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CaixaBank launches ESG advisory service

Source: CaixaBank

CaixaBank has launched a new environmental, social and governance (ESG) advisory service to help its corporate and institutional customers to analyse and establish a sustainable strategy and positioning.

With this new advisory service, CaixaBank seeks to promote its customers' transition towards neutrality in carbon emissions and guide them through their processes of adapting, understanding and defining sustainable goals in the short and long term.

Since the 2015 Paris Agreement, a series of regulatory milestones and a push for sustainability have emerged that focus on the need to decarbonise globally to guarantee sustainability at every level. This transition to a carbon-free economy poses an ambitious and complex challenge.

CaixaBank, as a financial institution, accepts its role as a conduit of financing and promotes investment to help its customers transition to carbon neutrality. Through its Corporate and Institutional Banking (CIB) Structured Finance - Sustainable Finance Department, it makes available an ESG advisory process to its customers to help them develop a comprehensive sustainability plan and adapt their finances to the specific needs of their decarbonisation strategy.

Three areas of customised diagnosis

This is a unique service designed using an in-house methodology based on the guidelines of the Cambridge Institute for Sustainability Leadership and UNEP-FI. It provides an added value to customers, who can ascertain their level of ESG maturity, while providing guidance and also offering a consulting partnership agreement to help them improve their sustainability performance. This service analyses three areas of customer performance, offering them a customised diagnosis, comparing their positioning and outlook in their sector, and suggesting an action plan with specific proposals.

In the first area, we provide a personalised analysis of each customer's sustainability strategy, commitments, and the degree of alignment with the goals of the Paris Agreement. Also defined are medium and long-term goals, which must be measurable and consistent with the company's corporate strategy.

In the second area, we rely on ESG agencies and ratings to analyse the customer's visibility in those markets in which it is present or in which it could achieve visibility. We propose different structures, metrics, and tracking and impact tools. CaixaBank offers active management with ESG agencies, ratings and indeces through active dialogue with market leaders in order to improve the sustainable positioning and recognition of each customer.

In the last phase, we evaluate if the company has incorporated ESG criteria into its financing decisions, and we assess the option of defining a sustainable financing framework that integrates these ESG criteria into the financing policy and streamlines decision-making and access to capital. We also validate potential financing products that can be incorporated into said financing framework.

Sustainable financing can be classified as Green if it has a direct and positive environmental impact; Social if the use of the funds affects social variables, such as health or education; or ESG-Linked if the financing incentivises the company to achieve sustainable objectives.

This entire process lasts somewhere between nine and twelve months. The bank has already signed several agreements with leading companies in their sectors, marking the beginning of the consulting process under strict confidentiality rules, with a designated team assigned to each customer.

Success story for the University of Cambridge and the United Nations

Recently, the University of Cambridge's Institute for Sustainability Leadership, in cooperation with the United Nations, published a report on “Leadership Strategies for Client Engagement”, in which it selected CaixaBank and three other international banks to illustrate the success of this method for advising and assisting customers in the field of ESG.

CaixaBank views this service as a “strategic partnership” with its corporate and institutional customers that elevates the strategic dialogue and enhances long-term relationships and commitments. It represents one more step in its commitment to provide added value to customers at a time of constant global change, when sustainability is playing a central role in the strategy of companies and institutions as a key factor in investment decisions, and as a core focus of development at both the regulatory and market forecasting level.

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