Our Approach to Sustainability

UOB’s approach to sustainability is based on five guiding principles that act as a compass for how we address the material risks and opportunities which may impact our customers, colleagues, investors, suppliers and the communities in which we operate. We believe that as one of Asia’s largest banks, we have a duty to contribute to and to ensure the region’s long-term economic, social and environmental well-being. We also recognise that good corporate governance is essential for embedding sustainable business practices across the Group. This responsible, long-run approach is central to our business strategy and activities.

The four pillars of our sustainability strategy arise from our fundamental strengths and are rooted in our values of Honour, Enterprise, Unity and Commitment. They reflect UOB’s expertise, the responsibilities we hold and the role we can play for the long-term benefit of our key stakeholders. Each of the pillars determines a set of objectives which we strive to achieve to ensure that we implement our strategy with clear plans and purpose.

Our sustainability strategy mirrors our business approach of balancing growth with stability. It takes into account the influence and impact our decisions and actions may have on our stakeholders and the environment. It also ensures that we remain economically relevant through managing ESG risks and opportunities practically and in line with market realities. To enable our programmes and initiatives to take root and to grow, we have ensured alignment with the ESG-related laws and regulations in each of our key markets. Just as our business strategy hinges on doing what is right for our customers, our sustainability strategy informs our engagement with our stakeholders and how we can help them in their own practices for positive outcomes in the long run.

When making business decisions and developing our products and services, we consider our stakeholders’ expectations in appreciation of what is material to them. As part of our commitment to sustainable and responsible growth, we also seek to identify, to assess and to manage social and environmental risks, challenges, impact and opportunities. This is carried out within a robust governance framework, underpinned by policies and guidelines that define our commitment and guide our approach to conducting business.

We refine our sustainability strategy continually through extensive discussions and workshops with teams from across the Bank. In our evaluation and planning, we start with internal factors that are key to the long-term growth of our business. Some of these factors are strong governance, employee health, safety and well-being, diversity and inclusion, as well as attracting, developing and retaining talent. Our deliberations also include wider sustainability trends affecting businesses globally, such as responsible financing, increasing interest in sustainability-related products and services and a changing regulatory landscape. In addition, we consider our alignment with the United Nations Sustainable Development Goals (UN SDGs) and the Paris Climate Agreement.

The UN SDGs set the global agenda for sustainable economic, social and environmental development by 2030 and call for action by both the public and private sectors. In 2019, we aligned our strategy and reporting to all 17 UN SDGs, compared with 11 in 2018. We recognise that while UOB is better placed to contribute directly to a sub-set of the Global Goals, the broadening scope of our sustainable financing and impact investment activities and their corresponding positive impact enable us to align more closely with all the Global Goals. Consequently, we are now aligned with six additional UN SDGs, namely: SDG 1 No Poverty; SDG 2 Zero Hunger; SDG 6 Clean Water and Sanitation; SDG 10 Reduced Inequalities; SDG 14 Life Below Water; and SDG 15 Life on Land.

Go to pages 66-67 of our 2019 Annual Report to find out about the Global Targets toward which we have aligned our efforts.

At UOB, we believe that constructive dialogue and collaboration with our stakeholders are important for creating and maintaining meaningful and mutually-beneficial relationships. Continual stakeholder engagement keeps us abreast of changes, open to possibilities and focused on staying relevant to our stakeholders. Stakeholder engagement is also an essential element in how we evaluate our strategies and initiatives as we strive to remain relevant in a fast-evolving region.

We regularly seek our stakeholders’ views and expectations through conversations, collaboration and research. By taking an inclusive approach, we hope they in turn will have a deeper understanding of our purpose, practices and performance. During the year, we also carefully considered feedback from institutional investors and analysts, regulators and non-governmental organisations (NGOs) regarding the ESG factors that are material to the Bank.

Go to pages 70-73 of our 2019 Annual Report to find out about how we responded to stakeholder expectations in 2019.

To identify the ESG factors which matter most to our business and to our stakeholders, we conduct materiality assessments and stakeholder consultations on a continual basis.

Materiality assessment exercises help us identify the environmental, social and economic topics we should prioritise to ensure the success of our business, while also supporting sustainable development. The results inform our strategic decision-making and reporting framework. Our analysis combines quantitative and qualitative research to provide a holistic overview of stakeholder expectations.

The materiality assessment process involves identifying relevant factors based on industry mega-trends and stakeholder feedback. UOB surveys internal as well as external stakeholders to rank the factors based on the significance they give to each of the ESG topics. Participants’ responses are then assessed to create a materiality matrix that reasonably reflects the sustainability factors most relevant to UOB and its stakeholders.

Board of Directors and Management Executive Committee (MEC)

UOB’s Board of Directors, through the Executive Committee, and the MEC review long-term business and organisational goals and provide the strategic direction for the Bank’s sustainability practices. They review, determine and oversee the management and monitoring of the Bank’s material ESG factors and their scope, as well as evaluate relevant key performance indicators. They also review and approve relevant disclosures.

Group ESG Committee

The Group ESG Committee reports directly to the MEC on sustainability matters. This ensures that ESG factors are given due consideration in all aspects of our operations. The ESG committee members represent the Bank’s business and support units whose activities have the potential to impact the environment, society and the economy positively and negatively. The Group ESG Committee reviews material ESG topics, identifies risks and opportunities, sets goals and targets, evaluates emerging issues, collates and assesses relevant data, and monitors the progress of sustainability-related programmes and initiatives.

Group ESG Framework

The Group ESG Framework was formalised in 2019. Underpinned by policies and guidelines that define our commitment and guide our approach to conducting business, the framework supports UOB’s business decision-making at all levels. It provides guidance on the management of sustainability-related risks and business opportunities in the context of our direct and indirect impact to the environment, society and the economy.

It is the responsibility of all UOB employees to comply with the Group ESG Framework. The management teams of the UOB entities are responsible for appraising the ESG issues in their respective domains and for taking appropriate steps to ensure that customers and suppliers also meet relevant policy requirements, wherever applicable. Sustainability indicators are integrated into the Key Performance Indicators (KPIs) and appraisal process for colleagues from relevant functions.

The UOB Code of Conduct lays down the principles of personal and professional conduct, including in the following areas:

• Fair Dealing in the conduct of business;
• protection of personal data and customer information in accordance with applicable banking secrecy, privacy and data security laws;
• equal opportunity for employees on the basis of merit;
• non-tolerance of discrimination or harassment on the basis of gender, race, age, religion, disability or any other classification that does not create a professional and safe workplace;
• maintenance of a conducive and healthy environment that contributes to the safety and well-being of employees and other stakeholders;
• compliance with applicable laws and regulations, including competition and anti-trust law;
• zero tolerance of bribery, corruption and illegal or unethical dealings, including insider trading and facilitation payments; and
• whistle-blowing.

All employees receive training relating to the Code, which embodies the corporate values. New employees are introduced to the Code as part of their induction while existing employees refresh their knowledge annually as part of the Bank’s self-learning programme. In the performance appraisal system, employees are assessed based on whether their behavior is aligned to the corporate values. Any employee who does not comply with the Code may be subject to disciplinary action. The Code is reviewed periodically for continued relevance.

Read UOB’s Statement on Code of Conduct (PDF 190KB)