Climate Change Data

Environmental Metrics

ESG Focus Areas

• Social Upliftment
• Shari'ah Compliance

Social Achievements

• Distributed a profit of Rs. 470 Mn amongst investors.
• Awarded ‘Islamic Finance Entity of the Year’ and Gold for ‘Social Upliftment Award (CSR)’ by SLIBFI.
• Ilsam Awfer won Silver award for ‘Rising Islamic Personality of the Year 2014’.

Governance Achievements

• Established a Shari’ah Supervisory Board (SSB) to ensure Shari’ah compliance.
• SSB conducts periodic Shari’ah audits on all transactions.

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• Wakala base lending facilities

Awards & Recognition

• Islamic Finance Entity of the Year 2014/15
• Gold for Social Upliftment Award (CSR)

Environmental Metrics

ESG Focus Areas

• Social Upliftment
• Shari'ah Compliance
• Governance

Social Achievements

• Disbursed Rs. 25,011,442 amongst 186 beneficiaries through its Charity Fund, focusing on Education, Health and Social needs.
• Received the Gold Award in Social Upliftment at the Islamic Finance Forum South Asia (IFFSA) Awards 2016.
• Launched 2 Al-Falaah Corporate Branches in Colombo and Kandy.

Governance Achievements

• Maintained high standards of corporate governance and ethical business conduct.
• Full compliance with Shari'ah Supervisory Board (SSB) requirements.
• Periodic Shari'ah audits conducted on all transactions.

Climate Goals & Targets

Environmental Challenges

• Less than favorable macroeconomic conditions in Sri Lanka (slowing export sector, capital outflows, rupee depreciation).
• Competitive interest rates from the banking sector.
• Challenges in the motor vehicle industry (increased prices and import duties).

Mitigation Strategies

• Innovative product development (Wakala lending product).
• Improved staff utilization.
• Personalized customer care services.
• Leveraging LOLC Group’s islandwide network.
• Prudent lending policy (Rs. 76 million bad debt provision).

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: AAOIFI

Third-party Assurance: Ernst & Young, Chartered Accountants

Sustainable Products & Innovation

• Wakala lending product

Awards & Recognition

• Islamic Finance Entity of the Year – Silver Award (IFFSA)
• Social Upliftment Award – Gold Award (IFFSA)
• Rising Islamic Finance Personality of the Year – Gold Award (IFFSA)
• Best Islamic Leasing Provider (Overall) – Runners Up Award (IFN)

Environmental Metrics

ESG Focus Areas

• Shari'ah Compliance
• Social Upliftment
• Financial Inclusion

Social Achievements

• Disbursed Rs. 9.67 Mn from the Charity Fund to 96 beneficiaries for medical needs, education, and social upliftment.
• Organized 12 customer awareness events on Islamic finance.

Governance Achievements

• Maintained high standards of corporate governance and ethical business conduct.
• Established a whistle-blowing policy.
• Consistently met Shari'ah compliance requirements.

Climate Goals & Targets

Environmental Challenges

• Severe liquidity crunch in the market.
• Tightening monetary policy.
• Trend of customers favoring banking industry over NBFI sector.
• Unfavorable weather conditions affecting various sectors.

Mitigation Strategies

• Focused on raising capital in overseas markets.
• Leveraged on the extensive branch network and geographical reach of LOLC Finance and LOLC Group.
• Offered tailor-made solutions and flexible repayment options to customers.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: AAOIFI

Sustainable Products & Innovation

• Ijarah Sukuk

Awards & Recognition

• Islamic Finance Entity of the Year (SLIBFI)
• Deal of the Year for Ijarah-Sukuk (IFN)
• Best Islamic SME Leasing and Finance Company (GBFR)
• Most Innovative Islamic Investment Product (Wakala) (GBFR)

Environmental Metrics

ESG Focus Areas

• Sustainability
• Climate Change
• Social Impact
• Governance

Environmental Achievements

• Robi (Bangladesh) increased solar-powered tower sites by 4.3 MW, Smart (Cambodia) achieved 8% reduction in grid usage and 17% reduction in CO2 emissions, edotco reduced carbon emissions per site by 58% from a 2013 baseline.
• Amreli Steel financed the construction of a 4 MW solar plant, reducing energy costs.

Social Achievements

• LOLC Al-Falaah established the Al-Falaah Ladies Business Unit, empowering women with financial solutions.
• Axiata contributed US$7.7 billion to GDP and supported 600,000 jobs.
• ICIEC supported the construction of two hospitals and five medical units in Ivory Coast.
• Government of Malaysia's Sukuk Prihatin supported COVID-19 medical spending, infectious disease research, MSME financing, and improved rural school connectivity.

Governance Achievements

• Axiata's continued inclusion in the FTSE4Good Bursa Malaysia Index.
• LOLC Al-Falaah's close monitoring by an independent Scholar Supervisory Board.
• Saudi Electricity Company's recapitalization exercise resulting in a clearer and sustainable capital structure.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impact on global economy and businesses.
• Supply chain disruptions.
• Weakening economic activities impacting insurance premiums.
• Declining trade volume and travel restrictions.
• Depressed investment climate.

Mitigation Strategies

• Government stimulus packages and bailout programs.
• Development of alternative sourcing strategies.
• Strict infectious and contagious disease exclusion clauses on overseas policies.
• National COVID-19 Immunisation Programme.
• Sukuk Prihatin facility for economic stimulus and recovery.
• Restructuring of debts and obligations.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Verification of supplier compliance with labor standards (TEEK TAKA).

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of energy-efficient products and renewable energy solutions.

Reporting Standards

Frameworks Used: UN SDGs, FTSE4Good Bursa Malaysia Index, GSMA's decarbonization call, AAOIFI Shariah Standards, ASEAN Sustainability SRI Sukuk Framework

Certifications: ISO27000:1 (Global Sadaqah)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• SDG 4 (Quality Education)
• SDG 7 (Affordable and Clean Energy)
• SDG 8 (Decent Work and Economic Growth)
• SDG 11 (Sustainable Cities and Communities)
• SDG 13 (Climate Action)

Initiatives contribute to these goals through various programs and projects, including education programs, renewable energy solutions, job creation, sustainable infrastructure development, and climate action initiatives.

Sustainable Products & Innovation

• Halal prepaid card (Manzil)
• Islamic mortgage products (Manzil)
• Car financing (Manzil)
• Income mortgage fund (Manzil)
• Sustainable Charity Program (Global Sadaqah)
• Renewable Energy Financing for SMEs (CIMB Islamic)

Awards & Recognition

• Best Leasing Provider Award (LOLC Al-Falaah)
• Best Islamic Bank in Sri Lanka (LOLC Al-Falaah)
• Best Islamic Leasing Provider (Global) (LOLC Al-Falaah)
• IFN Deal of the Year 2016 (LOLC Al-Falaah)
• Multiple accolades at SLIBFI and IFFSA Awards (LOLC Al-Falaah)
• ARC Global Awards and LACP Global Vision Awards (LOLC Al-Falaah)