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The bank for a changing world TCFD REPORT 2020#SUSTAINABLE FINANCE IN A CHANGING WORLD, LET'S ACCELERATE THE ENERGY TRANSITION AND THE INCORPORATION OF CLIMATE RELATED ISSUES | bnp paribas tcfd report 2020.pdf |
P. 52 BNP Paribas has established metrics to assess, monitor and oversee climate related issues P. 58 BNP Paribas has set quantitative targets for the purpose of managing climate related risks and opportunities P. 59 Summary of key metrics and targets P. 6 The Board of Directors supervises the management of climate rel... | bnp paribas tcfd report 2020.pdf |
Climate change caused by anthropic GHG emissions repre-sents a considerable challenge for humanity. The Paris Agreement, signed in 2015, set a goal with the potential to significantly reduce the risks and effects of these emissions: holding the increase in the global average temperature to well below 2°C above pre-indu... | bnp paribas tcfd report 2020.pdf |
4 TCFD REPORT 20201 GOVERNANCE OF CLIMATE RELATED ISSUES | bnp paribas tcfd report 2020.pdf |
In light of their importance, climate related issues are supervised by the highest executive management bodies of BNP Paribas, namely the Board of Directors and the Executive Management of BNP Paribas Group, with the personal involvement of its Director and Chief Executive, Jean-Laurent Bonnafé2. The climate strategy i... | bnp paribas tcfd report 2020.pdf |
6 TCFD REPORT 20201. 1 THE BOARD OF DIRECTORS VALIDATES THE GROUP'S STRATEGY, INCLUDING ON ENERGY AND CLIMATE RELATED MATTERS, WITH THE SUPPORT OF TWO SPECIALISED COMMITTEES In accordance with its Internal Rules, the Board of Directors determines the objectives of BNP Paribas' business and oversees their implementation... | bnp paribas tcfd report 2020.pdf |
7 Through his positions, Jean-Laurent Bonnafé, Director and Chief Executive of BNP Paribas, has fully engaged the Group in the financing of the energy transition and the fight against climate change. His earnest belief in the importance of climate related issues can be seen in a variety of press articles and his own Li... | bnp paribas tcfd report 2020.pdf |
8 TCFD REPORT 2020THE BOARD OF DIRECTORS VALIDATES THE VARIABLE COMPENSATION GRANTED TO COR-PORATE OFFICERS, BASED IN PART ON THE GROUP'S CSR PERFORMANCE (INCLUDING ON CLIMATE) The compensation paid to corporate officers includes an annual variable component asso-ciated with criteria that are representative of the Grou... | bnp paribas tcfd report 2020.pdf |
9 THE EXECUTIVE CORPORATE OFFICERS DETERMINE THE GROUP'S CLIMATE POLICY AND OVERSEES ITS PERFORMANCE For climate related risks and opportunities in all fields, the Director and Chief Executive and the Chief Operating Officer submit a strategy proposal to the Board of Directors, then subsequently oversee the management ... | bnp paribas tcfd report 2020.pdf |
10 TCFD REPORT 2020GOVERNANCE OF CLIMATE RELATED ISSUES The Environment and Energy Transition team, created in 2018, is in charge of helping all the business lines seize the business opportunities associated with the climate and the energy transition. It works continuously with the Func-tions and the business lines thr... | bnp paribas tcfd report 2020.pdf |
11 THE OPERATIONAL ENTITIES AND THE RISK FUNCTION (RISK) ARE RESPONSIBLE FOR MANAGING RISKS, INCLUDING CLIMATE RELATED RISKS In accordance with the internal organisation of the permanent control framework, the operational entities form the first line of defence. They comprise the primary contributors to the permanent c... | bnp paribas tcfd report 2020.pdf |
12 RAPPORT TCFD 20202 STRATEGY INCORPORATING CLIMATE RELATED ISSUES INTO STRATEGY AND GROUP ACTIVITIES | bnp paribas tcfd report 2020.pdf |
13 The direct and indirect consequences of climate change for BNP Paribas are significant. The associated risks and opportunities, continuously analysed, are taken into account in the Group's strategy, in its operations and in each of its business lines: corporate and investment banking, retail and specialised banking,... | bnp paribas tcfd report 2020.pdf |
14 TCFD REPORT 2020INCORPORATING CLIMATE RELATED ISSUES INTO STRATEGY AND GROUP ACTIVITIES For several years now, BNP Paribas has undertaken to examine the various implications of climate change for its business in increasingly greater detail. This analysis is rooted in a double-materiality perspective (illustrated in ... | bnp paribas tcfd report 2020.pdf |
