ESG Normative Landscape - v0.2

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ESG Performance
Normative Sustainability Landscape
V0.2
C apgemini Invent 2019. All rights reserved | 1

ESG Performance – a growing international community of practitioners
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FRANCE INDIA COE
Steering & Sponsorship ESG Think-Tank
Julien Omar Dalia Ludovic François Jean-Daniel

GARNIER MEGZARI BAHOUS PERRET MAYET TRUC
Gaurav BEDEKAR Aniruddha GUHA BISWAS

HEAD | DFRC I NDI A SENI OR MANAGER | DFRC I NDI A
gaurav.bedekar@Capgemini.com aniruddha.guha- biswas@capgemini.com
Julien Riddhima Hakim Jean Adrien Martin

BUFFY CANNAPPANE NEJMI LEBOUGRE RENAUD CHAUVIN
Rajesh VARMA Somobrata BALLABH

PORTFOLI O LEAD | DFRC I NDI A SR. CONSULTANT | DFRC I NDI A
rajes h.varma@Capgemini.com s omobrata.ballabh@capgemini.com
Omar Amaury Anis

BOUGHALEB CHARBON EL HARRAK
ESG Specialists Group
NETHERLANDS GERMANY
Mayank KHATRI Pallavi ROY Satya Akshay GHIREPUJE

SR. CONSULTANT SR. CONSULTANT CHAKRADHAR CONSULTANT
DFRC I NDI A DFRC I NDI A DFRC I NDI A
pallavi.a.roy@capgemin i.com
SR. CONSULTANT akshay-namdeo.girhepuje@ca pgem in i.com
mayank-n.khatri@capgemi ni.com
Rob Marco Erekle DFRC I NDI A

vankayala-
VAN DIJK
satya.chakradhar@capgemini.com
MEYER TOLORDAVA
C apgemini Invent 2021.

2019. All rights reserved | 2
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Overview
Sustainability, the
new business normal

A long-term trend of growing interest for sustainability…
Stockholm World conference on
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1972 environment and creation of the UN RIO Summit and creation of the
1992 2008 “subprime” crisis Paris Agreement on
notion of sustainable development 2016
United Nations Program Environment Climate change
2000 “Dot-com bubble” crisis
London Convention on Marine Pollution by
WORLDWIDE 1972 Dumping of Wastes and Other Matter Carthagen protocol against
2000 biotechnological hazards 2012 Second UN RIO summit
AGREEMENTS
Convention on International UN Convention Kyoto protocol against Nagoya Protocol on Access and Benefit Sharing
1973 1989 on the rights of 2005 climate change 2010
Trade in Endangered Species of Cancun summit on Climate change
Wild Fauna and Flora the Child
Creation of the European

Directive 70/20/EEC against air
1970 pollution from motor cycle 2005 Market of carbon emission 2010 UE “Sovereign debt” crisis 2019 Whistleblower
Directive
2016
Equal Pay Directive of 1975 and the Directive 2003/87/CE establishing a
1975 Equal Treatment Directive of 1976 2003 scheme for greenhouse gas emission Low carbon benchmarks and positive
EUROPEAN LAW carbon impact benchmarks Regulation
allowance trading
European directive reinforcing non-financial
1996 2000 Employment Equality Framework 2014 reporting of public interest companies
Directive and Racial Equality Directive
Directive 96/61/EC concerning integrated MIF2 Directive with application
pollution prevention and control 2004 MIF Directive 2012 EMIR 2014 on 2018
Law 2008-496 regarding French Energetic

2008 fight against discrimination 2015 Transition Law
Decree 2016-10
2016 creating ISR label
French Law on French law 2001-420 requiring French Reinforcement of
1978 “Informatiques et libertés” 2001 listed companies to issue information 2010
F RENCH LAW French extra-financial Loi Sapin II against
on environmental/social impact reporting 2016 corruption
2012
Decree for non-financial
2017 reporting reinforcement
1970 - 2000 2000 - 2010 2010 - 2020

Increasing interest and traction but Early structuring of ESG subjects in
Early awareness of ESG issues
low reliability of corporate statements financial markets

… now accelerating
Brace f o r impact!
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Dec. 2020 Mar. 2021 Apr. 2021 Dec. 2021

Mar. 2018 Jul. 2020 Adoption of the
Publication of Entry into force of Entry into force of
Kick- off Sustainable Approval of the
Delegated Act on the SFDR regulation Corporate the 1st two
Finance Action Plan European Taxonomy
two 1st (non- financial com Sustainability environmental
by the European Reporting Directive
environmental investment) objectives of the
Parliament
objectives (CSRD) European Taxonomy
Mar. 2020 Sep. 2020 Oct. 2020 Nov. 2020 Dec. 2020 Mar. 2021 Dec. 2022
Final report on the Publication of the Launch of the SBTi Release of 1st Pledge by CAC40 Release of the Entry into force of
European Taxonomy PACTA methodology framework validating draft of GHG companies to apply recommendations on the other
tailored for banks the alignment of FI Accounting and the TCFD the evolution of the environmental
objectives with the Reporting Standards recommendations NFRD objectives of the
Paris Agreement for the Financial for non- financial European Taxonomy
Sector communication on
climate change
June 2021 C apgemini Invent 2021.

ESG Performance is the new accounting
T h e E U ’ s g r een d eal : r es h ap i n g f i n an c i al mar k ets to f u n d th e s u s tai n abl e tr an s i ti o n o f th e
e c o n o my
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55
4 EUROPEAN REGULATIONS TO MANUFACTURE TRANSPARENCY
%
cuts in greenhouse emission
(from 90’s levels) targeted in
Europe by 2030
EUR 6.4 tn
eval. yearly funding required
NFRD
Status: fully applicable

General disclosure of
CSRD
Status: development in
progress (target 2023)
EU Taxonomy
Status: phasing in
Definition of criteria to define a
SFDR
Status: phasing in
Definition of what a green
investment is
to attain Paris agreement sustainability stakes & policies for Auditable, structured, quantified green business
goals companies (500+ staff), including report on sustainable Quantified transparency on
opt-in indicators performance of companies (250+ sustainable impact and risks of
staff) investments
Climate KEY PRINCIPLES:

Neutrality
to be achieved before 2050 in Europe,
through creating an economy with net- Materiality Quantification Comparability Accessibility Auditability
zero greenhouse gas emissions

Beyond Europe, an increasingly global regulatory trend…
… p e n d i n g d e v e l o p m en t s i n t h e N e w W o r l d
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Hong Kong
Enhanced disclosure for ESG Japan
Funds, ESG Law 2021 Ministry of Environment:
Environmental Reporting
Guidelines
China
SSE: Guidelines on Standard
Operating of Listed Companies
UK & Europe
SFDR, NFRD, CSRD
EU Taxonomy
Thailand
SET: Guidelines for
Sustainable Reporting
India Singapore
Africa SEBI BRSR MAS Sustainability
King Code for Corporate Governance, Code for Reporting Guide
Responsible Investing in South Africa (CRISA)
Indonesia
FSA: ESG Reporting Guide
Australia
FSC: ESG Reporting Guide

Beyond regulation, an increasingly complex normative landscape
V a r i o u s s ta n d a r d s e tte r s , q u i c k l y e x p a n d i ng a n d g r o w i ng i n ma tu r i ty
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Int’l organizations Local regulators Market standards Rating agencies

▪ PACTA (Paris Agreement
United Nations
C apital Transition Assessment)
▪ Non-Financial Reporting ▪ Ministry of Economy, Trade ▪ National Greenhouse and
▪ The 17 UN Sustainable Directive (soon C SRD) and Industry (METI) label - Energy Reporting ▪ CDSB (C limate Disclosure
Development Goals (SDGs) ▪ EU Sustainable Finance identify companies Regulation (NGER) Standards Board)
Disclosure Regulation reporting on ESG
(2019/2088) performance ▪ ASX C orporate Governance ▪ World Bank ESDG Data
Principles and Portal platform
▪ EU Taxonomy ▪ Japan Exchange Group and
▪ Sustainable C orporate Tokyo Stock Exchange ESG Recommendations
▪ SBTi (Science Based Targets
Governance Initiative disclosure handbook Initiatives)
▪ UN principle for Responsible ▪ PCAF (Partnership for Carbon

Investment (PRI) Accounting Financials)
▪ Hong Kong HKEX guidelines ▪ Singapore SGX ▪ Rules governing the ▪ IIRC (International Integrated
OECD on mandatory ESG Sustainability Reporting Preparation and Filing of Reporting Council)
▪ Guidelines for disclosure Guide C SR Reports by TWSE
multinational enterprises Listed C ompanies (Taiwan) ▪ GRI (Global Reporting Initiative
taxonomy)
▪ WBCSD (World Business
C ouncil on Sustainable
World Bank Development)
▪ C hina First Green ▪ Philippine Securities and ▪ Bursa Malaysia guidance on
▪ Environmental and Social Exchange C ommission
Framework (ESF) - assess Investment Guidelines ESG reporting ▪ ISO (International Organization
(SEC ) Sustainability for Standardization)
the environmental and social Reporting Guidelines for
risks of projects. Publicly Listed C ompanies ▪ TCFD (Task Force on Climate-
Related Financial Discl.)
▪ SASB (Sustainability
▪ POJK #51/POJK.03/2017 ▪ C orporate Governance Accounting Standards Boards)
▪ Egyptian C ode of C orporate ▪ MoU on Improv. the Roles Guideline No.
Governance (2005), 2016 ▪ World Economic Forum
of FS Instit. in Environ. SEC /CMRRCD/2006-
Protection and Mgt 158/134/Admin/44, 2012
▪ Gov. Regulation #47

ESG regulatory landscape – Timelines & expectations UK & Europe
SFDR NFRD/CSRD EU Taxonomy

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SFDR is the new EU regulation that introduces rules NFRD is the EU legal framework for regulating the It is a standardised classification system designed to
for financial market participants (FMPs) and financial disclosure of non-financial information by help users determine what is environmentally
advisers (FAs) to report on how they account for corporations sustainable
sustainability risks
The European Commission adopted a proposal for a Based on six environmental objectives:
SFDR has some mandatory disclosures –even for asset Corporate Sustainability Reporting Directive (CSRD), • Climate Change Mitigation
managers and financial advisers that do not promote which would amend the existing reporting • Climate Change Adaptation
any ESG or sustainability products or services requirements of the NFRD • Protection of Water and Marine Resources
• Circular Economy Transition
• Pollution Prevention & Control
• Biodiversity & Ecosystem Protection
Regulatory Timeline
Final date to report
CRR II and CRD V UK made TCFD First reference CSRD as national law
on Entity level
published mandatory period starts for all member states
disclosures
2019 24th March 2021 1st Jan 2022 1st Dec 2022 Final date to report for
20th June 2023 second time along with
CRR II comes into
Companies required • CRD V comes into force First 2 objectives comparison with first
Force Large companies shall
to disclose info under • UK’s announcement on requirements Periodic reporting report
May 2021 begin reporting CSRD
NFRD Green Taxonomy apply enforcement
Benchm. method Jan 2023 30th June 2024
2018 Nov 2020 Minimal Rules publ. 1st Jan 2022 Apr. 2022
Jul 2021
Jun 2021 Jan 2022 Jun 2022

10th March 2021 • PAI statement (FMS > 500 Jan 2023 1st Jan 2026
Implementation of PAI statement Jan 2023
Dec 2019 Effective date of SFDR staff) Basel IV Guidelines (FMS < 500 staff) Last 4 objectives Second reference
Listed SMEs shall begin
SFDR enters into force regulation • Green Tec hnical Advisory requirements CSRD reporting
Group established in UK period starts
12th July 2020 Early 2022 apply
21st Apr 2021 • Current Draft of CSRD will be
EU Taxonomy regulation
enters into force EU published proposal on finalised
CSRD • Consultation on 1st 2 objectives for
* Common standards/ guidelines/ frameworks that are under consideration the region under scope UK Green Taxonomy C apgemini Invent 2021.
ESG regulatory landscape – Timelines & expectations Asia
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Singapore Japan China & Hong Kong India
Sustainable Bond Grant Scheme ESG disclosure handbook 2020 Investor relations Guidelines by CSRC Guidance Document by BSE
Encourages the issuance of green, social Focuses on linking ESG issues to corporate Focussed on enhancing ESG disclosures and Voluntary ESG reporting outlining 33
and sustainability bonds in Singapore value and disclosing those links reduce carbon emissions. specific issues and metrics on which
companies should focus
Sustainability Reporting Guide Stewardship Code & the Revision, 2020
SGX mandates sustainability reporting on a Highlights TCFD & forthcoming IFRS Stewardship Code, 2019
comply-or-explain basis sustainability reporting framework as Mandatory disclosure on compliance with
noteworthy disclosure frameworks ESG norms. However, no penalty for
disobedience
Regulatory Timeline
Stewardship Code and Revision of

the Code 2020 - Companies expec ted
Sustainable Bond Grant
to submit corporate governanc e
reports reflecting revised Code by Dec Environment Risk Management Scheme - Effective as of 1
Guidance Document on ESG 2021 Guidelines for Asset M anagers to January 2021 and valid till
disclosure by BSE Stewardship Code, 2019 be implemented 31 May 2023
2018 July 2020 December 2021 2022/2023 2023
2016 2020 July 2020 2021/2022 2021/2022

Sustainability ESG disclosure M andatory ESG Revision on Corporate Revision to Investor relations
Reporting Guide handbook 2020 Disclosure by HKEX Governance Reporting - guidelines by CSRC
Consultation paper published in Published - February 2021
2021 and public c onsultation Public Consultation c losed on
c losed on 18 June, 2021 7th June, 2021
CSRC - China Sec urities Regulatory Commission , HKEX - Hong Kong Exc hanges and Clearing Limited , MAS – Monetary Authority of Singapore
Consultation papers awaiting confirmation
* Common standards/ guidelines/ frameworks that are under consideration the region under
scope C apgemini Invent 2021.
ESG regulatory landscape – Timelines & expectations Africa
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Code for Responsible Investing in South
King Code for Corporate Governance
Africa (CRISA)
• The King code is guideline for the governance structures and operation of • CRISA is voluntary code that applies to both institutional investors and
companies in South Africa their service providers
• The Institute of Directors in South Africa (IoDSA) releases the King • Provides guidance on how institutional investors should execute
reports investment analysis and activities
• To date the IoDSA has issued 4 King Reports or Codes for Corporate • The CRISA Code of 2011 followed “apply-or-explain” approach
Governance, latest version was released on 1 November 2016
• New draft code shifting from “apply-or-explain” to “apply and explain”
• King IV came into effect for financial years starting from 1st April 2017 approach
Regulatory Timeline
First King report on Sec ond King report on Third King report on
c orporate c orporate governance c orporate Fourth King report on
governanc e published – King II governanc e c orporate governance King IV c ame into
published – King I published – King III published – King IV effec t
1994 2002 2009 2016 Apr 2017
2011 2020 Jan 2021

CRISA Code for New 2020 Revision CRISA 2.0 c losed for
Responsible Investing Consultation Draft public c omments,
launc hed released CRISA 2.0 awaiting further
updates
* Common standards/ guidelines/ frameworks that are under consideration the region under
scope C apgemini Invent 2021.
Some key standards at a glance
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Relevant emission targets Financed GHG emission accounting
Financial s ector declens ion publ. in 10/2020 Publis hed 11/2020 by a cons ortium of banks (Dutch, then global)
• Process to certif y company-wide GHG Opt-in Opt-in
• A ccounting rules for the evaluation of f inanced GHG emissions
reduction target s as a relevant
Adopted by portf olios (s c ope 3 , c at. 1 5 for c redit and investment portfolios) Adopted by
contribution to at t aining Paris agreement
objectives 55 FIs • Rules for qualifying the quality and reliability of data us ed as a 95 FIs
bas is for ac c ounting
• C ombination of c alculation methodology and
c ertification process A CCOUNTING RULES DA TA SOURCE QUALIFICATION
T A RGET DETERMINATION CERTIFICA TION ▪ Listed equity and corporate bonds & Reported emission sources
Business loans and unlisted equities
▪ Sector-based approach PROCESS Audited emissions
Outstanding amount
Sector share of reduction based IEA’s × company emissions
1. Commitment Total equity + Debt Unaudited emissions
B2DS scenario then individualized for
the company
letter ▪ Project finance
Outstanding amount Physical activity-based emissions
▪ Economic-based approach 2. Target × project emissions
Total equity + Debt
Company contribution to reduction developpement Energy cons. × emis. factors
deduced on the company’s share of ▪ Commercial real estate & mortgages
global GDP determined by its profits 3. Validation f rom Outstanding amount Production × emission factors
× building emissions
▪ Absolute-based approach SBTi Property value at origination
Systematic reduction of emissions based ▪ Motor vehicle loan Economic activity-based emissions
4. Public target
on overall trajectory of 1.5°C scenario
announcement Outstanding amount Sector emissions × market share
from IPCC special report (SR15) × vehicle emission
Total value at origination
Disclosure Disclosure Temperature scenario benchmarking

Recommendations publis hed in 2017 (FSB) Founded in 2000, firs t dis closure 2002 Publis hed 09/2020 (2° I nves tment I nitiative)
T he TCFD provides a f ramework for c ompanies Opt-in D is closure methodology now aligned to T CFD Opt-in • Toolkit to meas ure the alignment of f inancial portf olios with
Opt-in
to develop more effec tive c limate- related offering a s tandard way of dis c losing 765 FIs
financ ial disclosures through existing reporting Adopted by performanc e on:
climate scenarios (output is a portfolio level temperature) Adopted by
9,600+ 1,500 FIs
proc esses. T he 2 017 report particularly all CAC40 • C limate change prevention • A t the c ore of the toolkit lies a dataset of assets, s ec urities and
companies
emphas ized the need for t ransparency in • Fores t protection and reforestation c ompanies to enable measurement on key s ectors
pricing risks (inc l. c limate-change related risk) • Water s ec urity
for effic ient c apital allocation dec ision. P latform with s tandard questionnaires allowing
c omparable disclosure and s c oring. E MITTER DA TASETS CLIMA TE SCENA RIOS
DISCLOSURE THEMES 230,000 assets emitting GHG… Emission scenarios aligned with possible
The TCFD provides recommended disclosure: CLIMA TE CHA NGE THEMES 4 A XES FOR SCORING … mapped against 35,000+ companies 2100 climate outcomes (baseline, +2°C,
• Metrics and Targets: Disclose the metrics and targets used to … and 30,000 securities +1.5°C)
• Governance 1. Disclosure
assess and manage relevant climate-related
Governance risks and opportunities. … in sectors with high capital concentration
T he T C FD breaks down • Risks and opportunities Comprehensiveness in the responses Technology pathways for asset performance
• Governance: Disclose the organization’s governance around (fossil fuels, power, steel, cement, automotive,
• Business strategy to the questionnaire measurement against these scenarios:
climate-related risks and opportunities
Strategy
climate risks into etc.)
• Targets and performance 2. Awareness • Technology/Fuel Mix
Physical
• Strategy: Disclose the actual and potential impactsrisk and
of climate- … covering of 75% of global GHG emissions • Production Volume Trajectory
Risk • Emissions methodology Comprehensiveness of a company’s
Transitionbusinesses,
related risks and opportunities on the organization’s risk. • Emissions data • Emission intensity
Management evaluation of its environmental stakes
strategy, and financial planning. T rans ition ris ks includes • Energy 3. Management
• Risk Management: Disclose howMetricsthe organization identifies,
: P olic y and L egal Risk, Climate scenarios models
• Additional metrics Evidence of actions associated with To be combined with
assesses, and manages climate-related & risks.
T ec hnology Risk, • Verification good environmental management portfolio data to yield
Targets User Sector Portfolio
The TCFD breaks down climate risks into M
Physical risk and
arket Risk, Reputation • Carbon pricing an overall portfolio
4. Leadership
Transition risk. Transition risks includes :Ris
Policy Engagement
k. and Legal Risk, •
Evidence of actions identified as best temperature Market Benchmark
Technology Risk, Market Risk, Reputation Risk.
practices by CDP contributors

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Appendix: detailed landscape
1 Corporate Sustainability Reporting Directive 7 Science-Based Target initiative
2 Sustainable Finance Disclosure Regulation 8 Paris Agreement Capital Transition Assessment
3 EU Taxonomy 9 Partnership for Carbon Accounting Financials
4 Task Force on Climate-related Financial 10 Carbon Disclosure Project

Disclosures
11 Risk Regulations
5 Sustainability Accounting Standards Board
12 Other noteworthy standards and workgroups
6 Global Reporting Initiative (GRI)
13 Sustainable disclosure metrics – an analysis

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1
Corporate Sustainability
Reporting Directive (CSRD)
Disclosing in a comparable quantified and
reliable way

Upcoming update in Europe’s Non-Financial Reporting Directive:
ongoing EFRAG consultation APTimum
EFRAG is the European voice of financial reporting

Its role is to ensure that International Financial Reporting Standards (IFRS) are responsive to European needs and
concerns.
EFRAG’S WORK AND MISSION EFRAG & EU TAXONOMY
EFRAG is a private association with a mission to serve the The Non-Financial Reporting Directive (NFRD), implemented since 2018 by the
European public interest by developing and promoting European European Commission, lays down the rules on disclosure of non-financial and diversity
views in the field of financial reporting (accounting standards). information by large companies.
▪ EFRAG provides advice to the European Commission on whether In February 2020 the EU launched a public consultation, to collect the views of stakeholders
newly issued or revised International Financial Reporting with regard to possible revisions to the NFRD. The resulted adjusted Commission Work
Standards (IFRS) meet the criteria in the International Programme is expected to be delivered in the 1st quarter of 2021.
Accounting Standards Regulation for endorsement for use in the
EU One of the ways to enhance the comparability, reliability and relevance of
information disclosed by companies will be to mandate the use of a common set of
➢ By assessing whether a standard provides relevant, non-financial reporting standards.
reliable, comparable and understandable information
Such standards could also facilitate the assurance of non-financial information,
▪ EFRAG considers whether application of the standard would be its enforcement and its digitisation using a taxonomy (tags) and a structured
conducive to the European public good data standard.
➢ By producing an impact analysis that considers the The EC has mandated EFRAG to undertake preparatory work for the elaboration
potential effects on the European economy, including of possible EU non-financial reporting standards.
financial stability, economic growth and competitiveness,
as well as the potential effects on the stakeholders IMPORTANT DATES:
directly concerned by the standard and on SMEs. November 6: Update to the EU and launch of a proposal design phase
February 2021: Final deliverable: proposal for EU non-financial reporting standards
➢ By running a cost-benefit analysis

Corporate Sustainability Reporting Directive (CSRD) – Overview
In April 2021, the European Commission, issued their proposed changes to strengthen the nature and extent of
sustainability reporting in the EU over the coming years – the Corporate Sustainability Reporting Directive (CSRD).
❑ Amendment to NFRD
The newly proposed EU Corporate Sustainability Reporting Directive (CSRD) will
The change of name of the successor of NFRD to CSRD is a
amend the existing Non-Financial Reporting Directive (NFRD) and make it more
deliberate attempt to remove the potential implication by
relevant to the changing dynamics of the sustainability ecosystem.
most that “non-financial” correlates to sustainability
❑ Expansion of Scope considerations do not have financial relevance.
The CSRD will require all large and listed EU companies to introduce mandatory
sustainability reporting standards.
❑ Introduction of Double Materiality

CSRD will follow double materiality where reporting organizations need to cover not EU Member States are expected to
just the risks to themselves but also their impacts on society and the environment. transpose the new directive into national law by
31 December 2022. As a result, companies that fall within the
❑ Introduction of Mandatory 3rd Party Assurance scope of the directive will need to comply with the amended
Companies will need to report in line with mandatory EU sustainability reporting rules for fiscal years beginning on or after 1 January 2023.
standards and provide external assurance of sustainability information.
❑ Integrated with EU Sustainability Regulation

The European Commission has committed that CSRD would ensure alignment with
other EU sustainability regulations like SFDR and EU Taxonomy. “By integrating sustainability disclosures with financial data,
we would create a ‘one-stop shop’ for all critical information
❑ Timeline about a company, including its green credentials, which would
Companies that fall within the scope of the directive will need to comply with the be immensely useful for investors.”
amended rules for fiscal years beginning on or after 1 January 2023, SMEs get extra – Christine Lagarde, President of the ECB
3 years to comply.

