Banking & Sustainability: A Decade of Driving Change From Within

July 2, 2020 EcoVadis ‏‏‎

"In hindsight, the main difficulty over the past 10 years has been deploying a [sustainability] strategy in 72 countries, within entities that have contradictory priorities and issues. This is where our alignment with the Sustainable Development Goals proved to be powerful – due to its universality."

An Interview with Laurence Pessez, CSR Director of the BNP Paribas Group

After recently signing the United Nations Environment Program's (UNEP FI) Principles for Responsible Banking at the United Nations and the creation of a position to promote the conservation and sustainable use of the ocean, 2019 will undoubtedly be a productive year for the entire BNP Paribas Group's sustainability team – and especially its CSR Director, Laurence Pessez, who has worked in this position for 10 years.

How do you become a sustainability leader within a CAQ40 (index of top listed French companies) company, and what is your day-to-day role like?

Since the beginning of my career, I’ve focused on positive impact areas, whether it be within the Paris Hospitals, the La Poste group or the insurance sector. With this determination, I helped to create the Sustainability Department at BNP Paribas, taking over responsibility in 2010.

I’m convinced that sustainability is a strategic challenge as well as a source of opportunities, and I work to ensure that it is addressed at all levels of the bank. 

Thanks to the efforts made by my teams, sustainability has become a priority for BNP Paribas, as evidenced by the creation of the Corporate Commitment department in 2017 and by the bank's recent commitment to reduce its exposure to thermal coal to zero by 2030 in the European Union – and by 2040 for the rest of the world. 

These initiatives contribute directly to the current challenges set out in the United Nations' Sustainable Development Goals (SDGs): Eradicating poverty, protecting the planet and ensuring prosperity for all by 2030. Thanks to our position in the economy, we have the opportunity to act on all 17 SDGs. These major issues, which concern future generations, are exciting challenges.

How big is your sustainability team?  

The bank's sustainability commitments are carried out by the Corporate Commitment Department, who are represented on the Group’s Executive Committee.

The Sustainability Department is made up of a team of nearly 30 people, structured around several areas of expertise: Extra-financial risk management, positive impact financing, sustainability stakeholder relations and promotion of human rights, environment and energy transition, microfinance and social entrepreneurship and, finally, communication and management of the emergency and development fund. 

Our team is supported by a network of around 130 sustainability professionals, who work in divisions, business lines, and networks to facilitate the deployment of the sustainability policy throughout the Group. 

Of course, this does not include all of the bank's 202,000 employees, whom we also encourage to take action on such issues. 

The people who created this organization have built a deeper awareness as our responsibilities for environmental and societal issues have expanded. All are recognized experts in their fields of specialization, and the entire team is now a reference in the company. 

What are the company’s sustainability milestones within the past ten years?

The need to meet society’s expectations of major financial institutions and banks has gone from a "nice to have" to an imperative need.

Prior to 2015 and COP 21, sustainability and corporate responsibility (CSR) was mostly considered a “voluntary” initiative which the BNP Paribas Group, free to scale its ambitions, was already committed to. We were also committed to raising awareness internally: We did so first in financing and investment policies in the defense sector and palm oil (2010), then integrating extra-financial criteria in the bonus calculation of 5,000 BNP Paribas managers (2013). 

For the first time, in the 2014-2016 Strategic Plan, BNP Paribas committed to developing as a responsible bank. Thus, 2015 marked a turning point: support and commitment from Executive Management on environmental and social issues, numerous discussions at the level of the Group's Executive Committee and exchanges between our Chief Executive Officer and our clients. It was also the year that the 17 United Nations Sustainable Development Goals (SDGs) were created. BNP Paribas was one of the first companies in France to explicitly mention SDGs in the definition of its sustainability strategy.

2015 also marked our entry into the Corporate Knights Global 100, one of the most internationally recognized sustainability indices. 

Since 2017 and the creation of the Corporate Commitment Department, our actions and commitments have been building in all areas.

Among the bank's flagship accomplishments, we can cite the achievement of carbon neutrality for our operational perimeter in 2017, and the publication of the Responsible Commercial Relations Charter in 2018, through which BNP Paribas demonstrates its desire to work with the top sustainability-performing companies. In the same year, our Group also contributed to the creation of the Principles for Responsible Banking, which were officially signed in 2019 alongside 130 other banks, with the aim of aligning business strategies with the UN's SDGs and the Paris Agreement. 

