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Environmental and Social Sustainability Report

Environmental and social sustainability (ESS) mission statement

ACLEDA Bank is committed to achieving strong, sustainable financial returns, while respecting the environment and community within which we live. We subscribe to the concept of triple bottom line ('people, planet, profit') reporting and are constantly developing indicators for measuring and reporting on our performance and impacts on the society and the environment and to implement a reporting structure based on the guidelines of the Global Reporting Initiative (GRI).

The key elements of ACLEDA Bank's ESS mission are:

1. To provide a framework of guidelines within which ACLEDA Bank can operate in a sustainable manner so that our impact on the environment, society and the community in which we operate is managed in a responsible way.
2. To continue to introduce energy efficient systems into our buildings and to manage sensibly our energy requirements wherever we operate.
3. To honour the society in which we live and actively work to promote an inclusive culture embracing not just shareholders and staff, customers, and business partners but respect for the individual within our community.
4. To recognise that supporting the community is not just morally sound but good business as well — our 'good health' and prosperity are mutually interdependent.

Environment

ACLEDA Bank fully subscribes to international conventions which prohibit the provision of credit to, or otherwise support, any activities which might harm the environment, be morally repugnant or jeopardise human rights. In particular the Bank has in place policies which forbid involvement with exploitative forms of forced or child labour, trade in weapons and munitions, gambling, casinos, brothels, regulated wildlife or wildlife products (CITES rules) and production or trade in radioactive materials or significant volumes of hazardous chemicals. Strict monitoring processes are in place which require customer contact staff to certify that any business we write conforms to these principles.

The Bank employs five full time Environmental Officers who regularly undertake training and refresher courses to coordinate ACLEDA's environmental activities and monitor performance.

In addition, ACLEDA Bank supports renewal energy by providing loans to customers related to Biogas and Solar energy.

Environmental Performance Indicators

In order to establish baselines for the measurement of our efforts to reduce our environmental impact, during 2005 we introduced a tracking system for resource usage. The results are given under their respective headings below and will be used to benchmark our future performance.

Paper Usage

In 2022, paper usage increased by 3.93% per co-worker compared to 2021. However, the Bank is continuing increased use of electronic data by using our system developed by the Bank's IT Division to send/receive internal information.

Waste paper decreased by 12.62% per co-worker compared to 2021.

Energy Consumption

Electricity consumption per co-worker increased by 9.21% in 2022 compared to 2021. Gasoline increased by 10.86% in 2022, diesel and lubricant consumption increased by 4.88% and 3.92% per co-worker compared to 2021.

However, the overall growth of the Bank inevitably led to an increase in CO2 emissions in absolute terms.

Water

Water consumption per co-worker decreased by 15.73% in 2022 compared to 2021.

Business Travel

In 2022, the total distance travelled by car and motorcycle increased by 55.36% and 16.08% compared to 2021.

Social Sustainability

ACLEDA Bank's corporate culture is built on respect for the society in which we operate and an inclusive perspective on our stakeholders embracing not just shareholders and staff, customers and business partners but the community at large. In addition to the environmental programs mentioned above the Bank observes a policy of equality in all dealings with the public in general and customers and staff alike. Above all, ACLEDA Bank has practiced from the very beginning 'zero tolerance' of corruption both internally and externally and transgressions are dealt with summarily.

The following are key principles in ACLEDA's corporate social responsibility policy:

Staff

• ACLEDA is an 'equal opportunity' employer. Apart from those jobs which involve a higher physical risk (e.g. guards and messengers) appointment to all positions at every level is based entirely on merit regardless of gender or physical disability.
• ACLEDA Bank aims to be the most progressive employer in Cambodia providing medical, provident fund and other benefits such as personal and housing loan schemes and an employee share ownership program for all staff who have completed probation. It provides comprehensive training both for new recruits as well as experienced staff and encourages those who wish to further develop themselves through external programs.
• The Audit and Compliance Committee under the chairmanship of the Board of Director has been specifically tasked with the responsibility of setting and monitoring the Bank's moral and ethical standards and respect for human rights.
• In consultation with its staff the Bank has drawn up social policies covering i) Code of Conduct, ii) Human Resources Management, iii) Health & Safety, iv) External Relations, v) Freedom of Association and the Right to Collective Bargaining. These are now published on Lotus Notes so that every member of the staff has free (and paperless) access to the most up-to-date versions.
• The staff is represented by a self elected Staff Representative Committee, which excludes management, and a Staff Sports Committee, to promote healthy recreation and good fellowship. At its headquarters, the Bank provides a clinic under the care of a full time doctor and two full time nurses. Healthy and safe work practices are part of the training provided to all employees under the doctor's supervision. A Health and Safety Policy under the direct responsibility of the Executive Vice President & Group Chief Administrative Officer is in place which includes a policy supervised by a dedicated committee for the support of our staff who are suffering from HIV/AIDS.

