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Crédit Agricole CIB specialises in the businesses of capital markets and investment and corporate banking.

» SUSTAINABLE DEVELOPMENT AT THE HEART OF CRÉDIT AGRICOLE CIB'S BUSINESS


CSR Sector Policies

Given its strong commitment to financing the real economy and supporting major projects aimed at sustainably revitalising the regions, Crédit Agricole CIB made it a point to include ESG criteria in its financing policies.


CSR Sector Policies

Key issues
Given its strong commitment to financing the real economy and supporting major projects aimed at sustainably revitalising the regions, Crédit Agricole CIB made it a point to include ESG criteria in its financing policies.

These criteria predominantly reflect the citizenship-oriented issues that are most relevant for a corporate and investment banking institution, particularly in terms of respect for human rights, combating global warming and protecting biodiversity.


The role of financial players
Financial players have no place stepping in for national public authorities or international organisations and defining the objectives and regulatory framework concerning global social and environmental issues.

Similarly, it is not their role to define their customers' investment policies. One of the basic roles of a commercial bank is to support its customers and thus help finance the real economy.

Each financial institution is nevertheless responsible for determining its own financial and investment policies, and through the loans given by these banks, they contribute to the achievement of citizenship-oriented goals.

Combating global warming, protecting biodiversity and respecting human rights are three major issues recognised in the CSR policy adopted by the Crédit Agricole S.A. group. The Group is one of five financial institutions to have launched the Climate Principles on December 2, 2008 and one of ten financial institutions to have launched the Equator Principles on June 4, 2003. Furthermore, it had entered into a strategic partnership with the non-governmental organisation WWF France in the interest of better addressing biodiversity issues. Finally, the Group has established a Human Rights Charter covering all the associated stakes and challenges.

Crédit Agricole CIB is fully aware of the service it can provide its customers in order to meet these important goals, which is why it has developed CSR expertise focusing on these challenges, as embodied by its Sustainable Banking Unit. What's more, it has also incorporated CSR criteria in its financing and investment policies. Crédit Agricole CIB deploys specific CSR policies for sectors where these issues are the most prevalent. 

Crédit Agricole CIB's CSR sector policies
Determination of priorities
The weapons sector is rather unique from the standpoint of human rights due to the existence of controversial categories of weapons. This observation has been raised by a large number of governments (Ottawa and Oslo Treaties) and major non-governmental organisations.

With respect to climate considerations, Crédit Agricole CIB has mapped out the greenhouse gas emissions associated with the economic activities that it finances, based on a methodology for calculating GHG emissions developed within the framework of the Finance and Sustainable Development Chair sponsored by Crédit Agricole CIB. In addition to the initial estimate of GHG emissions calculated, this work has highlighted that two industrial macro-sectors, namely Energy and Transport, together account for over 80% of these emissions.

Lastly, preliminary discussions with WWF France on the issues surrounding biodiversity singled out Hydropower as a priority sector. Extractive industries comprise another significant sector.

Weapons Sector Policy
As the leading sector policy adopted by the Crédit Agricole group, a procedural memorandum (see Risk Procedure Memorandum NP 2010-13) sets forth the scope of inclusion and exclusion of counterparties involved in the Weapons sector.

This memorandum describes the principles of inclusion of counterparties participating in the Weapons sector, with a distinction between controversial weapons (anti-personnel mines and cluster bombs), sensitive weapons and other arms equipment. Specifically, the funding of any companies actively operating in the anti-personnel and cluster bomb sector is strictly prohibited.

Energy Sector Policy
Crédit Agricole CIB combined the issues surrounding climate change and biodiversity to define a CSR Policy for the Energy sector.

This policy encompasses the principles of inclusion applicable to loans and investments in the following sectors: Oil & Gas, Shale Gas, Coal-Fired Thermal Power, Hydropower and Nuclear Power.

Metals and Mining Sector Policy
This Policy referring to the extractive industries completes the other CSR policies for the Energy sector given the importance of these issues notably in terms of biodiversity and human rights.

Transport Sector Policy
As indicated above, the mapping of greenhouse gas emissions associated with our activity highlighted that the Transport sector and the Energy sector together account for over 80% of these emissions. This led Crédit Agricole CIB to deploy a CSR policy for the Transport sector.

