BNP Paribas

RATING

SECTOR

Banking

WEBSITE

CONTACT

16, bd des Italiens
75009 Paris

Tel: 00 33 157 082 200

STOCK EXCHANGE

LISTING

EMPLOYEES

202,876

CHIEF SUSTAINABILITY OFFICER

Hervé Duteil

AWARDS

  • Bank of the Year for Sustainable Finance
  • #1 in France in terms of certified SRI

CONTENT SOURCE

FURTHER READING

Report created by Ellie Weiss

BNP Paribas

SECTIONS :  Sustainability Targets   Evaluation  •  Key Points  •  Overview

Company Activity

BNP Paribas is a French international banking group. They were founded in 1822 and are based out of Paris, France. They are the world’s 8th largest bank, by total assets, and currently work in 72 different countries. In 2000, Banque Nationale de Paris (BNP) merged with Paribas to form one of the three major international banks in France.

The bank works in Retail Banking and Services, and Corporate Institutional Banking. The Retail Banking and Services sector is in charge of retail banking networks and specialized financial services. The Corporate Institutional Banking sector provides financial solutions to corporate and institutional clients.

Company Sustainability Activity

BNP Paribas states its mission is to contribute to a responsible and sustainable economy by financing and advising clients according to the highest ethical standards. They work to align with the UN Sustainable Development Goals (SDGs), Principles for Responsible Banking (PRB), and Principles for Responsible Investments (PRI). The bank commits to economic, social, civic, and environmental responsibilities by being an innovative leader in sustainable finance. 

An important part of the company’s sustainability activity is encouraging responsible and inclusive growth while respecting the environment:

  • They have developed innovative investment solutions to help customers make ‘positive impact’ choices, focusing on growth sectors of the future
  • They helped combat COVID-19 with voluntary grants reaching €55 million, aiding hospitals and vulnerable individuals

The bank also conducts internal and external programs to combat inequalities:

  • They actively promote diversity and an inclusive environment
  • They have put in place solutions like microfinance for the financial inclusion of women, young people, entrepreneurs, and the underprivileged, reaching more equitable economic growth

BNP Paribas was also dedicated in its response to the effects of COVID on the wider community:

  • Close dialogue with professionals and small business clients to speed up the handling of urgent issues
  • Rolling out cash flow solutions to meet companies’ short-term funding needs
  • Postponing repayment and rescheduling loans
  • Activated an aid plan of €55 million, distributed to hospitals, research, and those that are vulnerable and disadvantaged

Being a leader in sustainable finance:

  • The significant contribution of €15.9 billion in 2019 towards the financing of renewable energies, making them the leader in Europe
  • Stopped financing coal-fired power-plant projects in 2017
  • Stopped lending to clients to specialize in non-conventional hydrocarbons
  • In 2019 and 2020, committed to no longer have clients whose business related to thermal coal
  • Integrating ESG criteria into all operational processes
  • The company engagement department coordinated efforts in promoting environmental and social inclusion, focusing specifically on youth, social entrepreneurship, and local communities

Innovations:

  • €13.6 million digital customers in the Group’s retail-banking networks
  • €97 million monthly connections to mobile applications by customers of DM networks or digital banks
  • 150 projects using artificial intelligence are already operational or in development at IFS
  • Over 21 million electronic orders processed for customers at Global Markets (CIB)

Sustainable Economic Growth: 

  • €806 billion in customer loans (+5.2% versus 2018)
  • €1,123 billion assets under management by BNP Paribas Asset Management, BNP Paribas Cardif and BNP Paribas Real Estate Services
  • €8.2 billion in the net income Group share
  • €10.6 billion of procurement at Group level
  • €6.2 billion in signed Sustainability-Linked Loans

Contributing to Society: 

  • €5.9 billion in taxes paid by the Group worldwide
  • €1.9 billion in investments and financing granted to social enterprises
  • 310 collective agreements signed across the Group
  • Over 450,000 hours dedicated to solidarity initiatives by employees

myImpact:

  • BNP Paribas co-created a digital tool to build clients’ sustainable development preferences into the investment advice they receive
  • Increased Socially Responsible Investment mandate by almost 40%

Promoting employee professional development:

  • Digital, Data & Agile Academy: offers employees the opportunity to acquire, increase and/or deepen skills and expand their medium and long-term professional development prospects

Sustainable growth:

  • Helps companies improve their Environmental, Social, and Governance (ESG) performance by offering loans based on compliance with extra-financial criteria
  • Granted Masmovil the first leveraged Sustainability-Linked Loan (SLLS), these are positive impact loans that incentivize companies to improve their ESG performance
  • Allowed Masmovil to cover almost all of the Spanish population with a 3G and 4G optic fiber network
  • Global Sustainability Strategy: sets clear objectives grouped around the energy transition, environmental sustainability, and equality, and inclusive growth
  • Applying ESG criteria to all investment processes by 2020
  • Partnering with Arval to offer rental solutions for vehicle charging stations in Europe
  • Hydrogen Council: in 2020, BNP Paribas joined the Hydrogen Council which aims to promote the use of hydrogen as an accelerator of the energy transition
  • Circular economy: in 2019, they formed a joint-venture with 3stepIT which specializes in the lifecycle management of IT devices and offers solutions based around the circular economy

