Climate Change Data

Environmental Metrics

ESG Focus Areas

• Customers' financial freedom
• Empowerment of the community
• Employees' quality of life and well-being
• Living with the environment
• Corporate governance and ethics
• Prevention of corruption

Environmental Achievements

• Reduced greenhouse-gas emissions by 37% from 2012 to 2017
• Reduced total electricity consumption by 0.18% in 2017 compared to 2016
• Reduced paper consumption by 170 tons in 2017 compared to 2016
• Increased recycling of electronic waste to approximately 94 tons in 2017
• Achieved 49% of power consumption from Dorad (natural gas based power supplier) by the end of 2017

Social Achievements

• Launched the Financial Growth Center to provide financial tools and knowledge to the public
• Implemented Poalim Recovery program to support customers experiencing financial difficulties
• Launched Second Chance initiative to help former customers settle debts
• Expanded services for small businesses, including a new business website and innovative management tools
• Increased accessibility of services for diverse customer groups, including seniors, Arab community, and Haredi sector
• Increased number of accessible branches to 248 by the end of 2017
• Implemented a mentoring program for young Arab employees
• Donated NIS 43 million to community initiatives in 2017
• Approximately 3,500 employees volunteered regularly in 2017

Governance Achievements

• Implemented a new remuneration policy for officers in compliance with the Remuneration Limit Law
• Updated code of ethics in four areas: prevention of sexual harassment, political donations, investor relations, and social media representation
• Maintained compliance with laws and regulations in the area of products and services with no significant fines or sanctions in 2017
• Addressed eight cases of suspected damage to the moral integrity of the bank

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions (not explicitly stated, but implied by the focus on responsible supply chain management)
• Maintaining customer satisfaction in a changing business environment
• Managing environmental risks in financing
• Addressing investigations by US authorities concerning business with American customers

Mitigation Strategies

• Implemented a responsible purchasing policy
• Improved service experience through various initiatives
• Developed an environmental risk management system for financing
• Continued to cooperate with US authorities

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Code of ethics for suppliers
• Commitment to fair employment practices
• Environmental considerations in purchasing

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of energy-efficient products and services

Reporting Standards

Frameworks Used: GRI

Certifications: ISO 14001

Third-party Assurance: BDO

UN Sustainable Development Goals

• Goal 8: Decent Work and Economic Growth
• Goal 9: Industry, Innovation, and Infrastructure
• Goal 10: Reduced Inequalities
• Goal 11: Sustainable Cities and Communities
• Goal 13: Climate Action
• Goal 17: Partnerships for the Goals

The report details how the bank's initiatives contribute to these goals through various programs and activities

Sustainable Products & Innovation

• Loans for solar energy systems
• Loans for energy efficiency projects

Awards & Recognition

• Ranked at the top of the Platinum Plus class by Maala

Environmental Metrics

ESG Focus Areas

• Financial freedom for customers
• Service for a diverse range of customers
• Information security and privacy
• Accessibility
• Responsible supply-chain management
• Community investment
• Appropriate work environments
• Diversity, equal opportunities, and transparency
• Employee training and development
• Environmental impact reduction
• Environmental sustainability in products and services
• Environmental risk management in financing
• Corporate governance and ethics
• Prevention of corruption

Environmental Achievements

• Reduced carbon footprint by approximately 9% from 2017 to 2018 (58,318.5 tons CO2eq)
• Granted approximately NIS 8.7 billion in credit for environmental projects and products
• Financed 80% of water desalination plants in Israel

Social Achievements

• Established the Financial Growth Center, reaching approximately 500,000 people with financial education resources
• Launched Poalim Digital Independence initiative to improve digital literacy for senior citizens
• Led initiative enabling people with life-shortening disabilities to obtain mortgages
• Granted NIS 642 million in credit to promote shared business and social value
• Supported small and medium-sized businesses with credit 6.8% higher than the average for Israeli banks