This policy encompasses the principles of inclusion applicable to loans and investments in the following subsectors: Aviation, Shipping and Automotive.

Transport Infrastructures Sector Policy
This policy referring to transport infrastructures completes the other sector policies for the Transport sector given the importance of these issues notably in terms of biodiversity.

Other sector policies
Additional sector policies will be developed in the coming months to address in particular the construction sector.

 


CSR Policy for the Energy Sector

Sector issues and policy objectives

The Energy sector, and electricity generation in particular, is of vital importance due to its central role in the development of the economy and its strong current contribution to GHG emissions (especially CO2 emitted during the combustion of fossil fuel). In northern countries, the biggest issue often has to do with the speed of transition to a less carbon-based economy, particularly in terms of developing renewable energy or low carbon-emitting energy (nuclear), while southern countries often see carbon constraints as an imposed impediment to much-needed development.

The aim of Crédit Agricole CIB's CSR policy for the Energy sector is to define the overall principles and rules for inclusion governing loans and investment in this sector, in line with the policy adopted by the Crédit Agricole S.A. group. These rules and principles aim to incorporate climate change as well as other key issues (see the key citizenship issues) in the individual analysis of funding and investment projects.

Principles and structure of the policy

The assessment of the economic, environmental and social benefits and costs expected from the activities subject to financing and investment projects is the focal point of this policy, with each type of energy offering its own pros, cons and constraints.

Crédit Agricole CIB has established principles and rules governing the following sub-sectors (see documents in central column):
- Oil & Gas,
- Shale Gas,
- Coal-Fired Thermal Power,
- Hydropower
- Nuclear Power and the Nuclear Fuel Cycle,
- Metals & Mining.

For each sector, Crédit Agricole CIB identified the best practices recognised by major international organisations and professional bodies, and laid down analysis and exclusion criteria based on these references.

These principles and rules apply to all loans and investments undertaken by Crédit Agricole CIB. They will be revised as our knowledge and assessment of the relevant issues evolve over time.

Any transactions generating significant uncertainty in terms of compliance with the relevant sector policy are submitted to the CERES CommitteeThe CERES Committee is headed by Crédit Agricole CIB's Compliance Head and gathers 5 voting members (or their representative):
- the president,
- one of the Natural resources, infrastructure and power business line's co-head,
- the Head of Risk and Permanent Control,
- the Head of the Sustainable Development mission in Crédit Agricole S.A., assisted by Crédit Agricole CIB's Head of Sustainable Development,
- the Head of Crédit Agricole S.A.'s Industrial and Sector Research unit.
The legal department and the communications direction are also represented in this committee.
for a recommendation. If in the Committee's view the transaction breaches this policy, it is subject to final arbitration by the General Management of Crédit Agricole CIB.

These policies prohibit the funding of the following new projects:
- surface bituminous sands,
- offshore oil drilling in the Arctic region,
- sub-critical coal-fired thermal power (excluding small plants in countries not belonging to the list of high-income OECD countries),
- hydropower plants, where the size of the reservoir is disproportionate to the energy generated,
- nuclear plants, where the technology, operator or host country is not deemed satisfactory.

Finally, Crédit Agricole CIB is one of the first renewable energy financing institutions, having made this field an integral part of the Project Finance business line. 


Renewable energy

International agreements (UNFCCC) and European targets (climate and energy package) are focused on substantially reducing GHG emissions over the next several years, which calls for sustainable development of renewable energy.

Crédit Agricole CIB is already actively involved in funding these new energy sources, and will help support their growth in accordance with its risk analysis criteria applicable to structured as well as corporate financing.

Crédit Agricole CIB was one of the very first renewable energy financing institutions. The Bank has worked in this sector for over a decade, having funded its first wind farms in 1997 and a solar energy project in Spain in 2008. The funding of renewable energy is also an integral part of the Project Finance business line, which financed as at end-2011, a total of 226 wind farms with a combined capacity of 10,000 MW, and 21 solar plants with total installed capacity of 850 MW.

The share of these loans out of all electricity generation projects has consistently increased in recent years, accounting for over half the number of these transactions in 2011.