MKB adopted the social and environmental management system that enables analysis of environmental and social risks and the possibilities of their mitigation, ensures evaluation and analysis of activities of the financed organizations to check their conformity to the international (EBRD) and Russian environmental, health care, and safety requirements.
The social and environmental management system is based on the clear distribution of functions between the corporate governance bodies of the Bank and divisions involved in the credit process.
The function of control over the general implementation of the Environmental Policy is assigned to the manager of social and environmental activities who is appointed from among the senior management of the Bank. The coordination function is assigned to the authorized employee of the Bank acting as a coordinator of social and environmental activities. Thanks to this smooth system, the services rendered by the Bank and financing provided by it meet the safety, occupational health, labor, and environmental norms and standards applicable in the Russian Federation.
Due to the participation of the international shareholder, the European Bank for Reconstruction and Development, in the MKB equity, it was possible to build up an effective process of traditional lending and provision of other financial support to customers in accordance with the international requirements (EBRD Project Implementation Requirements (TP1-TP10)).
Regular internal audits, monitoring of the loan portfolio held to identify and assess social and environmental risks, and analysis of the credit process of the Bank generally boost the social and environmental efficiency of the credit activity of the Bank, which rests upon the understanding of the importance of the social and environmental component during the comprehensive assessment of projects financed by the Bank.
The Bank drafts annual reports on the compliance of the Bank’s borrowers with the social and environmental requirements and on the general environmental and social indicators of the cumulative loan portfolio and discloses this information in the annual social and environmental report. As of the end of 2019, the Bank’s loan portfolio contains zero problem loans from the point of view of their environmental component; there were no cases when a concluded transaction was declined for any social or environmental reasons, nor were there any cases associated with the legal proceedings, accidents, complaints, notices of fines, and other actions against the borrowers caused by their failure to comply with requirements of the current environmental laws.
To increase the environmental and economic efficiency of the borrowers’ activities, MKB, among other things, provides its knowledge in this area to the borrowers to reduce the level of environmental risk and to increase its environmental safety.
Besides, the way the Bank’s borrowers comply with the applicable environmental laws and their careful nature management in practical work are an important factor for the Bank for the purpose of evaluating their activities.
MKB abides in its activities by the principles of environmental responsibility and tries to pay much attention to environmental issues. Every year, MKB allocates funds to finance various environmental initiatives, such as forest plantation, support of WWF projects, organization and support of various environmental promotional events.
The key environmental tasks for the Bank include:
- Environmental care as an integral part of its corporate culture
- Evaluation of the conformity of projects to environmental and OHS requirements of the Russian Federation and the EBRD
- Green project financing (see the Socially Important Business section)
- A decline in consumption of energy resources
- Responsible disposal and processing of waste
Environmental responsibility is no longer an issue of concern for a narrow circle of specialists. The world where the next generation will live also depends on the responsibility of the business. We believe that everyone can make their fair share of contribution to the preservation and augmenting of the wealth that the nature has given us".Vladimir Chubar Chairman of the Management Board of MKB