Governance Achievements

• Adopted the voluntary code for the prevention of sexual harassment and obtained certification from the Israel Standards Institute
• Implemented a new code of ethics
• Maintained 100% director participation in audit and remuneration committee meetings

Climate Goals & Targets

Environmental Challenges

• Need to anticipate future changes in the banking arena and prepare appropriately through innovation
• Assisting senior citizens with the transition to digital banking
• Managing environmental risks in financing
• Maintaining customer privacy and information security

Mitigation Strategies

• Adopting innovation in all areas of activity, including agile development processes and big-data methods
• Digital empowerment activities and services adapted for senior citizens
• Environmental risk management system in financing
• Investment in advanced security methods and encryption systems

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Binding criteria for all suppliers, including social responsibility and sustainability considerations
• Corporate responsibility document signed by suppliers
• Code of ethics for suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI Standards: Comprehensive option

Certifications: ISO 14001

Third-party Assurance: BDO Ziv Haft, Corporate Responsibility Institute

UN Sustainable Development Goals

• Goal 8: Decent Work and Economic Growth
• Goal 10: Reduced Inequalities
• Goal 4: Quality Education
• Goal 5: Gender Equality
• Goal 9: Industry, Innovation, and Infrastructure
• Goal 7: Affordable and Clean Energy
• Goal 6: Clean Water and Sanitation
• Goal 11: Sustainable Cities and Communities

Bank Hapoalim's routine activities contribute to the realization of these SDGs through various initiatives described in the report.

Sustainable Products & Innovation

• Loans for energy efficiency projects
• Loans for solar energy systems

Awards & Recognition

• Global Finance magazine's best bank in Israel (7 consecutive years)

Environmental Metrics

ESG Focus Areas

• Protecting the environment
• Promoting astute financial behavior for customers
• Innovation
• Serving a diverse clientele and promoting financial inclusion
• Information security and privacy
• Accessibility
• Responsible supply-chain management
• Expansion of spheres of influence
• Investment in the community
• Promotion of appropriate work environments
• Promotion of diversity, equal opportunities, and transparency
• Training and individual development
• Development of products and services to promote sustainability and protect the environment
• Examination of environmental risks in financing
• Corporate governance and ethics
• Prevention of corruption

Environmental Achievements

• 50% reduction in the carbon footprint of the bank over the last decade; 9% reduction in 2019
• 46% of the power consumed at the bank was acquired from Dorad (natural gas-based power supplier) in 2019
• 11% reduction in paper consumption in 2019
• 54% reduction in total mileage of employee flights in 2019

Social Achievements

• Won the "Dov Lautman Diversity in Business" Award for its actions towards inclusion of employees with disabilities
• 30,000 senior citizens received knowledge, tools, and skills for digital competence
• Launched Poalim Digital Independence project, providing thousands of senior citizens with digital literacy skills
• Expanded the activities of the Financial Growth Center, offering knowledge and tools for deeper financial understanding through thousands of lectures nationwide

Governance Achievements

• First Place (Platinum Plus category) in Maala ratings of corporate responsibility performance
• Remained committed to the ten principles of the United Nations Global Compact (UNGC)
• Submitted an Accessibility Report, summarizing its extensive action in promoting accessibility for people with disabilities, to the Commissioner of Equal Rights for Persons with Disabilities

Climate Goals & Targets

Environmental Challenges

• Climate crisis
• Accessibility challenges for senior citizens in the digital banking transition
• Low mortgage market participation in the Arab sector
• Challenges faced by small and mid-sized businesses in navigating a competitive and dynamic environment

Mitigation Strategies

• Continued work to reduce the environmental impacts and carbon footprint of the bank
• Launched Poalim Digital Independence project to enhance digital literacy among senior citizens
• Prepared a large-scale effort to promote and improve the accessibility of mortgages in the Arab community
• Launched Expansion Package for business owners, which consists of banking benefits alongside education in professional skills

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Embedding social responsibility and sustainability considerations in purchasing processes
• Prioritizing suppliers who have embedded sustainability and corporate responsibility principles in their routine operations
• Requiring suppliers to sign a social responsibility document

