With “green” questionnaires loans to large companies

By Vassos Angeletou

More than 3,000 large and medium-sized enterprises have received questionnaires from their bank about their Environmental-Society-Governance (ESG) policies in order to obtain new financing or renew their existing credit lines.

According to his information Capital.gr, already about 600 questionnaires are in the process of being completed by large organizations. These questionnaires, drawn up by the Hellenic Banking Association in collaboration with Teiresias, were presented at the Digital Banking & Insurance Summit of Boussias Events by the acting General Manager of EET, Haroula Apalagaki.

These include four sections of questions: general information, Environment, Society and Governance. In the first category, companies provide information about their size (assets, total number of employees), as well as their degree of dependence on energy-intensive activities.

The second section includes questions about the company’s policies regarding climate issues such as recycling, waste management, natural disaster prevention, CO2 footprint, consumption of natural resources (such as water), as well as any exposure to areas that have suffered painful effects from extreme natural phenomena.

The questions concerning Society focus mainly on inclusiveness policies and, specifically, the quota of women in top management positions, health and safety policies, incidents of non-compliance with legislation on social issues, etc.

The Governance section, finally, concerns the company’s policies and code in matters of ethics, anti-corruption, due diligence in ESG matters, as well as any incidents of non-compliance with existing legislation and regulatory framework.

As Ms. Apalagaki pointed out, “the interbank questionnaire only concerns the loan relationship and in the first stage it aims at the self-evaluation of each business, while it will also produce the so-called ESG Scoring, the function of which will be equivalent to the known until now Credit Scoring That is, it will shape not only the financial, but also the general profile of the company”.

Advantages for businesses

Beyond the compliance element, businesses benefit in the medium term from strengthening their competitiveness by paying particular attention to sustainability issues.

As mentioned, there are studies that confirm the existence of a correlation between the performance of ESG indicators and the financial performance of a company. This fact proves that ESG information is essential from a financial point of view, and should be evaluated, both by banks and investors.

The benefits for the company from the adoption of sustainable practices with ESG criteria are multiple:

-Easier access to financial capital,

– strengthening extroversion by providing cooperation opportunities with large companies that require the implementation of these practices from their partners,

– prevention/avoidance of any adverse financial and operational effects (fines, license revocation, etc.),

-improvement of environmental performance (reduction of environmental footprint) with potentially positive economic impact,

-strengthening the brand name and creating long-term value,

-facilitating your transition to the new environment with easier adaptation to upcoming changes in the legislative framework (e.g. climate law), to the requirements of new technologies, to the integration of circular economy principles, and

-strengthening your cooperation with all interested parties (local communities of activity, customers, investors, staff, etc.).

It is noted that Teiresias will keep in its register the “green” information of each company in order for the bank to refer to it for every new financing. At regular intervals the information will be updated in order to incorporate any improvements that the company has implemented either at the level of corporate governance and inclusiveness/equality or at the level of sustainability of its operation.