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| A promotional image from Hana Bank announcing its adoption of the Equator Principles / Courtesy of Hana Bank |
By Anna J. Park
Hana Bank announced earlier this week that it recently officially adopted the Equator Principles, which refer to a risk management framework adopted by global financial institutions for assessing and managing environmental and social risks in investment projects according to a minimum standard.
Currently, 123 financial institutions in 37 countries have officially adopted the principles, which were first established in 2003. Adopters vow to implement the principles in their environmental and social policies for financing projects and will not provide financing or loans to projects where the client will not ― or is unable to ― comply with the principles.
With the adoption, Hana Bank plans to launch its own environmental and social risk screening process, which will be implemented systemically in providing loan products, as well as in financing large projects, in order to eliminate any harmful effects on the environment or human rights in the bank's businesses.
"With the adoption of the Equator Principles, the bank will proactively take on the social role required to bring about sustainable financing by managing environmental and social risks," an executive from Hana Bank said.
In April, Hana Financial Group announced its environmental, social and corporate governance (ESG) vision, "Big Step for Tomorrow," setting a series of medium- and long-term goals to reduce carbon emissions and increase support for financial projects that are in line with ESG principles. The bank's adoption of Equator Principles is in line with the financial group's long-term ESG vision.
With Hana Bank's adoption of the principles, it joins four other major local banks ― KB Kookmin, Shinhan, Woori and NH NongHyup ― in completing their endorsement of the principles, along with state-led Korea Development Bank (KDB). KDB was the first Korean bank to adopt the principles back in 2017, followed by Shinhan Bank in September of that year, and KB Kookmin Bank in February of this year. NH NongHyup and Woori Bank also followed suit this month along with Hana Bank.