From NFRD To CSRD
What is the Scope of reporting requirements? Applicable to which companies?

NFRD: CSRD: NFRD: CSRD:
Companies used to report on: Now additional requirements will be on: Large public interest entities with > 500 ▪ All large companies meeting at least 2
• Environmental Protection • Double materiality concept employees out 3 criteria:
▪ > 250 employees
• Social Responsibility And Treatment Of • Process to select material topics for
Public Interest Entities includes; ▪ > €40M Turnover
Employees stakeholders
▪ Listed Companies ▪ > €20M Total Assets
• Respect For Human Rights • More forward looking information, which ▪ Banks and Insurance Companies ▪ Listed companies
includes targets and progress on them SMEs get an extra 3 years to comply.
• Anti-corruption And Bribery
• Diversity On Company Boards (In Terms
• information relating to intangibles
11,600 Companies 49,900 Companies
Of Age, Gender, Educational And • Reporting in line with SFDR and EU (Covers >75% of total EU companies’ turnover)
Professional Background) Taxonomy
When will it be applicable? Is 3rd Party Assurance needed?

NFRD: CSRD: NFRD: CSRD:
▪ M id- 2022: Draft standards available Non- mandatory in most countries except M andatory
▪ Applicable from FY2018
few which had legal audit requirements Including:
▪ Dec 2022: EU member states will be
▪ Integration in Auditor’s Report,
expected to transpose the new directive
into national law by 31 December 2022. ▪ Involvement of key audit partner,
▪ FY 2023: First set of Sustainability ▪ Scope to include EU Taxonomy and
Reporting Standards process to identify key relevant
information.
▪ FY 2024: Second set of Sustainability
Reporting Standards
How should it be reported?

NFRD: CSRD:
▪ Included in the Annul Report ▪ To be included in the Management Report
▪ Online or PDF version ▪ To be submitted in XHTML format in
accordance with ESEF Regulation
From NFRD To CSRD: a timeline
Accounting directive 2013/34/EU The accounting directive was

released harmonising the regime of amended by directive 2014/95/EU
financial and non-financial (NFRD Draft) which includes
reporting, including reporting disclosure of non-financial and European commits to Draft Sustainability Companies to start
about corporate social diversity information by certain large review NFRD to Consultation start on Reporting standards to be reporting information
responsibility to ensure clarity and undertakings and groups in annual integrate it with SFDR identify to revisions to available that will align with using CSRD, information
comparability reporting and EU Taxonomy NFRD CSRD will cover FY2023
2013 2014 2019 2020 Mid 2022 2024
Nov 2016 Jun 2019 Apr 2021 2023

Paris Agreement is into European Commission European Commission First set of Sustainability
force publishes additional announced the CSRD Reporting Standards
guidelines on how to proposal that will replace
report climate-related the NFRD.
disclosures in the NFRD.
NFRD CSRD
In Management Report,
Reporting Format In Annual Report ESEF format
3rd Party Assurance Only if required by law (Country Specific) Mandatory (Limited) Assurance

CSRD & EU’s Sustainable Finance Framework at a glance
CSRD SFDR EU Taxonomy

Proposed regulation on reporting by large companies and SFDR lays down rules for financial market participants EU taxonomy is a classification system, establishing a
listed companies on their sustainability risks and impacts and financial advisers on transparency with regards to list of environmentally sustainable economic activities
including climate change. Addresses double materiality the integration of sustainability risks and their impacts in the context of the European Green Deal
Disclosure requirements for financial

Disclosure Information on social products promoting environmental or
Environmental, and governance social characteristics
issues T he Light Green Products
CSRD SFDR
Financ ial Market
Large and listed
Partic ipants and
c ompanies
financ ial advisors Disclosure requirements for financial
Information on percentage of current
products that have sustainable
and future revenues coming from
investment as their objective
activities aligned with the taxonomy
T he Dark Green Products
EU Taxonomy
A c lassification system establishing list
of environmentally sustainable
ec onomic activities
EU Taxonomy Regulation aids reporting entities in complying with

CSRD will increase the number of organizations that Information disclosed by large and listed companies
both CSRD and SFDR by providing companies, investors and
will have to report information related to sustainability through CSRD will help financial market participants and
policymakers with appropriate definitions for economic activities
and will also improve the availability & quality of data advisors easily comply with SFDR
that can be considered environmentally sustainable

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Sustainable Finance
Disclosure Regulation (SFDR)
Providing transparency on integration of
sustainability consideration in
investments

SFDR : Sustainable Finance Disclosure Regulation
What is that ? APTimum
SFDR defines transparency obligations for management companies (> 500 employees) on the inclusion of extra-
financial criteria in the products and services it offers, to enable:
• Reorienting capital flows towards sustainable transformation of the economy
• Fight against greenwashing and allow the comparability of products and services
• Promote long-term vision in investments
• Improve the consideration of risks linked to sustainability issues
Transparency at 2 levels: entity and product Quantitative indicators to assess the

harmful impacts of investments:
• 32 mandatory
At entity level, publication on the website: • 18 optional
• Methods of considering the risks linked to sustainability RTS draft update (02/2021) - mandatory
• Negative impacts of investments indicators retained: 14 for companies, 2 for
• And the correlation of executive compensation with these elements. sovereigns and 2 for real estate
For all investment products and services, publication in the pre-contractual documentation of the procedures
for considering the risks associated with sustainable issues, as well as adverse impacts in terms of sustainability.
For impact products1:
• Precise description of the concrete commitments on the sustainable transformation of the economy (including
their measurement), as well as the performance monitoring methods on the website and in the pre-contractual
documentation
• Monitoring of the achievement of objectives in periodic reports.
For products highlighting sustainability characteristics:
• Precise description of the criteria for considering sustainable dimensions (inc. their measurement), as well
as the performance monitoring methods on the website and in the pre-contractual documentation
• Monitoring of this inclusion in periodic reporting.
Calendar
10/2020 03/2021 05/2021 06/2021 06/2022 06/2023 06/2024
Year-to-year
Consideration of 1st cycle of
EBA: conf. of Entry into Expected 1st reporting monitoring in
adverse impacts metrics
the application force of the adoption of cycle at both place
by report ing reporting at throughout
in 03/2021 principles RTS * entities entity level levels
the perimeter
1: products mainly focused on objectives linked to sustainability themes C apgemini Invent 2021.
Focus on
Focus on the
the Sustainable
SustainableFinance
FinanceDisclosure
DisclosureRegulation (SFDR)
Regulation (SFDR)
APTimum
SFDR : What is it? Objectives (EU Action Plan) Disclosures Requirements:
▪ Reorient capital flows towards a more sustainable economy ▪ Disclosed to : Potential investors
▪ SFDR (entered into force in December
▪ Prevent from greenwashing and ensure comparability ▪ Channels: Website, pre-contractual documents
2019) define a first set of regulatory wave
▪ Foster long-termism (e.g., prospectus), periodic reports
aiming to reorient capital flows towards a
more sustainable economy ▪ Increase the importance of sustainability risks ▪ Disclosure : Entity and Product level
Oct 2020 March 2021 May 2021 Jun 2021 June 2022 June. 2023 June. 2024
FMPs* and Report for
Effective FAs* must Report for Disclosure
Adoption of all SFDR
EBA Letter Date of SFDR start all SFDR year on year
RTS* considering metrics – 2nd
Regulation metrics time
basis
PAIs*
*RTS – Regulatory technical Standards *FMP – Financial Market Participants *FA – Financial Advisors *PAI – Principle Adverse Impact
▪ The co-legislators agreed in March 2019 on an ambitious timeframe for the Regulation (2019/2088), requiring the joint development by EIOPA,
ESMA and EBA of most of the draft regulatory technical standards by 30 December 2020 and the application of the Regulation’s
provisions from 10 March 2021.
▪ The transparency requirements contain disclosure obligations on an entity and product level and apply to entities manufacturi ng financial products
(Financial Market Participants) or providing investment or insurance advice (Financial Advisors). Financial Market Participants include fund
managers, insurance-based investment product providers, pension product providers and institutions providing portfolio management (discretionary
mandates) so, broadly speaking, any type of asset manager.
▪ No delays on the general application deadlines of the SFDR (Level 1 : March 2021) will be accepted
▪ The European Commission (EC) is expected to adopt the RTS by early May 2021
▪ The disclosure to be made at entity level by June 2022 and at both (entity +product) level by
June 2023
Source: EBA, AMF, Allen & Overy, Bloomberg More details provided on next slides C apgemini Invent 2021.
Roadmap
APTimum
We are here
Oct 2020 March 2021 May 2021 Jun 2021 June 2022 June 2023 June. 2024
FMPs* and Report for

Effective Date Report for all
Adoption of FAs* must start all SFDR Year on Year
EBA Letter of SFDR SFDR metrics
Regulation RTS* considering metrics – – both levels
disclosure
PAIs*
level 1
Integration of The purpose of • Consideration of Disclosure for • Pre contractual The FMP would also
sustainability risks the RTS is to principal adverse entity at SR, PAI Disclosure – SR, have to complete
in processes provide further impacts of and ESG. PAI and the “historical
• The manner in detail and investment The ESG market Additional comparison” section
which guidance to decisions/advice includes a broad sustainability of the Annex,
sustainability ensure that firms or insurance variety of ESG disclosures comparing the first
risks are take a advice on approaches (e.g. • Website reference period
integrated in the harmonized sustainability exclusions, norms- Disclosure – with the second
investment approach in their factors based screening, PAI, Additional reference period
decision/investm methods of • Statement on best-in-class, ESG sustainability
ent or insurance collecting and due diligence integration, disclosures
advice disclosing policies thematic and • Additional
• Assessment of information. This • Mandatory for impact related green
the likely is needed to meet large entities approaches) taxonomy-
impacts of the objective of and large The main rationale related
sustainability the EU SFDR. holdings is to prevent information
risks on the • Comply or misleading the • Periodic
financial return explain for all investor Reporting
other entities
Entity – Level 1 disclosure Product – Level 2 disclosure
Source: EBA, AMF, Allen & Overy, Bloomberg C apgemini Invent 2021.
Disclosure Overview
APTimum
Disclosure Topic
Disclosure Level Place
Sustainability
PAI Others
Risks
Publish the policy in Report on the policies

Publish and explain how
place on how in place regarding the
the remuration policy is
sustainability risks are principal adverse
Firm level integrated in the impacts (PAI) on
consistent with the Website
integration of
investment advice or investment advice or
sustainability risks
decisions decisions
Publish the policy in

Include the description • Pre
place on how
of the characteristics contractual
sustainability risks are Report whether, and if information
and objectives, and of
integrated in the so how, a product
Product level investment advice or considers the PAI on
the methodologies for • Periodic
the assessment, product
decisions and the sustainability
measuring and reports
impact of these risks
monitoring • Website
on the returns
Source : https://sustainalize.com/2021/01/sfdr-eu-esg/ More details provided on next slides

Focus on the SFDR requirements (Level 1)
APTimum
▪ Investment firms ▪ Firms that provide advice in relation to
Which organizations are ▪ Credit institutions providing advice and/or insurance
impacted by SFDR ? portfolio management (incl. Via model ▪ Asset and fund managers
portfolios)
Main requirements (Level 1)

▪ Disclosure obligations on an entity and product level and apply to any type of asset manager
▪ The draft RTS proposes a very granular template-based description of the PAI based on up to 50 quantitative key performance indicators
(KPIs). Of these, 32 are mandatory and the remainder are optional.
Sustainability risks Principal Adverse impacts ESG Approach

Financial Market
• Consideration of principal
Participants • Integrate Sustainability risks into adverse impacts of investment • The ESG market includes a broad
investment decision decisions/advice or insurance variety of ESG approaches (e.g.
process/investment advice or advice on sustainability factors exclusions, norms-based
insurance policies • Statement on due diligence screening, best-in-class, ESG
policies integration, thematic and impact
• Assess the likely impacts of • Mandatory for large entities and related approaches)
sustainability risks large holdings • The main rationale is to prevent
• Comply or explain for all other misleading the investor and,
• Provides for the option to explain entities therefore, also reduce the
why sustainability risks are not prevalence of “greenwashing”
relevant and thus need not be
considered
Financial Advisors
Source: EBA, AMF,PwC, Allen & Overy C apgemini Invent 2021.

APTimum
Product level disclosure ▪ Includes requirements not only for ESG-related products, but also for mainstream, or non-ESG-
requirements related, products.
SFDR defines 3 categories of

products (Level 2)
Article Article
8 9
Promoting environmental Sustainable investment as

Mainstream Products
and/or social characteristics their objective
Sustainability The manner in which sustainability risks are integrated in the investment decision/investment or insurance advice
Risks
Pre
PAI • Where the FMP considers it: consideration of the product’s principal adverse impacts on sustainability factors
Contractual • Where the FMP does not consider it: statement on non-consideration + reasons for this
Disclosures
Additional NA • How the characteristics are met • How the objective is to be attained
sustainability • Consistency of the index with the • Alignment of the index with the
disclosures characteristics objective
APTimum
SFDR defines 3 categories of

products (Level 2)
Article Article
8 9
Mainstream Products Promoting environmental Sustainable investment as

and/or social characteristics their objective
NA • Summary • Summary
• Description of the characteristics • Description of the characteristics
• Information on the methodologies • Information on the methodologies
for assessing, measuring and for assessing, measuring and
monitoring of the characteristics monitoring of the impact
• Due diligence on the underlying • Due diligence on the underlying
Website Disclosures assets
• Data sources, screening criteria for
assets
• Data sources, screening criteria for
the underlying assets and relevant the underlying assets and relevant
sustainability indicators sustainability indicators
• Limitation to methodologies & data • Limitation to methodologies & data
SFDR Roadmap Expected date RTS entry First PAI Statement PAI disclosure/Annual Report on first PAI Report on Second
PAI comply Big
First application date into force under RTS reporting on PAI reference period PAI
managers reference period
First Taxonomy alignment Second Taxonomy alignment APTimum
30 Dec2022/
10 March 2021 30 June 2021 01 Jan 2022 30 June 2022 30 June 2023 30 June 2024
01 Jan 2023
➢ Disclosure on • Additional
sustainability risks • Additional disclosures on
policies, all funds disclosures on Taxonomy alignment
Taxonomy for Environmental
➢ Due date for the ➢ Due date for the
➢ First detailed
WEBSITE
➢ Mandatory alignment for Taxonomy Funds report about the report about the
➢ Principal adverse PAI statement
sustainability impact
disclosure for big Climate Taxonomy first reference sec ond reference
Medium for publishing Entity level, Product level and Taxonomy
Fund Funds for c ompliant period period, inc luding a

Managers/Group Fund Managers.
c omparison
➢ Remuneration
policies
➢ Additional disclosures
on specific
characteristics
PRE-CONTRACTUAL
▪ Update of pre- Optional PAI

PRE- CONTRACTUAL
▪
▪ Integration of contractual disclosure at Fund
sustainability risks in information based on
disclosures
level starts for

(E.g. Prospectus)
investment decisions the templates compliant Fund

provided in the RTS Managers
▪ Likely impact of
sustainability risks on • Additional disclosures
Fund returns on Taxonomy • Additional
alignment for Climate disclosures on
▪ Additional Taxonomy Funds Taxonomy alignment
disclosures on for Environmental
characteristics starts Taxonomy Funds
▪ Annual report
(E.g. Annual Reports)
▪ Annual reporting on containing optional

PAI disclosure at Fund ➢ Entity
PERIODIC
characteristics starts
level for compliant ▪ Product
Fund Managers • Taxonomy Aligned
• Additional disclosures
on Taxonomy • Additional disclosures Taxonom y provides for the following six environmental objectives: •
alignment for Climate on Taxonomy two clim ate objectives: clim ate change m itigation and clim ate
alignment for change adaptation • four other environm ental objectives: the
Taxonomy Funds sustainable use and protection of water and m arine resources; the
Environmental transition to a circul ar economy; poll ution prevention and control;
Taxonomy Funds the protection and restoration of biodiversity and ecosystem s
Sustainability risks Art 8 & 9 Funds PAI entity level PAI Produc t level
APTimum
3
EU Taxonomy
Defining what is green and what is not

Context and purpose of the European Taxonomy Regulation
APTimum
1 2 3 4
Proposed to launch a An important enabler for Provides uniform criteria Aims to increase
sustainable finance strategy scaling up sustainable for companies and investors transparency and limit
aiming to redirect capital investment to determine which greenwashing risk and
flows to help generate implementing the economic activities can be market fragmentation
sustainable and inclusive European Green Deal considered in green activities and
growth environmentally investment projects
sustainable classification
The Taxonomy Regulation establishes for investors, companies, issuers and project promoters the framework for the
EU Taxonomy by setting out conditions that an economic activity must meet in order to qualify as environmentally
sustainable.
Insurance Issuers & Project Companies Investors

Promoters

Scope and application of the Taxonomy Regulation
APTimum
6 Environmental Objectives
Sustainable and
protection of Pollution prevention
1 3 5
Climate change water and
mitigation and control
marine resources
Protection and
2 4 6
Climate change Transition to a
adaptation preservation of
circular economy biodiversity and
ecosystems
OBJECTIVES 1 AND 2 ARE FOR 2021
OBJECTIVES 3 THROUGH 6 ARE FOR
APPLICATION ON ALL SECTORS
2022 APPLICATION ON ALL SECTORS
9 COMMON ECONOMIC SECTORS FOR OBJECTIVES 1 AND 2 4 EXTRA SECTORS FOR OBJECTIVE 2

Precisions on Environmental Objectives 1 and 2
APTimum
Environmental Objective 1 : Climate Change Mitigation

An economic activity that pursues the environmental objective of climate change
mitigation should contribute substantially to the stabilisation of greenhouse gas
emissions by avoiding or reducing them or by enhancing greenhouse gas
removals.
The economic activity should be consistent with the long-term temperature goal
of the Paris Agreement.
Environmental Objective 2 : Climate Change Adaptation

An economic activity that pursues the environmental objective of climate change
adaptation should contribute substantially to reducing or preventing the adverse
impact of the current or expected future climate, or the risks of such adverse
impact, whether on that activity itself or on people, nature or assets.
Economic activities that are to be considered as enabling climate change mitigation

activities should also be considered as contributing substantially to climate change
adaptation.

A sector scope covering 93.5% of European GHG emissions
5. Water Supply, Sewerage, Waste
1. Agriculture & Forestry 4. Energy
Management and Remediation
6. Transport APTimum
1. Growing of non-perennial crops 1. Electricity generation using solar photovoltaic 1. C onstruction, extension and operation of water 1. Passenger interurban rail transport
2. Growing of perennial crops technology collection, treatment and supply systems 2. Freight rail transport
3. Livestock production 2. Electricity generation using concentrated solar 2. Renewal of water collection, treatment and 3. Urban, suburban and road passenger transport
4. Afforestation power (CSP) technology supply systems 4. Operation of personal mobility devices
5. Rehabilitation and restoration of forests 3. Electricity generation from wind power 3. C onstruction, extension and operation of waste 5. Transport by motorbikes, passenger cars and
6. Reforestation 4. Electricity generation from ocean energy water collection and treatment commercial vehicles
7. Improved forest management technologies 4. Renewal of waste water collection and 6. Freight transport services by road
8. C onservation forestry 5. Electricity generation from hydropower treatment 7. Inland passenger water transport
6. Electricity generation from geothermal energy 5. C ollection and transport of non-hazardous 8. Inland freight water transport
7. Electricity generation from gaseous and liquid waste in source segregated fractions 9. Retrofitting of inland water passenger and
2. Environmental Protection & fuels 6. Anaerobic digestion of sewage sludge freight transport
Restoration 8. Electricity generation from bioenergy 7. Anaerobic digestion of bio-waste 10. Sea and coastal freight water transport
1. Restoration of wetlands 9. Transmission and distribution of electricity 8. C omposting of bio-waste 11. Sea and coastal passenger water transport
10. Storage of electricity 9. Material recovery from non-hazardous waste 12. Retrofitting of sea and coastal freight and
11. Storage of thermal energy 10. Landfill gas capture and utilisation passenger water transport
12. Storage of hydrogen 11. Transport of CO2 13. Infrastructure for personal mobility
3. Manufacturing 13. Manufacture of biogas and biofuels for use in 12. Underground permanent geological storage of 14. Infrastructure for rail transport
transport C O2 15. Infrastructure enabling low-carbon road
1. Manufacture of renewable energy technologies 14. Transmission and distribution networks for transport
2. Manufacture of equipment for the production of renewable and low-carbon gases 16. Infrastructure for water transport
hydrogen 15. District heating/cooling distribution 7. Construction & Real Estate 17. Low-carbon airport infrastructure
3. Manufacture of low carbon technologies for 16. Installation of electric heat pumps
transport 17. C ogeneration of heat/cool and power from solar 1. C onstruction of new buildings
4. Manufacture of energy efficiency equipment for energy 2. Renovation of existing buildings
buildings 18. C ogeneration of heat/cool and power from 3. Installation, maintenance and repair of energy 8. Information & Communication
5. Manufacture of other low carbon technologies geothermal energy efficiency equipment
6. Manufacture of cement 19. C ogeneration of heat/cool and power from 4. Installation, maintenance and repair of 1. Data processing, hosting and related activities
7. Manufacture of aluminium gaseous and liquid fuels charging stations for electric vehicles in 2. C omputer programming, consultancy and
8. Manufacture of iron and steel 20. C ogeneration of heat/cool and power from buildings (and parking spaces attached to related activities
9. Manufacture of hydrogen bioenergy buildings) 3. Programming and broadcasting activities
10. Manufacture of carbon black 21. Production of heat/cool from solar thermal 5. Installation, maintenance and repair of 4. Data-driven solutions for GHG emissions
11. Manufacture of disodium carbonate heating instruments and devices for measuring, reductions
12. Manufacture of chlorine 22. Production of heat/cool from geothermal regulation and controlling energy performance
13. Manufacture of organic basic chemicals energy of buildings
23. Production of heat/cool from gaseous and liquid 6. Installation, maintenance and repair of
9. Professional, Scientific and
14. Manufacture of anhydrous ammonia
15. Manufacture of nitric acid fuels renewable energy technologies Technical Activities
16. Manufacture of plastics in primary form 24. Production of heat/cool from bioenergy 7. Acquisition and ownership of buildings 1. Engineering activities and related technical
25. Production of heat/cool using waste heat consultancy dedicated to adaptation to climate
13. Arts, Entertainment and change
10. Financial and Insurance 2. Research, development and innovation related
Activities 11. Education Recreation to nature based solutions for adaptation
1. Non-life insurance: underwriting of climate- 1. C reative, arts and entertainment activities 3. Research, development and innovation
related perils 2. Libraries, archives, museums and cultural 4. Professional services related to energy
12. Human Health and Social Work performance of buildings
2. Reinsurance activities
Activities 3. Motion picture, video and television programme
1. Residential care activities production, sound recording and music
publishing activities C apgemini Invent 2021.
Four conditions defining a “Green” activity
APTimum
4 Meet technical screening criteria (e.g. quantitative
thresholds or qualitative assessment)
1 2 3
Make a Substantial
Do No Significant Harm Meet minimum social
Contribution to 1 or more of
(DNSH) any of the other safeguards
the 6 environmental
environmental objectives
objectives
Technical screening criteria are to take into account : Minimum social safeguards correspond to :
• the nature and the scale of the economic activity and sector that they refer to • OECD Guidelines on Multinational
• whether the economic activity is a transitional economic activity or an enabling Enterprises
activity, as referred to the Regulation
• UN Guiding Principles on Business
They should be set as a quantitative threshold or minimum requirement, as a relative and Human Rights
improvement, as a set of qualitative performance, as process or practice-based
requirements, or as a precise description of the nature of the economic activity itself
ensuring that :
• the economic activity makes a positive impact on the climate objective or reduces
negative impact on the climate objective for Substantial Contribution
• the economic activity has no significant negative environmental impact, i.e. that
contribution to one of the environmental objectives is not made at the expense of
other environmental objectives for Do No Significant Harm.

