Purposeful Strategy
Our Approach to Sustainability
As a financial institution, we acknowledge the significance of our role in shaping a sustainable future and are committed to creating sustainable value for all stakeholders by embedding sustainability-related considerations across our business and lending activities. Key highlights of our sustainability agenda in 2024 are summarised below.
Sustainability Context in 2024
- Revitalising SMEs
- Valuing human capital
- Financial inclusion amidst rising inequality
- Combat of climate change
- Preserving natural ecosystems and responsible consumption
- Customer privacy and data security
- Enhanced sustainability related regulations and disclosure requirements
- Enhancement of community empowerment
- Advancement of digital adoption
- Emergency preparedness
Local and Global Principles, Standards and Guidelines that inform Our Sustainability Approach
- National Environmental Act
- CBSL Green Finance Taxonomy
- Sri Lanka Banks’ Association’s Sustainable Banking Principles
- 10 Principles of United Nations Global Compact (UNGC)
- UN Sustainable Development Goals
- IFC Performance Standards
- WHO Health and Safety Standards
- Labour Convention of the International Labour Organisation
| Role and Responsibilities | ||
|---|---|---|
| Board level | Board of Directors | Provide direction to formulate the Bank’s sustainability strategy |
| Board Sustainability Committee | Make recommendations to the Board on sustainability related matters | |
| Management level | ESG Committee |
Facilitates the implementation of the Bank’s Board-approved sustainability strategy by liaising between the Board Sustainability Committee and the operational teams The Committee is led by the Executive Director/Chief Financial Officer and key focus areas of other members depicted below:
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| Operational level | Corporate Sustainability Department | Actively plans, implements and monitors the sustainability initiatives and day-to-day operations related to ESG matters of the Bank under the oversight of the ESG Committee |
| ESG Working Group | This cross-functional team with representatives from all business lines provide oversight for the effective implementation of the Bank’s ESG agenda. As the central coordinating team, they ensure that sustainability is a shared responsibility throughout the Bank’s operations | |
SAMPATH BANK’S ESG POLICY
The Bank’s Environmental, Social and Governance (ESG) policy is fully-aligned with our Strategic Sustainability Framework, ensuring that sustainability considerations are central to our operations and decision-making processes. This alignment supports our commitment to responsible banking and the integration of ESG principles into every aspect of our business.
Our ESG policy drives initiatives that address key areas such as climate change, financial inclusion, ethical governance and social impact. By embedding these principles within our Strategic Sustainability Framework, we are able to mitigate risks, create long-term value for our stakeholders, and contribute to broader national and global sustainability goals.
The Bank’s Strategic Sustainability Framework enables the integration of sustainability-related considerations into all aspects of the Bank’s business operations. The framework comprises six pillars which are summarised below.
Environmental and Social Risk Management System (ESMS)
Given significant exposure to environmental and social risks through its lending activities, the Bank has developed a robust ESMS in consultation with external specialists to effectively identify, assess and manage these risks. Sampath Bank’s ESMS is also aligned with CBSL’s Roadmap for Sustainable Finance relating to the Green Finance Taxonomy and IFC Performance Standards. The key elements of the Bank’s ESMS are summarised below.
Environmental Impact Financing
Promoting the growth of Non-Conventional Renewable Energy (NCRE) industry in Sri Lanka is a strategic priority for Sampath Bank. Accordingly, we continued to prioritise financing in hydro power, solar, wind and other renewable energy generation initiatives in Sri Lanka. We also leveraged relationships with bilateral lending partners to enhance support for this industry.
Socially Responsive CSR Model
The Bank adopts a formal approach to Corporate Social Responsibility with clearly defined policies, procedures and evaluation criteria to ensure projects effectively contribute towards furthering its broader sustainability objectives.
CSR initiatives are guided by the Bank’s CSR policy and procedure and are subjected to the Project Management and Evaluation Process (PMEP) which is overlooked by the ESG Committee to ensure alignment and progress of objectives specified in the Bank’s CSR model. The Bank’s Project Management and Evaluation Process for CSR initiatives is summarised below.