15 2. 1 GLOBAL WARMING AND ITS RELATED TURMOILS REPRESENT RISK FACTORS THAT AFFECT ALL OF THE BANK'S ACTIVITIES As specified in Chapter 5 of the 2020 Universal Registration Document and Annual Financial Report, “The BNP Paribas Group could experience business disruption and losses due to climate change risks such as tr... | bnp paribas tcfd report 2020.pdf |
16 TCFD REPORT 2020VARIOUS RISK FACTORS STEM FROM THE NECESSARY ENERGY AND ECOLO-GICAL TRANSITION The quantitative analyses conducted, based on expert appraisals, led to the identification of the main climatere-lated transition risks for BNP Paribas. They are presented in Table 1. An indication of the time frame in whi... | bnp paribas tcfd report 2020.pdf |
17 Table 3 | Some of the main climate related opportunities for BNP Paribas It is BNP Paribas' ambition to be able to offer all its customers, spanning all business lines and countries of operation, a range of products and services to help them achieve their own energy transition. For Jean-Laurent Bonnafé, “ the energy... | bnp paribas tcfd report 2020.pdf |
18 TCFD REPORT 2020 BNP PARIBAS INCORPORATES THESE RISKS AND OPPORTUNITIES IN ITS STRATEGY AND ACTIVITIES2. 2 Figure 5 | Incorporation of climate related issues by BNP Paribas The considerable challenges posed by climate change are factored in at all levels and in all businesses conducted by the company. Figure 5 below... | bnp paribas tcfd report 2020.pdf |
19 The Group's ambition with respect to the challenges of climate change is to align all its activities with the goals of the Paris Agreement. At Group level, this ambition takes multiple forms: BNP Paribas joins the Net Zero Banking Alliance and align greenhouse gas emissions arising from its credit and invest-ment fo... | bnp paribas tcfd report 2020.pdf |
20 TCFD REPORT 2020BNP PARIBAS IS ADAPTING ITS ORGANISATIONAL STRUCTURE AND HAS CREATED DEDICATED TEAMS IN ITS VARIOUS OPERATIONS Over the last decade, BNP Paribas has created several dedicated teams in different countries and business lines, tasked with capturing opportunities associated with the energy transition and... | bnp paribas tcfd report 2020.pdf |
21 BNP PARIBAS TAKES PUBLIC POSITIONS AND COMMITS TO COLLECTIVE INITIATIVES BNP Paribas draws on a general strategic framework for all its climate initiatives, both to reduce its direct impacts and to take action alongside its customers. The Paris Agreement states that, in order to limit the increase in global average ... | bnp paribas tcfd report 2020.pdf |
22 TCFD REPORT 2020THE GROUP IS IMPLEMENTING ITS EXIT STRATEGY FROM THE THERMAL COAL SECTOR AND HAS DISCONTINUED RELATIONS WITH ENTITIES SPECIALISING IN UNCONVENTIONAL OIL AND GAS In terms of thermal coal, the Group has set an exit deadline, in line with the SDS (Sustainable Development Scenario) of the International E... | bnp paribas tcfd report 2020.pdf |
23 In the Corporate and Institutional Banking division, the strategy is employed to direct its efforts to fund the economy towards supporting the energy transition: BNP Paribas commits to reducing its support for oil and gas exploration and production; BNP Paribas funds the development of renewable energies; BNP Pariba... | bnp paribas tcfd report 2020.pdf |
24 TCFD REPORT 2020 15 | Widely promoted by Muhammad Yunus, a pioneer in microcredit, the am of Social Businesses is to provide a solution to social and environmental problems while remaining economically sustainable, no matter what their legal status (non-profit, cooperative, corporation, etc. ). BNP PARIBAS SUPPORTS ... | bnp paribas tcfd report 2020.pdf |
25 BNP PARIBAS SUPPORTS SMES AND ISES IN THEIR ENERGY TRANSITION In France, French Retail Banking (BDDF) provides all Corporate Customers with solutions to help them with their ecological and energy transition. A comprehensive range of solutions, listed in a Green Book, was co-built with the Group's other business line... | bnp paribas tcfd report 2020.pdf |
26 TCFD REPORT 2020ARVAL AND BNP PARIBAS LEASING SOLUTIONS CONTRIBUTE TO THE DEVELOPMENT OF SUSTAINABLE MOBILITY SOLUTIONS Arval, BNP Paribas' subsidiary specialising in car leasing and mobility, made sustainability the cornerstone of its 2020-2025 strategic plan, “Arval Beyond”, launching two new offers: 360° Mobility... | bnp paribas tcfd report 2020.pdf |
