Question

1. What is the Sustainability policy of the ING group? Please answer with reference.

Answer 1

Sustainability Policy of ING

The multinational banking group ING is headquartered in Amsterdam, Netherlands. The primary business areas of the bank include direct asset management, banking, retail banking, investment banking, commercial banking, private banking, wholesale banking, and insurance service. ING ranks amongst the largest banks of the globe having branches in 40 countries, and total assets worth USD 1.1 trillion.

ING fully acknowledges that its business activities and policies make a significant impact worldwide, as it operates in 40 countries and has a customer strength of approx. 34 million. The company takes a stance to be more transparent in its business transaction and activities. The ESR (Environment and Social Risk Management) policies of the company are applicable to all its services and products (including project finance, investment, loans, asset management, and banking among others). ESR policies are created for the specific operational areas and define the different risk management procedures that ING has in place. The bank has relevant policies and frameworks on a range of issues, and its business activities and action plans are carried out in accordance with these specific policies and guidelines. For instance, ING ESR policy related to "animal welfare" expects the clients to respect animal welfare and follow the best practices. The company finances human rights action plans through contribution. Likewise, the company has the guideline frameworks in areas including palm oil, deforestation, data ethics, climate, plastic, tobacco, fisheries, and other areas as well.

ING's ESR and Sustainability Policies

The company does not finance business areas and sectors including animal testing, fur production, cosmetic animal testing, deforestation of the rain forests and the controversial arm industries. The company fully realizes that its corporate clients (that comprise around 30% of its lending portfolio) make the most environmental and social impact. ING hence carries out discussions with the clients (among others) to help them improve the social and environmental impact.

ING has a 3-step approach to ESR management.

1. Maintaining the policy framework

2. Screening clients and transactions.

3. Relationship monitoring once an agreement is reached.

ING's ESR Policies

The company regularly carries out reviews of its policy framework to ensure that it is always updated and addresses the latest causes. Peers, clients, NGOs and stakeholders all participate and provide guidance. The policies also aim to manage the climate, environment and human rights risks. The company restricts financing to the controversial prospective clients, as said earlier and may also have a zero-tolerance policy in some areas (for instance for clients and businesses involved in the manufacturing of cluster munitions)(ING.com)1. In other cases, if 30% or more revenue of a client comes from controversial activities, the party is excluded and ING does not indulge in doing business with it.

Reference

1.Environmental and Social Risk Management. ING.com. <https://www.ing.com/Sustainability/Sustainable-business/Environmental-and-social-risk-policies.htm>. Accessed 5 April, 2020.