Community

ACLEDA recognises that playing our part as good citizens in the community in which we abide is vital to our mutual interests and prosperity. Major initiatives we are taking are:

• Developing and offering appropriate products and services carefully selected and developed for the particular needs of Cambodian society. In 2006 the Bank launched a housing loan scheme, with interest rates fixed for up to 15 years to enable Cambodians, especially in the lower wealth segment, to purchase their own homes.
• Expanding outreach: opening up banking services to new communities in new locations by expanding our network in the provinces and extending online banking services to mobilise savings. The expansion of our 24 hours a day/7 days a week ATM network to all provinces in 2010 has enabled our customers to access their funds at their own convenience, irrespective of the normal opening hours of the Bank or national holidays. In April 2017 we launched 'ACLEDA mobile (formerly ACLEDA Unity ToanChet)' — a real bank in your hand. In 2014 and 2015 we launched 'ACLEDA Internet Banking' and 'ACLEDA E-Commerce Payment Gateway' which enable our customers' access to financial services and online payments anywhere anytime.
• At the end of 2022, we conducted an annual survey on our small-sized enterprise loan and medium-sized enterprise and corporate loan customers' living standards that get loans at least twice from ACLEDA Bank to test the impact of our credit services. This involved 2,272 respondents (female: 54.23%) randomly selected from our 361,668 active borrowers of whom 70.16% were traders, 15.40% were farmers/workers and 14.44% were private companies/NGOs/civil servants. The responses indicated that across all sectors there were 81.78% who considered that their wealth had increased as a result of credit provided by ACLEDA Bank, 6.78% who did not detect any noticeable change while only 11.44% had the perception that they were worse off than before.

	2022	2021	2020	2019	2018
Income Situation
Growth	81.78%	80.15%	78.31%	92.40%	90.90%
Stability	6.78%	5.37%	6.08%	3.57%	6.23%
Reduction	11.44%	14.47%	15.61%	4.03%	2.87%

• Incorporated into our policies are strictures against overselling or encouraging customers to over commit themselves or buy inappropriate products or services. As a matter of principle, ACLEDA does not impose mandatory savings requirements on its customers.
• Transparency and 'truth in advertising' are strictly enforced when developing, advertising and selling our products and services and full and detailed information is provided through brochures, our website and other promotional materials.
• ACLEDA practices equality in its lending irrespective of gender or race: 54.8% of our borrowing customers are female.
• Customer confidentiality is inculcated in all our staff during induction training and transgressions are treated as a serious offence.
• Recognising the particular problem of disability in Cambodia, ACLEDA takes into account the special needs of the disabled when constructing new, or renovating old offices.
• As a commercial organisation ACLEDA does not receive subsidies but may on occasion, and where appropriate, receive financial support to provide non-commercial services such as workshops for external trainees.
• ACLEDA does not ally itself to any particular political parties or creeds but seeks to cooperate and work in harmony with the elected government of the day. To this end the Bank regularly participates in meetings with senior officials through industry associations, business forums, chambers of commerce and other group activities. Individual meetings with officials are conducted with transparency and important matters are minuted. ACLEDA has strict rules governing 'undue entertainment' or other activities which might be open to question on the grounds of probity, including the provision of banking services at non-commercial rates ('policy lending').
• In 2022, ACLEDA Bank Plc. provided 396 internships for local students.
• ACLEDA Bank Plc. took part in important social and humanitarian activities through the following sponsors & donations.

Note:

• FTE (Full Time Equivalent): average number of full-time co-workers during the year.
• * CO₂ equivalent is referred to the Greenhouse Gas Protocol calculation principles.