27 A third business division encompasses the Group's investment and protection services: BNP Paribas Asset Management, BNP Paribas Wealth Management, BNP Paribas Real Estate and BNP Paribas Cardif. Each of these entities, in accordance with its own specific conditions, deploys initiatives to incorporate climate related... | bnp paribas tcfd report 2020.pdf |
28 TCFD REPORT 2020For non-financial analysis purposes, BNP Paribas Cardif also collects ESG data specific to each asset class, which are then included in its portfolio management processes. To that end, BNP Paribas Cardif subjects the companies in its investment universe to carbon screening. Companies are ranked accor... | bnp paribas tcfd report 2020.pdf |
29 ENGAGING WITH ISSUERS TO INFLUENCE THEIR ENERGY TRANSITION BNP Paribas Asset Management uses its voting rights to influence the energy transition of portfo-lio companies In line with its climate change strategy, BNP Paribas Asset Management adapted its voting policy, and reserves the right to abstain from voting to ... | bnp paribas tcfd report 2020.pdf |
30 TCFD REPORT 2020BNP PARIBAS PROVIDES ITS CUSTOMERS WITH GREEN INVESTMENT OPTIONS BNP Paribas Asset Management offers a wide range of green funds, invested predominantly in alternative energies and energy efficiency, totalling €18. 4 billion in assets under management at 31 December 2020. BNP Paribas Asset Management... | bnp paribas tcfd report 2020.pdf |
31 BNP PARIBAS REAL ESTATE IS DEVELOPING A HIGH ENERGY PERFORMANCE REAL ESTATE OFFER 100% of BNP Paribas Real Estate's commercial real estate business has obtained environmental certification (through the two highest certification standards in the industry), and the company is now in the Top 2% of all firms in the real... | bnp paribas tcfd report 2020.pdf |
32 TCFD REPORT 2020BNP Paribas also factors in climate change within its own scope of operations: BNP Paribas conducts a voluntary policy aimed at reducing its GHG emissions and has been carbon-neutral in its operational scope since 2017; BNP Paribas supports the soft mobility of its employees; BNP Paribas raises emplo... | bnp paribas tcfd report 2020.pdf |
33 Climate change is generating sizeable impacts on human activities and affecting all economies, business sectors and geographic areas over the short, medium and long term. They are also highly uncertain, as demonstrated by the wide variety of scenarios defined to describe the potential consequences in the decades to ... | bnp paribas tcfd report 2020.pdf |
34 RAPPORT TCFD 20203 RISK MANAGEMENT IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS | bnp paribas tcfd report 2020.pdf |
35 Management of risks associated with the climate and the energy transition is incorporated in BNP Paribas' risk management framework. The framework is gradually being expanded to include advancements in methodologies used to analyse climate related risk factors and transmission channels as well as interactions with t... | bnp paribas tcfd report 2020.pdf |
36 TCFD REPORT 20203. 1 PROCESS USED TO IDENTIFY AND ANALYSE CLIMATE RELATED RISKS FOUR ENVIRONMENTAL RISK FACTORS ARE USED TO INCLUDE CLIMATE CONSIDERATIONS IN THE RISK IDENTIFICATION PROCESS BNP Paribas incorporates environmental and climate related risk factors in its risk identification process. This process, detai... | bnp paribas tcfd report 2020.pdf |
37 In this process, four environmental risk factors may be chosen as likely to affect BNP Paribas' financial or non-financial risks (commercial risk, credit risk, strategic risk, operational risk, etc. ): PHYSICAL IMPACT OF CLIMATE CHANGE ECONOMIC TRANSITION DUE TO CLIMATE CHANGE LIABILITY CONSEQUENCES OF CLIMATE CHANG... | bnp paribas tcfd report 2020.pdf |
38 TCFD REPORT 2020IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS Of these risks, some have been clarified, based on expert appraisals, by more precisely describing how they are liable to affect different Group activities: TRANSITION RISKS strategic and commercial risks associated with: the decrease... | bnp paribas tcfd report 2020.pdf |
39 IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS RISK ANTICIPATION EXERCISES, SERVING AS A BASIS FOR THE RISK IDENTIFICATION PROCESS, COVERS CLIMATE RELATED RISKS For several years now, the Group Risk Function's Industry and Sector Research Team (“EIS”) has conducted analyses aimed at forecasting t... | bnp paribas tcfd report 2020.pdf |
