CEO Sustainability Series | Julia Tan, Chief Executive CIC Asia Pacific

Question 1. What has your company’s sustainability journey been like so far?

We are a firm believer in the engagement of sustainable finance activities. We actively
support our clients’ transition to sustainable business models that will ensure their success in the future. On the environment front, Crédit Mutuel Alliance Fédérale (which CIC is part of) is committed to doing its part to combat global warming. It has set three objectives for combating climate change in its 2019-2023 strategic plan:

• First, to reduce CO2 emissions by 30% as an institution (from 2018 level);
• Second, to reduce the carbon footprint of its corporate, asset management and insurance portfolios and investment portfolios in asset management and insurance by 15%; and
• Lastly, to increase the financing for projects with high climate impacts by 30%, by 2023.

To finance the activities arising from its strategic plan, the Group launched its green, social & sustainable bond program and issued its first Green Bond of €750 million via Banque Fédérative du Crédit MutuelI (“BFCM”) in October 2020. BFCM issued its second Green Bond of €750 million in June 2021.

In Asia Pacific, CIC has established a Sustainable Finance team comprising members from
different business lines spread across three geographies - Singapore, Hong Kong and Australia. The main objective of the team is to source for, promote and arrange sustainable finance transactions. Where training is concerned, all staff are highly encouraged to attend ESG / Sustainable Finance courses to help raise their understanding of sustainability as well as to develop key skills and competences relevant and important in today’s world.

Q2. What measures have CIC implemented in facilitating the transition to a more
sustainable economy?

The bank takes into account environmental, social and governance (ESG) risk factors in its
evaluation process before considering a banking relationship with its customers. Individual sectoral policies have been developed to allow for robust evaluation of each transaction to determine if the ESG risks are high.

The bank’s risk appetite framework also includes specific ESG application grids to allow
business units to thoroughly analyse companies whose activities may contribute negatively to ESG issues. There is also an external ESG database, which the bank relies on to enhance its counterparty analysis. Specifically, in Asia Pacific, CIC has recently put in place an Environmental Risk Management Policy, in response to the expectations set out by the Monetary Authority of Singapore and Hong Kong Monetary Authority regarding environment and climate-related risk management by banks. On transactions that are likely to raise ESG concerns, they will be deliberated at the ESG committee (both locally and in Head Office). The ESG committee’s role is to provide an opinion to facilitate the final decisionmaking by the credit committee.

In 2021, the Group further stepped up its commitments to combat global warming by
discontinuing the financing of all new oil & gas exploration, production and infrastructure
projects. This was a natural extension to its previous commitments to phase out the coal
sector.