The Association of Banks and CRIF organized a workshop on managing environmental, social and governance risks in banking and how banks are prepared to assess environmental risks. The workshop took place at the headquarters of the Association on Thursday, March 24, 2022 with the participation of a number of representatives of risk, compliance and credit departments in banks.

Dr. Maher Al-Mahrouq, Director General of the Association, welcomed the attendees noting that the Covid-19 pandemic highlighted the importance of environmental, social and corporate governance (ESG), and that it increased the world’s expectations of directing investments in these areas which prompted the integration of ESG analysis further into the work of companies in addition to building investment portfolios. Al-Mahrouq indicated that high-quality ESG standards companies excel in the long run as this would strengthen their relationship with investors and positively affects the sustainability of investment portfolios and of the planet as a whole. He added that ESG will change the investment game rules as a means of managing risk and increasing returns as companies must demonstrate how to protect customer data, prioritize environmental sustainability, promote a good employee culture and maintain standards among their supply chains. Al-Mahrouq said that financing institutions are expected to start defining the rules of environmental, social and corporate governance (ESG) that must be adhered to in managing investment portfolios in the coming years in addition to paying attention to the traditional performance requirements. With regard to banks, Al-Mahrouq stated that the risks of environmental, social and governance (ESG) issues have become more important to the creditworthiness of banks in conjunction with rapidly changing regulatory policies, market developments and social attitudes noting that such risks affect assessments of liquidity, financing, asset quality and bank’s capital adequacy.

Eng. Areej Obeidat, Business Development Manager of Digital Solutions at CRIF ITS, who leads business development activities in the field of digital solutions and has 16 years of experience in banking technology in Jordan, said that banks should be prepared to assess environmental and social risks as an integral part of the credit process integration through technical solutions and partnerships with the competent authorities concerned with sustainability and the measurement of environmental and societal risks (ESG).

Bank al Etihad had an active participation as Ms. Dalal Dabour (Director of Corporate Sector) highlighted the latest measures taken at the bank in line with managing environmental and social risks. She also announced the upcoming cooperation between Bank al Etihad and CRIF ITS regarding the automation of environmental and social risk measurement (ESG) in the corporate sector.

Mr. Fabio Lazzarini, Senior Director of International Business Development at CRIF Spa, is a marketing expert and business development manager experienced in the field of business intelligence and information industry with a focus on business-to-business solutions and has 20 years of experience in the field of information and commercial intelligence provided a detailed explanation of CRTF ITS services in the field of environmental and social risk management. Consultants Claudio Dronzo and Marco Macellari from CRIF International presented a detailed and scientific explanation addressing the impact of climate change on banks, current best practices in regulatory development and new regulatory obligations, the importance of environmental, social and governance factors in risk management processes, climate impact as an effective element in assessing Business risks and qualitative information importance in assessing compliance with environmental, social and corporate governance principles.