TSKB’s Science-Based Greenhouse Gas Emissions Reduction Targets Approved

TSKB advances further on the climate change roadmap with another significant step

TSKB forges ahead in its climate risk roadmap, unveiling its “Approved Science-Based Greenhouse Gas Emissions Reduction Targets” and pioneering yet another sustainability practice. The Bank’s emissions arising from its loan and investment portfolio, which accounts for 53% of its total assets, and its operational emissions reduction targets announced in previous years have been approved by the Science Based Targets initiative (SBTi).

TSKB’s emission reduction targets, calculated in line with the guidelines of the Science Based Targets initiative (SBTi) have been approved by SBTi. TSKB, with sustainability at the core of its banking model, reinforces its commitment to the Sustainable Development Goals (SDGs) by introducing SDG-aligned financing and setting portfolio weighting targets that prioritize the environment and climate. The Bank previously committed to disclose its emission reduction targets, once guidelines for the finance sector are published by the Science Based Targets initiative. The Bank has now obtained approval for and publicly disclosed its greenhouse gas emissions targets, including direct emissions from internal operations (Scope 1), indirect emissions from procured energy (Scope 2) and emissions from its loan portfolio (Scope 3).

Committing to reduce absolute Scope 1 greenhouse gas emissions by 63 percent from the baseline year of 2021 by 2035, aligning with the IPCC’s studies on limiting climate change to 1.5°C, TSKB also pledges to source 100 percent renewable electricity through 2035 for its Scope 2 emissions. TSKB, since 2021, has been measuring and auditing Scope 3 emissions for carbon-intensive sectors. Focusing on emissions stemming from its loan and investment portfolio, which represents 53% of its total assets, TSKB sets a target to reduce these emissions from the baseline year of 2021. This target covers 70% of the Bank’s total loan and investment loan portfolio.

Murat Bilgiç: “With the unveiling of our approved science-based greenhouse gas emission reduction targets in Turkey, we have taken yet another accountable step towards our shared future.”

Indicating that in 2021 they published the first Climate Risks Report of the finance sector within the framework of the Task Force on Climate-related Financial Disclosures (TCFD), TSKB CEO Murat Bilgiç said, “We integrate climate risks into our loan processes and measure risks at the loan allocation stage with our climate risk assessment model. Through internally developed sectoral heat maps, we continuously monitor the physical and transition risks of our loan portfolio arising from climate change. We are also intensifying our efforts to quantify climate risks. Furthermore, mobilizing all our business lines and adopting a systematic approach, we extend support to all our business partners, particularly our customers in sectors impacted by the Carbon Border Adjustment Mechanism (CBAM), to effectively reduce their carbon emissions. As a signatory of the Net-Zero Banking Alliance, an initiative spearheaded by the United Nations Environment Programme Finance Initiative, we have pledged to align our loan and investment portfolio with net-zero emission targets by 2050. As an important step towards this commitment, today we are announcing our science-based targets, encompassing 70% of our loan and investment portfolio.”

The Science Based Targets initiative, formed in 2015 following the Paris Agreement at COP 21, is a collaborative effort between CDP, the United Nations Global Compact, the World Resources Institute (WRI), and WWF. SBTi provides companies with a clearly-defined path to reduce emissions in line with the Paris Agreement, which aims to limit global warming to well-below 2°C above pre-industrial levels and pursue efforts to limit warming to 1.5°C. By leveraging climate science, SBTi provides guidance to organizations through the publication of sector-specific guidelines.

Murat Bilgiç: “We actively champion the green transition of our country.”

Underlining that an integrated and multidimensional approach is required for the against climate change to succeed, Bilgiç went on to add, “The financial sector plays a critical role in the transition to a low-carbon economy. At TSKB, we actively champion the green transition of our country through our climate-oriented roadmap, our aligned structuring, and the value chain we have established with all our business partners. In line with Turkiye’s Intended Nationally Determined Contributions and climate strategy, we foster collaboration through participating in inclusive working groups lead bydiverse stakeholders. Additionally, we actively contribute to international platforms such as the UN Environment Programme Finance Initiative (UNEP-FI), the Global Compact, and the International Development Finance Club (IDFC), where we serve as a board member. In addition to offering sustainability-themed medium and long-term funds we obtain from development finance institutions, we are committed to serving as an influential stakeholder in guiding Turkey’s Net-Zero target by drawing upon our 73 years of consultancy expertise.”

TSKB’s portfolio-based science-based greenhouse gas emissions targets:

·        reduce its electricity generation project finance portfolio GHG emissions from 85.6% per kWh by 2035 from a 2021 base year. reduce GHG emissions from the commercial real estate sector within its corporate loan portfolio 71% per square meter by 2035 from a 2021 base year.

reduce GHG emissions from the electricity generation sector within its corporate loan portfolio 85.7% per kWh by 2035 from a 2021 base year. align its scope 1 + 2 portfolio temperature score by loan value within the other long-term corporate loan portfolio from 3.20°C in 2021 to 2.74°C by 2027 AND scope 1 + 2 + 3 portfolio temperature score by loan value within the other long-term corporate loan portfolio from 3.20°C in 2021 to 2.82°C by 2027. align its scope 1 + 2 portfolio temperature score by invested value within its corporate bond portfolio from 2.57°C in 2021 to 2.31°C by 2027 AND scope 1 + 2 + 3 portfolio temperature score by invested value within its corporate bond portfolio from 2.86°C in 2021 to 2.59°C by 2027.

https://sciencebasedtargets.org/resources/files/Target-language-and-summary_TSKB.pdf