an emerging economy experience...334.5% 2006 34.8% 33.7% 2007* 28.67% 20.3% patrimônio (r$ m) 3.1...
TRANSCRIPT
An Emerging EconomyExperience
Seminario Sector Financiero Mexicano Y Medio Ambiente
Cris Ronza
Where is the catfish?
The New York Times
International Herald Tribune
Government
Unhappy with Brazil’s anemic rate of growth,President Luiz Inácio Lula da Silva has made thezeconomy the top priority of his second term, whichbegan in January. Large public works projects,including the dams here on the Madeira River areincluding the dams here on the Madeira River, areenvisioned as one of the best ways to stimulate growth.“Who dumped this catfish in my lap?” was thepresident’s irate complaint when he learned recentlythat the government’s environmental agency hadrefused to license the dam projects, according torefused to license the dam projects, according toBrazilian news reports.
NGOs
NGOs
“Public Banks, such as theEuropean Investment Bank,which already has Odebrechtamong its Brazilian clients, asamong its Brazilian clients, aswell as the World Bank and theIDB, must meet certainsafeguards and considerations
i h iconcerning the socio-environmental risks that shouldbe considered in the financingof such projects with enormousp jimpacts on the Amazonregion.”
What Financial Institutions have to do with it?
Reputation risk
Shareholder risk
Credit risk: default
Collateral: depreciated assets
I t d dInterdependency & Engagement
Interdependency
E l
ClientGovernment
Employees
Banco Real
Shareholder
Investors
Banco Real
Union
MediaCommunity
S liSuppliers
Environment
L diChallenges and Lessons
Leadingby We don’t have all the answers but weby
ExampleWe don t have all the answers, but we are not afraid of questions. We have to discuss the issues
Integrate social and environmental aspects into our products, processes and policies
Coherence and interdependence
Invest in the education and engagement f ll ff bof all staff members
From risk to opportunity
Business consistentwith Sustainable DevelopmentBusiness consistent
Interacts withCore Business•Suppliers•Diversity•Sustainability Report•Ecoefficiency
•Social and environmental risk policy•Social and environmental products •Ecoefficiency
•Social Investment•Social & environmental training & education
products•Responsible Investment funds•Microcredit
CredibilitMarket Management
Credibility Social Action
Does it work?
Social and EnvironmentalEnvironmentalRiskRisk5,000 companies screened
Cl d l i hi i h 46Closed relationship with 46 clients (more than 46 new clients)
More than 3,000 managers and financial analysts were trained
Equator PrinciplesEquator Principles
S i l d
Does it work?
Social and Environmental
FinancingRecent partnership with IFC (US$200 million credit line) and
A process of continual growth
(US$200 million credit line) and BNDES
Facilities for companies: water treatment renewable energytreatment, renewable energy, power efficiency
Social and Environmental financing portfolio in 2006:a c g po t o o 006:
8,351 loansUS$ 78,3 million
Biodiesel Sustainable Business
and Wind PowerFi d 4 i d k (199 3 MW h t
In the past 24 months, ABN AMRO Real has:
Financed 4 wind parks (199.3 MW – enough to meet the needs of 4 million people)
Financed biodiesel plants, with the capacity to meet 25% of the domestic market
Supported projects that allowed the creation of approximately 70 000 new direct and indirectapproximately 70,000 new direct and indirect jobs
Sustainable Business
Carbon Credits
• First financial institution to close carbon credit transactions in Brazil
• Leader financial institution in number of deals
S liDoes it work?
SuppliersFrom 15 suppliers in 2001 to 150 suppliers in 2006
Social and environmental criteria in selection and management of suppliers
Ethical FundDoes it work?
Ethical Fund
2001 2002 2003 2004
Fundo Ethical II 12.2% 1.6% 67.5% 35.9%
IBVSP Medio 11.3% -17.6% 97.0% 17.8%
2005
26.6%
27.1%
2001-2007 return
469.60%
334.5%
2006
34.8%
33.7%
2007*
28.67%
20.3%
Patrimônio (R$ M) 3.1 14.7 33 75.2 105.5
** 2001-2007
187.7 631.8
*August
Sustainability Index
Engage stakeholders to build together
• Equator PrinciplesEquator Principles Version 2
• Unibanco, Bradesco, Banco do Brasil, Itaú, , ,Itaú BBA
• Workshop 50 FI
Does it work?
74 Efficiency and performance35
i 2006 & 2007
74Awards Sustainability28
in 2006 & 2007 Human Resources + Marketing11Sustainable Emerging Markets Bank of the Year
Challenges and Lessons
Succeed,,doing the right things
the right waythe right way