HSBC 2007 Annual Report Download - page 320

HSBC HOLDINGS PLC
Report of the Directors: Governance (continued)
Corporate sustainability
318
Corporate sustainability
Corporate sustainability is the term used at HSBC to
describe the Group’s approach to meeting a wide
range of non-financial responsibilities which,
although not generally enshrined as legal or
regulatory requirements, constitute business
practices expected of the Group by its stakeholders,
including shareholders, customers and employees.
Insofar as these expectations concern HSBC’s
impact on the long-term environmental, social and
economic well-being of the world at large, corporate
sustainability influences the Group’s response to
encouraging sustainable development. Previously,
HSBC described these activities under the heading,
‘Corporate responsibility’.
Investing in sustainability
HSBC seeks to meet society’s expectations by
managing all aspects of its business ethically,
responsibly and in an increasingly sustainable way.
The Group’s key business values include a
commitment to the highest personal standards of
integrity at all levels, including honesty,
transparency and fair dealing in all its business
activities. In recent years HSBC has intensified its
efforts to embed sustainability into the way it
manages risk and business development
opportunities. This acknowledges that HSBC’s
continuing financial success depends, in part, on
its ability to identify and address non-financial
considerations which are material to the business.
Recognising that HSBC’s core financial
services businesses have the potential to exert the
most influence over sustainability issues, a Group
Corporate Sustainability unit was formed in 2007
to work closely with individuals and businesses
in all customer groups to help them to manage
sustainability risks and to pursue opportunities in
environmental markets worldwide.
Group Corporate Sustainability acts as a focal
point for the management of HSBC’s environmental
and social initiatives. Environmental initiatives are
directed primarily to issues arising from climate
change, including its effect on energy production and
usage, water management and biodiversity. Social
initiatives are centred on community action to
promote education as a lasting way of alleviating
poverty. The Group Corporate Sustainability unit
allows HSBC to join up its business development,
risk management, business operations, community
investment and reporting activities. The unit also
works closely with Group Marketing to further
embed sustainability into the brand; with Group
Communications to ensure that sustainability
initiatives are communicated to internal and external
audiences; and with Group Human Resources to
integrate this area into employee engagement and
talent management strategies. The unit reports
directly to the Group Chairman.
HSBC aims for consistency in the
implementation of its sustainability strategy across
all Group businesses, and has identified four themes
as relevant to its response to the United Nations
Millennium Development Goals of resisting climate
change, achieving water availability, protecting
biodiversity and alleviating poverty. These themes
are risk management (policies and processes);
business development; operations (buildings, travel,
suppliers and IT); and community investment
(education and environment).
The Group’s Sustainable Risk Management
Unit has published policies laying down minimum
standards for lending and investment covering
relationships with clients in energy, forest land and
products, freshwater infrastructure, mining and
metals and the chemicals industry. Each policy
focuses on how HSBC’s involvement in these
environmentally sensitive industries can contribute
to sustainable development.
In recognition of its leadership in building
responsible practices into the way it does business,
HSBC moved from 7th to 4th in the Accountability
Rating prepared by Accountability. HSBC continued
to earn a high score of 95 and a triple-A rating in the
Carbon Disclosure Project, a climate change index
ranking FT500 corporations.
In 2005, HSBC was the first major banking
organisation in the world to become carbon neutral.
HSBC remains committed to reducing its own
carbon emissions and helping to bring about a
low-carbon economy.
HSBC created a Climate Change Centre of
Excellence in 2007. The Centre’s goal is to evaluate
the implications of climate change for the HSBC
Group, its Global Research division and relevant
businesses. The Centre is HSBC’s central source of
climate knowledge, translating a wide range of
expertise – from academic studies, think tanks and
government regulations – into business opportunities
for the bank and its clients. The Centre works closely
with HSBC’s Global Research sector heads and
analysts on integrating the financial implications of
climate change and relevant government regulations
into their sectoral research. It also supports the
implementation of HSBC’s Carbon Finance
Strategy, announced in June 2006, and advises a
range of HSBC businesses for which climate change
is increasingly important.