Minimum social safeguards
APTimum
OECD Guidelines on Multinational UN Guiding Principles on Business and
Enterprises Human Rights
The OECD Guidelines for Multinational Enterprises are These Guiding Principles are grounded in recognition of :
recommendations (2011) addressed by governments to
multinational enterprises operating in or from adhering a) States’ existing obligations to respect, protect and fulfil
countries. human rights and fundamental freedoms;
They focus on business ethics issues : b) The role of business enterprises as specialized organs of
• Employment and industrial relations society performing specialized functions, required to
• Consumer interests comply with all applicable laws and to respect
• Human relations human rights;
• Science & Technology
• Environment c) The need for rights and obligations to be matched to
• Competition appropriate and effective remedies when breached.
• Information disclosure
• Taxation They :
• Combating bribery
• apply to all States and to all business enterprises,
OECD Guidelines for Multinatinational Enterprises provide both transnational and others, regardless of their size,
non-binding principles and standards for responsible sector, location, ownership and structure;
business conduct in a global context consistent with
applicable laws and internationally recognized standards • should allow to enhance standards and practices with
regard to business and human rights so as to achieve
An Annual Report is yearly produced, so updated, and tangible results for affected individuals and communities,
describes work on implementation of the Guidelines and thereby also contributing to a socially sustainable
and more broadly on responsible business conducts globalization.

APTimum
TAXONOMY REGULATION
SAMPLE CRITERIA

Sample 1: Construction of new buildings for climate change
adaptation (1/2) APTimum
Description
Development of building projects for residential and non-residential buildings by bringing together financial, technical and physical means to realise the
building projects for later sale as well as the construction of complete residential or non-residential buildings, on own account for sale or on a fee or
contract basis.
Technical Screening Criteria : substantial contribution
The economic activity has implemented physical and non-physical solutions (adaptation solutions) that reduce the most important physical climate risks that
are material to that activity.
A robust state-of-the-art climate risk and vulnerability assessment is performed, proportionate to the scale of the activity and its expected lifespan, such that :
• for investments into adaptation solutions activities with an expected lifespan of less than 10 years, the assessment is performed, at least by using downscaling of
climate projections;
• for all other activities, the assessment is performed using high resolution, state-of- the-art climate projections across a range of future scenarios consistent with the
expected lifetime of the activity, including, at least, 10 to 30 years climate projections scenarios for major investments.
The adaptation solutions implemented :

a) do not adversely affect the adaptation efforts or the level of resilience to physical climate risks of other people, of nature, of assets and of other economic activities
b) favour nature-based solutions or rely on blue or green infrastructure to the extent possible
c) are consistent with local, sectoral, regional or national adaptation efforts
d) are monitored and measured against pre-defined indicators and remedial action is considered where those indicators are not met
e) where the solution implemented is physical and consists in an activity for which technical screening criteria have been specified in the Annex 2 (Regulation) the
solution complies with the do no significant harm technical screening criteria for that activity.

Sample 1: Construction of new buildings for climate change
adaptation (2/2) APTimum
Technical Screening Criteria : do no significant harm (DNSH)
1) Climate change mitigation : The building is not dedicated to extraction, storage, transport or manufacture of fossil fuels. The Primary Energy Demand (PED)
setting out the energy performance of the building resulting from the construction does not exceed the threshold set for the nearly zero-energy building (NZEB)
requirements.
3) Sustainable use and protection of water and marine resources : Where installed, the specified water use for the following water appliances are attested by
product datasheets, a building certification or an existing product label in the Union :
• wash hand basin taps, kitchen taps and showers have a maximum water flow of 6 litres/min
• WCs, including suites, bowls and flushing cisterns, have a full flush volume of a maximum of 6 litres and a maximum average flush volume of 3,5 litres
• …
4) Transition to a circular economy : At least 70 % (by weight) of the non-hazardous construction and demolition waste generated on the construction site is
prepared for re-use, recycling and other material recovery, including backfilling operations using waste to substitute other materials...
5) Pollution prevention and control : Building components and materials used in the construction do not contain asbestos nor substances of very high concern as
identified on the basis of the list of substances subject to authorisation set out in Annex XIV to Regulation (EC) No 1907/2006. Building components and materials
used in the construction that may come into contact with occupiers679 emit less than 0,06 mg of formaldehyde per m3 of material or component and less than 0,001
mg of categories 1A and 1B carcinogenic volatile organic compounds per m3 of material or component, upon testing in accordance with CEN/TS 16516680 and ISO
16000-3681 or other comparable standardised test conditions and determination methods…
6) Protection and restoration biodiversity ecosystems : The new construction is not built on one of the following :
• arable land and crop land with a moderate to high level of soil fertility and below ground biodiversity
• greenfield land of recognised high biodiversity value and land that serves as habitat of endangered species (flora and fauna)
• forest land (whether or not covered by trees), other wooded land or land that is partially or wholly covered or intended to be covered by trees, even where
those trees have not yet reached the size and cover to be classified as forest or other wooded land

Sample 2: Urban, suburban and road passenger transport for
climate change mitigation APTimum
Description
Operation of urban and suburban transport systems for passengers and road passenger transport. This may include different modes of land transport, such
as by motor bus, tramway, streetcar, trolley bus, underground and elevated railways, town-to-airport operation, long-distance bus services, excursion…
Technical Screening Criteria : substantial contribution

The direct (tailpipe) CO2 emissions of the vehicles are zero.
Technical Screening Criteria : do no significant harm (DNSH)
2) Climate change adaptation : The activity complies with the criteria set out in Appendix E to the Annex 1 of the Regulation (similar to Technical Screening Criteria
for substantial contribution of Zoom 1).
3) Sustainable use and protection of water and marine resources : N/A
4) Transition to a circular economy : Measures are in place to manage waste, in accordance with the waste hierarchy, both in the use phase (maintenance) and the
end-of-life of the fleet. For battery-operated fleet, those measures include reuse and recycling of batteries and electronics, including critical raw materials therein.
Vehicles of all types purchased or operated do not contain lead, mercury, hexavalent chromium and cadmium, except for the exemptions listed in Annex II to
Directive 2000/53/EC of the European Parliament and of the Council.
5) Pollution prevention and control : For road vehicles of categories M and N, tyres comply with external rolling noise Class A and with energy performance class A or
B set out in Regulation (EU) 2020/740 of the European Parliament and of the Council. Where applicable, tyres comply with the noise requirements laid down in
Regulation (EC) No 661/2009 of the European Parliament and of the Council.
6) Protection and restoration of biodiversity and ecosystems : N/A

Sample 3: examples from the energy sector
Activity
Technical Screening Cri teria
Climate Change Mitigation
Do No Si gnificant Harm Cri teria
APTimum
1 .E lectricity generation
1 . robus t c limate risk and vulnerability as sessment + adaptation ac tions
us ing s olar photovoltaic T he ac tivity generates electricity using s olar P V technology
4 . E quipment and c omponents of high durability and rec yclability
tec hnology
2 .E lectricity generation 3 . Water us e and protec tion management plan to pres erve water quality and avoid water s tress
us ing c oncentrated solar T he ac tivity generates electricity using CSP technology. 4 . E quipment and c omponents of high durability and rec yclability
power (C SP ) technology 6 . E nvironmental I mpact Assessment with related mitigation and c ompensation
2 . For offs hore wind, c ompliance with E U D irective 2 008/56/EC for D es criptor 1 1 (N oise/Energy), and C ommission D ecision
(E U ) 2 0 17/848239 for c riteria and methodological s tandards for that des c riptor.
3 .E lectricity generation 4 . E quipment and c omponents of high durability and rec yclability
T he ac tivity generates electricity from wind power.
from wind power 6 . E nvironmental I mpact Assessment with related mitigation and c ompensation
6 . I n c as e of offs hore wind, c ompliance with E U D irective 2 008/56/EC in relation to its D escriptors 1 (biodiversity) and 6
(s eabed integrity), and C ommission D ecision (E U)2017/848 for c riteria and methodological s tandards for thos e descriptors.
3 . C ompliance with the requirements of D irec tive 2 008/56/EC in relation to its D escriptor 1 1 (N oise/Energy), and C ommission
D ec ision (E U) 2 017/8 48 for c riteria and methodological s tandards for that des c riptor.
4 .E lectricity generation 4 . E quipment and c omponents of high durability and rec yclability
from oc ean energy T he ac tivity generates electricity from oc ean energy. 5 . M easures in place to minimise toxicity of anti-fouling paint and biocides as laid down in Regulation (E U) N o 5 28/2012
tec hnologies 6 . E nvironmental I mpact Assessment with related mitigation and c ompensation
C ompliance with the requirements of D irective 2 008/56/EC in relation to its D escriptors 1 (biodiversity), and C ommission
D ec ision (E U)2017/848 for c riteria and methodological standards for thos e descriptors.
3 . E nvironmental degradation ris ks related to pres erving water quality and avoiding water s tress identified and addressed, in
L ife- cycle G HG emissions lower than 1 0 0gCO2e/kWh.
ac c ordance with a water us e and protec tion management plan
6 .E lectricity generation L ife-cycle G HG emission s avings c alculated us ing C omm. Recommend. 2 0 13/179/EU or, alt., us ing I SO
5 . For the operation of high-enthalpy geothermal energy s ystems, adequate abatement s ystems in place to c omply with the
from geothermal energy 1 4 0 67:2018 or I SO 1 4064- 1:2018.
air emis s ion requirements s et out in E U D irectives 2 004/107/EC and 2 008/50/EC
Q uantified life-cycle G HG emissions verified by an independent third party.
6 . E nvironmental I mpact Assessment with related mitigation and c ompensation
L ife- cycle G HG emissions lower than 1 0 0gCO2e/kWh.
3 . E nvironmental degradation ris ks related to pres erving water quality and avoiding water s tress identified and addressed, in
L ife-cycle G HG emissions calculated based on projec t-specific data, where available, us ing C ommission
ac c ordance with a water us e and protec tion management plan, developed in c onsultation with relevant s takeholders
Rec ommendation 2 013/179/EU or, alternatively, us ing I SO 1 4067:2018 or I SO 1 4064 -1:2 018.
5 . E mis sions within or lower than the emis s ion levels associated with the bes t available techniques (BAT -AEL) ranges s et out
7 .E lectricity generation Q uantified life-cycle G HG emissions verified by an independent third party.
in the bes t available techniques (BAT) c onclusions for large c ombustion plants - no s ignificant c ross-media effects oc cur.
from gas eous and liquid A batement ac tivity c omplying with c riteria defined in the T axonomy (incl. technical s creening c riteria for
For c ombus tion plants greater than 1 M W thermal input but below the thres holds for the BA T c onclusions for large
fuels trans port and s torage of C O2)
c ombus tion plants to apply, emissions below the emis sion limit values set out in A nnex I I, part 2 , to D irec tive (E U)
I ns tallation of meas urement equipment for monitoring of phys ical emissions, s uch as methane leakage, or a
2 0 1 5/2193
leak detec tion and repair program is introduced, or phys ical measurement of emis sions reported and
leakages repaired at operation.
1 . A gricultural biomass us ed in the ac tivity complies with the c riteria laid down in A rticle 2 9, paragraphs 2
3 . E nvironmental degradation ris ks related to pres erving water quality and avoiding water s tress are identified and
to 5 , of D irec tive (E U) 2 018/2 001. Forest biomass us ed in the ac tivity c omplies with the c riteria laid down
addres sed, in ac cordance with a water us e and protec tion management plan, developed in c onsultation with relevant
in A rticle 2 9, paragraphs 6 and 7 , of that D irec tive.
s takeholders
2 . T he greenhouse gas emission s avings from the us e of biomas s are at leas t 8 0 % in relation to the G H G
5 . For ins tallations falling within the s c ope of D irective 2 010/75/EU, emissions within or lower than the emis s ion levels
s aving methodology and the relative fossil fuel c omparator s et out in A nnex V I to D irective (E U)
as s ociated with the bes t available techniques (BAT -AEL) ranges set out in the bes t available techniques (BAT) c onclusions for
2 0 1 8/2001.
large c ombus tion plants - no s ignificant c ross-media effects occur.
3 . Where the ins tallations rely on anaerobic digestion of organic material, the produc tion of the diges tate
For c ombus tion plants greater than 1 M W thermal input but below the thres holds for the BA T c onclusions for large
meets the c riteria in Sections 5 .6 and c riteria 1 and 2 of Sec tion 5 .7 of this Annex, as applicable.
c ombus tion plants to apply, emissions are below the emis sion limit values s et out in A nnex I I, part 2 , to D irec tive (E U)
4 . P oints 1 and 2 do not apply to elec tricity generation installations with a total rated thermal input below 2
2 0 1 5/2193.
8 .E lectricity generation M W and us ing gas eous biomass fuels.
For plants in zones or parts of zones not c omplying with the air quality limit values laid down in D irec tive 2 008/50/EC of th e
from bioenergy 5 . For elec tricity generation ins tallations with a total rated thermal input from 5 0 to 1 0 0 M W, the ac tivity
E uropean P arliament and of the C ounc il277, res ults of the information exchange whic h are published by the C ommission in
applies high-efficiency c ogeneration technology, or, for elec tricity-only installations, the ac tivity meets an
ac c ordance with A rticle 6 , paragraphs 9 and 1 0 , of D irec tive (E U) 2 0 15/2193 taken into ac count.
energy effic iency level as sociated with the bes t available techniques (BAT -AEELs) as referred to in
For anaerobic digestion of organic material, the produc ed digestate is used as fertiliser or s oil improver, either directly or
C ommission I mplementing D ecision (E U) 2 017/1 442271.
after c ompos ting or any other treatment, and meets the requirements for fertilising materials s et out in C omponent M aterial
6 . For elec tricity generation ins tallations with a total rated thermal input above 1 00 M W, the ac tivity
C ategories (CMC) 4 and 5 in A nnex I I to Regulation (E U) 2 0 19/1009 and relevant national law on fertilis ing produc ts.
c omplies with one or more of the following c riteria:
For anaerobic digestion plants treating over 1 00 tonnes per day, emis sions to air and water are within or lower than the
(a) attain elec trical effic iency of at leas t 3 6 % ;
emis s ion levels associated with the bes t available techniques (BAT -AEL) ranges s et for anaerobic treatment of was te in the
(b) generate highly effic ient CHP (c ombined heat and power) as referred to in D irec tive 2 012/2 7/EU of the
bes t available techniques (BAT) c onclusions for was te treatment279. N o s ignificant c ross -media effects oc cur.
E uropean P arliament and of the C ounc il272;
(c ) us e c arbon c apture and s torage technology. C apgemini Invent 2021.
Green Asset Ratio - Overview
The Green Asset Ratio (GAR) is a KPI proposed by the European Banking Authority that shows the proportion of assets that are environmentally sustainable and contribute
substantially to the objectives of climate change mitigation or climate change adaptation or that enable other activities to contribute substantially to those objectives.
THE EBA PROPOSES FOUR TYPES OF KPIs:

Loans and advances, debt securities, equities, repossessed
❑ Green Asset ratio collaterals financing Taxonomy-aligned economic activities, , thus
To understand how institutions are financing activities that will capturing total Taxonomy-aligned exposures, except for sovereign
meet the publicly agreed Paris agreement objectives of climate exposures to non-NFRD counterparties, derivatives, on-demand
change mitigation and adaptation based on the EU taxonomy interbank loans, cash-related assets
❑ KPI on the trading portfolio Taxonomy-aligned exposures for loans &

GAR = advances, debt securities and equity holdings
❑ KPI on fees and commissions income Total eligible exposures
Total assets of a bank except sovereign

❑ KPIs on off-balance sheet exposures exposures, central bank exposures and trading book.
WHY GAR? WHAT IT MEANS FOR BANKS?
• Green Asset Ratio will provide investors and regulators with a

Better Transparency Reputational Risk
Single KPI will make it easier to The proposed approach will expose banks
single metric to determine how green a bank’s balance sheet is
communication and increase to renewed public scrutiny and laggards in
transparency sustainability will face increased
• GAR will serve as metric to help investors make peer-to-peer reputational risks
comparisons and better direct their capital
• The ratio will also help policymakers better understand where Structural Data Challenges Transitional Challenges
the capital shortfalls are and feed into policy directives Banks might face difficulties collecting data Abrupt reliance on GAR by investors, regulators,
from corporate clients that aren’t subject to etc may force banks to make changes to their
• GAR will allow better stakeholder communication for banks reporting requirements because they’re portfolio mix in short span time and they are
regarding sustainability and climate related objectives and goals based outside Europe likely to face transitional challenges

Green Asset Ratio – KPI Areas
Non-financial corporations Residential real estate
subject to NFRD disclosure exposure
obligations
Financial corporates Retail car loans
Commercial real estate Loans to local governments

exposures for housing financing
Debt securities & other
Repossessed real estate
loans & advances to non-
collateral held for sale
NFRD companies
TIMELINE GUIDANCE BY EBA:

2021 2022 2023 2024
Jan 2022
By Dec 2022 By Jun 2024
for c ounterparties on whose For c redit facilities granted
KPIs for stoc k once it is
data institution have to rely before the applic ation date,
public ly disc losed by
for their own disc losures, for through regular c redit reviews
c ounterparties
the financ ial year 2021 of borrowers
ON ONGOING BASIS
KPIs related to exposures or services to Update KPIs for flows for any new loan granted from the date on whic h their c ounterparties c an make this information available
corporates subject to NFRD
For new lending, banks should start requesting the relevant information in the loan origination proc ess no transition period is proposed.
KPIs related to exposures to corporates
not subject to NFRD and to households

Green Asset Ratio - Definitions
RESIDENTIAL REAL ESTATE LENDING COMMERCIAL REAL ESTATE EXPOSURES
For the GAR on retail exposures the technical screening criteria w ill have to be EBA suggests applying the transition period until June 2024 for the disclosure of
applied information on the stock of exposures to SMEs and other non-financial corporations
Residential mortgage loans to households aligned with the Loans to SMEs collateralised by commercial immovable property,
taxonomy (climate change mitigation objective) and house renovation loans, aligned with the taxonomy,
GAR = GAR =
Total residential mortgage loans Total loans to SMEs collateralised by commercial immovable property
A transition period of three years is proposed for disclosures on real estate

loans, during w hich proxies should be used
REPOSSESSED REAL ESTATE COLLATERAL HELD FOR SALE LOANS FOR PUBLIC HOUSING
commercial and residential repossessed collateral aligned with the loans to municipalities financing public housing aligned with the
taxonomy taxonomy
GAR = GAR =
total commercial and residential repossessed real estate collateral Total loans to municipalities financing public housing

Green Asset Ratio - Definitions
NON-FINANCIAL CORPORATIONS SUBJECT TO NFRD DEBT SECURITIES & OTHER LOANS & ADVANCES TO NON-NFRD COMPANIES
The counterparty w ill provide the information on the taxonomy alignment for The Green Asset Ratio calculation is based upon a similar three step approach as
specialised loans for exposures to NFRD non-financial corporates
debt sec urities, other loans & advanc es and equity instruments financing
Loans & advanc es, debt sec urities, equity instruments financing
ec onomic activities in sectors covered by the taxonomy
STEP 1 = ec onomic activities in sectors covered by the taxonomy
Total loans & advanc es, debt securities, & equity instruments of NFRD
STEP 1 = total debt securities, other loans & advanc es and equity instruments
NFC
loans & advanc es, debt sec urities, equity instruments financing debt sec urities, other loans & advanc es and equity instruments financing
taxonomy c ompliant economic ac tivities
STEP 2 =
taxonomy c ompliant economic ac tivities
loans & advanc es, debt sec urities, equity instruments financing economic
STEP 2 = debt sec urities, other loans & advanc es and equity instruments financing
ac tivities in sectors c overed by the taxonomy ec onomic activities in sectors covered by the taxonomy
loans & advances, debt securities, equity instruments financing debt securities, other loans & advances and equity instruments
taxonomy compliant economic activities financing taxonomy compliant economic activities
GAR = the total loans & advances, debt securities and equity instruments of
GAR =
total debt securities, other loans & advances and equity instruments
NFRD NFC
FINANCIAL CORPORATES OTHER KPIs

The GAR for financial corporates w ill be calculated based upon the NFRD
disclosures of the counterparties
KPIs for off-balance Trading portfolio
sheet exposures disclosures
THIS WILL INCLUDE:
▪ Exposures to other credit institutions
▪ Exposures to investment firms
▪ Exposures to asset managers
KPIs for fees &
▪ Exposures to insurance companies
commissions (F&C KPI)

