ADB

The financial institution discloses that the highest governance body is responsible for decision-making and oversight of the sustainability strategy. It has a stewardship policy that supports environmental transitions and social best practices in line with its sustainability strategy. This policy encompasses client and stakeholder engagement, advocacy, and partnerships, and includes criteria for successful stewardship outcomes, escalation routes for failures, and conditions for escalation. In addition, the financial institution discloses a list of trade associations that it is a member of.

The financial institution has established time-bound, measurable targets for products, services, and capital related to climate solutions. Key sectors, clients, and investees for climate engagement are identified, as well as nature-related impacts of provided products and services. The financial institution also discloses the monetary amount allocated to nature-positive solutions and has a strategy for supporting climate adaptation and resilience, including at least one example of such support. It monitors its Scope 1-2 emissions and other Scope 3 categories. Furthermore, it discloses its operational details by country and financing provided to low-income and lower-middle-income countries. It has a process in place to identify social risks linked to the provision of products and services in the context of the net zero transition.

While the financial institution identifies material sustainability impacts across its value chain, further detail on the criteria and evidence used for prioritisation is needed. Recommendations include disclosing third-party assurance of target reporting and linking senior executive remuneration to sustainability targets. Although it states it does not use lobbying to create adverse sustainability impacts, it does not make a formal commitment. The institution discloses it does not provide products or services to certain fossil fuel projects but does not address all fossil fuels. It refers to nature-related impacts but should clarify the connection to its offerings.

Recommendations also include detailing the methodology for emissions footprint calculations, breaking down clients by income group, and avoiding unintended divestment from low and lower-middle-income countries. Furthermore, the institution has a publicly available statement on ILO fundamental rights at work but lacks a formal policy approved by its highest governance body. It could disclose its methodology for determining a living wage in its operational regions and establish a public policy against bribery and corruption, including relevant clauses in its contracts with business relationships.

This scorecard refers to information in English which was publicly available by July 15 2024. AuM and Total assets are stated in USD for comparability and have been calculated based on reported local currency values multiplied by applicable IMF currency converter values.