Climate Change Data

Environmental Metrics

ESG Focus Areas

• Economic Performance
• Market Presence
• Indirect Economic Impacts
• Energy
• Emissions
• Environmental Compliance
• Employment
• Training and Education
• Diversity and Equal Opportunity
• Local Communities
• Customer Privacy
• Socioeconomic Compliance

Environmental Achievements

• Adopted an Environmental Management System (EMS) framework in accordance with globally recognized best practices.
• Reduced energy consumption (quantified data not explicitly provided but mentioned in the report).

Social Achievements

• LBF is the largest employer in the financial sector with more than 3,500 workers.
• Implemented various training and education programs (details provided in the report).
• Focus on diversity and equal opportunity (details provided in the report).

Governance Achievements

• Established a Sustainability Committee.
• Implemented a robust risk management framework reviewed by the Board Integrated Risk Management Committee.

Climate Goals & Targets

Environmental Challenges

• Economic challenges faced by the SME sector in Sri Lanka due to inflation, US dollar liquidity crisis, and rupee devaluation.
• Climate change risks and its impact on natural resources.

Mitigation Strategies

• Focused on multiple strategies combining market penetration and market development approaches to record double-digit growth.
• Stringent yield management to bolster NIMs and tightened recoveries to drive a sizable reduction in NPLs.
• Initiatives to minimize GHG pollution and effects on habitats, involving the supply chain.
• Commitment to reducing absolute direct and indirect emissions by 40% by 2030.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards: Comprehensive option

Third-party Assurance: Ernst & Young, Chartered Accountants

Environmental Metrics

ESG Focus Areas

• Economic performance
• Environmental performance
• Social performance
• Governance

Environmental Achievements

• Reduced environmental impact of activities
• Green lending practices encouraging customers to purchase hybrid or zero-emission vehicles
• Continued carbon footprint calculation for the entire branch network
• Awareness programs and green CSR activities

Social Achievements

• Embracing diversity in recruitment
• Focus on embedding best practices in talent acquisition and leveraging unique value proposition as an employer
• Inclusive hiring initiatives
• Instructor-led training on inclusive behaviors and managing unconscious bias
• Online learning opportunities on inclusive culture
• Deliberate succession planning emphasizing leaders in high-growth market regions
• Strong relationships with employees, no need for collective bargaining agreements, no industrial disputes

Governance Achievements

• Combined assurance approach to verify accuracy and completeness of information
• Independent assurance for Consolidated Financial Statements and non-financial sustainability indicators by Ernst & Young
• Internal Social Responsibility committee
• Conflict of Interest Policy
• Related Party Transaction Review Committee reviews non-recurrent related party transactions

Climate Goals & Targets

Environmental Challenges

• Increased hiring demand due to voluntary turnover and competition for roles
• Higher candidate expectations (flexible work arrangements)
• Higher turnover in specific areas (Western Province)

Mitigation Strategies

• Focus on embedding best practices in talent acquisition
• Leveraging unique value proposition as an employer
• Inclusive hiring initiatives
• Focus on unique work culture and collaboration with local teams on engagement and community building
• Better balance approach promoting a representative workforce
• Development of tools for more impactful and inclusive job advertisements

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI

Third-party Assurance: Ernst & Young

Environmental Metrics

ESG Focus Areas

• Financial Resilience
• Customer Centricity
• Business Simplification and Optimisation
• Digital Transformation
• Workforce Empowerment
• Manage Our Impacts

Environmental Achievements

• 25 branches use solar power
• 20,109 kg of paper recycled
• 8,000+ trees planted
• Reduced carbon footprint

Social Achievements

• Launched ‘Wanitha Ran Saviya’ gold loan for women empowerment
• Invested Rs. 20.20 Mn in CSR projects
• 50% of female employees promoted
• 7,132 employee volunteer hours for CSR

Governance Achievements

• Established a dedicated Board Sustainability Committee
• Strengthened information security and technology risk resilience process
• Successfully transitioned from ISO 27001:2013 to ISO 27001:2022 certification

Climate Goals & Targets

Environmental Challenges

• Challenging economic conditions
• Volatility in operating environment
• Intense market competition
• High employee turnover
• Information security threats
• Inefficient processes
• Macroeconomic vulnerabilities
• Adverse fiscal policies
• High bargaining power of customers
• Staff turnover due to macroeconomic conditions
• Limited regional presence (Myanmar)
• Evolving needs of customers and rapid changes in technology
• Reaching customer base outside major cities
• Finding the right partnerships
• Addressing stakeholders’ queries and potential complaints
• Implementing an effective resource optimisation system
• Creating awareness among customers regarding the benefits of green projects
• Ensuring Green Office practices are maintained

Mitigation Strategies

• Maintaining sufficient capital and liquidity buffers
• Improving skills and developing pleasant workplace
• Strengthened governance structures and surveillance and monitoring tools
• Business process re-engineering
• Investing in continuous improvement of the Eclipse core banking system
• Investment on land and building
• Investment on digital channels and related developments
• Investment on staff training on customer service standards
• RPAs system implementation
• Investment on RPAs
• Investment on analytical tools
• Investment on process automation
• Investment on human capital - specific training to IT Staff
• Investment in data security
• Investment in customer care operations
• Investment in human capital specific, IT related training to staff
• Investment on renewable energy generation at branches
• Investment on training
• Investment on carbon credits
• Enhanced digital customer acquisition
• Building trust with business partners through proactive communication
• Informing optimal incentives to attract our target customers and to retain our existing customers and women customers
• Implemented an organisation-wide Carbon reduction and resource 0ptimisation initiatives
• Leveraged our relationships with regulators and multilateral organisations to increase green financing

Supply Chain Management

Responsible Procurement

• Procurement policy
• Code of Ethics

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards, SASB Standards, UN Sustainable Development Goals (SDGs), 10 Principles of United Nations Global Compact, SLFRS Sustainability Disclosure Standards S1 & S2

Certifications: ISO 27001:2022

Third-party Assurance: Ernst & Young

UN Sustainable Development Goals

• 1
• 2
• 4
• 5
• 6
• 8
• 9
• 10
• 11
• 12
• 13
• 15
• 16
• 17

LBF contributes to the SDGs both directly and indirectly through its core business and CSR initiatives.

Awards & Recognition

• Silver and Merit Award at the South Asian Best Presented Annual Report Awards 2023
• Gold award for the NBFI sector at the TAGS Awards