3.a
EU Taxonomy for Gas
and Nuclear activities
(Under Discussions)
Presentation Title | Author | Date Company Confidential © Capgemini Invent 2021. All rights reserved | 45
EU Taxonomy – Delegated Act for Gas and Nuclear activities
EU Taxonomy is a standardised classification system designed to help users determine what is environmentally sustainable
EU Taxonomy Introduction EU Taxonomy Complementary Delegated Act (CDA) Draft,
Jan 2022
• The overarching goal of the Taxonomy is to set minimum
thresholds, facilitate comparison, and ultimately prevent
‘greenwashing’. The foundation of the Taxonomy is based The European Commission (EC) has developed a draft
on six environmental objectives: focussing on activities in energy system specifically gas and
nuclear power and announced it on 1st Jan 2022
Protection of
Climate Change Climate Change Water and
Mitigation Adaptation Marine
Resources The proposal focuses on classifying Gas and Nuclear activities
under EU Taxonomy especially for the first two climate
Circular Pollution Biodiversity &
related objectives
Economy Prevention & Ecosystem
Transition Control Protection
They reached out to “EU Platform on Sustainable Finance”
• Under the Taxonomy an economic activity is considered and member states for consultation purpose
environmentally sustainable or considered as Taxonomy-
aligned activities,
If they meet the Technical Screening Criteria On 21st Jan 2022, EU Platform on Sustainable Finance
(TSC) for any one of the six objectives and submitted their response to the CDA
DNSH (Do No Significant Harm) to other
objectives and complies with minimum social and
governance safeguards.
It takes around 4-6 months for the European parliament and
• TSC is provided and are being followed for the first two Council to review and approve it
objectives Climate Change Mitigation (CCM) and Climate
Change Adaptation (CCA)
ESG Standards Company Confidential © Capgemini Invent 2021. All rights reserved | 46
For Nuclear Energy For Fossil Gas
Three activities are proposed under Nuclear energy, Three fossil gas activities considered are:
they are:
• Demonstration units for advanced nuclear • Electricity generation
technologies • High-efficiency cogeneration
• The construction of new nuclear power plants • District heating and cooling
using best available technologies
• Electricity generation from existing nuclear ▪ Detailed conditions include that for new gas
installations plants approved before the end of 2030 with
emissions thresholds in place
▪ For existing nuclear plants to be considered as
green, there is a provision available in this draft ▪ Direct greenhouse gas emissions need to be
below 270g of CO2 equivalent per kWh of
▪ Permissions for new Nuclear power plants energy output, or annual emissions can not
which are given until 2045 are considered as exceed 550kg CO2e/kW of energy output over
green, if they can safely dispose the nuclear 20 years.
waste and DNSH to the climate.
▪ Gas will be considered sustainable if it replaces
▪ Specific requirements are clearly mentioned for coal power, and operators need to demonstrate
managing radioactive waste including some that co-firing of low-carbon gases will be possible
points related to the export of radioactive waste and plans are in place to use at least 30% of them
to third countries. from 2026.
EU Platform on Sustainable Finance Response to the CDA
• EU Platform on Sustainable Finance – whose members include utilities, corporations, banks and nongovernmental organizations – have responded with a
detailed report of feedback and recommendations for the European Commission on the draft CDA
• The final conclusion from the response report is that “ the draft CDA activities are not line with the Taxonomy regulation and most members see a serious
risk of undermining the sustainable Taxonomy framework. Further, Platform members have doubts about how the draft criteria would work in practice”
• The key points from the Response report are:
• Draft CDA approach to activities: There are many differences in the approach to developing the draft CDA TSC’s compared to requirements laid out in the
Taxonomy Regulation and the design of TSCs in the existing Climate Delegated Act and the Taxonomy Regulation requirements. In their current form, the
draft CDA TSCs4 are not suitable for green, sustainable finance products or instruments in the market today.
• Electricity Generation from Fossil Gaseous fuels: That criterion 1.b) is removed and criterion 1.a)100g CO2e/kWh on a life cycle basis is maintained as this
is the science-based, technology neutral approach consistent with other energy activities in the existing climate delegated act. Any criteria for GHG emissions
above 100g CO2e/kWh on a life-cycle basis could use an alternative Taxonomy treatment such as an Intermediate Performance (or Amber zone) in any
extended Taxonomy beyond green
• Nuclear Energy Generation: The current TSCs do not meet the requirements of the Taxonomy Regulation. They are insufficient to allow recognition of
existing or new nuclear facilities as a sustainable economic activity due to the lack of performance criteria or confident mechanism to ensure DNSH
performance in the criteria.
• Disclosures by companies and for financial products: The draft disclosure arrangements are unsuitable for financial markets as they do not sufficiently
distinguish the draft CDA activities from other Taxonomy aligned disclosures. The measurement and verification requirements are insufficient for monitoring
performance of the TSCs in the draft CDA and thus also for assessing taxonomy alignment.
• Finally through this report, the EU Platform on Sustainable Finance largely rejected the commission's draft legislation, which labels
nuclear and gas infrastructure as "green" investments
• Several other sustainability and finance experts are also advising that Nuclear power and natural gas should not be labelled as green
• There is a huge pushback from several places across the Europe regarding the gas and nuclear inclusion
• But due to several other reasons (political) there is a high chance of acceptance of this draft by EU parliament and Council
3.b
UK Green Taxonomy
UK Green Taxonomy
APTimum
The structure of the Taxonomy draws on the EU approach which the UK helped design as a former
Member State
Objectives Approach
‒ Robust and evidence-based: The Taxonomy will take an objective and
‒ Create clarity and consistency for investors, science-based approach to assessing sustainability
‒ Improve understanding of companies’ ‒ Accessible: The government will take a co-ordinated and consultative
environmental impact approach to developing the Taxonomy, incorporating learning from other
‒ Provide an informative performance target for taxonomies developed internationally
companies ‒ Built for the UK to support a global transition: The government will
take an approach that is suitable for the UK market and consistent with UK
government policy
ENVIRONMENTAL OBJECTIVES OF TAXONOMY Like EU Taxonomy, to be considered Taxonomy-aligned, an activity must meet
three tests –
• Make a substantial contribution to one of six environmental objectives
• Do no significant harm to the other objectives
• Meet a set of minimum safeguards
Climate Change Pollution Protection and
Mitigation prevention and
The Taxonomy also recognises companies which are working to meet environmental
restoration of
control biodiversity ecosystem objectives in the future in –
• Transitional activities: Due to technological constraints, some economic activities cannot

currently be conducted in a way which is aligned with net zero-ambitions. For a number of
these activities, the TSCs will set the threshold for Taxonomy alignment at the best -in-sector
emissions level (subject to not locking in carbon-intensive activities)
Climate Change
Adaptation • Investment: Companies will report the proportion of their capital expenditure which is
Transition to Sustainable use and Taxonomy-aligned enabling them to demonstrate their investment in producing green
Criteria are subject to
circular economy protection of water and activities in the future
consultation in Q1
marine resources
2022
• Enabling Activities: Includes activities which currently support the transition by enabling
There will be an individual Technical Screening Criteria for each economic substantial contributions to environmental objectives in other sectors, but which are not yet
activity included in the Taxonomy, which identifies how that activity can sustainable themselves
make a substantial contribution to the environmental objective. C apgemini Invent 2021.
Development and Implementation of Green Taxonomy
In June 2021, the government launched the Green Technical Advisory Group (GTAG) to provide independent advice on market, regulatory and
APTimum
scientific considerations around developing and implementing the Taxonomy. Chaired by the Green Finance Institute, the GTAG f irst met in June and
has since established a workplan and structure in line with its Terms of Reference
The UK will implement TSCs for each of the Taxonomy’s objectives, ensuring Development of Further Technical
that these are evidence-based, accessible and built for the UK market. This Screening Criteria (TSC)
implies that:
▪ Companies will have adequate notice before becoming subject to disclosure • The Taxonomy will focus on the outcomes of economic
requirements activities, rather than technologies used
▪ TSCs will be subject to public consultation to ensure that they take a rigorous
approach that works for the UK market • The government expects to consult on the expansion of
the climate TSCs and standards for the remaining four
▪ TSCs will be made through statutory instruments implying that TSCs will not be
amended without due notice environmental objectives during the first quarter of 2023
in advance of laying legislation before Parliament
▪ The government will use regulatory guidance and develop presentational tools to
increase ease of application
▪ Disclosure requirements for corporates will come into force prior to those for
investment products, enabling the former to feed into the latter The Government is currently reviewing these and expects to
consult on UK draft TSCs in the first quarter of 2022, ahead
▪ The government plans to focus on delivering the Taxonomy and ensuring that it of legislating by the end of 2022
has been road-tested by the market before considering any changes or an
extension to its scope
TIMELINE Consultation of TSCs for Consultation for TSCs for

Published the Green Financing – Environmental Objective 1 & 2 in Q1 remaining four Environmental
Roadmap to Sustainable Investing 2022 Objective in Q1 2023
2020 2021 2022 2023
UK announced its 10 point climate plan to create Green Technical Advisory Group Legislation on the Objective
green industrial revolution including the decision established 1 & 2 TSCs later in 2022
to implement UK Green Taxonomy
4
Task Force on Climate-
related Financial
Disclosures
Providing reliable and comprehensive
disclosures on climate change risks
and opportunities

Task Force on Climate-related Financial Disclosures (TCFD):
Reporting as a lever to mitigate climate risk APTimum
The TCFD was established following the COP 21 in 2015, by the Finance Stability Board (FSB) to develop a set of voluntary, consistent disclosure
recommendations for use by companies in providing information to investors, lenders and insurance underwriters about their climate-related
financial risks
The TCFD recommendations on climate-related financial disclosures are widely adoptable and applicable to organizations across
sectors and jurisdictions. They are designed to solicit decision-useful, forward-looking information that can be included in
mainstream financial filings.
SCOPE & APPLICATION
1 THEMATIC AREAS 2 PRINCIPLES CLIMATE

Governance FOR SCENARIOS
Recommendations on core elements of how organizations operate: DISCLOSURE
• Governance: Disclose the organization’s governance around climate-related Strategy Recommendation to
risks and opportunities Recommendation describe the resilience
• Strategy: Disclose the actual and potential impacts of climate-related risks Risk to achieve high- of strategy, taking
and opportunities on the organization’s businesses, strategy, and financial Management quality into consideration
planning where such information is material. disclosures that different climate-
• Risk Management: Disclose how the organization identifies, assesses, and Metrics enable users to related scenarios,
manages climate-related risks. & understand the including a 2°C or
• Metrics and Targets: Disclose the metrics and targets used to assess and Targets impact of lower scenario, where
manage relevant climate-related risks and opportunities where such climate change such information is
information is material on organizations material.
2015 2017 2019 2020 2021

TIMELINE
COP21 & launch of TCFD TCFD Final Report on TCFD 1st Status TCFD 2nd TCFD 3rd Status Report & possible
recommendations for disclosures Report Status Report standardization (cf. next slide)
Status report are meant to (1) provide support in understanding disclosure

practices;(2) identify challenges; and (3) provide guidance and details on
implementation of recommendations

From recommendations to widespread implementation APTimum
1,600+ 2017: A NON-BINDING REPORTING FRAMEWORK

The TCFD published its first recommendations in 2017, and was embraced by the European
organizations have commission as a non-binding climate reporting standard
expressed their support for
the TCFD 2017 – 2020: GROWING WORLDWIDE SUPPORT
recommendations Support from the private sector quickly grew from around 100 CEOs, to more than 600 companies
(+85% from 2019) in 2019, and over 1600 companies today, representing over 12$ trillion of global market capitalization.
While this support is worldwide, it is worth pointing out that almost half of these companies are based
in Europe.
60% 2020: FRANCE MOVING TOWARDS WIDESPREAD IMPLEMENTATION

of the world’s 100 largest In France, alignment to the TCFD from CAC40 companies jumped from 13% in 2018, to 43% in 2019, to
public companies support continue increasing to over 50% in 2020. Today 22 out of the 40 companies claim alignment with
the TCFD, report in line TCFD, but also have precise communication on the 4 thematic areas identified by the TCFD.
with the TCFD
recommendations, or both On December 12, 2020, on the 5-year anniversary of the Paris agreement, the CAC40
companies all committed to implement the TCFD climat reporting recommendations starting
in 2021.
100% NOTE:
Support to the TCFD: indicates that your organization believes the TCFD recommendations provide a useful framework to increase
Of the CAC40 companies transparency on climate-related risks and opportunities within financial markets. It is a commitment to work toward their own
have committed to implementation of the TCFD recommendations
implement TCFD reporting Alignement with TCFD: using the TCFD framework for climate disclosure and reporting; the TCFD framework is aligned with several
in 2021 other frameworks such as GRI and CDP questionnaire, ensuring ease of integration for a lot of organizations that have already aligned to
other reporting frameworks.

Assessing climate risks using climate scenario analysis APTimum
The TCFD sets out recommendations for undertaking an assessment of climate risk, specifically the use of climate scenario ana lysis (CSA). CSA
uses data to help develop climate simulations. These simulations hypothesise potential future climatic conditions and assess the associated impacts
to an organisation. A risk assessment should look at the “physical” and “transition” risks of climate change under the different climate scenarios.
Physical risks resulting from climate change may have financial implications for organizations, such as direct damage to asse ts and
indirect impacts from supply chain disruption.
PHYSICAL RISK
Increased severity of extreme weather Rising sea levels Rising mean temperatures Changes in precipitation
events such as cyclones and floods patterns and extreme
Increased capital costs Write-offs and early Reduced revenue and higher variability in weather patterns
(e.g., damage to facilities). Increased retirement of existing costs from negative impacts on Reduced revenue from decreased
insurance premiums and potential for reduced assets (e.g., damage to workforce (e.g., health, safety, production capacity (e.g., transport
availability of insurance on assets in “high- property and assets in absenteeism) difficulties, supply chain
risk” locations “high-risk” locations) interruptions)
Transition risks are those associated with the transition to a zero-carbon economy. This transition will require structural
technological and social changes and the longer we wait, the more expensive this transition will be.
TRANSITION RISK
Policy and Legal Risk Technology Risk Market Risk Reputation Risk
▪ Increased pricing of GHG ▪ Substitution of existing ▪ Changing customer ▪ Shifts in consumer

emissions products and services with behaviour preferences
▪ Enhanced emissions-reporting lower emissions options ▪ Uncertainty in market ▪ Stigmatization of company
obligations ▪ Unsuccessful investment in new signals ▪ Increased stakeholder
▪ Mandates on and regulation of technologies ▪ Increased cost of raw concern or negative
existing products and services ▪ Costs to transition to lower materials stakeholder feedback
▪ Exposure to litigation emissions technology

Core elements of recommended disclosures APTimum
The TCFD structured its recommendations for disclosure around four thematic areas that represent core elements of how organizations op erate:
governance, strategy, risk management, and metrics and targets. It provides guidance to assist preparers by providing context and suggestions
for implementing the recommended disclosures.
GOVERNANCE STRATEGY RISK MANAGEMENT METRICS AND TARGETS
Disclose the organization’s Disclose the actual and potential Disclose how the organization Disclose the metrics and targets
governance around climate impacts of climate-related risks and identifies, assesses, and used to assess and manage
related risks and opportunities. opportunities on the organization’s manages climate-related risks. relevant climate-related risks and
businesses, strategy, and financial opportunities.
planning.
Recommended Disclosures Recommended Disclosures Recommended Disclosures Recommended Disclosures
✓ Describe the board’s oversight of ✓ Describe the climate-related risks ✓ Describe the organization’s ✓ Disclose the metrics used by the
climate-related risks and and opportunities the organization processes for identifying and organization to assess climate-
opportunities. has identified over the short, assessing climate-related risks. related risks and opportunities in
medium, and long term. line with its strategy and risk
✓ Describe management’s role in ✓ Describe the organization’s
management process.
assessing and managing climate- ✓ Describe the impact of climate- processes for managing
related risks and opportunities. related risks and opportunities on climate-related risks. ✓ Disclose Scope 1, Scope 2, and, if
the organization’s businesses, ✓ Describe how processes for appropriate, Scope 3 greenhouse
strategy, and financial planning. identifying, assessing, and gas (GHG) emissions, and the
managing climate-related risks are related risks.
✓ Describe the resilience of the
integrated into the
organization’s strategy, taking into ✓ Describe the targets used by the
organization’s overall risk
consideration different climate- organization to manage climate-
management
related scenarios, including a 2°C related risks and opportunities and
or lower scenario. performance against targets.

5
Sustainability Accounting
Standards Board
Determining materiality and measuring
sustainable performance

Sustainability Accounting Standards Board (SASB)
What is it??
SASB standards are designed to identify a minimum set of sustainability issues most likely to Available for 77 industries, the Standards identify the subset of ESG
impact the operating performance or financial condition of the typical company in any industry, issues most relevant to financial performance in each industry
regardless of location
SASB’s approach is to first categorize industries and sectors and then use nuances of each industry to
Asset management companies, like BlackRock,
define the materiality of specific sustainability accounting criteria.
Current Goldman Sachs, and Morgan Stanley,
manufacturing giants and even specialized SASB
Users Structure The industry-specific approach allows the Standards to cater to each type of business, supplying detailed
industries with companies like Merck and JetBlue
guidance and examples of best practice to report 26 different ESG-related metrics of most any business
use SASB’s Standards to disclose ESG metrics
that pursues this reporting framework.
The GRI Standards supports comprehensive disclosures by

TCFD has a singular focus on how material climate- providing the framework and supporting standards for a
related issues could impact a company’s financial comprehensive understanding of the organization’s
impacts on economy, environment, and society including
SASB with performance. To harmonize SASB’s standards with
financially material impacts. SASB’s Standards offer an
Value Proposition
other TCFD’s recommendations, SASB is undertaking a
frameworks review of its 79 industry standards, evaluating them industry-focused perspective by identifying the subset of
with the objective of bringing them into closer issues that are likely to be financially material for the The SASB standards are designed to
alignment with TCFD recommendations. typical company in an industry. Each set of standards, • Surface and pinpoint financially-material
therefore, complement rather than act as a substitute sustainability information that is likely to
one another. affect the financial performance of a typical
company within a specific industry
• Produce information that is decision-useful for
Global Use of SASB Standards – Investor & Market Support investors
• Be cost-effective for companies to use
• Provide an evidence-based and market-
informed process (which is modelled after the
process used to develop financial accounting
Institutional investors standards)
representing $73T AUM and 25 unique users Standards downloads countries represented
countries support SASB and/or
use SASB Standards

Roadmap To Maturity And Critical Events
Publication of Harvard IRI
paper “From Transparency SASB and
to Performance” International
SASB’s public launch Harvard Business Fundamentals of Foundation and
of standards setting School Publishes Sustainability SASB Integrated
activities paper on SASB Account (FSA) Reporting
Launched Council (IIRC)
merged to
Jean Rogers
Completed form Value
founded Accreditation received
Standard Navigator Consultation Phase Reporting
SASB from American National Implementation
tool to navigate on Provisional Foundation
Standards Institute Guide for Companies
SASB incorporated Standards released Standards (VRF)
(ANSI) Launched
in California as 501
© (3) non-profit
organisation Release of Conceptual Industry Working
Industry Working
Framework Group Exceed 2,000
Group Exceed 2,800
2010 2011 2012 - 2013 2014 2015 2016 - 2017 2021
Evolution of Industry inclusion 8 Industries in Resource

7 Industries in 5 Industries in Resource
in the standards 6 Industries in Health Infrastructure Sector
Financials Sector Transformation Sector
care Sector
6 Industries in Technology
and Communication 15 Industries in VRF is a global non-profit organization
Sector Consumption Sector that aims to provide -
▪ Complimentary tools to provide a
8 Industries in Non- complete picture of long-term value
6 Industries in creation
Renewable Resources
Renewable Resources ▪ Clarity & simplification in the
Sector
and Alternative Sector corporate reporting landscape
▪ Unification of notable ESG frameworks
8 Industries in like TCFD ,with SASB as the industry
Transportation Sector attains maturity
10 Industries in Services
Sector
SASB STANDARDS – In Detail Dimensions of SASB Sustainability
Environment
Social Capital
Inc ludes environmental impac ts,
either through the use of Relates to the expectation that a
nonrenewable, natural resourc es as business will c ontribute to society in
inputs to the factors of production return for a soc ial lic ense to operate. It
STRUCTURE OF SASB STANDARDS into the environment that may addresses the management of
result in impac ts to the c ompany’s relationships with key outside parties. It
financ ial c ondition or operating inc ludes issues related to human rights
performanc e.
Disclosure Topics
A minimum set of industry-specific disclosure topics reasonably
likely to constitute material information, and a brief description of
Social
how management or mismanagement of each topic may affect
value creation Capital
Leadership & Human Capital

Governance
Accounting metrics Involves issues that are
Universe of Relates to the
A set of quantitative and/or qualitative accounting metrics inherent to the business management of a
intended to measure performance on each topic. model or c ommon Sustainability c ompany’s human
prac tice in the industry issues
and that are in potential
Human resourc es as key assets to
Capital delivering long- term value.
c onflic t with the interest It inc ludes issues that
Technical protocols of broader stakeholder affec t the productivity of
groups and therefore
Each accounting metric is accompanied by a technical protocol employees and c an c reate
c reate a potential liability a safety c ulture
that provides guidance on definitions, scope, implementation, of a lic ense to operate
compilation, and presentation, all of which are intended to Business
constitute suitable criteria for third-party assurance. Model
Activity metrics Business Model and Innovation

A set of metrics that quantify the scale of a company’s business Addresses the integration of environmental, human,
and are intended for use in conjunction with accounting metrics and soc ial issues in a c ompany’s value- c reation
proc ess, inc luding resource recovery and other
to normalize data and facilitate comparison
innovations in the produc tion process.

Impact of SASB – Financial Materiality
SASB has developed its Sustainable Industry Classification System (SICS) which is comprised of 11 sectors which subdivide into 77
industries. For each industry, standards have been established for the ESG issues most likely to be material to investors.
How Investors Use SASB Disclosures
Factors for Value Creation

SASB Standards enable ESG integration across
For most industries, only about 5-6 multiple asset classes
issues with unique manifestation are Link with Financial Value Drivers
identified as Disclosure Topics. These SASB has analysed the link between Public Equities
factors are directly related to the the defined set of Disclosure Topics ▪ Data-driven corporate engagement
shareholder value creation and the 13 financial value drivers ▪ Input to fundamental equity analysis
categorised as Revenue, Operating ▪ Constructing ESG-integrated indexes
Expenses, Assets, Liabilities and Cost
of Capital Corporate Fixed Income
Impact of specific issues ▪ Input to credit analysis and internal credit
Differences in the impact of each level rating assignment
specific issues of the five sustainability ▪ Assess quality of disclosure for insight into
dimensions are also observable. For Materiality Mapping risk
instance, within the environment Private Equity
dimension, Company Assets are It is imperative to identify the SICS ▪ Identify focus areas for fund and portfolio
impacted due to GHG Emissions and industry a company belongs to and the company due diligence
Ecological impacts however, air quality, ESG issues that are likely to have ▪ Report to GPs and LPs on performance on
waste management are relevant to significant impact on financial material ESG topics
liabilities. Similar phenomenon can be condition, operating performance or Real Assets
observed in other dimensions as well. risk profile using the Materiality Map. ▪ Use SASB’s Infrastructure sector standards to
guide risk assessment and performance
reporting for real assets

SASB – Key Materiality Across Sectors
Consumer Goods
▪ Product Quality & Safety
▪ Product Design & Lifecycle Extractives & Minerals Processing
▪ GHG Emissions
Transportation Management ▪ Ecological Impacts
▪ Air Quality
▪ GHG Emissions ▪ Supply Chain Management ▪ Employee Health &
▪ Water & Waste
▪ Air Quality Safety
▪ Water Management
▪ Employee Health & Safety ▪ Critical Incident
▪ Waste & Hazardous
▪ Critical Incident Risk Management ▪ Risk Management
Materials
Technology & Communications

▪ Energy Financials
▪ Product Design & ▪ Selling Practices & Product Labelling
Management Lifecycle Management
▪ Customer Privacy ▪ Product Design & Lifecycle Management
▪ Materials Sourcing & ▪ Business Ethics
▪ Data Security
▪ Employee ▪
Efficiency
Competitive 11+ SICS ▪ Systemic Risk Management
Engagement,
Diversity & Inclusion
behaviour INDUSTRIES
Food & Beverage
▪ Selling Practices &
Services ▪ GHG Emissions
▪ Product Labelling
▪ Energy Management
▪ Product design &
▪ Water & Waste Water
▪ Lifecycle
Management
Management
Resource Transformation ▪ Product & Quality Safety
▪ Supply Chain Mngt
▪ Energy Management ▪ Customer Welfare
▪ Materials Sourcing &
▪ Waste & Hazardous Materials Management
Efficiency
▪ Product Quality & Safety
▪ Product Design & Lifecycle Management
▪ Materials Sourcing & Efficiency Healthcare
▪ Data Security
Renewable Resources & Alternative Infrastructure ▪ Access & Affordability
Energy ▪ Employee Health & Safety ▪ Product Quality & Safety
▪ Energy Management ▪ Product Design & Lifecycle ▪ Customer Welfare
▪ Water & Wastewater Management Management ▪ Selling Practices & Product Labelling
▪ Product Design & Lifecycle management ▪ Business Model Resilience ▪ Business Ethics
▪ Materials Sourcing & Efficiency
SASB - Materiality Map For Financial Sector
SASB’s Materiality Map® identifies sustainability issues that are likely to affect the financial condition or operating performance of
companies within an industry
A s s e t Ma n a g e ment a n d In v e s tme nt B a n k in g &

C o mme r c i a l B a n k s C o n s u me r F in an ce In su ran c e
C u s t o dy A c t i v i ti es B ro k e rage
Selling Practices & Product Selling Practices & Product Employee Engagement,
Data Security Data Security
Labelling Labelling Diversity & Inclusion
Employee Engagement, Access & Affordability Customer Privacy Product Design & Lifecycle Product Design & Lifecycle
Diversity & Inclusion Management Management
Product Design & Lifecycle Product Design & Lifecycle Selling Practices & Product Physical Impacts of Climate
Management Management Labelling Change Business Ethics
Business Ethics Business Ethics

S e c u ri t y & C o mmo d i t y Systemic Risk Management
Mort gage F inance
E xc h an ges
Systemic Risk Management Systemic Risk Management
Selling Practices & Product Product Design & Lifecycle Managed Care
Labelling Management
Physical Impacts of Climate Business Ethics Data Security

Change
Access & Affordability
Systemic Risk Management
E x t e n de d Product Quality & Safety