More recently, the Bank has announced the dates for exiting the coal sector, as well as its entry into the Collective Commitment to Climate Action. It has also committed to finance the ecological transition of merchant navy ships to the tune of €1 billion by 2025. 

In July 2019, BNP Paribas was named "The World's Best Bank for Corporate Responsibility" by Euromoney, a leading publication in international finance, and was named the world's best bank in terms of ESG (environmental, social and governance) responsibility by Capital Finance International (CFI.co).

In conclusion, the main difficulty over these 10 years has been deploying a sustainability strategy in 72 countries, within entities that have contradictory priorities and issues. This is where alignment with the Sustainable Development Goals proved to be powerful – due to its universality. 

By financing all sectors of activity, the Bank is one of the few economic players that has the privilege of contributing to all 17 objectives. In fact, the Group has decided to include them in its sustainability performance indicators. This is an innovative mechanism that reflects the Bank's strong commitment to SDGs, recognized by the UN as a best practice. At the end of 2018, BNP Paribas had allocated € 168 billion of financing to sectors considered to contribute directly to SDGs, and the goal is to increase this amount by € 10 billion per year.

Over this decade, what major changes have you noticed in the practice of your profession?

I would say that it is the diversification of stakeholders that challenges us on a daily basis. This situation is not unique to the banking sector.

For a long time, large companies and CSR departments were only questioned by NGOs and trade unions, and then by their long-term investors, such as pension funds and insurance companies, particularly with regard to social and climate risks. Then the requests came from clients in all segments, from business to business, but also from the general public. 

Today, employees are also in demand and can even be proactive. Within our Group, the decision in 2017 to end financing and investment activities relating to tobacco companies, for example, was initiated and driven by employees.

Even more recently, students and the younger generation are taking action on social and environmental issues (more than 30,000 signatories of the Student Manifesto for an ecological awakening). Finally, sustainability is now a major and strategic subject and is becoming more regulated with, for example, the law on the duty of care of multinationals in France, the Modern Slavery Act in the U.K. or the European Commission's work on taxonomy, which aims to define activities contributing to the energy transition. 

This is good news for all sustainability departments who can work with increasingly credible contacts who are close to our businesses.

A word about EcoVadis in conclusion?

We asked to be rated by EcoVadis for the first time in 2010. 

The EcoVadis rating allowed us to measure our performance as a responsible supplier in areas including the environment, purchasing decision, working conditions and human rights, and business ethics.

In our opinion, this evaluation has become even more relevant, since it addresses material issues for our customers and prospects. EcoVadis shapes their questionnaire according to their customer.  

Some of our subsidiaries or very specific business lines have their own EcoVadis rating, such as Arval, our long-term vehicle rental subsidiary, or BNP Paribas Real Estate, our real estate subsidiary. In 2019, Arval obtained a score of 70/100, earning it a "Gold" level of recognition. 

For BNP Paribas, the EcoVadis platform is a valuable interface with our customers and prospects. They have access to the results of the Group and its entities, its scores and a detailed report on its performance in the various themes. To date, around sixty clients and prospects have been added to the Group's EcoVadis network (the list of companies with whom we share access to our profile).

The interface enables the centralization of a certain amount of information useful to customers in the context of calls for tenders. It allows our sustainability and sales teams to save significant time. And, finally, it is an important business vector insofar as BNP Paribas' ongoing involvement in its annual assessment and rating enables it to stand out as a responsible supplier, committed to a deep and structured approach to sustainability. 

Your recent fund raising to accelerate the platform's international development is excellent news: Our calls for tenders are international and our major prospects are outside France. EcoVadis thus remains an independent french player specialized in corporate and sustainability ratings.

This interview was originally published in French and is also available in German.

About the Author

EcoVadis ‏‏‎

EcoVadis is the world’s most trusted provider of business sustainability ratings, intelligence and collaborative performance improvement tools for global supply chains. Backed by a powerful technology platform and a global team of domain experts, EcoVadis’ easy-to-use and actionable sustainability scorecards provide detailed insight into environmental, social and ethical risks across 200+ purchasing categories and 160+ countries.

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