40 TCFD REPORT 2020IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS Climate related risk factors are liable, for example, to affect the quality of a country's business environment and its creditworthiness as a sovereign issuer. One of the limits of this approach is the risk of duplicate accounting of ... | bnp paribas tcfd report 2020.pdf |
41 IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS CLIMATE RELATED FACTORS ARE INCLUDED IN THE SCENARIOS USED TO ASSESS THE ROBUSTNESS OF THE BANK'S ACTIVITY IN RESPONSE TO VARIOUS SHOCKS Scenario-based analysis is an integral part of the Bank's risk management and financial oversight system. In 2017... | bnp paribas tcfd report 2020.pdf |
42 TCFD REPORT 2020IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS BNP PARIBAS CONTRIBUTES TO THE COLLEC-TIVE DEVELOPMENT OF CLIMATE RELATED RISK AND SCENARIO METHODOLOGIES Regulatory authorities and central banks in different countries organise pilot programmes aimed at testing methodologies used to... | bnp paribas tcfd report 2020.pdf |
43 Furthermore, alongside these two initiatives, BNP Paribas participates in the exercises orga-nised by the Climate Financial Risk Forum (CFRF), launched by the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) in 2019. The CFRF is comprised of financial institutions (banks, insurance com... | bnp paribas tcfd report 2020.pdf |
44 TCFD REPORT 2020IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS The consolidated assessment of climate related risk factors weighing on diversified portfolios still raises challenges in terms of methodologies and data availability. BNP Paribas and its subsidiaries are testing multiple avenues alon... | bnp paribas tcfd report 2020.pdf |
45 IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS Figure 15 | Example of representations of climate related risks impacting the loan book This assessment was used to assign physical risk scores to around 1,700 cus-tomers representing €200 billion in outstanding loans. The majority of the sample pres... | bnp paribas tcfd report 2020.pdf |
46 TCFD REPORT 2020IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS This assessment also serves to identify the cli-mate hazards that generate the greatest risk for BNP Paribas Cardif portfolios. Figure 17 presents the average score of companies in the portfolio of stocks and bonds directly held by BN... | bnp paribas tcfd report 2020.pdf |
47 3. 2 CLIMATE RELATED RISK MANAGEMENT PROCESS AND INCORPORATION IN OVERALL RISK MANAGEMENT BNP PARIBAS HAS TAKEN SEVERAL INITIATIVES TO INCORPORATE CLIMATE RELATED RISK FACTORS IN ITS RISK MANAGEMENT FRAMEWORK In 2012, BNP Paribas began launching multiple initiatives to incorporate climate related risk factors in its... | bnp paribas tcfd report 2020.pdf |
48 TCFD REPORT 2020IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS CLIMATE RELATED RISK FACTORS ARE INCLUDED IN BNP PARIBAS' OVERALL RISK IDENTIFICATION PROCESS Through its risk identification process, the RISK Function identifies and assesses the impact of climate and energy-related risk factors. In... | bnp paribas tcfd report 2020.pdf |
49 IDENTIFICATION, ASSESSMENT AND MANAGEMENT OF CLIMATE RELATED RISKS ENHANCEMENT OF THE GROUP'S ESG FRAMEWORK WAS STRUCTURED UNDER A MUL-TI-YEAR PROGRAMME, THE ESG ACTION PLAN, UNDER THE RESPONSIBILITY OF TWO MEMBERS OF THE GROUP EXECUTIVE COMMITTEE In 2020, the Bank further strengthened the Group ESG strategy by laun... | bnp paribas tcfd report 2020.pdf |
50 RAPPORT TCFD 20204 METRICS AND TARGETS USED TO ASSESS AND MANAGE CLIMATE RELATED RISKS AND OPPORTUNITIES | bnp paribas tcfd report 2020.pdf |
51 Incorporation of climate related issues in the strategy, offer, risk management and, in general, all activities of BNP Paribas relies on the definition and establishment of metrics. These metrics, chosen not only to measure the impacts of the Group's activity on climate change and the efforts it makes to reduce thes... | bnp paribas tcfd report 2020.pdf |
52 TCFD REPORT 20204. 1 BNP PARIBAS HAS ESTABLISHED METRICS TO ASSESS, MONITOR AND OVERSEE CLIMATE RELATED ISSUES BNP PARIBAS APPLIES THE PACTA METHODOLOGY FOR MEASURING THE ALIGNMENT OF ITS LOAN BOOK WITH THE GOALS OF THE PARIS AGREEMENT Since 2018, the Group has agreed, as a founding member and contributor, in conjun... | bnp paribas tcfd report 2020.pdf |