Mat erial GHG Emissions Carbon Footprint Human Rights &
F a c t o rs Community Relationship Selling Practices & Product
Labelling
Physical Impacts of Climate
Sustainability Leadership Change
Environment Social Capital Human Capital Business Model
Dimensions & Governance

A s s e t M a n a g e m e nt a n d C u s t o d y A c t i v i t i e s
The Asset Management & Custody Activities industry is comprised of companies that manage investment portfolios on a commissio n or fee basis for institutional, retail, and
high net-worth investors. In addition, firms in this industry provide wealth management, private banking, financial planning, an d investment advisory and retail securities
brokerage services. Companies in the industry range from large multinational asset managers with a wide range of investable p roducts, strategies, and asset classes to small
boutique firms providing services to a very specific market niche
S u s t a i n a b i l i t y D i s c l o s u r e To p i c s
Transparent Information & Fair Advice for Customers Employee Diversity & Inclusion
Enhanced disclosure on procedures or programs with - By ensuring gender and racial diversity throughout the
• Adequate, clear, and transparent information about products Systemic Risk Management
organization leads to expansion of candidate pools and
and services substantially lower their hiring costs and improve
• Regulatory violation record of employees operational efficiency simultaneously.
• Amount of fines and settlements associated with A diverse groups of employees at these companies may
professional integrity enhance the risk- return characteristics of investment Companies in this industry designated
Provides details on how companies are managing risks and portfolios. by regulators as systemically important
preserving long term Value
financial institutions are subject to
stricter prudential regulatory standards
and oversight by the central banking
Environmental, Social, and Governance
Business Ethics systems in various jurisdictions. Failure
Factors in Investment Management & Advisory
to meet qualitative and quantitative
regulatory performance thresholds
Firms that are able to ensure regulatory compliance Research has established that a company’s management of could lead to substantial penalties.
through robust internal controls will be better certain ESG factors can materially impact both its accounting and To demonstrate how these risks are
positioned to build trust with clients, leading to market returns. being managed, companies should
increased revenue, and to protect shareholder value Deeper understanding of ESG factors in valuation and enhance disclosure on key aspects of
by minimizing losses incurred as a result of legal modelling in addition to engagement with investors is systemic risk management.
proceedings effective in generating superior returns

C o m m e rcial B a n ks
Commercial banks accept deposits and make loans to individuals and corporations as well as engage in lending for infrastructu re, real estate, and other projects. The industry
is driven by the volume of deposits, quality of loans made, the economic environment, and interest rates. It is further characterized by risk from mismatched assets and
liabilities. This industry serves an essential role in the functioning of global economies and in facilitating the transfer of financial resources to their most productive capacity.
The SASB Commercial Banks (FN-CB) Standard addresses “pure play” commercial banking services.
Data Security Financial Inclusion & Capacity Building

The metrics for this disclosure topic focus on providing more Emerging financing models and technologies provide banks
detail on efforts on safeguarding data against emerging and Systemic Risk Management
with an opportunity to offer products and services in
continuously evolving cybersecurity threats and technologies, previously underserved markets and obtain additional
and actual security breaches compromising customers' sources of revenue
personally identifiable information (PII). The systemic nature of the risk results
Disclosing their approach to financial inclusion and
Enhanced disclosure on management strategies to address from the interconnectedness of
capacity building, commercial banks can provide investors
these risks will allow shareholders to understand how financial institutions and has become a
with decision- useful information for assessing banks'
commercial banks are protecting shareholder value central concern of national and
ability to ensure long- term, sustainable value creation.
international regulators.
Enhanced disclosure on how the risks
Environmental, Social, and Governance associated with banks’ size, complexity,
Business Ethics Factors in Credit Analysis interconnectedness, substitutability,
and cross- jurisdictional activity are
being managed, on quantitative and
Firms that are able to ensure regulatory compliance Commercial banks should disclose how ESG factors are integrated
qualitative metrics measuring their
through robust internal controls will be better into lending processes and the current level of portfolio risk
resilience against the financial &
positioned to build trust with clients, leading to associated with specific sustainability trends.
economic shocks
increased revenue, and to protect shareholder value In particular, investor and regulatory pressure is mounting for
by minimizing losses incurred as a result of legal banks to disclose how they address climate change related
proceedings. risks.

C o n s u m er F i n a nc e
The Consumer Finance industry provides loans to consumers. The largest segment of the industry is comprised of revolving credit loans through credit card products.
Additional loan services include auto, micro lending, and student loans. Some companies in the industry also provide consumer-to-consumer money transfers, money orders,
prepaid debit cards, and bill payment services. Industry performance is determined by consumer spending, rates of unemploymen t, per capita GDP, income, and population
growth. The SASB Consumer Finance (FN-CF) Standard is limited to the abovementioned consumer finance services
Customer Privacy Data Security
Ensuring the privacy of personally identifiable information (PII) and other data of To assess performance on this issue, disclosure on efforts related to
account holders is an essential responsibility of companies in the Consumer safeguarding data against emerging and continuously evolving
Finance industry cybersecurity threats and technologies, actual security breaches
compromising customers’ PII, and credit and debit card fraud are useful
Consumer finance companies that fail to manage performance in this area
are susceptible to decreased revenues as a result of lost consumer Companies that fail to manage these issues risk decreased customer
confidence and churn, as well as to financial impacts stemming from legal confidence and churn and also increases exposure to litigations and
exposures money losses.
Selling Practices
The disclosure of key characteristics of a lending portfolio, including average fees from add -on products, average age of
accounts, average APR, average number of trade lines, and average annual fees for pre -paid transaction products will allow
shareholders to determine which companies are better positioned to protect long -term value rather than relying on short-
term revenue generation practices.
Clarity on these practices can help minimizing risk exposure to existing product portfolio and ensure sustainable
revenue by building trust with existing and new customers

I nsurance
The Insurance industry provides both traditional and non-traditional insurance-related products. Traditional policy lines include property, life, casualty, and reinsurance. Non-
traditional products include annuities, alternative risk transfers, and financial guarantees. Insurance premiums, underwritin g revenue, and investment income drive industry
growth, while insurance claim payments present the most significant cost and source of uncertainty for profits. Insurance companies provide products and services that
enable the transfer, pooling, and sharing of risk necessary for a well-functioning economy. Insurance companies can also create a form of moral hazard, lowering incentives
to improve underlying behaviour and performance, and thus contributing to sustainability impacts
Policies Designed to Incentivize Responsible
Behaviour
Transparent Information & Fair Advice for Customers
Insurance companies have the ability to incentivize healthy
As financial regulators emphasize consumer protection and lifestyles and safe behaviour as well as the development of Systemic Risk Management
accountability, companies that maintain transparent policy terms sustainability-related projects and technologies such as
and direct customers toward the products best suited to them those focused on renewable energy, energy efficiency, and
will be better positioned to maintain their brand reputation, carbon capture Insurance companies have the potential to
avoid regulatory scrutiny, and protect shareholder value Policy clauses that provide incentives through pose, amplify, or transmit a threat to the
incorporation of ESG factors can be used as tools to financial system. The size,
mitigate risk in the overall underwriting portfolio, which interconnectedness, and complexity of
can reduce insurance payouts over the long term insurance companies are factors that
highlight exposure to systemic risk for
Environmental Risk Exposure companies in the industry.
Environmental, Social, and Governance To demonstrate how these risks are
Catastrophe losses associated with extreme Factors in Investment Management being managed, insurance companies
weather events will continue to have a material,
Companies should enhance disclosure on how ESG factors, should enhance their disclosures of key
adverse impact on the Insurance industry.
including climate change and natural resource constraints, are aspects of systemic risk management
Companies that incorporate climate change
incorporated into the investment of policy premiums and affect and their ability to meet stricter
considerations into their underwriting process
the portfolio risk. regulatory requirements
for individual contracts as well as the
management of firm- level risks and capital Failure to address these issues could lead to diminished risk -
adequacy will be better positioned to protect adjusted returns of their portfolios and limit a company‘s
shareholder value ability to issue claim payments

I n v e st m e nt B a n k i ng & B r o k e r a ge
The Investment Banking & Brokerage industry consists of firms performing a wide range of functions in the capital markets, in cluding assisting with the capital-raising and
allocation process, and providing market-making and advisory services for corporations, financial institutions, governments, and high net-worth individuals. Companies in the
industry generate their revenues from global markets and, therefore, are exposed to various regulatory environments. The indu stry continues to face regulatory pressure to
reform and disclose aspects of operations that present systemic risks.
Professional Integrity
Employee Incentives & Risk Taking
A description of management’s approach to assuring
Improved disclosure of employee compensation, focusing on the professional integrity can help investors understand risk Systemic Risk Management
use of performance metrics and variable remuneration, policies exposure as well as any processes in place to avoid misconduct.
around clawback provisions, supervision, control, and validation Additionally, disclosure of the company’s amount of legal and
of traders' pricing of Level 3 assets will provide investors with a regulatory fines and settlements can provide a clearer picture of The systemic nature of risk resulting from
clear understanding of how investment banking companies are the extent to which financial institutions are adhering to the interconnectedness of financial
protecting corporate value. regulatory norms. institutions has become a central concern
of federal and international regulators.
Enhanced disclosure on how the risks
Business Ethics associated with banks’ size, complexity,
Environmental, Social, and Governance interconnectedness, substitutability,
Investment banking and brokerage companies are and cross- jurisdictional activity are
Factors in Investment Banking & Brokerage Activities
subject to rules against tax evasion, fraud, money being managed, on quantitative and
laundering, and corrupt practices. Appropriately pricing ESG risks could reduce investment qualitative metrics measuring their
Firms that are able to ensure regulatory banks’ financial risk exposure, help generate additional resilience against the financial &
compliance through robust internal controls will revenue, and/or open new market opportunities . To help economic shocks
be better positioned to build trust with clients, investors understand how well companies in the industry manage
leading to increased revenue, and to protect performance around this issue, investment banks should disclose
shareholder value by minimizing losses incurred how ESG factors are incorporated into their core products and
as a result of legal proceedings services

S e c u r i t y & C o m m o d i ty E x c ha n g e s
Security and commodity exchanges operate marketplaces in the form of physical trading floors or electronic platforms for trad ing financial securities, commodities, or other
financial instruments. Companies in the industry primarily generate revenue from fees on trades and for clearing transactions as well as listing fees. As new policies and
market transformations encourage more responsible management of social capital and strong governance, firms that can address all forms of capital—not just financial—
will be better positioned to protect shareholder value in the future
Promoting Transparent & Efficient Capital Markets Managing Conflicts of Interest
As public markets, these companies play a critical role in efficient capital Recent controversies relating to market manipulation, tax fraud,
allocation and the equal application of rules to all participants. Information investor protection rules, and anti-trust have raised
asymmetries that lead to unfair arbitrage could result in litigations and concern about conflicts of interest that arise due to security and
reputational damage commodity exchanges’ position as self-regulatory
Disclosure of policies relating to information releases, halts of trading, organizations (SROs).
and the risks and opportunities associated with algorithmic or high- Companies that avoid fraudulent or unethical activities will
frequency trading will allow investors to further understand how maintain market integrity, limit reputational damage, and
security and commodity exchanges protect shareholder value ensure their long- term sustainable growth.
Managing Business Continuity & Technology Risks
As security and commodity exchanges face increased volumes of trading associated

with the clearing and execution of derivative trades and increased frequency of cyber
attacks, the industry will be exposed to new risks and opportunities associated with its
reliance on information Technology.
Increased disclosure of efforts taken to prevent these risks, in addition to the
current performance, will allow shareholders to accurately assess value.

M o r t g a ge F i n a n c e
The Mortgage Finance industry provides an essential public good in enabling consumers to purchase homes, and contributes to t he overall home ownership rate. The primary
products are residential and commercial mortgages, while other services offered include: mortgage servicing, title insurance, closing and settlement services, and valuation.
Recent trends in the regulatory environment indicate a significant shift toward consumer protection, disclosure, and accountability. Legislation passed in response to the
2008 mortgage crisis demonstrates the potential for further alignment between the interests of society and those of long -term investors.
Lending Practices Discriminatory Lending

Mortgage finance companies that are able to provide transparent information
and fair advice are more likely to protect shareholder value. The industry Mortgage finance companies can reduce the risk of intentional or
regulators established significant consumer protection laws in the wake of the unintentional discriminatory lending through the implementation of
2008 financial crisis that seek to limit the predatory lending practices that strong processes, internal controls, and monitoring the loan portfolio,
encouraged qualified and unqualified borrowers to among other techniques. Proactive companies that develop strong
assume subprime mortgages techniques for preventing discrimination can effectively mitigate the
Enhanced disclosure on key elements of lending practices will allow risks associated with discriminatory lending
shareholders to determine which companies are better
positioned to protect value.
Environmental Risk to Mortgaged Properties
An increase in the frequency of extreme weather events associated with climate change may have
an adverse impact on the Mortgage Finance industry can potentially lead to missed payments and
loan defaults, while also decreasing the value of underlying assets.
Disclosure of overall exposure, loan forgiveness programs, and the incorporation of climate
change into lending analysis will allow shareholders to determine which mortgage finance
firms are best positioned to protect value in light of environmental risks

M a n a g ed C a r e
The Managed Care industry offers health insurance products for individual, commercial, Medicare, and Medicaid members. Companies also provide administrative services
and network access for self-funded insurance plans and manage pharmacy benefits. Enrolment in managed care has traditionally bee n correlated with employment rates,
while revenues are driven by the inflation of medical costs. A focus on patient outcomes and plan performance continue to sha pe the industry’s sustainability risks and
opportunities.
Access to Coverage
Customer Privacy & Technology Standards
Companies in this industry are required to develop policies and Companies must comply with regulations intended to control Climate Change Impacts on Human
technical safeguards to protect patient health information. A plan costs, including medical loss rations, while also ensuring Health
failure to comply with these evolving standards, which in the U.S. coverage for all applicants regardless of health status, gender,
include provisions established under the Health Information Extreme climate-related events, coupled
or pre-existing conditions. Increased regulatory focus on
Technology for Economic and Clinical Health (HITECH) Act, can with the potential spread of infectious
health care costs and the need to comply with evolving
lead to significant civil and criminal penalties. diseases and food and water scarcity, are
regulations continue to present challenges for the industry.
likely to present material implications for
the Managed Care industry through an
increase in encounters with the health care
system. Companies that are able to
Improved Outcomes
Plan Performance address the risks posed by extreme
weather events and potential changes in
the incidence, morbidity, and mortality
Managed care companies can play a critical role in
Managed care companies manage performance in areas such as of illnesses and diseases may be better
maintaining and improving the health of enrolees.
responsiveness, complaints, voluntary disenrollment, and positioned to protect shareholder value.
Companies that are able to improve the health of
enrolees may be better positioned to protect customer service in order to maintain competitiveness.
shareholder value. Disclosure on key indicators related to plan performance may
allow shareholders to understand how managed care
companies are able to protect corporate value.

SASB – Indicators For Financial Sector
Security and Consumer Finance
Commercial Banks
Commodity Exchanges
Topic Met rics Topic Metrics Topic Metrics
I. Number and (2) value of c hecking and savings
I. Average daily number of trades I. Number of unique c onsumers with an ac tive (1) c redit
ac c ounts by segment: (a) personal and (b) small
Ac tivity exec uted, by produc t or asset c ard ac c ount and (2) prepaid debit card account
Ac tivity Metrics business Ac tivity
Metrics c lass II. Number of (1) c redit c ard accounts and (2) prepaid
II. (1) Number and (2) value of loans by segment: (a) Metrics
II. Average daily volume traded, by debit c ard ac counts
personal, (b) small business, and (c ) c orporate
produc t or asset class
(1) Number of data breac hes, (2) percentage involving
personally identifiable information (PII), (3) number of I. Number of data breac hes, (2) percentage involving
I. Number and (2) average duration Data Sec urity personally identifiable information (PII), (3) number
ac c ount holders affected
of (a) halts related to public of ac c ount holders affected
Promoting release of information and (b) I. (1) Number and (2) amount of loans outstanding II. Card- related fraud losses from (1) c ard-not present
qualified to programs designed to promote small Data fraud and (2) c ard- present and other fraud
Transparent pauses related to volatility
Sec urity III. Perc entage of total remuneration for covered
& Effic ient II. Perc entage of trades generated business and c ommunity development
Capital from automated trading systems II. (1)Number and (2) amount of past due and employees that is variable and linked to the amount
Markets nonac c rual loans qualified to programs designed to of produc ts and servic es sold
Financ ial promote small business and c ommunity
Inc lusion & development
Capac ity Building III. Number of no- cost retail c hecking accounts provided I. Number of ac c ount holders whose information is
Total amount of monetary losses as a to previously unbanked or underbanked c ustomers Customer used for sec ondary purposes
result of legal proc eedings associated IV. Number of partic ipants in financ ial literacy initiatives Privac y II. Total amount of monetary losses as a result of legal
Managing with fraud, insider trading, anti-trust, for unbanked, underbanked, or underserved proc eedings associated with customer privac y
Conflic ts of anti- competitive behavior, market c ustomers
Interest manipulation, malprac tice, or other Inc orporation of Commercial and industrial c redit exposure, by industry I. Average fees from add- on products, (2) average APR,
related financ ial industry laws or Environmental, (3) average age of ac c ounts, (4) average number of
regulations trade lines, and (5) average annual fees for prepaid
Soc ial, and
Governanc e produc ts, for c ustomers with FICO sc ores above and
Fac tors in Credit below 660
Analysis II. 1) Number of c omplaints filed with the Consumer
I. Number of signific ant market
Selling Financ ial Protec tion Bureau (CFPB),(2) percentage
Managing disruptions and (2) duration of
Total amount of monetary losses as a result of legal Prac tices with monetary or nonmonetary relief, (3) perc entage
Business downtime
proc eedings associated with fraud, insider trading, anti- disputed by c onsumer, (4) percentage that resulted in
Continuity & II. Number of data breac hes, (2)
Business Ethics trust, anti-competitive behavior, market manipulation, investigation by the CFPB
Tec hnology perc entage involving personally
malprac tice, or other related financial industry laws or III. Total amount of monetary losses as a result of legal
Risks identifiable information (PII), (3)
regulations proc eedings associated with selling and servic ing of
number of c ustomers affected
produc ts
Systemic Risk Global Systemic ally Important Bank (G- SIB) score, by
Management c ategory

SASB – Indicators For Financial Sector Contd.
Insurance Investment Banking (IB)
and Brokerage
Topic Metrics
Topic Metrics
Number of polic ies in forc e by segment: (1) property and c asualty
(2) life (3) assumed reinsurance I. (1) Number and (2) value of (a) underwriting, (b) advisory, and (c ) sec uritization
Ac tivity Metrics transac tions
Ac tivity Metrics II. (1) Number and (2) value of proprietary investments and loans by sec tor
I. Total amount of monetary losses as a result of legal III. 1) Number and (2) value of market making transac tions in (a) fixed inc ome, (b)
Transparent proc eedings associated with marketing and c ommunication of equity, (c ) c urrency, (d) derivatives, and (e) c ommodity products
Information & Fair insuranc e product related information to new and returning
Advic e for c ustomers Inc orporation of I. Revenue from (1) underwriting, (2) advisory and (3) securitization
Customers II. Complaints-to-claims ratio Environmental, transactions. Incorporating integration of environmental, social, and
III. Customer retention rate Soc ial, and governance (ESG) factors, by industry
Governanc e Fac tors
Inc orporation of in Investment
II. (1) Number and (2) total value of investments and loans incorporating
Environmental, Banking & integration of environmental, social, and governance (ESG) factors, by
Soc ial, and Brokerage industry
Governanc e Total invested assets, by industry and asset c lass Ac tivities
Fac tors in
Investment Total amount of monetary losses as a result of egal proc eedings associated with fraud,
Management insider trading, anti-trust, anti-competitive behavior, market manipulation, malpractice,
Business Ethics or other related financ ial industry laws or regulations
Polic ies Designed (1) Number and (2) perc entage of c overed employees with a rec ord of investment-
Net premiums written related to energy efficiency and low c arbon related investigations, c onsumer-initiated c omplaints, private civil litigations, or other
to Inc entivize
tec hnology regulatory proc eedings
Responsible
Behavior
I. Number of mediation and arbitration cases associated with professional integrity,
I. Probable Maximum Loss (PML) of insured produc ts from Professional inc luding duty of c are, by party
weather- relat ed natural Catastrophes Integrity II. Total amount of monetary losses as a result of legal proc eedings associated with
II. Total amount of monetary losses attributable to insurance professional integrity, inc luding duty of c are
Environmental
payouts from (1) modeled natural c atastrophes and (2) non-
Risk Exposure
modeled natural c atastrophes, by type of event and Global Systemic ally Important Bank (G- SIB)score, by c ategory
geographic segment (net and gross of reinsurance) Systemic Risk
Management
I. Exposure to derivative instruments by c ategory: (1) total
potential exposure to noncentrally c leared derivatives, (2) I. Perc entage of total remuneration that is variable for Material Risk Takers (MRTs)
Systemic Risk total fair value of ac c eptable c ollateral posted with the II. Perc entage of variable remuneration of Material Risk Takers (MRTs) to which
Employee
Management Central Clearinghouse, and (3) total potential exposure to malus or c law bac k provisions were applied
Inc entives & Risk
c entrally c leared derivatives
Taking
II. Total fair value of sec urities lending c ollateral assets

SASB – Indicators For Financial Sector Contd.
Managed Care - Health Insurance Extended Indicators **
Topic Metrics
Topic Metrics
I. Number of polic ies in forc e by segment: (1) property and c asualty
I. Emission level - Total emissions (by type of GHG, by sourc e, by
Ac tivity Metrics (2) life (3) assumed reinsurance
GHG Emissions Sc ope)
(Ref. TCFD, SFDR) II. Emission intensity - Emissions per output scaling fac tor (Example:
I. (1) Number of data breaches, (2) percentage involving (a) Revenues, Sales, Unit Produc ed)
Customer Privac y & personally identifiable information (PII) only and (b) protected III. GHG emissions in real estate assets
Tec hnology health information (PHI), (3) number of customers affected in I. Amount invested in deployment of low-carbon technology,
Standards
each category, (a) PII only and (b) PHI2 Carbon Footprint energy efficiencies etc.
II. Total amount of monetary losses as a result of legal proceedings (Ref. TCFD) II. Amount invested in resiliency capabilities
associated with data security and privacy III. Amount invested in developing low-carbon products, services
I. Medic al Loss Ratio (MLR) and/or technology
II. Total amount of rebates accrued and paid due to non- compliance I. Investments in c ompanies without workplac e accident prevention
Ac c ess to Coverage with the Patient Protection and Affordable Care Ac t for Medic al polic ies
Loss Ratio (MLR) Human Rights and II. Rate of ac c idents
III. Perc entage of proposed rate increases receiving “not Community III. Number of days lost to injuries, accidents, fatalities or illness
unreasonable” designation from Health and Human Servic es (HHS) Relations IV. Number of inc idents of disc rimination reported in investee
review or state review (Ref. SFDR) c ompanies, expressed as a weighted average
I. Enrollee retention rate by plan type, inc luding: (1) HMO, (2) loc al V. Number of inc idents of disc rimination leading to sanc tions in
Plan Performanc e PPO, (3) regional PPO, (4) PFFS, and (5) SNP investee c ompanies, expressed as a weighted average
II. Perc entage of c laims denied that were appealed by c ustomers and VI. Number of identified cases of severe human rights issues and
ultimately reversed inc idents
III. Plan enrollee grievanc e rate
I. Perc entage of enrollees in wellness programs by type: (1) diet
Improved Outc omes and nutrition, (2) exercise, (3) stress management, (4) mental **This is an indicative list of indicators that may impact the financial
health, (5) smoking or alc ohol c essation, or (6) others performance of companies in future due to evolving regulations.
II. Total c overage for preventive health servic es with no c ost sharing **These indicators have been referred from other regulations like TCFD, SFDR
for the enrollees, total c overage for preventive health servic es
and may be updated as the SASB dimensions are updated.
requiring c ost-sharing by the enrollee, percentage of enrollees
rec eiving Initial Preventive Physic al Examinations (IPEE) or Annual
Wellness Visits (AWV)
III. Number of c ustomers receiving c are from Accountable Care
Organizations or enrolled in Patient - Centered Medical Home
programs

