On the 4th of March, the 1st Belgian SIB ( Social Impact Bond) structured and financed by BNP...
CSR takes center stage
While the effects of the 2008 financial crisis continue to significantly impact the global economy, Corporate Social Responsibility (CSR) may seem like it would be a minor concern. On the contrary, many banks and insurers are placing CSR at the center of their strategy, communications and initiatives.
This is no passing trend, but a deliberate choice motivated by the following three factors:
• Legal: The French “Factor 4,” “Grenelle Environment” and “Grenelle 2” regulatory frameworks encourage banks and insurers to commit to a sustained CSR approach.
• Societal: Consumers are demanding more transparency and increased ethical, social and environmental commitments. A bank or an insurer can thus derive a competitive edge from CSR initiatives.
• Economic: In this still difficult context, businesses, banks and insurers are pressed to reduce costs and better manage risk. CSR can be leveraged for better performance, combining economic and financial efficiency with measures to preserve asset value.
CSR is a must on the internal level…
CSR challenges are first tackled internally through the numerous initiatives companies develop to reduce their ecological footprint, carbon emissions and greenhouse gas (GHG) emissions.
These measures can include using less paper or lowering energy consumption by raising employee awareness (by turning lights and computers off, monitoring the energy efficiency of facilities, or encouraging ridesharing). In HR departments, CSR initiatives include the promotion of parity, professional training and mobility.
These initiatives—which can be linked to specific objectives—and their results all typically feature in a dedicated report: the CSR report.
Some of these initiatives may have an impact on customer relations. For example, going paperless generally involves issuing account statements, deadline notices and other documents in a digital format.
In addition, banks and insurers may also illustrate their CSR commitments through a new range of products and services integrating environmental and/or social criteria. In this case, CSR becomes a powerful driver for innovation!
… and pushes banks and insurers to innovate
The banking sector has indeed expanded its socially responsible investment (SRI) offer, and promoted these products to its customers.
“Green” financing tools have also begun to emerge: from dedicated loans for individuals wishing to improve their home’s energy efficiency or buy a green vehicle, to financing for businesses developing activities tied to sustainable development.
For example, in Italy, BNP Paribas Group has set up a dedicated consulting and financing service for renewable energy and energy efficiency projects: the “Green Desk.” This service has already supported over 150 projects, for individuals and SMEs alike. The initiative won the 2014 Green Globe Banking Award and the Milano-Finanza Innovation Award 2014. BNP Paribas Fortis in Belgium implemented a similar service, with France to follow.
BNP Paribas launched an even more ambitious initiative in 2014 by working with the World Bank to create a green bond: the company shares composing the bond were selected from companies assessed according to Vigeo’s demanding CSR standards.
As for insurers, they can enact incentive-based policies, such as those offering preferential rates for clean vehicles.
Banks and insurers also propose many new services to provide socially responsible support to customers, including socially responsible complementary health insurance, which can be combined with information and prevention services, decoupled from the ordinary commercial offer. Car insurance can also be combined with road safety training and driver’s education offers.
Broadly speaking, products of all kinds can be marketed in new ways to become distinctive, tailored offers constructed with the customer.
Inspiring others through shared best practices
CSR also encourages greater expertise sharing with other stakeholders, in an effort to create socially responsible collaborative initiatives, exchange best practices and encourage joint reflection between businesses.
Proof of this is the growing success of the Produrable Expo, the “Expo for Sustainability and CSR Players and Solutions,” created in 2007. Over the years, the event has attracted 20,400 participants, 746 speakers and 325 exhibiters or partners.
At the 2015 event (March 31-April 1), BNP Paribas sponsored the “eco-social innovation barcamp” showcasing innovative eco-social initiatives through interactive workshops. Its goal was to promote exchange and cooperation in order to increase and encourage CSR initiatives.
It’s impossible to speak of collaboration and synergies aimed at enacting CSR principles without mentioning the Convergences World Forum. Launched in Europe to bring together public, private, non-profit, academic and media stakeholders, Convergences is a forum for exchanging ideas. Its objectives:
- Promote the Millennium Development Goals (MDG)
- Alleviate poverty and instability in developed and developing countries
The 8th Convergences World Forum conference will take place in Paris next September, with BNP Paribas among the event’s associate partners. This year’s theme is “Zero Exclusion, Zero Carbon, Zero Poverty”. Conferences will be held on developing SMEs, green microfinance, financing social enterprises, humanitarian action and climate financing.
Lastly, other types of initiatives combine several different aspects of CSR and its impacts.
As such, BNP Paribas has dedicated part of its “Innov&Connect” business accelerator—which brings together ETIs and startups on common projects—to social enterprises. This decision combines important aspects of sharing and collaboration, but also innovation, all in the service of social and/or environmental initiatives that benefit society as a whole. In this way, our efforts touch on every aspect of CSR!
Corporate Knights, a company dedicated to promoting CSR, publishes an annual global ranking of the 100 top performing companies in terms of sustainable development: the Global 100. To compile the ranking, over 4,600 listed corporate groups are evaluated according to energy production, CO2 emissions, water consumption and other criteria. In 2015, BNP Paribas joined the Global 100 ranking for the first time.
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