As the world grapples with urgent challenges like climate disruption and social inequality, the need for change has never been more apparent. It is increasingly clear that businesses have a vital role ‒ and even a responsibility ‒ to work towards a more sustainable and equitable future. This is where environmental, social and governance (ESG) comes into play.

ESG is a framework used to evaluate a company’s performance and impact across these three crucial areas, providing the public with insight into the operations of the companies that colour and shape the world around us.

HSBC has always been a firm believer in the importance of transparency and corporate responsibility. In recent years the bank has implemented a robust and comprehensive ESG strategy that positions it as a major player in the push for a more sustainable banking sector.

HSBC’s ESG strategy has seen the bank place a great emphasis on combating climate change, as well as helping its customers transition to more sustainable practice. The bank is already making significant strides in its energy transition, having committed to net-zero emissions by 2030. HSBC is also committed to aligning both financed and investment emissions to net-zero by 2050.

Moreover, HSBC plans to publish a comprehensive climate transition plan this year, implementing transition pathways and climate solutions across the entire group, including Malta. In addition to updating its energy policy, HSBC is actively participating in the phase-out of coal and investment in greener technologies.

At a local level, the HSBC Malta Foundation is working with the Malta Chamber of Commerce, Enterprise and Industry on a project entitled ‘Establishing a Framework for Net Zero Buildings in Malta’. The aim of this project is to guide Malta towards achieving its climate goals by tackling the building and construction sector, with particular focus on operational carbon, i.e. the emissions of carbon dioxide and other global warming gases during the in-use operation of a building.

HSBC is working towards building resilient communities

HSBC is also working towards building resilient communities. From a social perspective, the bank focuses on promoting resilience and inclusion among its employees, customers and the communities it serves. For employees, this means providing better support for their physical, mental and financial well-being, as well as equipping them with the right skills and knowledge during times of economic transformation and uncertainty.

For customers, HSBC prioritises promoting financial literacy and helping people make informed financial decisions for themselves and their loved ones. The bank is actively involved in projects with JA Malta, ĠEMMA (the National Financial Literacy Campaign), and the Prince’s Trust International Achieve Programme. Furthermore, the HSBC Malta Foundation is funding a three-year research project aimed at identifying current and future skills needed in information technology, communication, financial services, banking, and scientific and technical services.

From a governance perspective, HSBC is committed to ensuring integrity, conduct and fairness across all of its operations, while providing its customers with an efficient and transparent service. The bank is also conscious of its obligations when it comes to the handling of people’s data, both from a data privacy and cybersecurity perspective.

While sustainability reporting has become increasingly popular among companies worldwide, it is essential to back up these reports with a focus on key metrics and outcomes. To reduce and mitigate risks, HSBC incorporates ESG issues into its existing risk assessment frameworks and processes, both internally and externally. The bank establishes measures and risk tolerance levels, taking immediate action when necessary and maintaining regular interaction with all stakeholders.

HSBC has also expanded its efforts to help customers transition to more sustainable practices, launching its first green bond fund in 2019. In a world where concerns about the environment are at an all-time high, it is crucial for companies to take genuine action rather than simply adopting green slogans.

Recognising this, HSBC added greenwashing to its list of material risks last February, emphasising that while the shift to greener and more sustainable practices should be encouraged and supported, there would always be actors who look to undermine the cause for their own personal gain. While this will take time and considerable expertise, HSBC is committed to concentrating its efforts in areas that can bring about real change.

HSBC’s commitment to ESG extends beyond the impacts of sustainability issues on its business, encompassing the effects of the bank’s activities on society and the environment. By regularly releasing updates and reports on its progress, HSBC demonstrates that it is dedicated to fulfilling its responsibilities to society.

This unwavering commitment sets HSBC apart as a true leader in sustainable banking, paving the way for a future where businesses prioritise not only their own success but also the well-being of the planet and its inhabitants.

Glenn Bugeja is corporate responsibility manager, HSBC Bank Malta plc.