6
Global Reporting
Initiative (GRI)
Providing comprehensive reporting on
sustainable performance

GRI – Overview
APTimum
What is GRI? Objectives
GRI (Global Reporting Initiative) is the not It helps businesses and other
for profit independent, international organizations take responsibility for
organization. The GSSB (Global their impacts so that we can create a
Sustainability Standards Board) has sole sustainable future. GRI creates the global
responsibility for setting the world's first common language for organizations to
globally accepted standards GRI. report their impacts.
Value Proposition Scope
GRI Standards are available as a free These Standards are highly relevant to
public good. These standards can be many other groups, including investors, GRI Reporting can be done with “Core option” or
applied irrespective of the industry for policymakers, capital markets, and civil “Comprehensive Option”. Need to comply with all reporting
reporting ESG. society. 73% of the world’s largest 250 requirements for all the topic specific disclosures for
but in future they are planning to come up companies use GRI as their reporting comprehensive option where in one can comply with atleast
with sector specific program. standard. one topic specific disclosure in core option
Regulatory Timeline
GRI founded in Boston Development of Sector Sector standards for Group 1

by UNEP, Ceres and standards for Oil & Gas, Coal. sectors includes Banking,
GRI G2 Guidelines GRI G4 Guidelines GRI Sector Program
the Tellus Institute Agriculture and Fishing Insurance and Asset Management
launched launched Launched
1997 2002 2013 2019 2021 After 2021
2000 2006 2016 2020 2021
1st version of GRI G3 Guidelines GRI Sustainability Updated waste Review of GRI’s
Guidelines launched Launched Reporting Standards related disclosures Universal Standards
Launched GRI 306

GRI – Materiality
As per GRI 101: Foundation - It is important to note that it is the responsibility of the reporting organization’s management to
APTimum
determine material topics, based on applying the Materiality principle and the other principles for report content.
• Relevant topics, which potentially merit inclusion in the report, are those that can reasonably
be considered important for reflecting the organization’s economic, environmental, and
social impacts, or influencing the decisions of stakeholders. In this context, ‘impact’
refers to the effect an organization has on the economy, the environment, and/or society
(positive or negative). A topic can be relevant – and so potentially material – based on only
one of these dimensions.
• In general, ‘significant impacts’ are those that are a subject of established concern for expert
communities, or that have been identified using established tools, such as impact assessment
methodologies or life cycle assessments.
• A combination of internal and external factors can be considered when assessing whether a
topic is material. These include the organization’s overall mission and competitive strategy, and
the concerns expressed directly by stakeholders.
Factors to be considered by the organization for considering the material topics
The interests and

Topics raised by
Reasonably estimable expectations of
stakeholders such as The main topics and future
economic, environmental, stakeholders specifically
workers who are not challenges for a sector, as
and/or social impacts invested in the
employees, suppliers, local identified by peers and
identified through sound organization, such as
communities, vulnerable competitors
investigation by experts employees and
groups, and civil society
shareholders
This graph presents an example
matrix, for guidance purposes. It
Law s, regulations,
The core competencies of
Consequences for the shows the two dimensions for
international agreements, Key organizational values, organization which are
or voluntary agreements of policies, strategies,
the organization and the
related to its impacts on assessing whether a topic is material;
manner in which they can
strategic significance to the
organization and its
operational management
systems, goals, and targets
contribute to sustainable
the economy, the
environment, and/or
and that a topic can be material based
development
stakeholders society on only one of these dimensions.

Approach, challanges & impact of GRI across the sustainability reporting
lifecycle APTimum
Assess and Analyse Build & Improvise Engage & Establish Motivate & Maintain
• Assessment of as-is existing • Building new sustainability • Engage stakeholders and improve • Motivate and train the employees
Approach
corporate structure in alignment strategies & policies stakeholder relations on ESG and sustainability artefacts
with sustainability • Integrating ESG aspects with the • Establishing a sustainability team to • Build and maintain the credibility as
• Assessing and analysing the existing enterprise wide risk develop, operate and handle ESG a committed and sustainable
reporting standards and frameworks management system aspects organization
• Benchmark sustainability • Strengthen and improvise internal • Identify the key performance • Maintain a strong and effective
performance against self and others data management and reporting indicators and establishing the communication while adhering to
systems sustainability goals established reporting standards
• Need of Expertise for assessment and • Board level expertise is needed for • Stakeholder dissatisfaction due to • New reporting processes may
analysis in terms of sustainability setting up new strategies rapidly changing ESG reporting complicate the existing reporting &
Challenges
• Unclear and rapidly evolving • Incorporating ESG into existing risk standards and the day-to-day reconciliation process
sustainability reporting landscape management processes is complex operations • Fear of risking credibility and
• Industry wide reluctance to accept and time consuming • No short term tangible impact on reputation in case of incompetent
common sustainability • Developing and improving data investment in development and and inefficient reporting
benchmarking collection methodology across maintenance • Preparation of report involves
multiple channels • Demand for more reliable data for internal and potential external
setting up long term targets resources like consultancy etc
O v erall I m pact
Clarity & consistency across industry A common reporting mandate for all Improved transparency and credibility Precise and periodic measurement of
specific sustainability reporting market players among the investors group social and environmental impact

GRI – Deep Dive
Universal Standards – GRI 101: Foundation
APTimum
GRI 101:
Foundation
• GRI 101: Foundation is the starting point for an organization to use
the GRI Standards to report about its economic, environmental, and
social impacts.
Reporting Using GRI Standards Making claims
• GRI 101 takes organizations through the reporting process and Principles for Sustainability related to the use of
gives detailed guidance on how to use the Standards. Reporting GRI Standards
• It includes requirements for preparing a sustainability report in
accordance with the GRI Standards, and describes how these Reporting
standards can be used. Principles for
• Claims that a
defining Reporting
• It also includes the specific claims that are required for • Applying Reporting report has been
content:
organizations preparing a sustainability report in accordance with • Stakeholder Principles prepared in
the Standards, and for those using selected GRI Standards to report Inclusiveness • Reporting General accordance with
specific information. Disclosures the GRI
• Sustainability
• Identifying Material Standards
Context
topics and their • Reasons for
Section 1 of this Section 2 explains Section 3 sets out • Materiality
Reporting Principles
Claiming Process
Sustainability Reporting
Boundaries omission
Standard presents the basic process for the ways that the • Completeness
• Reporting on • Using selected
the Reporting using the GRI GRI Standards can material topics standards with a
Principles for Standards for be used and the GRI-referenced
• Presenting
defining report sustainability specific claims, or claim
Reporting Information
content and report reporting. This statements of use,
Principles for • Compiling and • Notifying GRI of
quality. These section includes which are required
defining Reporting presenting the the use of the
Reporting Principles fundamental for organizations
Quality: information in the standards
are fundamental to requirements for using the
helping an applying the Standards. • Accuracy report
organization decide Reporting Principles, • Balance
what to include in a and for identifying • Clarity
report and how to and reporting on • Comparability
ensure the quality material topics. • Reliability
of it. • Timeliness

GRI – Deep Dive
APTimum
Universal Standards – GRI 102: General Disclosures
GRI 102: General Disclosures is used to report contextual GRI 103:
information about an organization and its sustainability Management
reporting practices. This includes information about an Approach
organization’s profile, strategy, ethics and integrity,
governance, stakeholder engagement practices, and
reporting process.
103-1: Explanation 103-2: The 103-3: Evaluation
Organizational of the material management of the
Profile topic and its approach and its management
boundary components approach
Reporting
Practice
Strategy Universal Standards – GRI 103: Management Approach
It is used to report information about how an organization

GRI 102: manages a material topic. It is designed to be used for each
General material topic in a sustainability report, including those covered
Disclosures by the topic-specific GRI Standards (series 200, 300, and 400)
and other material topics.
Stakeholder
Engagement
Ethics and
Integrity
Applying GRI 103 with each material topic allows the
organization to provide a narrative explanation of why the topic
is material, where the impacts occur (the topic Boundary), and
how the organization manages the impacts.
Governance

GRI – Deep Dive
Topic-Specific Disclosures: APTimum
Topic-Specific Standards – GRI 200: Economic An organization is expected to compile information for economic disclosures using
figures from its audited financial statements or from its internally-audited
Management Approach Disclosures: management accounts, whenever possible. Data can be compiled using, for
Management approach disclosures are a narrative explanation of how example:
an organization manages a material topic, the associated impacts, and • the relevant International Financial Reporting Standards (IFRS), published by
stakeholders’ reasonable expectations and interests. Any organization the International Accounting Standards Board (IASB), and the Interpretations
developed by the IFRS Interpretations Committee (specific IFRS are referenced
that claims its report has been prepared in accordance with the GRI
for some of the disclosures); the International Public Sector Accounting
Standards is required to report on its management approach for every Standards (IPSAS) issued by the International Federation of Accountants
material topic, as well as reporting topic-specific disclosures for those (IFAC); national or regional standards recognized internationally for the
topics. purpose of financial reporting.
Therefore, this topic-specific Standard is designed to be used together
with GRI 103: Management Approach in order to provide full disclosure GRI 204: Procurement Practices
of the organization’s impacts. •204-1: Proportion of spending on local suppliers
GRI 201: Economic Performance

•201-1: Direct economic value generated and distributed GRI 205: Anti Corruption
•201-2: Financial implications and other risks and •205-1: Operations assessed for risks related to corruption
opportunities due to climate change •205-2: Communication and training about anti-corruption policies
•201-3: Defined benefit plan obligations and other and procedures
retirement plans •205-3: Confirmed incidents of corruption and actions taken
•201-4: Financial assistance received from government
GRI 202: Market Presence GRI 206: Anti Competition

•202-1: Ratios of standard entry level wage by gender •206-1: Legal actions for anti-competitive behaviour, anti-trust,
compared to local minimum wage and monopoly practices
•202-2: Proportion of senior management hired from the
local community
GRI 207: Tax
GRI 203: Indirect Economic Impact •207-1: Approach to Tax
•203-1: Infrastructure investments and services •207-2: Tax governance, control, and risk management
supported •207-3: Stakeholder engagement and management of concerns
•203-2: Significant indirect economic impacts related to tax
•207-4: Country-by-country reporting

GRI – Deep Dive
APTimum
Topic-Specific Standards – GRI 300:Environmental
In the context of the GRI Standards, the environmental dimension of sustainability concerns an organization’s impacts on
living and non-living natural systems, including land, air, water and ecosystems.
GRI 301:Materials GRI 302:Energy GRI 303:Water (2016) GRI 303: Water and Effluents (2018)
•301-1: Materials used by weight or •302-1: Energy consumption within the •303-1: Water withdrawal by •303-1: Interactions with water as a shared
volume organization source resource
•301-2: Recycled input materials •302-2: Energy consumption outside of the •303-2: Management of water discharge-
used organization •303-2: Water sources related impacts
significantly affected by
•301-3: Reclaimed products and their •302-3: Energy intensity •303-3: Water withdrawal
packaging materials withdrawal of water
•302-4: Reduction of energy consumption •303-4: Water discharge
•302-5: Reductions in energy •303-3: Water recycled and •303-5: Water consumption
reused
•Requirements of products and services
GRI 304: Biodiversity GRI 305: Emissions GRI 306: Waste

•304-1: Operational sites owned, leased, •305-1: Direct (Scope 1) GHG emissions •306-1: Waste generation and
managed in, or adjacent to, protected •305-2: Energy indirect (Scope 2) GHG significant waste-related impacts
areas and areas of high biodiversity value emissions •306-2: Management of significant
outside protected areas •305-3: Other indirect (Scope 3) GHG emissions waste-related impacts
•304-2: Significant impacts of activities, •305-4: GHG emissions intensity •306-3: Waste generated
products, and services on biodiversity
•305-5: Reduction of GHG emissions •306-4: Waste diverted from disposal
•304-3: Habitats protected or restored
•305-6: Emissions of ozone-depleting •306-5: Waste directed to disposal
•304-4: IUCN Red List species and national substances (ODS)
conservation list species with habitats in
•305-7: Nitrogen oxides (NOX), sulfur oxides
areas affected by operations
(SOX), and other significant air
emissions
GRI 307: Environmental GRI 308: Supplier Environmental

Compliance Assessment
307-1: Non-compliance with •308: New suppliers that were screened
environmental laws and using environmental criteria
regulations •308: Negative environmental impacts in
the supply chain and actions taken

GRI – Deep Dive
Code Index Disclosures C ode Index Disclosures APTimum
Topic- 401-1 New employee hires and employee turnover GRI 407: Freedom of
Specific GRI 401:
Association and
C ollective Bargaining
407-1
Operations and suppliers in which the right to freedom of
401-2 Benefits provided to full-time employees that are association and collective bargaining may be at risk
Standards – Employment
not provided to temporary or part-time employees GRI 408: C hild Labor 408-1 Operations and suppliers at significant risk for incidents of
child labor
GRI 400: 401-3 Parental Leave
GRI 409: Forced or
GRI 402: Labor 409-1 Operations and suppliers at significant risk for incidents of
Social / Management 402-1
Minimum notice periods regarding operational
C ompulsory Labor
forced or compulsory labor
Relations GRI 410: Security Security personnel trained in human rights policies
changes 410-1
Practices or procedures
Occupational health and safety management GRI 411: Rights of
403-1
In the context of system Indigenous Peoples
411-1
Incidents of violations involving rights of indigenous peoples
the GRI 403-2
Hazard identification, risk assessment, and
incident investigation 412-1 Operations that have been subject to human rights reviews or
impact assessments
Standards, the 403-3 Occupational health services
GRI 412: Human 412-2
social dimension 403-4 Worker participation, consultation, and Rights Assessment
Employee training on human rights policies or procedures
Significant investment agreements and contracts that
of sustainability GRI 403: communication on occupational health and safety 412-3 include human rights clauses or that underwent human rights
Occupational screening
concerns an Health and
403-5
Worker training on occupational health and safety 413-1 Operations with local community engagement, impact
GRI 413: Local
organization’s Safety 403-6 Promotion of worker health
C ommunities
assessments, and development programs
Operations with significant actual and potential negative
Prevention and mitigation of occupational health 413-2
impacts on the 403-7 and safety impacts directly linked by business
impacts on local communities
414-1 New suppliers that were screened using social criteria
social systems relationships GRI 414: Supplier
Social Assessment 414-2
Workers covered by an occupational health and Negative social impacts in the supply chain and actions taken
within which it 403-8
safety management system GRI 415: Public
415-1
operates. 403-9 Work-related injuries
03-10 Work-related ill health
Policy Political contributions
Assessment of the health and and service categories safety
416-1
impacts of product
404-1 GRI 416: C ustomer
Average hours of training per year per employee Health and Safety
416-2 Incidents of non-compliance concerning the health and
GRI 404: Programs for upgrading employee skills and safety impacts of products and services
Training and 404-2 transition
417-1
Education assistance programs Requirements for product and service information and labeling
Percentage of total employees by gender and by GRI 417: Marketing Incidents of non-compliance concerning product and service
404-3 417-2
employee category and Labeling information and labeling
GRI 405: 417-3 Incidents of non-compliance concerning marketing
405-1 Diversity of governance bodies and employees communications
Diversity and
GRI 418: C ustomer Substantiated complaints concerning breaches of customer
Equal 405-2 Ratio of basic salary and remuneration of women Privacy
418-1
privacy and losses of customer data
Opportunity to men GRI 419:
GRI 406: Non- Incidents of discrimination and corrective actions Socioeconomic 419-1 Non-compliance with laws and regulations in the social and
406-1
discrimination taken C ompliance economic area

GRI Key Indicators
Sub Index
Topic-Specific Metrics – GRI 200: Economic Category Number
Metrics APTimum
GRI 205: Anti Disclosure Total number and percentage of operations assessed for risks related to corruption.
Sub Index Corruption 205- 1
Category Number M etrics
Disclosure a. Total number and percentage of governance body members that the organization’s
GRI 201: Disc losure 205- 2 anti- corruption policies and procedures have been communicated to, broken down by region.
Ec onomic 201- 1 i. Direc t economic value generated: revenues; b. Total number and percentage of employees that the organization’s anti-corruption policies
ii. Ec onomic value distributed: operating costs, employee wages and and procedures have been communicated to, broken down by employee category and region.
Performanc e
benefits, payments to providers of c apital, payments to government c. Total number and percentage of business partners that the organization’s anti-corruption
policies and procedures have been communicated to, broken down by type of business partner
by c ountry, and c ommunity investments;
and region. Describe if the organization’s anti-corruption policies and procedures have been
iii. Ec onomic value retained: ‘direct economic value generated’ less communicated to any other persons or organizations.
‘ec onomic value distributed’. d. Total number and percentage of governance body members that have received training on
Disc losure The c osts of ac tions taken to manage the risk or opportunity. anti- corruption, broken down by region.
201- 2 e. Total number and percentage of employees that have received training on anti- corruption,
broken down by employee category and region
Disc losure Perc entage of salary c ontributed by employee or employer
201- 3 Disclosure a. Total number and nature of confirmed incidents of corruption.
Disc losure a.Total monetary value of financ ial assistance received by the 205- 3 b. Total number of confirmed incidents in which employees were dismissed or disciplined
201- 4 organization from any government during the reporting period, for corruption.
c. Total number of confirmed incidents when contracts with business partners were terminated
inc luding:
or not renewed due to violations related to corruption.
I. tax relief and tax c redits; d. Public legal cases regarding corruption brought against the organization or its employees
ii. subsidies; during the reporting period and the outcomes of such cases.
iii. investment grants, research and development grants, and other
GRI 206: Anti Disclosure Number of legal actions pending or completed during the reporting period regarding
relevant types of grant;
Competition 206- 1 anti- competitive behaviour and violations of anti-trust and monopoly legislation in which
iv. awards; the organization has been identified as a participant.
v. royalty holidays;
GRI 207: Tax Disclosure a. All tax jurisdictions where the entities included in the organization’s audited consolidated
vi. financ ial assistance from Export Credit Agenc ies (ECAs); 207- 4 financial statements, or in the financial information filed on public record, are resident for tax
vii. financ ial inc entives; purposes.
viii. other financ ial benefits received or receivable from any
government for any operation. b. For each tax jurisdiction reported in Disclosure 207- 4-a:
b. The information in 201- 4-a by c ountry. I. Names of the resident entities;
c . Whether, and the extent to which, any government is present in the ii. Primary activities of the organization;
shareholding structure. iii. Number of employees, and the basis of calculation of this number;
iv. Revenues from third- party sales;
v. Revenues from intra- group transactions with other tax jurisdictions;
vi. Profit/loss before tax;
GRI Disc losure Perc entage of senior management at significant loc ations of vii. Tangible assets other than cash and cash equivalents;
202:Market 202- 2 operation that are hired from the loc al c ommunity viii. Corporate income tax paid on a cash basis;
Presenc e ix. Corporate income tax accrued on profit/loss;
x. Reasons for the difference between corporate income tax accrued on profit/loss and the
GRI 204: Disc losure Perc entage of the procurement budget used for significant loc ations tax due if the statutory tax rate is applied to profit/loss before tax.
Proc urement 204- 1 of operation that is spent on suppliers local to that operation (such as
Prac tices perc entage of products and servic es purchased locally). c. The time period covered by the information reported in Disclosure 207- 4.

