Climate Change Mitigation and Adaptation Policy
A. PURPOSE
This policy sets out the framework for the assessment and management of climate-related physical and transition risks that may arise within the scope of the activities of Türkiye Sınai Kalkınma Bankası A.Ş. (TSKB) and to which these activities may be exposed. It also sets out the scope and principles of the climate change mitigtion and adaptation that supports Türkiye's transition to a low-carbon, climate-resilient and nature-positive economy.
B. SCOPE
It covers all employees and operations of TSKB and its subsidiaries.
This policy sets out the Bank's responsibilities and principles regarding its practices and strategies for climate change mitigation and adaptation and is implemented together with the principles of other natural and social capital policies under the umbrella of TSKB Sustainability Policy.
- TSKB Environmental and Social Risk and Impact Management Policy
Annex: List of activities that are not to be financed
- TSKB Nature and Biodiversity Policy
C. PRINCIPLES AND PRACTICES
TSKB Climate Change Mitigation and Adaptation Policy includes the following basic principles and guidelines.
The Bank;
1. addresses the climate change mitigation and adaptation through an active participation of the senior management including the Board of Directors.
2. manages climate related risks by prioritizing them across all business processes.
3. operates in line with the focus on climate change mitigation and adaptation and the do no harm policy adopted in the Bank's Nature and Biodiversity Policy, considering just transition and applying the principles of assessing and managing environmental and social impacts defined in the Bank's Environmental and Social Risk and Impact Management Policy.
4. integrates physical and transition risks from climate change into the Bank's risk management system, including lending processes, aims to monitor these risks through appropriate methods, including scenario analyses and stress tests, taking into account the transfer of these risks on other risk types to which the Bank is exposed, and to manage these risks through policies, limits and control mechanisms.
5. assesses and manages the climate-related physical and transition risks for all investment and working capital loans it finances, regardless of their amount, through the Climate Risk Evaluation Tool (CRET) developed in accordance with nationally and internationally recognized standards, and takes into account the potential impacts, risks and opportunities identified while making lending decisions.
6. within the scope of climate change mitigation, declares that it will not finance any green-field coal-fired thermal power plants, capacity extension investments and coal mining investments for electricity generation purposes. The Bank commits to phase out from financing coal activities (excluding non-performing loans) by the end of 2035.
7. takes into account the climate adaptation processes of its suppliers in accordance with the Sustainable Procurements Management Policy and supports its suppliers to make environmental commitments and manage climate risks and opportunities. To this end, it encourages cooperation and interaction along the value chain.
8. actively contributes to the relevant Sustainable Development Goals (SDGs) which support financing climate change mitigation and adaptation, in particular SDG 13 - Climate Action and SDG 17 - Partnerships for the Goals, through its lending activities and collaborations with relevant stakeholders.
9. acts in consideration of Türkiye's Nationally Determined Contribution, 2053 Net Zero Emission Target and national climate policies, strategies and action plans in line with the United Nations Framework Convention on Climate Change (UNFCCC) and the Paris Agreement, to which Türkiye is a party.
10. supports the Science-Based Targets initiative (SBTi) and the Partnership for Carbon Accounting Financials (PCAF), follows the Net Zero Banking Alliance (NZBA) guidelines as well as International Energy Agency and Intergovernmental Panel on Climate Change scenarios, and sets science-based targets to reduce greenhouse gas emissions in line with the long-term goals of the Paris Agreement. It implements actions that support the financing of low carbon investment and transition plans of its customers. It calculates and verifies its annual greenhouse gas emissions according to ISO 14064 Greenhouse Gas Reporting and Verification Standard and aims to continuously improve its performance.
11. discloses its targets and impacts related to climate change mitigation and adaptation with a principle of transparency through its publications, including the Integrated Annual Report prepared in alignment with the Türkiye Sustainability Reporting Standards (TSRS), the UNEP FI Principles for Responsible Banking Progress Report, and the Carbon Disclosure Project (CDP) Report.
12. strengthens its collaborations with national and international stakeholders in the context of climate change mitigation and adaptation; conducts joint initiatives with the public sector, private sector, academia, and civil society organizations, and supports the sharing of knowledge.
13. encourages the adoption of these policy principles by all parties within the Bank’s business partners and supply chain.
14. monitors the implementation and performance of this policy under the supervision of senior management and the Board of Directors.
D. ENTRY INTO FORCE
This policy shall enter into force on the date it is approved by the Board of Directors.
