to maintain business volumes
• Enhancing operational efficiencies
• Strengthening collections
• Strengthening liquidity management processes
• Diversifying funding sources
• Maintaining a cautious approach to lending
• Careful monitoring of economic conditions

Supply Chain Management

Responsible Procurement

• Prioritising suppliers who share our values and promote positive environmental and social practices

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: International Integrated Reporting Council’s (IIRC) Integrated Reporting Framework, Global Reporting Initiative Sustainability Reporting Standards (GRI) 2021

Third-party Assurance: KPMG

Awards & Recognition

• Best Finance Company – 2021, 2022, and 2023 (Global Economics Awards)
• Best Auto Finance Company 2021 (Global Banking & Finance review)
• Crown of the Year Sri Lanka 2020 - Financial Services (Global Banking & Finance review)
• Most Innovative Finance Product Sri Lanka 2020 – Vallibel Wheel Draft (Global Banking & Finance review)