GRI Key Indicators
Topic-Specific Metrics – GRI 300: Environmental Sub Index
Category Number
Metrics APTimum
GRI 303: Disclosure a. Total water withdrawal from all areas in megaliters, and a breakdown of this total by
Sub Index Water and 303-3 the given sources
Metrics
Category Number Effluents b. Total water withdrawal from all areas with water stress in megaliters, and a breakdown
GR I Disclosure a.Total we ight or volume of materials that are used to produce and package the (Revised in of this total by the given sources
301:Material 301-1 organization’s primary products and services during the re porting period 2018)
s Disclosure a.Pe rcentage of recycled input materials used to manufacture the organization’s c. A breakdown of total water withdrawal from each of the sources listed in Disclosures
301-2 prim ary products and services. 303-3-a and 303-3-b in megaliters by the following categories:
Disclosure a. Pe rce ntage of re claimed products and their packaging materials for e ach product I. Freshwater (≤1,000 mg/L Total Dissolved Solids);
301-3 cate gory. ii. Other water (>1,000 mg/L Total Dissolved Solids).
GR I Disclosure The re porting organization shall report the following information:
302:Energy 302-1 a. Total fuel consumption within the organization from non-renewable source s, in Disclosure a. Total water discharge to all areas in megaliters, and a breakdown of this total by the
joule s or m ultiples, and including fuel types used.
303-4 given types of destination
b. Total fuel consumption within the organization from re newable source s, in joules
or m ultiples, and including fuel types used.
b. A breakdown of total water discharge to all areas in megaliters by the following
c. In joule s, watt-hours or m ultiples, the total: categories:
I. e le ctricity consumption ii. heating consumption iii. cooling consumption iv. steam I. Freshwater (≤1,000 mg/L Total Dissolved Solids);
consumption ii. Other water (>1,000 mg/L Total Dissolved Solids).
d. In joules, watt-hours or m ultiples, the total: c. Total water discharge to all areas with water stress in megaliters, and a breakdown of
I. e le ctricity sold ii. heating sold iii. cooling sold iv. steam sold this total by the following categories:
e . Total energy consumption within the organization, in joules or m ultiples. I. Freshwater (≤1,000 mg/L Total Dissolved Solids);
Disclosure a. Ene rgy consumption outside of the organization, in joules or m ultiples. ii. Other water (>1,000 mg/L Total Dissolved Solids).
302-2
Disclosure a. Ene rgy intensity ratio for the organization. d. number of incidents of non-compliance with discharge limits.
302-3 b. O rganization-specific metric (the denominator) chosen to calculate the ratio. Disclosure a. Total water consumption from all areas in megaliters.
c. Type s of energy included in the intensity ratio; whe ther fuel, e lectricity, heating, 303-5 b. Total water consumption from all areas with water stress in megaliters.
cooling, steam, or all.
c. C hange in water storage in megaliters, if water storage has been identified as having a
d. W hether the ratio uses energy consumption within the organization, outside of
significant water-related impact.
it, or both.
Disclosure a. Am ount of re ductions in e nergy consumption achieved as a dire ct re sult of GRI 304: Disclosure a.For each operational site owned, leased, managed in, or adjacent to, protected areas
302-4 conse rvation and efficiency initiatives, in joules or multiples.
Biodiversity 304-1 and areas of high biodiversity value outside protected areas, the following information:
b. Type s of energy included in the re ductions; whe ther fuel, electricity, heating,
cooling, steam, or all.
iii. Position in relation to the protected area (in the area, adjacent to, or containing
c. Basis for calculating re ductions in e nergy consumption, such as base year or
portions of the protected area) or the high biodiversity value area outside protected
baseline, including the rationale for choosing it. areas;
d. Standards, methodologies, assumptions, and/or calculation tools used v. Size of operational site in km2 (or another unit, if appropriate);
GR I Disclosure a. Total volume of wate r withdrawn, with a bre akdown by the given source s vi. Biodiversity value characterized by the attribute of the protected area or area of high
303:Water 303-1 biodiversity value outside the protected area (terrestrial, freshwater, or maritime
(2016) Disclosure a. Total number of wate r source s significantly affected by withdrawal by type: ecosystem);
303-2 I. Size of the wate r source; vii. Biodiversity value characterized by listing of protected status (such as IUCN Protected
ii. W he ther the source is designated as a nationally or internationally protected Area Management C ategories, Ramsar C onvention, national legislation).
are a; Disclosure Total number of IUCN Red List species and national conservation list species with habitats
iii. Biodiversity value (such as species diversity and e ndemism, and total number of 304-4 in areas affected by the operations of the organization, by level of extinction risk:
prote cte d species); I. C ritically endangered
iv. Value or importance of the wate r source to local communities and indigenous ii. Endangered
pe oples. iii. Vulnerable
b. Standards, methodologies, and assumptions used.
iv. Near threatened
Disclosure a. Total volume of wate r re cycled and re used by the organization.
v. Least concern
303-3 b. Total volume of wate r re cycled and re used as a percentage of the total water
withdrawal as specified in Disclosure 303 -1.
c. Standards, methodologies, and assumptions used.
GRI Key Indicators
Topic-Specific Metrics – GRI 300: Environmental Sub Category Index
Number
Metrics APTimum
Gri 306: Disclosure Total weight of waste generated in metric tons, and a breakdown of this
Sub Index
Metrics Waste 306-3 total by composition of the waste.
Category Number
GRI 305:Disclosur a. Gross direct (Scope 1) GHG emissions in metric tons of CO2 Disclosure a. Total weight of waste diverted from disposal in metric tons, and a
Emission e 305-1 equivalent. 306-4 breakdown of this total by composition of the waste.
s b. Gases included in the calculation; whether CO2, CH4, N2O, HFCs, b. Total weight of hazardous waste diverted from disposal in metric tons,
PFCs, SF6, NF3, or all. and a breakdown of this total by the given recovery operations
c. Biogenic CO2 emissions in metric tons of CO2 equivalent. c. Total weight of non-hazardous waste diverted from disposal in metric
Disclosur a. Gross location-based energy indirect (Scope 2) GHG emissions in tons, and a breakdown of this total by the given recovery operations:
e 305-2 metric tons of CO2 equivalent. d. For each recovery operation listed in Disclosures 306-4-b and 306-4-c, a
b. If applicable, gross market-based energy indirect (Scope 2) GHG breakdown of the total weight in metric tons of hazardous waste and of
emissions in metric tons of CO2 equivalent. non-hazardous waste diverted from
disposal
Disclosur a. Gross other indirect (Scope 3) GHG emissions in metric tons of CO2
e 305-3 equivalent. Disclosure a. Total weight of waste directed to disposal in metric tons, and a
b. If available, the gases included in the calculation; whether CO2, CH4, 306-5 breakdown of this total by composition of the waste.
N2O, HFCs, PFCs, SF6, NF3, or all. b. Total weight of hazardous waste directed to disposal in metric tons, and
c. Biogenic CO2 emissions in metric tons of CO2 equivalent. a breakdown of this total by the given disposal operations
d. Other indirect (Scope 3) GHG emissions categories and activities c. Total weight of non-hazardous waste directed to disposal in metric tons,
included in the calculation. and a breakdown of this total by the given disposal operations
Disclosur a. GHG emissions intensity ratio for the organization. c. Total weight of non-hazardous waste directed to disposal in metric tons,
e 305-4 b. Organization-specific metric (the denominator) chosen to calculate and a breakdown of this total by the given disposal operations
the ratio.
c. Types of GHG emissions included in the intensity ratio; whether direct GRI 307: Disclosure Significant fines and non-monetary sanctions for non-compliance with
(Scope 1), energy indirect (Scope 2), and/or other indirect (Scope 3). Environmenta 307-1 environmental laws and/or regulations in terms of:
d. Gases included in the calculation; whether CO2, CH4, N2O, HFCs, l Compliance I. total monetary value of significant fines;
PFCs, SF6, NF3, or all. ii. total number of non-monetary sanctions;
Disclosur a. GHG emissions reduced as a direct result of reduction initiatives, in
e 305-5 metric tons of CO2 equivalent. GRI 308: Disclosure Percentage of new suppliers that were screened using environmental
b. Gases included in the calculation; whether CO2, CH4, N2O, HFCs, Supplier 308 criteria
PFCs, SF6, NF3, or all. Environmenta a. Number of suppliers assessed for environmental impacts.
Disclosur a. Production, imports, and exports of Ozone Depleting substances in l Assessment b. Number of suppliers identified as having significant actual and potential
e 305-6 metric tons of CFC-11 (trichlorofluoromethane) equivalent. negative environmental impacts.
c. Significant actual and potential negative environmental impacts identified
Disclosur Significant air emissions, in kilograms or multiples, for each of the
e 305-7 follow ing: in the supply chain.
d. Percentage of suppliers identified as having significant actual and
I. NOX
potential negative environmental impacts with which improvements were
ii. SOX
agreed upon as a result of assessment.
iii. Persistent organic pollutants (POP)
e. Percentage of suppliers identified as having significant actual and
iv. Volatile organic compounds (VOC)
v. Hazardous air pollutants (HAP) potential negative environmental impacts with which relationships were
terminated as a result of assessment, and why.
vi. Particulate matter (PM)

GRI Key Indicators
Topic-Specific Metrics – GRI 400: Social
Sub Category Index
Metrics
APTimum
Sub Index Number
Metrics
Category Number GRI 404: Disclosure Average hours of training that the organization’s employees have undertaken
GR I 401: Disclosure a . Total number a nd ra te of new e mployee hires during the re porting period, by a ge Training and 404-1 during the reporting period, by:
Em ployme 401-1 group, gender and re gion. Education i. gender;
nt b. Total number a nd ra te of employee turnover during the re porting period, by a ge ii. employee category.
group, gender and re gion.
Disclosure a . Total number of employees that we re e ntitled to parental leave, by gender. GRI 405: Disclosure a. Percentage of individuals within the organization’s governance bodies in each of
401-3 b. Total number of e mployees that took parental leave, by gender. Diversity and 405-1 the following diversity categories:
c. Tota l number of e mployees that re turned to work in the re porting period after parental Equal i. Gender;
le ave ended, by gender. Opportunity ii. Age group: under 30 years old, 30-50 years old, over 50 years old;
d. Total number of e mployees that re turned to work after parental leave e nded that were iii. Other indicators of diversity where relevant (such as minority or vulnerable
still e mployed 12 m onths after the ir re turn to work , by gender. groups).
e . R e turn to work and retention ra tes of employees that took parental leave, by gender.
b. Percentage of employees per employee category in each of the following diversity
categories:
GR I 403: Disclosure If the organization has implemented an occupational health and safety m anagement i. Gender;
O ccupation 403-8 syste m based on legal re quirements a nd/or re cognized standards/guidelines: ii. Age group: under 30 years old, 30-50 years old, over 50 years old;
al He alth i. the number and perce ntage of all employees and work ers who are not employees but
iii. Other indicators of diversity where relevant (such as minority or vulnerable
and Safety whose work a nd/or work place is controlled by the organization, who a re covered by such
a system;
groups).
ii. the number a nd percentage of all employees and work ers who a re not employees but Disclosure Ratio of the basic salary and remuneration of women to men for each employee
whose work and/or work place is controlled by the organization, who are covered by such 405-2 category,
a system that has been internally audited;
by significant locations of operation.
iii. the number and perce ntage of all employees and work ers who are not employees but
GRI 406: Non- Disclosure Total number of incidents of discrimination during the reporting period.
whose work a nd/or work place is controlled by the organization, who a re covered by such
a system that has been audited or ce rtified by an e xternal party. discrimination 406-1
Disclosure a . For a ll employees: GRI 410: Disclosure Percentage of security personnel who have received formal training in the
403-9 i. The number a nd rate of fatalities as a re sult of work -re lated injury; Security 410-1 organization’s
ii. The number a nd ra te of high-consequence work -related injuries (excluding fatalities); Practices human rights policies or specific procedures and their application to security.
iii. The number and ra te of re cordable work -related injuries;
iv. The main types of work -related injury; GRI 411: Disclosure Total number of identified incidents of violations involving the rights of indigenous
v. The number of hours work ed. Rights of 411-1 peoples
b. For a ll work ers who are not employees but whose work and/or work place is controlled Indigenous during the reporting period.
by the organization: Peoples
i. The number a nd rate of fatalities as a re sult of work -re lated injury;
GRI 412: Disclosure Total number and percentage of operations that have been subject to human rights
ii. The number a nd ra te of high-consequence work -related injuries (excluding fatalities);
iii. The number and ra te of re cordable work -related injuries;
Human Rights 412-1 reviews
iv. The main types of work -related injury; Assessment or human rights impact assessments, by country.
v. The number of hours work ed. Disclosure a. Total number of hours in the reporting period devoted to training on human rights
412-2 policies
or procedures concerning aspects of human rights that are relevant to operations.
Disclosure a . For a ll employees: b. Percentage of employees trained during the reporting period in human rights
403-10 i. The number of fatalities as a re sult of work -re lated ill health; policies
ii. The number of ca ses of re cordable work -related ill health; or procedures concerning aspects of human rights that are relevant to operations.
iii. The main types of work -related ill health.
b. For a ll work ers who are not employees but whose work and/or work place is controlled
by the organization: Disclosure Total number and percentage of significant investment agreements and contracts that
i. The number of fatalities as a re sult of work -re lated ill health; 412-3 include human rights clauses or that underwent human rights screening.
ii. The number of cases of re cordable work-related ill health

GRI Key Indicators
Topic-Specific Metrics – GRI 400: Social Sub Category Index
Metrics APTimum
Number
Sub Index GRI 417: Disclosure Total number of incidents of non-compliance with regulations and/or
Metrics
Category Number Marketing 417-2 voluntary codes concerning
GRI 413: Disclosure Percentage of operations with implemented local community and Labeling product and service information and labeling, by:
Local 413-1 engagement, impact assessments, i. incidents of non-compliance with regulations resulting in a fine or
Communities and/or development programs penalty;
ii. incidents of non-compliance with regulations resulting in a warning;
GRI 414: Disclosure The reporting organization shall report the following information:
iii. incidents of non-compliance with voluntary codes.
Supplier 414-1 a. Percentage of new suppliers that were screened using social
b. If the organization has not identified any non-compliance with
Social criteria.
regulations and/or voluntary
Assessment Disclosure a. Number of suppliers assessed for social impacts.
codes, a brief statement of this fact is sufficient.
414-2 b. Number of suppliers identified as having significant actual and
potential negative social impacts. Disclosure Total number of incidents of non-compliance with regulations and/or
c. Significant actual and potential negative social impacts identified 417-3 voluntary codes concerning
in the supply chain. marketing communications, including advertising, promotion, and
d. Percentage of suppliers identified as having significant actual and sponsorship, by:
potential negative social impacts i. incidents of non-compliance with regulations resulting in a fine or
with which improvements were agreed upon as a result of penalty;
assessment. ii. incidents of non-compliance with regulations resulting in a warning;
e. Percentage of suppliers identified as having significant actual and iii. incidents of non-compliance with voluntary codes.
potential negative social impacts b. If the organization has not identified any non-compliance with
with which relationships were terminated as a result of assessment, regulations and/or voluntary
and why. codes, a brief statement of this fact is sufficient.
GRI 415: Disclosure Total monetary value of financial and in-kind political contributions
GRI 418: Disclosure Total number of substantiated complaints received concerning breaches of
Public Policy 415-1 made directly and indirectly
Customer 418-1 customer privacy,
2016 by the organization by country and recipient/beneficiary.
Privacy categorized by:
GRI 416: Disclosure Percentage of significant product and service categories for which i. complaints received from outside parties and substantiated by the
Customer 416-1 health and safety impacts are organization;
Health and assessed for improvement. ii. complaints from regulatory bodies.
Safety b. Total number of identified leaks, thefts, or losses of customer data.
Disclosure Total number of incidents of non-compliance with regulations and/or
c. If the organization has not identified any substantiated complaints, a
416-2 voluntary codes concerning
brief statement of this
the health and safety impacts of products and services within the
fact is sufficient.
reporting period, by:
i. incidents of non-compliance with regulations resulting in a fine or
penalty; GRI 419: Disclosure Significant fines and non-monetary sanctions for non-compliance with laws
ii. incidents of non-compliance with regulations resulting in a Socioeconomi 419-1 and/or regulations
warning; c Compliance in the social and economic area in terms of:
iii. incidents of non-compliance with voluntary codes. i. total monetary value of significant fines;
ii. total number of non-monetary sanctions

APTimum
7
Science-Based Target
initiative
Defining meaningful targets for the
sustainable transition

Science Based Targets initiative (SBTi) – Make relevant
commitments for a meaningful contribution APTimum
Following the Paris agreement-COP21 held in 2015, Science-Based targets provide companies with a “clearly defined pathway to future-proof
growth by specifying how much and how quickly they need to reduce their greenhouse gas emissions.” Targets adopted by all companies
willing to commit to reduce greenhouse gas (GHG) emissions are considered “science based” if they are in line with the level of decarbonization
required to keep global temperature increase below 2 degrees Celsius compared to preindustrial temperatures.
3 APPROACHES TO SET TARGETS METHODOLOGY
Sector-based approach: The global carbon budget is divided by The key components of an SBT method are:
sector and then emission reductions are allocated to individual • Carbon budget: defining the overall amount of GHGs that can be
companies based on its sector’s budget. emitted to limit warming to within well-below 2°C or 1.5°C
Use the “Beyond 2 Degrees Scenario” (B2DS) developed by IEA. • Emissions scenario: defining the magnitude and timing of
Absolute-based approach: The percent reduction in absolute emissions reductions
emissions required by a given scenario is applied to all companies • Allocation approach: defining how the budget is allocated to
equally. companies.
Use IPCC Special Report on Global Warming of 1.5°C (SR15) for
two pathways, a well-below 2°C and a 1.5°C trajectory. This
equates to at least a 2.5% (4.2%) absolute reduction per year
Economic-based approach: A carbon budget is equated to
global GDP and a company’s share of emissions is determined by
its gross profit, since the sum of all companies’ gross profits
worldwide equate to global GDP.
intensity reduction of tCO2e/$ value added -> 7 % a year
SBTi recommends companies to choose the method

leading to the most ambitious target. Targets need to be
reviewed every 5 years.
2. Target 4. Announcement of
Pathway to SBTs 1. Commitment letter
developpement
3. Validation from SBTi target
APTimum
8
Paris Agreement Capital
Transition Assessment
Measuring portfolios’ alignments with
various climate scenarios consistent with
the Paris agreement

PACTA for Banks – Measuring the “temperature” of a portfolio
of financial assets (incl. credits) APTimum
The Paris Agreement Capital Transition Assessment (PACTA): A tool to align your financial flows with the Paris
Agreement objectives
PACTA Data USER Data
Asset-Level Data Climate Scenarios Portfolio
• 230,000+ assets (plant, factory) • Climate Outcome: +2/1.5°C in 2010 • Companies ID

matched with 35,000+ companies • Technology pathways: • Loan values
• 5-years Forward-looking • Technology/Fuel Mix • Companies Sector(s)
• Sectorial Cover (Fossil Fuels, Power, • Production Volume Trajectory
Steel, cement and Automotive) • Emission intensity
• Provided by Asset Resolution • Provided by IEA-WEO
Measure the alignment of your portfolios (aggregated by sectors)

with climate scenarios and compare to benchmarks
Climate Scenarios OVERALL BENEFITS

5-years • Bypass non-financial reporting
trajectory of portfolio User Sector Portfolio • Cover 75 % of CO2 emissions
in Coal Power Production • Open-Source Software and
sector
Market Benchmark Free Data

APTimum
9
Partnership for Carbon
Accounting Financials
Accounting for financed GHG emissions

Partnership for Carbon Accounting Financials (PCAF) –
Accounting for funded GHG emissions APTimum
METHODOLOGY
Harmonized and transparent greenhouse gas The annual accounting and disclosure of GHG emissions financed by loans and
(GHG) accounting as a first step towards investments at a fixed point in time in line with financial accounting and
reporting periods
decarbonization…
Emissions are attributed to financial institutions based on robust and consistent
accounting rules
PCAF is a global partnership of financial institutions
that work together to develop and implement a
SCOPE
harmonized approach to assess and disclose the ▪ Listed equity and corporate bonds
Outstanding amount * company emissions
greenhouse gas (GHG) emissions associated with their & Business loans & unlisted Total equity + Debt
loans and investments. It provides financial equities
institutions with the starting point required to set Outstanding amount * project emissions
▪ Project finance Total equity + Debt
science-based targets and align their portfolio with
the Paris Climate Agreement. PCAF enables ▪ Commercial real estate & Outstanding amount * building emissions
transparency and accountability and will develop an mortgages Property value at origination
open-source global GHG accounting standard for Outstanding amount
▪ Motor vehicle loan * vehicle emission
financial institution. Total value at origination
EMISSION measurement quality

Audited emissions Production × emission factors
…to facilitate financial industry alignment with
Unaudited emissions Sector emissions × market share
the Paris Climate Agreement
Energy consumption × emission factors

APTimum
10
Carbon Disclosure Project
A platform for the disclosure of
environmental performance information

Carbon Disclosure Project –
Report on emissions and get rated on this basis APTimum
WHAT IS IT? SPONSORS / PROMOTERS
CDP works with institutional investors with assets of US$95 trillion, to motivate companies
CDP (formerly Carbon Disclosure Project, est. 2000) is an international, not-for- to disclose their impacts. CDP has partnered with investors, fund providers, networks for
profit organization providing a global system for companies and cities to measure,
cities, states and regions, national governments and intergovernmental organizations (inc.
disclose, manage and share vital environmental information. UN), government agencies as well as policy expert groups, coalitions and NGOs. EU is
funding CDP Europe through the « LIFE programme »
SCOPE & APPLICATION OBJECTIVES

▪ CDP aims at creating a « thriving economy that works for people
▪ CDP have regional offices and local partners spanning 50 countries. and planet in the long term ».
There are now companies, cities, states and regions from over 90 countries
disclosing through CDP on an annual basis. CDP has become a powerful ▪ CDP focus investors, companies and cities on taking action
to build a truly sustainable economy by measuring and
organization and a reference with:
understand their environmental impact.
▪ $106tn investor assets (from 515 investors)
▪ $4tn purchasing power over 147 major buyers
▪ +8400 companies reported through CDP on climate change
▪ +800 cities disclosed environmental information through CDP VALUE PROPOSITION & OFFERING SERVICES
▪ +120 states and regions disclosed environmental impacts through CDP
▪ One of the most popular features of the investor membership
package is the full greenhouse gas (GHG) emissions dataset
CDP’S A LIST & QUESTIONNAIRE which includes both self-reported and estimated Scope 1, 2 and 3
emissions data for over 5000 companies
▪ Report through CDP’s Questionnaire and integrate the A List
▪ New for FS in 2020: CDP introduces a Portfolio Impact section in the ▪ CDP's annual Companies A List celebrates corporate leadership on
Questionnaire. Usage of PCAF, SBTi, PACTA is recommended. environmental performance and transparency, with CDP scoring
thousands of companies from A to D- across climate change,
deforestation and water security.
companies have made this year's climate change A List

APTimum
11
Risk regulations
Integrating non-financial risk factors in
financial risk models

A normative framework that is being strengthened to take into account
new non-financial risk factors for banks APTimum
The EBA is mandated by the European Commission to define a normative framework aimed at integrating ESG factors into risk management
and reporting, while the ACPR has launched an unprecedented pilot exercise of climatic stress tests
We are
here
Guidelines on granting 30/06/2021 30/06/2022 30/06/2024

and monitoring loans Entry into force for new Entry into force for Entry into force for all
credits restructured credits credits granted before
06/30/2021
Pillar 3 disclosures of 1er/03/2021 30/06/2022

ESG risks Launch of public First reporting on
consultation on ITS draft ESG risks
(1)
Management & 3/11/2020 30/06/2021 2022 ? 2023 ?

Supervision of ESG Publication of Publication of final Dedicated guidelines Likely inclusion of ESG
risks discussion paper report risks in stress tests
Disclosure Regulation 11/03/2021 30/06/2021 1er/01/2022 30/06/2022

SFDR (extra-financial Entry into force Requirement to publish Entry into force of the Requirement to publish
investment com.) negative impact statement - provisions relating to periodicadverse impact statement -
SGP > 500 pers reports SGP < 500 pers
Climate pilot 16/07/2020 Déc. 2020 Avril 2021 Fin 2021

exercise Launch of the Delivery of results by Publication of results Methodological work as part
exercise institutions of the Finance ClimAct
project
(1) ITS : Implementing Technical Standards C apgemini Invent 2021.

