MSCI ESG Ratings: AmBank Keeps “AA” Rating

AMMB Holdings Berhad (AmBank Group) has maintained the “AA” rating from MSCI ESG Ratings which it initially attained in 2020.

MSCI ESG Ratings aim to measure a company’s management of financially relevant ESG risks and opportunities. We use a rules-based methodology to identify industry leaders and laggards according to their exposure to ESG risks and how well they manage those risks relative to peers. Our ESG Ratings range from leader (AAA, AA), average (A, BBB, BB) to laggard (B, CCC).

This ESG rating of ‘AA’ places AmBank Group among the top 32% of 190 banks rated globally based on the MSCI ACWI Index constituents, of which only 4% have been accorded the highest rating of AAA.

The rating was based on an assessment of AmBank Group’s practices covering six broad areas namely Financing Environmental Impact, Access to Finance, Human Capital Development, Privacy & Data Security, Consumer Financial Protection, Corporate Governance and Corporate Behaviour.

The rating was driven primarily from AmBank Group corporate governance practices which falls into the highest scoring range for all the companies assessed relative to global peers, indicating that AmBank Groups practices are well aligned with shareholder interests. It also highlights that AmBank Group ranks ahead of its global top five peers in its Customer Financial Protection due to its adoption of best practices in inter alia employee training on customer financial protection.

AmBank Group Chief Executive Officer Dato’ Sulaiman Mohd Tahir said that this globally recognised rating by MSCI ESG Ratings which AmBank Group has maintained since 2020 is testament of the Group’s consistency and tenacity in following through its ESG agenda which has redefined its business and operational approach hinged firmly on sustainable and responsible banking principles.

He added, “Sustainability is a central component of our strategic vision of ‘Growing Trust, Connecting People’ and a core consideration in all that we do as a trusted partner on the financial frontier. With adherence to ESG standards as a key strategic focus, AmBank Group consciously embarks on inculcating responsible and inclusive practices as part of our fiduciary duties, in the delivery of sustainable financial products and services,” he said.

“This includes AmBank Group’s partnership with renewal energy companies to supply solar panels to AmBank Group’s customers.” Eqhwan Mokhzanee, AmBank Group Sustainability Champion added that AmBank Group is strengthening its climate risk management capabilities, whilst accelerating efforts to support its customers in their transition to a low-carbon economy. To ensure AmBank Group’s portfolio are aligned, AmBank Group has expanded its exclusion list for new loans and financing in relation to coal whereby with the exception of the national energy/ power company, AmBank Group will no longer provide new or additional loans and financing to businesses where coal or coal-related activities constitute at least 20% of the business’ total revenue or cost of production.

AmBank Group has also enhanced its ESG Risk Assessment to include climate change considerations.

As part of AmBank Group’s long-term strategy to achieve Net Zero Carbon, AmBank Group continues to embrace green and renewable energy. AmBank Group is the first financial institution in Malaysia to install solar photovoltaic panels on its building in April 2021 as part of its carbon offset initiative. AmBank Group is also the first financial institution to be awarded the Energy Management Gold Standard Certification in May 2022.

In July 2022, AmBank Group signed-up to become a Task Force on Climate-related Financial Disclosures supporter as its commitment to increase its transparency on its climate-related risks and opportunities.

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