Contribution to society – more inclusive and equitable growth:

  • €6.2 billion towards SSE enterprises, €1.9 billion of which went to microfinance and social enterprises
  • Partnered with Grameen Creative Lab to create initiatives raising employee awareness regarding social business, training staff to enable them to make positive impacts on their businesses, and encouraging their engagement through pro bono legal advice for the Grameen Creative Lab teams and social businesses
    • Tilia: a website they created to provide support to caregivers of a family member who has lost autonomy in their daily activities
    • Tangata: a website that helps the disabled and caregivers access leisure activities
    • Act for Impact: an initiative launched with the aim of supporting 1/4 of new social entrepreneurs in France by the end of 2020 through banking advice and access to a network of partners, from which many successful startups have come
  • Inclusive growth: joined OECD’s Business for Inclusive Growth coalition, aiming to fight against inequality

Policies:

  • Progressive policies in financing and investment targeting palm oil, defense, and nuclear energy among others
  • New restrictive policy to fight deforestation in the Amazon and Cerrado regions
  • Participation in the Taskforce for Nature-related Financial Disclosures, pushing financial institutions to study their impact on biodiversity

BNP Paribas supports scientific research on climate in Arctic regions:

  • Partnered with Craig Lesson to create the film The Last Glaciers, seeking out scientists and experts to understand how and why glaciers are melting and the impact of the change on future generations
  • Launched Climate & Biodiversity Initiative: supporting research projects to increase scientific knowledge on interactions between climate change and biodiversity and building public awareness around these issues
  • Mobilized 27 research teams with a budget of €18 million and reaching more than 400,000 in awareness-raising efforts
  • Projects concerning melting of the permafrost and biodiversity effects
  • Partnered with the Swiss Polar Institute to support research projects in the field of extreme environments and polar research
  • Co-created the Polar Access Fund allowing young scientists to conduct research associated with global warming in polar regions

Sustainable finance key figures:

  • €10.8 billion green bonds structured and placed by BNP Paribas
  • €17.8 billion devoted to financing renewable energies
  • €188 billion in financing enterprises in favor of the energy transition and sectors considered to contribute directly to the UN SDGs

Highlights

  • Show responsible and inclusive growth through COVID-19 aid and more sustainable investing
  • Combats inequalities and promotes diversity with microfinance solutions for minorities
  • Aided in COVID-19 relief with donations and postponing repayments and loans
  • Lead in sustainable financing renewable energies and ending coal and power-plant support
  • Show innovation with tech development and support
  • Push for sustainable economic growth with SSLs
  • Contribute to society by supporting SSEs, creating multiple websites to support the community
  • Create policies that fight against unsustainable practices
  • Supports the research on climate change and biodiversity and raising awareness for Arctic regions

Targets

  • Complete coal-exit timetable (2030 for the EU and OECD countries, 2040 for the rest of the world)
  • Promoting useful innovation for clients:
    • Implement new customer journeys to meet the expanded range of needs and user habits
    • Develop simple, useful, and secure services for clients
    • Strengthen operational efficiency to provide a responsive, secure answer to client needs
    • Lead the transformation of business lines and strengthen teams’ agility and ability to innovate
  • Encouraging sustainable growth in the economy:
    • Consolidate financial performance and expand activities
    • Support clients’ growth and strong international presence 
    • Generate a positive impact through products and solutions 
    • Consolidate position as a major player in sustainable finance 
    • Build solutions with partners, start-ups, entrepreneurs, and intrapreneurs
  • Developing contribution to society:
    • Ensure best practices in ethics and compliance
    • Implement a fair and responsible HR policy for the Group’s employees
    • Adopt commitments supporting the energy transition
    • Promote a culture of diversity, equality, and inclusion in business lines and society
    • Develop support to regions and local communities through cultural and solidarity-based initiatives
 

Progress

  • Stopped financing coal-fired power-plant projects in 2017
  • Stopped lending to clients to specialize in non-conventional hydrocarbons
  • In 2019 and 2020, committed to no longer have clients whose business related to thermal coal
  • €806 billion in customer loans (+5.2% versus 2018)
  • Increased Socially Responsible Investment mandate by almost 40%

Certificates

UN Sustainable Development Goals

UN SDGs Compliance

SDG 3: Good Health and Well-Being

  • Helping combat COVID-19 with voluntary grants reaching €55 million, aiding hospitals and vulnerable and young people

SDG 5: Gender Equality

  • Putting in place solutions like microfinance for the financial inclusion of women, young people, entrepreneurs, and the underprivileged, reaching more equitable economic growth