"Preserving the heritage of our present into the future"
The Bank introduced 'Apema Sampath' as the umbrella brand for all our Corporate Social Responsibility (CSR) initiatives in 2024. This strategic move reflects our commitment to consolidating and amplifying the impact of our sustainability efforts under a single, cohesive identity.
'Apema Sampath' encompasses our key CSR pillars; Community Empowerment, Education Development, Entrepreneurship Development and Biodiversity Conservation. By unifying our initiatives, the Bank ensures a more structured, transparent and impactful approach in creating long-term value for our stakeholders and the nation. This initiative enhances visibility, strengthens stakeholder engagement and reinforces our dedication to responsible banking.
Through 'Apema Sampath', we reaffirm our pledge to driving meaningful, purpose-driven change, aligning with our sustainability vision for a better future.
Capacity Building
Ongoing initiatives to strengthen the knowledge and awareness of our team on socio-economic and environmental sustainability continued in 2024. The Vidvan e-learning platform plays a key role in this effort delivering regular training sessions to enhance the collective knowledge of Sampath team.
Strategic Partnerships and Collaborations
Sampath Bank continued to leverage the strength of partnerships to promote sustainable practices within the organisation and among stakeholders. These include,
- Promoting solar energy usage among home owners - Hayleys Fentons (Pvt) Limited
- Recycling of paper waste - Neptune Papers (Pvt) Limited
- Responsible disposal of e-waste - Infinity Green International (Pvt) Limited
- GHG measurement - RR Associates (Pvt) Ltd and Sri Lanka Climate Fund
- Preserving natural ecosystems - Biodiversity Sri Lanka, Wildlife and Nature Protection Society of Sri Lanka and Department of Forest Conservation
Sustainable Product Development, Resource Management and Best Governing Practices
Sustainability is embedded across our operations, guiding our approach to product development, resource management and governance. This enables us to contribute positively to economic growth, social equity and environmental conservation.
- The Bank adopts a holistic approach to product development considering both customer needs and sustainability principles. Our digital transformation strategy plays a vital role in driving sustainable product development, enabling innovative financial solutions that promote financial inclusion, enhance operational efficiency and significantly reduce paper consumption. Our customer-centric approach ensures that solutions are aligned with customer needs and values. This includes ethical marketing and promotions, sound selling and lending practices and a commitment to environmentally conscious lending encompassing renewable energy financing and a detailed assessment of environmental and social considerations prior to lending.
- Minimising our environmental footprint is a key priority at the Bank, based on the findings of the Eco-Office Audit conducted in 2023 and we have implemented a comprehensive resource management initiatives for this purpose. Promoting efficient energy use is a core component of this strategy. We have also consistently invested in expanding our reliance on renewable energy by installing solar panels across our branch network. Strategic emphasis on digital solutions, the expansion of digital banking centres and the transition to digital documentation has led to a significant reduction in paper consumption and waste across the Bank. We have also implemented recycling programmes and water conservation initiatives within the Bank to minimise our overall environmental impact. These efforts reflect the Bank’s commitment towards sustainability and environmental stewardship.
- The Bank’s Sustainability Governance Framework ensures transparency, accountability and responsible practices in its interactions with internal and external stakeholders. Sustainability governance is built on relevant policies, clear accountability and regular reporting and monitoring. Proactive stakeholder engagement strengthens relationships with stakeholders by welcoming diverse perspectives while engaging them in sustainability initiatives. Responsible leadership fosters integrity, embeds sustainability within the Bank’s corporate culture and underpins responsible decision making at all levels of the Bank. These principles underscore the Bank’s commitment to principled and sustainable governance and form the bedrock of long-term sustainable value creation.
