Jerry Zhang, CEO of Standard Chartered Bank (China), speaks about the bank’s award-winning efforts in sustainable, socially responsible banking practices.
Global Finance: How significant are environmental and social responsibilities to Standard Chartered as a business?
Jerry Zhang: Banks have an essential role in a prosperous and healthy society. Sustainability is integrated into how we do business and focuses on three priorities: contributing to sustainable economic growth, being a responsible company and investing in communities. Our approach focuses on getting the basics of banking right, making sure that we are financially stable. This enables us to create value for our shareholders and society over the long run. Our commitment to promoting social and economic development in communities where we operate is in our strategic intent. We have an annual target to contribute at least 0.75% of our previous year’s operating profi t to the community.
GF: How does the bank go about selecting its corporate social responsibility (CSR) programs?
Zhang: Our community investment activities focus on health and education, with youth as a target demographic group. Employee-volunteering is integrated into our approach. China is one of the main benefi ciaries, especially with regard to our global fl agship program, Seeing is Believing (SiB), dedicated to tackling avoidable blindness. Within China, the CSR programs go to places in need—usually underdeveloped regions where health or education resources are scarce.
GF: Tell us more about your fl agship program and how it makes a difference in the world.
Zhang: Avoidable blindness is a key health issue across our footprint. Visual impairment diminishes quality of life and negatively impacts economic growth. Yet 80% of all visual impairment can be prevented or cured. To celebrate the Bank’s 150th anniversary, in 2003, we committed to raise enough money for 28,000 sight-restoration surgeries—one for every member of staff at the time. SiB has grown into an international campaign that has gained support from clients, business partners and the wider community. Standard Chartered has committed to raise $100 million by 2020 for SiB—by the end of July 2017, $95 million had been raised.
In China, we have invested close to $13 million in SiB projects, delivering comprehensive and sustainable eye-care services to 25 million people. Globally, SIB has implemented 166 eye-health projects in 36 countries. All SiB projects rely on multiple external partners—NGO partners for overall coordination, hospitals for training and treatment, education bureaus and schools for screening activities, etc. This is challenging, as it deviates from the typical philanthropy/donation model popular in China.
GF: How—and why—does the bank sustain the environment?
Zhang: Sustainability is about creating long-term value for our shareholders. We have a stringent environmental and social-risk assessment process as an integral part of our credit process. Projects or companies identifi ed as not meeting minimum E&S standards are subject to further review, remedying actions or even denial of borrowing requests. We also fi nance activities in renewable energy and clean technology. For instance, we have made a $5 billion commitment to support Power Africa, a fi ve-year multistakeholder partnership to bolster investment in power generation across Sub-Saharan Africa. We set stringent targets for reducing our consumption of energy, air travel, water and paper. Between 2008 and 2016, we reduced our energy consumption by 37%, water consumption by 35% and paper use by 71%.
GF: Has the global banking system come around to environmental and social governance thinking?
Zhang: There are growing business drivers toward improved social and environmental sustainability. Mounting opposition to globalization and the increasing economic threat of climate change make for a heightened focus on ESG responsibility around business decisions. An increased emphasis on the ethics of doing business will also play well in an era of growing consumer expectations; it may even help companies win the attention of the best millennial recruits, who prefer to work for companies seen as socially responsible. But it is not straightforward: There is no single blueprint for success.