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI

Certifications: ISO 14001

Third-party Assurance: BDO Ziv Haft, CSR Institute

UN Sustainable Development Goals

• Goal 8: Decent Work and Economic Growth
• Goal 10: Reduced Inequalities
• Goal 4: Quality Education
• Goal 9: Industry, Innovation, and Infrastructure
• Goal 7: Affordable and Clean Energy
• Goal 6: Clean Water and Sanitation
• Goal 5: Gender Equality
• Goal 11: Sustainable Cities and Communities
• Goal 12: Responsible Consumption and Production

The bank's initiatives contribute to these goals through various activities such as financial inclusion, renewable energy financing, community investment, and financial education.

Sustainable Products & Innovation

• Poalim Accessibility Deposit
• Green Deposit
• ESG Structured Deposit

Awards & Recognition

• Dov Lautman Diversity in Business Award
• 2019 Product of the Year (bit application)
• Gold Win, Effie Awards
• First place in Globes brand index (bit application)
• Second place in PayTech Awards (bit application)
• 2020 Product of the Year Award - Consumers’ Choice (Smart Advice service)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Gender Equality
• Diverse Employment
• Financial Inclusion
• Community Investment
• Employee Well-being
• Responsible Supply Chains
• Corporate Governance
• Ethics
• Compliance
• Information Security

Environmental Achievements

• Reduced the carbon footprint of operations by approximately 9% in 2021 and 60% over the last decade (2012-2021).
• Issued the first Green Bonds in Israel in 2021 (USD 1 billion).
• Stopped financing and investing in new oil and coal exploration and production projects.
• Increased financing for projects promoting a green environment to NIS 13 billion.

Social Achievements

• Introduced dozens of initiatives to reduce social inequalities and promote equal opportunities.
• Expanded the Financial Growth Center's services to include individual financial guidance.
• Promoted gender equality through employment and entrepreneurship initiatives.
• Supported various non-profits through the Bit app fundraising tool.
• Achieved high ratings on international ESG indices, including first place in Maala ratings for the fourth consecutive year.

Governance Achievements

• Updated ESG goals for 2030 to encompass climate risk.
• Issued Green CoCo Bonds, a first in the Israeli banking system.
• Implemented a climate risk management framework.
• Maintained high ESG ratings and upgrades for 2021.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to the COVID-19 pandemic.
• Social and economic events in Israel and overseas (e.g., war in Ukraine).
• Climate change and its impact on business activities.
• Managing environmental and climate risks.

Mitigation Strategies

• Maintained business continuity and provided service during crises.
• Reinforced call centers and expanded digital channels.
• Developed financial products and services adapted to the needs of the period.
• Offered special reliefs and benefits to small businesses.
• Promoted activities and supported ventures to respond to emerging needs.
• Formulated a plan for a climate risk management framework.
• Issued Green CoCo Bonds.
• Guided customers in the transition to a low-carbon economy.

Supply Chain Management

Supplier Audits: Frequent monitoring (including through external entities) to ensure compliance with laws and bank criteria.

Responsible Procurement

• Formalized program to instill sustainability principles in purchasing activities.
• Binding criteria for all suppliers.
• Preference criteria for suppliers with embedded sustainability principles.
• Supplier Code of Ethics.

Climate-Related Risks & Opportunities

Physical Risks

• Floods, storms, heat/cold waves, wildfires, rising temperatures, decreasing precipitation, desertification, rising sea levels.

Transition Risks

• Changes in regulation, government policies, technological changes, market changes, changes in consumer preferences.

Opportunities

• Development of energy-efficient products and services.
• Financing of renewable energy projects.

Reporting Standards

Frameworks Used: GRI (In Accordance: Comprehensive Option), SASB

Certifications: ISO 14001

UN Sustainable Development Goals

• Goal 4 (Quality Education)
• Goal 5 (Gender Equality)
• Goal 6 (Clean Water and Sanitation)
• Goal 7 (Affordable and Clean Energy)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation, and Infrastructure)
• Goal 10 (Reduced Inequalities)
• Goal 11 (Sustainable Cities and Communities)
• Goal 13 (Climate Action)

Initiatives contribute to these goals through financial services accessibility, green project financing, community investment, financial education, gender equality promotion, and more.