OUR ESG SCORECARD
| ENVIRONMENT | |||
|---|---|---|---|
| 2024 | 2023 | ||
| Renewable energy sector | |||
| Environmental impact financing for renewable energy | Rs Mn | 1,440 | 1,819 |
| Projects financed | No. | 4 | 6 |
| Hybrid/electric vehicle financing | |||
| Total financing extended | Rs Bn | 6.0 | 1.6 |
| Vehicles financed | No. | 824 | 276 |
| Climate action | |||
| Borrowers screened for environmental and social considerations | No. | 830 | n/a |
| Carbon footprint | tCO₂e | 9,521 | 10,378 |
| Carbon intensity (GHG emission per employee) | tCO₂e | 2.15 | 2.48 |
| Energy intensity ratio per employee (Head Office) | GJ | 7.19 | 9.28 |
| Capacity building | |||
| Team members trained on the ESMS/IEE | No. | 56 | 388 |
| Team members trained on credit competency development programmes which covered the aspects on environment due diligence |
No. | 1,418 | 512 |
| Preserving natural ecosystems | |||
| Turtle eggs protected under the ‘A Breath to the Ocean’ programme | No. | 46,460 | 50,457 |
| Coral reefs restored under the ‘A Breath to the Ocean’ programme | No. | 2 | 2 |
| School environmental custodians appointed under the ‘Gasai Mamai Pubudu Pothai’ programme | No. | 5,516 | 8,146 |
| Team members volunteered in environmental initiatives | No. | 1,850 | 1,647 |
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| SOCIAL | |||
|---|---|---|---|
| 2024 | 2023 | ||
| Equity and diversity | |||
| Female representation within the Sampath team | % | 42 | 39 |
| Remuneration ratio at the entry level (Male : Female) | Ratio | 1 : 1 | 1 : 1 |
| Salary increment granted for all employees | % | 20 | 10.5 |
| Employee satisfaction rate | % | 86 | 85 |
| Supporting the SME sector | |||
| New SME loans disbursed | No. | 6,069 | 4,774 |
| Value of new SME loans disbursed | Rs Bn | 48 | 31 |
| Total SME loan portfolio | Rs Bn | 159 | 138 |
| Total loan portfolio of the Bank | Rs Bn | 965 | 877 |
| Financial inclusion | |||
| Physical touchpoints island-wide | No. | 2,302 | 2,385 |
| Increase in digital transaction volumes | % | 18.1 | 20.6 |
| Beneficiaries of ‘Sampath Saviya’ and other entrepreneurship development programmes | No. | 5,298 | 4,791 |
| Community engagement | |||
| Tank restoration projects initiated under the ‘Wewata Jeewayak’ programme (to-date) | No. | 30 | 21 |
| Investment in ‘Wewata Jeewayak’ programme | Rs Mn | 34.5 | 23.8 |
| Internship opportunities provided | No. | 1,052 | 975 |
| Beneficiaries from ‘Wewata Jeewayak’ programme | No. | 6,208 | 5,316 |
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| GOVERNANCE | |||
|---|---|---|---|
| 2024 | 2023 | ||
| Board effectiveness | |||
| Proportion of Independent Directors out of total number of Non-Executive Directors | % | 77 | 70 |
| Board meetings | No. | 14 | 16 |
| Board meetings with more than 80% of Board members' attendance | % | 100 | 100 |
| Female representation at Board level | % | 27 | 25 |
| Risk management | |||
| Common equity (Tier I) capital ratio | % | 16.75 | 16.35 |
| Total capital ratio | % | 19.38 | 19.56 |
| Liquidity coverage ratio - All currency | % | 307.36 | 312.47 |
| Net stable funding ratio | % | 198.66 | 184.20 |
| Impaired loans (stage 3) ratio | % | 4.69 | 5.87 |
| Impairment (stage 3) to stage 3 loan ratio | % | 60.08 | 57.80 |
| Return on equity (after tax) | % | 17.74 | 12.65 |
| Compliance | |||
| Non-conformities of the ISO : 27001 Annual Surveillance Audit | No. | Zero | Zero |
| Taxes paid | Rs Bn | 33.8 | 32.8 |
| Team members trained on anti-bribery and anti-corruption considerations | No. | 3,276 | 1,862 |
| Data privacy related incidents reported | No. | Zero | Zero |
| Customer complaints resolved | % | 98.2 | 100 |
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