Combating Climate Change - Managing Climate Risks
According to the Global Risks Report 2022 published by the World Economic Forum, environmental risks associated with climate change are among the top ten risks in terms of both impact and probability.
Extreme weather events such as forest fires, floods, droughts and storms have recently affected the whole world. The main reason for these extreme weather events in recent years is the increasing global temperature due to the increase in greenhouse gases on the atmosphere. As a result of the rapid and uncontrolled industrialization brought about by the Industrial Revolution, the rate of CO2 in the atmosphere increased rapidly. Today, the amount of global warming caused by greenhouse gases has reached 1.1 °C. In the scope of the 2015 Paris Climate Agreement, a global effort is being made to limit the global temperature increase to 1.5 °C by the end of the century.
As Garanti BBVA, we aim to contribute to global effort against climate change. In this line, we focus on monitoring risks and opportunities related to climate change and integrating climate change into our business processes and risk policies.
As Garanti BBVA, we published our Climate Change Action Plan in October 2015, which focuses on carbon pricing, reducing deforestation, managing climate-related water risks and implementing green office standards. With this Action Plan, we also pledged that a minimum of 60% of the total funds allocated to greenfield energy generation facilities would be allocated to renewable investments. In this direction, we have been financing 100% renewable energy greenfield electricity generation projects in our project finance portfolio since 2014 and we are the market share leader in wind energy projects in Türkiye.
In September 2021, the Bank became the first and only company from Türkiye to make a commitment to the United Nations Net Zero Banking Alliance, which supports the mobilization of the entire financial system to achieve the goals of the Paris Agreement. Garanti BBVA’s commitments include aligning its portfolio with net zero emissions by 2050. In addition, the Bank became carbon neutral in 2020 and achieved its 2035 target 15 years earlier.
As Garanti BBVA, we authored another sector-steering first in Türkiye and declared our pledge to exit coal in March 2021. Having updated our Environmental and Social Loan Policies, we committed that we will not finance new investments in coal-fired power plants and coal mines and that it will zero its coal exposure in our portfolio by 2040 at the latest. We proved our pioneering stance in the sector and our sustainable development vision by being the first bank to declare this commitment in Türkiye
Please find Garanti BBVA - Physical Climate Risks Adaptations & Actions here.