Sustainable Products & Innovation

• Green Deposit
• Accessibility Deposit
• Good Cause Savings Deposit
• ESG Structured Deposit

Awards & Recognition

• Top ranking in Maala ratings.
• Best Bank in Israel by Global Finance.
• Gold Award in Diversity category of Asia Sustainability Reporting Awards.

Environmental Metrics

ESG Focus Areas

• Climate Change
• Green Financing
• Gender Equality
• Diverse Employment
• Financial Inclusion
• Community Engagement
• Responsible Supply Chains
• Corporate Governance
• Ethical Conduct
• Information Security

Environmental Achievements

• Reached NIS 20 billion (USD 627 million allocated in 2022) goal for financing green projects by 2030; set a new goal of NIS 37 billion.
• Green bond issuance (first in Israel) of USD 1 billion, with projects financed contributing to the prevention of approximately 147,000 tCO2e of greenhouse gas emissions per year.
• Reduced the bank's operational carbon footprint by approximately 5.1% relative to 2021.
• Reduced operational carbon footprint by approximately 60% over the last decade (relative to 2020).

Social Achievements

• Launched a subsidized loan fund for small businesses.
• Absorbed the January 2023 increase in prime-track mortgage interest rates for approximately 15,000 customers.
• Offered eligible customers the option to spread mortgage payments over more installments.
• Social Banking Unit supported hundreds of initiatives promoting diverse employment, social mobility, and inclusion.
• Financial Growth Center expanded its offerings of tools and knowledge on astute financial behavior, reaching 612,000 people.
• Bank placed ninth in the BDI survey ranking the 100 best workplaces in Israel.
• 58,500 volunteer hours invested in activities organized by Poalim Volunteers.

Governance Achievements

• Established an ESG steering committee focused on climate aspects, chaired by the head of Human Resources and Risk Management.
• Continued to embed ESG principles into organizational DNA and routine business operations.
• Achieved top ranking among all companies in Israel on the Maala ESG Index for the fifth consecutive year (AAA rating).

Climate Goals & Targets

Environmental Challenges

• Ongoing fighting in Europe, rising interest rates and inflation, sociopolitical crisis in Israel.
• Increased mortgage payments due to higher interest rates and inflation.
• Challenges facing small businesses due to interest rate increases and inflation.
• High number of customer messages to the Ombudsman Unit in 2021 (partially due to service requests).

Mitigation Strategies

• Absorbed interest rate increase for affected mortgage customers.
• Offered option to spread mortgage payments.
• Launched subsidized loan fund for small businesses.
• Improved website accessibility to reduce Ombudsman requests.

Supply Chain Management

Supplier Audits: Approximately 2,400 suppliers engaged in 2022; ESG questionnaire pilot project planned for 2023.

Responsible Procurement

• Supplier Code of Ethics.
• ESG principles embedded in purchasing activities.
• Prioritization of suppliers with embedded sustainability and corporate responsibility principles.

Climate-Related Risks & Opportunities

Physical Risks

• Floods, storms, heat waves, wildfires.

Transition Risks

• Regulatory changes, market shifts, changes in consumer preferences.

Opportunities

• Green financing and investments.
• Development of green technologies and infrastructures.
• New markets in climate tech and environmental innovation.

Reporting Standards

Frameworks Used: GRI (2021), SASB

Certifications: ISO 14001

UN Sustainable Development Goals

• Goal 4 (Quality Education)
• Goal 5 (Gender Equality)
• Goal 6 (Clean Water and Sanitation)
• Goal 7 (Affordable and Clean Energy)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation, and Infrastructure)
• Goal 10 (Reduced Inequalities)
• Goal 11 (Sustainable Cities and Communities)
• Goal 13 (Climate Action)

Initiatives contributing to SDGs through financial services accessibility, green financing, community investment, financial education, gender equality promotion, and more.

