BDO and its commitment to sustainability
BDO Unibank has been incorporating Environmental, Social, and Governance (ESG) in the way it conducts business as an organization and as a bank committed to sustainability.
From the social impact projects of the BDO Foundation for communities where the Bank operates, to financing renewable energy sources in support of national energy development targets, to strong governance that puts a premium on accountability, transparency, and integrity on the Board, BDO has strong ESG initiatives that were already in place long before sustainability became widespread.
ESG is well ingrained in BDO’s Sustainability Strategies: Product Sustainability, Sustainability Contribution, Human Capital, Disaster Response Sustainability, and Governance-based Sustainability.
Internally, the Bank’s Human Capital strategy focuses on Social as it relates to recruiting, retaining, and developing a diverse and inclusive workforce where everyone is valued for their contributions to the Bank’s success, and encouraged to have a sustainability mindset. Likewise, it includes providing a safe and healthy work environment for all employees to allow everyone to do their work well and at their best.
On the other hand, BDO’s Product Sustainability and Sustainability Contribution Strategies touch on both Environmental and Social as BDO ensures that its products and services have financial inclusion at their core, addressing the financial needs of almost half the country’s population who remain unbanked, and the underserved market.
Contributing to nation-building
The Bank contributes to national economic development not just through financial inclusion but also through financing of infrastructure, eco-friendly solutions, and clean and renewable energy sources.
Since 2010, the Bank’s Sustainable Finance Desk under the Institutional Banking Group has financed eligible business projects that pursue energy efficiency, green building, clean transportation, pollution prevention and control, sustainable management of natural resources and land use, eco-efficient technology, sustainable water and waste water management, terrestrial and aquatic biodiversity conservation, and climate change adaptation.
BDO’s Social and Environmental Management System Policy was developed in partnership with the International Finance Corporation (IFC) to categorize the risks of project proposals based on their environmental and social impact. IFC is a member of the World Bank Group and is the largest global development institution focused on the private sector in developing countries.
Meanwhile, BDO’s Disaster Response strategy addresses both Economic & Social issues and helps economic recovery in areas hard-hit by natural or man-made disasters.
The Bank’s other activities through the BDO Foundation, its corporate social responsibility arm, have profound Social Impact as well, from financial education across various sectors of society to fund raising for target communities, and donating test kits and vaccines in light of the COVID-19 pandemic.
The Bank’s Governance-based Sustainability strategy ensures that all its sustainability initiatives are aligned with business performance and managed and disclosed in an accountable and transparent manner.
Pioneering an ESG-themed fund
On the financial-side, the Bank’s foray into sustainable investments continues to pay dividends for the last five years since the instrument was first launched.
As of end-2020, the value of the assets under management of BDO’s environmental, social, and corporate governance-themed Unit Investment Trust Fund grew 79% to PhP99.4 million from P55.5 million in 2016.
When COVID-19 was declared a full blown pandemic in 2020, drastic health measures and social distancing protocols had to be implemented to mitigate the spread of the virus, including temporarily closing down businesses or cutting down on their manpower hours. This subsequently triggered a freefall in share prices in March 2020—wiping out Php1.6 trillion in market value in the local bourse on March 19, 2020 in the process.
Since that market plunge however, the BDO ESG UITF recovered dramatically, posting 19.90% returns in the past three months and 13.95% in the past six months ending in December 2020.
From Php55.5 million in 2016, the assets under management of BDO ESG UITF have grown steadily to Php60.1 million in 2017, Php66.6 million in 2018, Php75.2 million in 2019, and Php99.4 million in 2020.
The BDO ESG UITF followed a similar higher return performance shown by ESG funds globally, proving the importance of sustainable business practices. While the Fund is still small, it has the potential to grow in size and importance as more investors are consciously looking for companies that protect the environment, are socially responsible, and practice good governance in a sustainable manner.
The BDO ESG UITF was the first of its kind in the Philippines. It allows investors to see value in socially responsible companies as an investment destination for their funds, and to invest in one fund that covers several companies, instead of investing separately in every local company that they believe creates a positive contribution to society.
Its importance is further heightened during this time of the pandemic, as sustainable investment amplifies the Bank's resiliency to unforeseen global or local crises.
Embracing the New Normal. BDO personnel wear face masks and face shields—while also having disinfectants nearby—while at work.
Related Stories: