1.Climate Change
Confronting climate change risks, Fubon Financial Holdings formulated the climate change policy in August 2017, and has incorporated the Task Force on Climate-related Financial Disclosures into the policy since 2018. The following items which may exacerbate climate change have been accordingly included in TFB’s designated industries and activities contributing to significant adverse impact on environmental and social sustainability, and the credit application proposed for a client who operates in any one of the designated industries or involves in any one of the designated activities should be declined:

• Any new coal-fired power plant or any power plant which has total installed capacity of coal-fired power no less than 50% of all energy generation capacity
• The mining of solely extracting coals
• Illegal logging and wood logged in tropical rainforest, primeval forest, and legal forest reserves
• Construction or development activities, which result in significant adverse impact on environment and society, in nature and forest reserves, wildlife sanctuary, historical heritages, cultural and aboriginal sites and other conservation areas
• Deforestation, such as conversion of nature forests and land clearance by burning, for plantation, construction, development or other business activities.

In the event that a client’s principal business is coal-fired or fossil fuel power plants, or mine extracting which is mainly coals and fossil fuels, the impact of the greenhouse gas emission regulation should be assessed. Provided that extreme weather and climates may result in high operating risks for a client, the proactive measures for disaster prevention and the risk mitigation should be evaluated.

Climate change has been an important strategic factor for TFB’s business planning and decision making. In addition to implementation of the sustainability risk management framework, TFB has promoted loans to companies in green-related industries, diversified mobile and online financial services, and financial products related to sustainability. TFB also has taken practical actions to reduce energy consumption, improve waste management, and lower carbon emission; measures for emergency prevention and responses have been made to mitigate the impact of significant nature disasters.

 

2.Human Rights

TFB has developed internal programs, based on the following important principles, to be in line with the human rights policy established by Fubon Financial Holdings:

• Equal opportunity and intolerance of discrimination and harassment
• Prohibition using of all forms of forced labor and child labor
• Freedom of assembly and association for all employees
• Safe and healthy workplace for all employees
• Prevention and preparedness for emergency
• Implementation of information security and privacy policies

According to the sustainability risk management framework, the following requirements are established in order to influence our clients and the related parties in improving respect for and protection of human rights in their business operations:

• A client’s involvement in illegal employment of child labor, one of the high ESG risk factors for TFB, would result in restrictions on credit extension and marketable security investments & transactions
• For a credit application, it is required to provide the assessment for the impact on a client’s business and reputation upon the occurrence of the following events:

1. Any material event related to business negligent homicide, occupational injuries, other events related to labor safety and health, or violating the related regulation
2. Any material event related to labor disputes, strike, massive layoffs without notices in advance, forced labor, or other controversy between the client and its employees.
3. Any material event related to any form of discrimination or harassment, or other matters violating human rights.

• For an application falling into the Category A or B according to the Equator Principles, the applicant is required to establish appropriate labor management policies and systems, occupational health and safety policies, and an effective communication mechanism with the affected communities in order to manage environmental and social risks and to comply with the Equator Principles.