Material Matters

We aim to provide a coherent story of our activities. The basis of this story is the materiality analysis which enables us to identify the most relevant and important topics for Garanti BBVA and its stakeholders, the material issues. Material issues are mainly determined based on stakeholder dialogue and are plotted in the materiality matrix. The topics defined within the materiality matrix form the basis of this report, as described in the ‘About This Report’ section.

We performed our first materiality analysis in 2013. As we want to make sure that we are always in line with the needs of our stakeholders and that the identified material issues are still the most important, we perform an update of our materiality analysis approximately once in every two years. The revision in the first quarter of 2017 formed the basis for our 2017 and 2018 reports. The last revision was finalized in 2019. As we brought our new analysis to completion, we once again listened to our internal and external stakeholders, and reviewed the connection between our corporate strategy and global trends which impact the banking sector.

As Garanti BBVA, we carried out a desk study where we gathered the available information shaped by the opinions of all our key internal and external stakeholders, and studied the trends, sectoral reports, reports of global banks, and advice by international professional organizations such as the UN Environment Program Finance Initiative (UNEP FI), Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB). On another front, we identified the topics taking into consideration the outputs from the task force that included the Strategic Planning and Responsible Banking Unit at the BBVA Group. Then, we conducted a comprehensive stakeholder analysis by reaching all key stakeholder groups via questionnaires and phone calls to gather their opinion. In the external trend analysis, we reviewed the priorities of initiatives which guide the business world and financial sector, such as the UN Sustainable Development Goals, UN Principles for Responsible Investments, the World Economic Forum’s Global Risks Report, Presidency of the Republic of Turkey Department of Strategy and 11th Development Plan, and UNEP FI Principles for Responsible Banking. Our external stakeholder analysis also incorporated reports issued by organizations active in the same sector, printed media and social media feedbacks to gain an insight into the perspective of the society and the sector, as well.

We included the view of a senior executive who is directly reporting to our Board of Directors and the CEO. The senior executive evaluated the topics according to the five-year corporate strategy and topics’ risk and opportunity areas as well as their operational, reputational, strategic, legal and financial impact. In addition, we



evaluated the topics through a four-step assessment called “Four Factor Impact Analysis”. In the assessment, we ranked each topic according to the magnitude of impact, likelihood of impact and time frame (short, middle, long) in terms of;

  • Direct financial impact and risk,
  • Legal, regulatory and policy drivers,
  • Opportunities for innovation,
  • Industry norms, best practices and competitive advantage.
In an integrated governance approach, we finalized the analysis considering the alignment of topics with our integrated business strategy. According to the analysis, the following were assigned over 70% importance and were highlighted within 12 material topics: Solvency and sustainable results, corporate governance, ethical behavior and consumer protection, easy, fast and DIY, adequate and timely advice to customers, cybersecurity and responsible use of data, and environmental and climate chang impact. These were clustered under 6 main topics in our analysis: Customer Experience, Financial Performance, Digital Transformation, Corporate Governance and Risk Management, Investing in Human Capital, Responsible and Sustainable Development.