Sustainable Products & Innovation

• Green bonds, green deposits.

Awards & Recognition

• Maala ESG Index top ranking (AAA), Entropy ESG leading score, Bloomberg GEI Gender Equality Index inclusion, Green Market Pioneer award.

Environmental Metrics

ESG Focus Areas

• Financial inclusion and accessibility of services
• Social and community engagement
• Mobilizing for stakeholders in emergencies
• Fair and responsible service
• Employment conditions and appropriate work environment
• Employee development and training
• Environmental risk management in financing and investments
• Development of financial products that promote a green environment
• Reduction of environmental impacts
• Ethics, fairness, and corruption prevention
• Business continuity
• Systemic risk management
• Corporate governance and regulatory compliance
• Information security and customer privacy
• Innovation
• Climate change

Environmental Achievements

• Reduced carbon footprint of operational activities by 4.6% compared to 2022
• Emissions intensity per million NIS of credit reduced to 30 tCO2e in 2022 (from 35 tCO2e in 2021)
• Approximately NIS 28.2 billion in balances of credit granted to projects promoting a green environment as of December 31, 2023
• USD 1 billion Green Bonds issued in 2021, fully allocated by June 2023

Social Achievements

• NIS 470 million in benefits and reliefs offered to customers to cope with the impacts of the war
• Established the Poalim Rebuild Fund with NIS 100 million for long-term restoration of communities
• Ranked ninth in the BDI survey ranking the 100 best workplaces in Israel
• 13.6% of employees belong to underrepresented population groups
• 78% of employees participated in training at the Poalim Campus
• NIS 45.8 million in community investments in 2023

Governance Achievements

• 40% women on the board of directors
• 56.8% women in overall management; 39% women in senior management
• ESG reports aligned with GRI, SASB, and TCFD standards
• Signatory of the UN Global Compact since 2010

Climate Goals & Targets

Environmental Challenges

• Swords of Iron War significantly impacted customers, employees, and the community
• High costs of living and inflation burdened customers
• Climate change poses physical and transition risks

Mitigation Strategies

• Extensive reliefs and support for customers affected by the war (NIS 470 million)
• Comprehensive support network for employees affected by the war
• Initiatives to help customers cope with high costs of living (mortgage subsidies, current account offsets, etc.)
• Climate risk management framework including scenario analysis and transition risk policy
• Commitment to stop financing new coal and oil production projects and gradually reduce holdings in these companies

Supply Chain Management

Responsible Procurement

• Supplier Code of Ethics
• ESG questionnaire for supplier selection

Climate-Related Risks & Opportunities

Physical Risks

• Floods
• Fires
• Heat waves
• Rising sea levels
• Rising average temperatures
• Changes in precipitation patterns
• Damage to water sources and land

Transition Risks

• Policy and regulatory changes
• Technological advancements
• Market shifts
• Reputational risks

Opportunities

• Green project financing
• Sustainable investments
• Climate tech industry support

Reporting Standards

Frameworks Used: GRI, SASB, TCFD

Certifications:

Third-party Assurance: BDO

UN Sustainable Development Goals

• Goal 4 (Quality Education)
• Goal 5 (Gender Equality)
• Goal 6 (Clean Water and Sanitation)
• Goal 7 (Affordable and Clean Energy)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation, and Infrastructure)
• Goal 10 (Reduced Inequalities)
• Goal 11 (Sustainable Cities and Communities)
• Goal 13 (Climate Action)

Bank Hapoalim's activities contribute to these SDGs through various initiatives described in the report

Sustainable Products & Innovation

• Green Bonds
• Green Deposits
• Loans for solar energy systems

Awards & Recognition

• Top ranking on Maala ESG Index (AAA)
• Third place on Entropy ESG scale
• Member of S&P Global Yearbook
• Member of FTSE4Good index series
• First place among all companies in Israel on Bloomberg ESG Disclosure Score