53 BNP PARIBAS MEASURES AND PUBLISHES THE ELECTRICITY AND ENERGY MIXES FINANCED BY THE GROUP AND THEIR CARBON INTENSITY By applying the PACTA methodology to the portfolio of loans issued to corporates in the electricity sec-tor, the Bank was able to calculate two alignment measurement indicators. These calculations app... | bnp paribas tcfd report 2020.pdf |
54 TCFD REPORT 2020BNP PARIBAS CARDIF APPLIES VARIOUS CLIMATE RELATED INDICATORS TO ITS INVESTMENT PORTFOLIOS BNP Paribas Cardif also publishes multiple reporting indicators on its invest-ment portfolio, listed in Table 4. They are presented and developed in detail in the report covering its Responsible Investment Stra... | bnp paribas tcfd report 2020.pdf |
55 In its various business lines, BNP Paribas measures the deployment of products and services developed to help its customers achieve their own energy and eco-logical transition. 4. 1. 3. BNP PARIBAS MEASURES ITS CONTRIBUTION TO THE ENERGY TRANSITION OF ITS CUSTOMERSMETRICS AND TARGETS THIS YEAR IN CORPORATE AND INSTI... | bnp paribas tcfd report 2020.pdf |
56 TCFD REPORT 2020 63,8% Electricity 7,6% Air travel 13,1% Natural gas 10,2% Road travel 3,1% Disctrict heating 0,8% Rail travel 1% Fuel oil 0,4% District cooling Divided by the Group's total headcount, GHG emissions came out at 1. 8 teq CO2/FTE in 2020, down 23% versus 2019 and more than 40% versus 2012 (Table 6). Th... | bnp paribas tcfd report 2020.pdf |
57 The Group: supports and implements the recommendations of the Task Force on Climate related Financial Disclosures (TCFD) and publishes information in line with these recommendations. In addition to this report, a summary of these disclosures, entitled, “Climate related issues management summary”, is provided in Sect... | bnp paribas tcfd report 2020.pdf |
58 TCFD REPORT 20204. 2 BNP PARIBAS HAS SET QUANTITATIVE TARGETS FOR THE PURPOSE OF MANAGING CLIMATE RELATED RISKS AND OPPORTUNITIES To strengthen its ambition to align its activities with the objectives of the Paris Agreement, BNP Paribas decided in April 2021 to join the Net Zero Banking Alliance Net Zero Banking All... | bnp paribas tcfd report 2020.pdf |
59 4. 3 SUMMARY OF KEY METRICS AND TARGETS Below, Table 7 recaps the key metrics and targets used by BNP Paribas to monitor and oversee its management of climate related issues. DIVISION METRICS SCOPE 2019 VALUE2020 VALUEUNIT TARGET CORPORATE AND INSTITUTIONAL BANKINGAlignment of credit and investment for own account a... | bnp paribas tcfd report 2020.pdf |
60 TCFD REPORT 2020 | bnp paribas tcfd report 2020.pdf |
61 CONCLUSION As a leading bank in Europe, boasting nearly 200,000 em-ployees and a major contributor to the funding of the global economy, BNP Paribas has been actively involved in the col-lective response to the challenges of climate change for more than 10 years. Preparing this TCFD report is a key component of its ... | bnp paribas tcfd report 2020.pdf |
62 TCFD REPORT 2020 | bnp paribas tcfd report 2020.pdf |
63 GLOSSARY 2DS: 2 Degree Scenario ACPR: Autorité de Contrôle Prudentiel et de Résolution (French Prudential Supervisory and Resolution Authority) AM: Asset Management AMF: Autorité des marchés financiers (French Financial Markets Authority) BDDF: Banque de détail en France (French Retail Banking) BNL: Banca Nazionale ... | bnp paribas tcfd report 2020.pdf |
PHOTOS CREDITS BNP Paribas Group Damien Grenon (p 7), Arval Photostock (p 26), BNP Paribas Group Communication Studio (p 6), Real Estate Photostock (p 30-31), BNP Paribas Photostock (p 57) Shutterstock p 9, p 62 Unsplash Joel Arbaje (Cover, Back cover), Philippe Bou-rhis (p 2, p 4-5) Dan Meyers (p 2, p 12-13), Karsten ... | bnp paribas tcfd report 2020.pdf |
TABLE OF CONTENTS INTRODUCTION ................................................................................................................................................................................................................................................................................ 3 1. GOVERNANCE ... | bnp paribas tcfd report 2020.pdf |
The bank for a changing world Ref: TCFD_2020_BNPP_EN | bnp paribas tcfd report 2020.pdf |
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