SDG 7: Affordable and Clean Energy

  • The significant contribution of €15.9 billion in 2019 towards the financing of renewable energies, making them the leader in Europe
  • Stopped financing coal-fired power-plant projects in 2017
  • In 2019 and 2020, committed to no longer have clients whose business related to thermal coal
  • Integrating ESG criteria into all operational processes
  • Global Sustainability Strategy: sets clear objectives grouped around the energy transition, environmental sustainability, and equality, and inclusive growth
  • In 2020, BNP Paribas joined the Hydrogen Council which aims to promote the use of hydrogen as an accelerator of the energy transition
  • €17.8 billion devoted to financing renewable energies

SDG 8: Decent Work and Economic Growth

  • €806 billion in customer loans (+5.2% versus 2018) 
  • €1,123 billion assets under management by BNP Paribas Asset Management, BNP Paribas Cardif and BNP Paribas Real Estate Services
  • €8.2 billion in the net income Group share 
  • €10.6 billion of procurement at Group level 
  • €6.2 billion in signed Sustainability-Linked Loans
  • Digital, Data & Agile Academy: offers employees the opportunity to acquire, increase and/or deepen skills and expand their medium and long-term professional development prospects

SDG 9: Industry, Innovation and Infrastructure

  • 13.6 million digital customers in the Group’s retail-banking networks
  • 97 million monthly connections to mobile applications by customers of DM networks or digital banks
  • 150 projects using artificial intelligence are already operational or in development at IFS
  • Over 21 million electronic orders processed for customers at Global Markets (CIB)

SDG 10: Reduced Inequalities

  • Actively promotes diversity and an inclusive environment
  • Putting in place solutions like microfinance for the financial inclusion of women, young people, entrepreneurs, and the underprivileged, reaching more equitable economic growth
  • Inclusive growth: joined OECD’s Business for Inclusive Growth coalition, aiming to fight against inequality

SDG 11: Sustainable Cities and Communities

  • Developed innovative investment solutions to help customers make ‘positive impact’ choices, focusing on growth sectors of the future

SDG 12: Responsible Consumption and Production

  • Circular economy: in 2019, they formed a joint-venture with 3stepIT which specializes in the lifecycle management of IT devices and offers solutions based around the circular economy

SDG 13: Climate Action

  • Partnered with Craig Lesson to create the film The Last Glaciers, seeking out scientists and experts to understand how and why glaciers are melting and the impact of the change on future generations
  • Mobilized 27 research teams with a budget of €18 million and reaching more than 400,000 in awareness-raising efforts

SDG 15: Life on Land

  • Projects concerning melting of the permafrost and biodiversity effects
  • Co-created the Polar Access Fund allowing young scientists to conduct research associated with global warming in polar regions

SDG 16 Peace, Justice and Strong Institutions

  • Over 450,000 hours dedicated to solidarity initiatives by employees

SDG 17: Partnerships for the Goals

  • Co-created myImpact to build client’s sustainable development preferences into their investment advice they receive
  • Partnered with Grameen Creative Lab: creating initiatives to raise employee awareness regarding social business, training staff to enable them to make positive impacts on their businesses, and encouraging their engagement through pro bono legal advice for the Grameen Creative Lab teams and social businesses
  • Partnered with Arval to offer rental solutions for vehicle charging stations in Europe
 

Evaluation

BNP Paribas has many initiatives that cover a wide range of areas relating to sustainable development. They acknowledge the importance of and their alignment with the UN SDGs, however, it is not entirely clear how their actions specifically align with these goals.

They do not have many certifications to help give their initiatives credibility, nor do they have many notable ESG awards or listings besides DJSI.

In terms of reporting, they make an effort to focus on targets in areas like innovation, sustainable growth, and community support. Their reporting of progress is not nearly as thorough. 

The bank has been acknowledged as a leader in sustainable financing and SRI and is clearly investing a good amount of time and resources into being a responsible bank. They still have some room to improve on reporting past progress as well as taking on more projects relating to environmental sustainability.

Despite its efforts to complete coal-exit timetable (2030 for the EU and OECD countries, 2040 for the rest of the world), BNP Paribas has contributed $120.825 B in the fossil fuel industry since the adoption of the Park Agreement. 

Even more so, the bank has increased its investments in the industry by approximately 41% from 2019 to 2020 alone.

Therefore, the company has been rated a D.

Analyst Outlook: Neutral

BNP Paribas is on the road to sustainability as seen throughout its initiatives to transform its business operations.

However, the bank has a long way to go to becoming sustainable especially in regards to its significant and increasing contributions to the fossil fuel industry.

 

Key Points

  • Acknowledge but do not align their own initiatives with the UN SDGs
  • A strong amount of listings and awards, including some relating directly to sustainability
  • Few certifications, but many partnerships and collaborations
  • Little in terms of past progress reporting
  • Targets focusing on innovation, encouraging sustainable growth, and supporting a strong society
  • Have done a lot to help out, especially financially, in COVID-19 aid and relief
  • Multiple policies and initiatives to promote diversity and combat inequalities
  • Investing in renewable energies while divesting in nonrenewable ones
  • Supports research on climate change, biodiversity, and future effects in the Arctic region
Share this Post