ECB Guide on Climate and Environmental Risks - Key Risk Management
Expectations APTimum
Overall risk management framework Stress-tests
▪ Integration of climate and environmental risks into the management of credit, ▪ Integration of climatic and environmental risks in the reference scenarios and
operational, market and liquidity risks, as well as the ICAAP (Internal Capital the adverse stress test scenarios
Adequacy Assessment Process), quantifying them as much as possible according to
- Examination of portfolio vulnerabilities via stress tests under the ICAAP
the different scenarios
- Tests carried out on different scenarios and time horizons (short, medium and
▪ Adoption of a strategic approach to climate and environmental management long term), taking into account the randomness of the modeling (little depth of history
and / or mitigation for risks hitherto infrequent) and the medium / long nature end of these risks
- Taking into account climatic effects on the lines of activity in the constitution of
- In line with operational strategy and risk appetite
scenarios for the recovery planning processes (see directive establishing a
framework for the recovery and resolution of credit institutions and investment
- With adaptation of policies, procedures, risk limits and risk controls accordingly
companies)
Credit risk Market Risk
▪ Consideration of climate and environmental risks at all stages of the loan ▪ Climate risk measurement on current market risk exposures
granting process monitoring of portfolio risks
- Measurement of future depreciation of securities linked to changes in physical
- Opinion on how climate and environmental risks affect borrower default risk climatic risks and transition risks not taken into account to date by the market
- Identification of borrowers likely to be exposed to increased climate risks - Assessment of risks arising from debt securities, equities and financial instruments
linked to equities in the trading book, as well as currency risk and commodity risk in
- Taking into account climate risks in the pricing and valuation of guarantees (upon
the trading book and the banking book
granting and regular reviews)
- Assessment of market risk in relation to the credit spread risk of the banking
- Examining the location and energy performance of residential and commercial
book arising from positions measured at fair value and at cost
real estate.
- Monitoring of the value of equity exposures to detect a change in perception of the
- Monitoring and analysis of sectorial / geographic concentrations and exposure
level of risk attached to the issuer due to climatic and environmental risks
limits

EBA Guidelines on Lending and Monitoring (LOM): global view of impacts
on banks' business models (1) EWI: Early Warning Indicator
APTimum Key: LOM i mpact ESG-related LOM i mpact
Loan Lifecycle Monitoring & Reporting

Credit Risk Assessment Loan Activation Unpaid Installment Restructuring agreement
Origination & Evaluation Syndication & Approval Loan Management Overdue Management Loan restructuring Loan Monitoring & Reporting
▪ Dea l origination ▪ Pri ci ng ▪ Di s bursement ▪ Ma na gement of overdue ▪ Modi fications of terms & ▪ Net & Gros s outstandings
▪ Request qualification ▪ Deci sion s heet ▪ Col l ection & Pa yment allocation pa yments condi tions ▪ Col l aterals & Guarantees
▪ Si mulation ▪ Credi t proposal ▪ Contra ct modification ▪ Ca l culation of costs & l ate - Interest ra te revision ▪ Profi ta bility measurement
Loan Management ▪ Ri s k a nalysis ▪ Va l idation of cl ient docs ▪ Ea rl y repayments pa yment i nterests - Dura tion extension ▪ Credi t portfolio analysis by
Process ▪ Off B/S booking ▪ Portfol io management ▪ Tra ns fer to l itigation s tatus ▪ Tota l or partial refinancing product, LoB, industry,
▪ Cl i ent signing ▪ Los s recovery geography, currency…
Formalized approach to Arrears & Non-Performing Metrics for profitability
Broad integration of ESG credit decision making Collateral revaluation loans management measurement (RAROC…)
Forborne loans management
criteria (heat map) Norms for algorithmic credit monitoring Early detection of credit
Metrics for credit monitoring
decisions deterioration
▪ Risk analysis ▪ Risk review ▪ Periodic risk review ▪ Loss provisioning ▪ Forborne loans ▪ Internal reporting
- Credi t ri sk assessment of - Check a nd va lidation of - Upda te of client ra ting - Sta ge 2 & 3 ECL / Cos t of ri sk - FBE cl a ssification rules - Expos ure control & monitoring
cl i ents (retail, corp…) gua rantees ▪ Limits & Thresholds ca l culation - Moni toring of FBE, NPE
▪ Credit scoring modelling management ▪ Default management - Credi t ri sk dashboard (EL,
- Methodology rul es, credit ▪ Watch list Monitoring ▪ Non Performing loans defa ulted exposures, RWAs…)
Credit Risk s corecard… ▪ RWAs & Stage 1 ECL calculation ▪ Write-offs - Provi s ioning reporting (ECL, Cos t
Management Process of Ri s k…)
Enhanced credit risk model Methodology & Process for Limits & Thresholds Comprehensive monitoring &
governance collateral valuation consistent / risk appetite Assessment of provisioning early warning system
Sound credit risk model Sensitivity analysis / negative Back testing on credit risk amount appropriateness Mutualized data with
lifecycle management events effects assessment regulatory reporting
Extensive list of credit Collection of external & Coverage of all significant risk
granting criteria internal data on clients factors
Hybrid levers Common language & data
Extended data for credit- Behavior scenario-based sources for Risk & Finance Collection of external &
worthiness assessment pricing internal data on EWI(1)
Transversal Credit Revised internal Application of Documented Pro-active approach Real time credit IT systems & Data for Building & integration Transparency on
Granting & Monitoring governance responsible lending delegated credit to monitoring credit traceability & the whole loan of a pricing cross-subsidization /
Governance framework principles approval system quality monitoring lifecycle framework loans, BUs
EBA Guidelines on Lending and Monitoring (LOM): focus on ESG
expectations APTimum
▪ Consider different risks to the borrower:
- Risks due to the physical effects of climate change
- Risks arising from the transition to a low-carbon and climate-resilient economy
Introduction of ESG factors and
associated risks in credit risk appetite - Other risks such as changes in market and consumer preferences and legal risks that may affect the performance of
underlying assets
assessment and credit monitoring
procedures ▪ Define qualitative and quantitative targets to develop and monitor the environmentally sustainable lending activity
▪ Define activities, eligible criteria or relevant existing standards to be used to identify environmentally sustainable
lending
▪ Specify how to evaluate the use of environmentally sustainable credit facilities granted, especially by enterprises:
- Collect information about the climate-related and environmental objectives of the borrowers
Integration of environmentally - Assess the conformity of the borrowers’ funding projects with the qualifying environmentally sustainable projects or
sustainable lending policies in risk activities
management policies and credit risk - Check on a regular basis that the granted credits are allocated properly (potentially by requesting for updated
procedures information on the use of the credit facility until it is repaid)
▪ Assess the borrowers’ exposures to ESG factors, in particular environmental factors and the impact on climate
change, and the appropriateness of the mitigating strategies
- Build and use of heat maps that highlight climate-related and environmental risks of individual economic (sub-)
sectors in a chart or on a scaling system
- Conduct a more intensive analysis of the actual business model of borrowers associated with a higher ESG risk:
Assessment of borrowers’ exposures review of current and projected greenhouse gas emissions, market environment assessment, supervisory ESG
to ESG factors and associated risks requirements applying, likely impacts of ESG regulation on the financial position…
▪ Consider ESG factors affecting the value of the collateral (e.g., the energy efficiency of buildings…)
▪ Include all risks associated with ESG factors and conditions to mitigate them in the credit decision
Banks are requested to consider environmental, social and governance (ESG)-related factors
in their credit-granting practices and lending standards
11.a
EBA Pillar 3
ESG Disclosures
Introduction To Pillar 3 Disclosure On ESG Risks
The Pillar 3 framework on prudential disclosures on ESG risks that these ITS implement will support institutions in the
public disclosure of meaningful and comparable information on how ESG-related risks and vulnerabilities, may
exacerbate other risks in their balance sheet
▪ The Pillar 3 disclosure framework promotes transparency as a The 3 Pillars of Basel 3

main driver of market discipline in the financial sector, to Capital Requirements Regulation
reduce the asymmetry of information between credit institutions
and users of information
▪ Article 449a of the Capital Requirements Regulation (CRR) requires Pillar 1 Pillar 2 Pillar 3
Minimum Capital Supervisory Review Transparency and
large institutions with securities traded on a regulated market to disclose
Requirements Process Market Discipline
prudential information on environmental, social and governance risks
▪ Article 434a CRR mandates the EBA to develop draft Pillar 3 ESG ITS disclosures in addition to other existing disclosures
implementing technical standards (ITS) specifying uniform Qualitative disclosures on environmental, social and
formats and associated instructions for the disclosure of this governance risks
information
➢ These disclosure requirements should convey comprehensive and Quantitative disclosures on climate change transitional risk
comparable information for users of that information to assess the
risk profile of institutions
Quantitative disclosures on climate change physical risk
▪ In accordance with this, European Banking Authority (EBA) on
24th Jan 2022 published its final draft implementing technical Quantitative information and KPIs on climate change
standards (ITS) on Pillar 3 disclosures on Environmental, mitigating measures, including Green Asset Ratio (GAR) and
Social and Governance (ESG) risks Banking Book Taxonomy Aligned Ratio (BTAR)
Presentation Title | Author | Date 103

Company Confidential © Capgemini Invent 2021. All rights reserved |
Capgemini Invent 2021. All rights reserved | 103
European Banking Authority’s Approach & Timeline for The Disclosures
Sequential Approach & Review of the Guidelines: Where to get the data from?
▪ The EBA is following a sequential approach in the development of the ▪ The EBA has deliberately designed the KPIs on taxonomy alignment
Pillar 3 ESG ITS in line with the approach that is being followed disclosure requirements so they match the data, and timelines, that
relevant initiatives on ESG at EU level such as the Taxonomy large corporates under the NFRD will produce according to
Regulation, NFRD, etc Article 8 of the Taxonomy Regulation
➢ This is why currently the Pillar 3 ESG ITS includes KPIs and ▪ This way banks will find it easy to use the data reported by
information related to environmental objectives of climate change counterparties through NFRD in their own Pillar 3 ESG Risks
mitigation and climate change adaptation and not other disclosures
objectives just as the commission has planned
▪ Information necessary for the calculation of the BTAR shall be
obtained on a best effort basis in the context of the bilateral relationship
▪ The EBA will review the requirements currently included in the
with counterparties or when needed using estimates
Pillar 3 ESG ITS in the course of 2024 in order to understand their
relevance in the context of the evolution of the ESG policy ▪ The EBA has also set out guidance that on how banks should capture
framework at EU and international level ESG related information in Loan Origination and Monitoring
processes for easier data collection and disclosure
Timeline:
2023 2024
Large institutions which have issued securities that The disclosure of information on the GAR A phase-in period until June 2024 is proposed for
are admitted to trading must disclose information on will start to apply in 2024 for data as of disclosures on institutions’ scope 3 emissions and
ESG risks from 28 June 2022. This information must end 2023. alignment metrics. During this period, they must explain
be disclosed on an annual bas is for the first year the methodologies they are developing to measure and
and semi-annually thereinafter. estimate their scope 3 emissions and the sources of
data that they plan to use.
Therefore, the first disclosure reference date
will be 31 December and information will be The information on the BTAR will apply from June
made publicly available by institutions during 2024. Institutions will include this additional and
the first months of 2023. separate KPI in their end of June 2024 disclosure.
Presentation Title | Author | Date 104
Pillar 3 ESG Risks Disclosures – Structure
Table 1,2,3 Template 1 Template 2 Template 3 Template 4 Template 5 Template 6 Template 9 Template 10
Mitigating
Banking book - Loans Exposure in actions: BTAR
1. Environmental Risk Alignment Banking book -
Quality of collateralised the Banking (Information on Other
exposures by metrics on exposures Summary of
2. Social Risk by immovable Book to top 20 exposures towards mitigation
sec tor, emission relative scope subject to GAR KPIs
type, maturity property - Carbon non- NFRD corporates actions
3. Governance Risk 3 emissions Physical Risk not assessed in the
buc kets Collateral EPC intensive firms
GAR)
Template 7 Template 9.1

Assets for the Assets for the
Qualitative Information related to: calculation of GAR calculation of BTAR
▪ Business Strategy & Processes
▪ Governance Template 8 Template 9.2
▪ Risk Management GAR % BTAR %
Template 9.3
BTAR Stock & Flow
Summary
Template 1 Template 2 Template 3 Template 4 Template 5

Horizontal Segregation: Horizontal Segregation: Horizontal Segregation: Information on exposures towards Horizontal Segregation:
By sector (Using NACE Code) By EU or non- EU exposure, By type of By sector (Using NACE Code) and institution that are among the top By sector (Using NACE Code)
immovable property collateral, sector aligned specific metrics 20 most carbon- intensive
Vertical Segregation: corporates worldwide Vertical Segregation:
Climate Change Climate Change Quality of exposure (Performing & Vertical Segregation: Quality of exposure, exposure
Transition Risk Physical Risk Non- performing), emissions type, By energy efficiency of collateral sensitive to chronic and acute
maturity using climate change events, maturity
Template 6 Template 7 Template 8 Template 9 Template 10

Mitigating An overview of the KPIs calculated Horizontal Segregation: Horizontal Segregation: Horizontal Segregation: Exposure segregated by:
Actions on the basis of templates 7 and 8 Type of counterparty (Million EUR) Type of counterparty (Million EUR) Types of counterparty or exposure ▪ Type of counterpart
▪ Type of financial instrument
Vertical Segregation: Vertical Segregation: Vertical Segregation: ▪ Type of risk mitigated (Climate
By Environment Objective (CCM, By stock and flow exposure, By By Environment Objective (CCM, change transition/physical Risk)
GAR = Green Asset Ratio CCA) for current reference period Environment Objective (CCM, CCA) CCA)
BTAR = Banking Book
Taxonomy
Presentation Alignment
Title | Author | Date ratio 105
11.b
ECB, EBA Risk
Integration &
Regulatory Roadmaps
EBA MILESTONES & MANDATES ON SUSTAINABLE FINANCE
EBA Climate Stress Test 2022 | Oct 2021 Company Confidential © Capgemini 2021 All rights reserved | 107
ECB ROADMAP FOR CLIMATE CHANGE RISK RELATED ACTIONS
The pink areas represent external developments that the Eurosystem

relies on for the implementation of measures. The blue areas represent
Eurosystem actions.
EBA Climate Stress Test 2022 | Oct 2021 Company Confidential © Capgemini 2021 All rights reserved | 108
12
Other noteworthy
standards and workgroups
International organisation for standardization (ISO) 26000
APTimum
What is it? Sponsors / Promoters
• The International Organization for Standardization (ISO) is an independent, non -governmental international • R e presentatives from government, NGOs, industry, consumer groups and labour organizations
organization . Founded on 23 February 1947, the organization promotes worldwide proprietary, around the world we re involved in the development of ISO 26000
industrial, and commercial standards. It is headquartere d in Ge neva, Switzerland, and work s in 164
• More than 400 e xperts and 200 observers from 99 countries and 42 international organizations
countrie s. It is the world's largest developer and publisher of International Standards that forms a bridge
contributed to the development effort
be twe e n the public and private sectors.
• ISO 26000 (created in 2010) provides guidance to those who re cognize that respect for society and
environment is a critical success factor.
Objectives
ISO 26000:2010 helps clarify what social responsibility is, helps businesses and organizations ISO 26000: schematic overview
translate principles into effective actions and shares best practices relating to social
responsibility, globally. The application of ISO 26000 is a way of assessing an organization’s
commitment to sustainability and its overall performance.
Value proposition from main reports

The ISO 26000 standard defines the main topics of social responsibility. They include a number of
issues, but it is each organization's responsibility to identify which issues are relevant and
significant to their stakeholders and/or need to be addressed. In this way, this standards help
organizations maximizing their contribution to sustainable development. (see figures for more
information)
It provides guidance rather than requirements, so it cannot be certified to unlike some other well-
known ISO standards.
Unlike GRI, their standards are monetized.
Scope / degree of adoption
ISO has developed over 20,000 international standards covering almost all aspects of technology and
manufacturing.
ISO 26000 is aimed at all type of organization regardless of their size, activity, or location.

International organisation for standardization (ISO) 14064
APTimum
T he I nternational Organization for Standardization (I SO) is an independent, non -governmental international organization .
Founded on 2 3 February 1 947, the organization promotes worldwide proprietary, indus trial, and c ommercial s tandards. I t R e presentatives from government, NGOs, industry, consumer groups and labour organizations
is headquartered in G eneva, Switzerland, and works in 1 6 4 c ountries. I t is the world's largest developer and publisher of around the world we re involved in its development,
I nternational Standards that forms a bridge between the public and private s ectors.
The ISO 14064 standard (published in 2006) provides governments, businesses, regions and other organizations
with a com plimentary set of tools for programs to quantify, monitor, re port and verify gre enhouse gas emissions.
Objectives ISO 14064: schematic overview

‒ The ISO 14064 standard supports organizations to participate in both regulated and voluntary
programs such as emissions trading schemes and public reporting using a globally recognized
standard. This standard is monetized.

ISO 14064 is made up of thre e parts, each dealing with the specificities and dire ctives applicable at the level of
organizations or projects on greenhouse gas e missions. These parts can constitute a whole, or on the contrary be used
e ach separately, according to the needs of declaration and verification of gre enhouse gas emissions:
1. ISO 14064-1:2006 spe cifies principles and requirements a t the organization le vel to quantify and
report greenhouse gas (GHG) emissions and removals. It includes design, development, management,
re porting and verification re quirements of an organization's GHG inventory.
2. ISO 14064-2:2006 spe cifies principles and requirements and provides guidance at the project level for
quantification, monitoring and reporting of activities intended to cause greenhouse gas (GHG)
emission reductions or re m oval
e nhancements.
The re quirements give guidance for planning a GHG project, identifying and selecting GHG sources, sinks
and re servoirs re levant to the proje ct and baseline scenario, monitoring, quantifying, documenting and re porting
GHG proje ct performance and managing data quality.
3. ISO 14064-3:2006 spe cifies principles and requirements a nd provides guidance for those conducting or
m anaging the validation and/or verification of gre enhouse gas (GHG) assertions. It can be applied to
organizational or GHG project quantification, including GHG quantification, monitoring and re porting carried out in
accordance with ISO 14064-1 or ISO 14064-2.
Scope / degree of application

It has developed over 20k international standards covering almost all aspects of technology and
manufacturing.
ISO 14064 can be applied to all type of organizations regardless of their size, activity, or location.
Climate Disclosure Standards Board (CDSB)
APTimum
The CDSB is collaborating and working alongside international
CDSB is an international consortium of business and environmental NGOs
organizations such as the OECD or UNCTAD*, workgroups and NGOs such
founded in 2007 offering to companies a framework for reporting
as the TCFD and SASB as well as worldwide institutes such as the XBRL
environmental information
and global coalitions such as the IIRC.
*United Nations Conference on Trade and Development
Scope/degree of application Objectives

The Climate Disclosure Standard Board is committed to advance and align the
The CDSB’s framework is intended to a broad type of investors as global mainstream corporate reporting model to equate natural capital
well as analysts, international companies, regulators or stock with financial capital.
exchanges and accounting firms: CDSB’s members are convinced that investors and financial institutions can
▪ 374 companies across 32 countries make the adequate decisions if companies are open, transparent and
▪ Companies across 10 sectors analyze the risks and opportunities associated with climate-related
information.
▪ Currently referenced in 7 stock exchanges across the world, covering
all continents
▪ Represent a Market capitalization of $5.2 Trillion
▪ The Reporting Exchange is a unique online platform developed by the
WBCS, the CDSB and Ecodesk to help business understand and navigate the
Material, Relevant and environmental information
complex world of corporate sustainability reporting with guidance on what,
where and how to report
▪ TCFD Good Practice Handbook (September 2019) is a report co-created by
the SASB, the TCFD and CDSB. It helps identifying good practices in
implementing the TCFD recommendations. Examples are drawn from
across the G20 to cover multiple jurisdictions and a diversity of practices in
making the 11 TCFD recommended disclosures
▪ TCFD Implementation Guide (2019) : Following the 2017 th TCFD report and
recommendations (supported by more than 600 organizations), this guide is
giving practical guidance on how to effectively implement these
recommendations
▪ CDSB Framework (latest version Dec 2019): First version of the Framework
was published in 2010 and has since become a reference for organizations to
prepare and present environmental information in mainstream reports for the
benefit of investors. The Framework is a method of compliance with
environmental reporting legislation containing guiding principles and
reporting requirements
Source: cdsb.net
World Business Council for Sustainable Development (WBCSD)
APTimum
The World Business Council for Sustainable Development is a global CEO-
lead organization leading businesses working together to accelerate the WBCSD is composed by an international coalition of over 200 large
transition to a sustainable world. WBCSD is structuring programs to companies around the world coming from different sectors
contribute to 6 domains of UN’s Sustainable Development Goals

Redefining value is a the hearth of WBCSD’s programs, which aim at
The Council is connected to almost 70 national and regional business
building collaborations and developing tools, guidance, case
councils and partner organizations. The combined members represent
studies, engagement and education opportunities to help
a revenue of more than $8.5 trillion and 19M employees around the
companies incorporate ESG performance into mainstream business
world.
and finance systems. The realization of the UN SDG’s is targeted through
six work programs to achieve systems transformation and redefine
value: Circular Economy, Cities & Mobility, Climate & Energy, Food &
Nature, People.

The WBCSD 6 Work Programs to Redefine Value
▪ Applying Enterprise Risk Management to Environmental, Social
and Governance-Related risks (October 2018) This guidance
(developed with the COSO) is intended to help entities better
understand the full spectrum of the ESG-related risks and to
manage and disclose them effectively
▪ Insights from the Reporting Exchange: Corporate governance
and harmonization (March 2018) provides clarifications to
corporate writers on what, where and how to report on
sustainability issues
▪ Insights from the Reporting Exchange: ESG reporting Trends
(February, 2018): In partnership with the CDSB and Ecodesk, the
Reporting exchange was launched in 2017 and consists in a free
online platform designed to help business navigate the “often-
confusing world of corporate reporting”
▪ Translating ESG into sustainable Business (March, 2010)
Resulting in different workshops conducted by the WBSCD, UNEP FI
and key stakeholders from their work on ESG and sustainability
reporting and disclosures, this document outline the findings, key
insights and sustainability aspects on company performance
evaluation
Source: République & Canton de Genève; WBCSD.org
International Integrated Reporting Council (IIRC)
APTimum
The IIRC is a global coalition of regulators, investors, companies, standard The IIRC was established in 2010 by the Prince of Wales’s Accounting for
setters, accounting representatives, academia and NGOs, which aims at Sustainability Project, the Gobal Reporting Initiative and the International
providing a more precise description on corporate value creation, Federation of Accountants. Leaders from different horizons (corporate,
embedding environmental and social aspects, in a longer-term vision investment, accountring, Securities…) are actively taking part of the IIRC

IRRC Business networks include international companies (ArcelorMittal, ▪ IIRC mission is to establish integrated reporting and thinking within
Sanofi…) and banks (ABN AMRO Bank, Société Générale…) but also mainstream business practice as the norm in the public and private
leading institutes such as the Institute of Cost and Management sectors
Accountants of Pakistan. ▪ The IIRC’s vision is to align capital allocation and corporate behavior
Capgemini is also part of the IIRC network. to wider goals of financial stability and sustainable development
through the cycle of integrated reporting and thinking
The Value Creation Process Value proposition from main reports

▪ The International IR Framework was released in December, 2013.
This Framework follows a 3 months global consultation led by the
IIRC which gathered over 350 responses from 140 businesses and
investors spread around 26 countries. IIRC initiative was supported
by a lage majority of the consulted worlwide organizations.
▪ The Integrated Report provides a communication of the value
creation of organization by taking into account their strategy,
governance, performance and prospects.
▪ The Special Interest Group Integrated Thinking & Strategy
launched in 2018 is composed by more than 40 worldwide
organizations collaborating on the forefront of « integrated thining ».
Partners include, The World Bnak, the Accounting for Sustainability or
the AICPA (Accounting of International Certified Professional
Accountants)
Whats next ?
▪ To celebrate the IIRC’s 10th anniversary, IIRC will be hosting a Global
Conference in 2020 (30 November – 1 December)
Sources: integratedreporting.org; aicpa.org C apgemini Invent 2021.

European Union Commission: Technical Expert Group on
Sustainable Finance (TEG) APTimum
The TEG is composed by 35 members: 32 organizations incl. companies,
The Technical expert group on sustainable finance (est. 2018) is an
NGOs trade unions and universities, two experts with proven knowledge
executive branch of the European Commission which role is to provide
and acting independently and one individual to represent a common
useful guidelines and reports on climate-related disclosures.
interest shared by stakeholders in a particular policy area.
Objectives
Scope/degree of application
TEGs Guidance and reports intends to assist companies in developing ▪ Following the 3 objectives Action Plan on Financing Sustainable Growth, the
high-quality climate-related disclosures that comply with the latest TEGs aims at assisting the Commission in the development of a unified
recommendations and requirements. classification system for sustainable economic activities and metholodologies
for low-carbon indices, but also on an EU green bond standard (Action 2 of the
Action Plan) and on metrics for climate-related disclosure (Action 9 of the Action
Plan)
Sustainable Finance Value proposition from main reports

▪ EU classification system or EU taxonomy (March 2020) determines whether an
economic activity is environmentally sustainable. This report contains
recommendations relating to the overaching design of the EU taxonomy, as well
as extensive implementation guidance on how companies and financial
institutions can use and disclose against the taxonomy.
▪ EU Green Bond Standard (June 2019): This report proposes the creation of a
voluntary EU Green Bond Standard to enhance the effectiveness,
transparency, comparability and credibility of the green bond market and
encourage the market participants to issue and invest in EU green bonds. Based on
these recommendations, the TEG published the usability guide for the EU Green
Bond Standard on March 2020
▪ The Final report on Climate Benchmarks and Benchmark’s ESG Disclosures

(June 2019) recommends a list of minimum technical requirements for the
methodologies of EU climate Transition and EU Paris -aligned benchmarks as well as a
set of ESG disclosure requirements (inc. standard format to be used for the
reporting)
▪ Final Report on Climate-related Disclosures (January 2019): This report proposes

climate-related disclosures to assist the European commission in its revision of the
current Non-Binding Guidelines
Source: ec.europa.eu
OECD Guidelines for Multinational Enterprises
APTimum
Me m ber countries
Founded in 1961, the OECD is an intergovernmental economic organization with 37 member countries. Its O ECD Investment committee and its work ing party
initial goal was to intensify economic progress and world trade. Members are advocates of democracy and
Objectives
‒ Gives guidance allowing comparison between policy experiences
‒ Try to address and tackle common problems
‒ Identify good practices
‒ C oordinate domestic and international policies of its members.

‒ Those guidelines are an appendix to the OECD Declaration on International Investment and Multinational
Enterprises.
‒ They are recommendations giving principles and standards for responsible and sustainable business
conduct for global companies operating in or from member countries.
‒ They focus on business ethics issues:
• Em ployment and industrial relations • C onsumer intere sts
• Hum an re lations • Scie nce & te chnology
• Environm ent • Com petition
• Information disclosure • tax ation
• Com bating bribery
Scope/ degree of application

‒ Although the guidelines are legally nonbinding, their implementation are highly encouraged by the
OEC D Investment Committee and its Working Party
Source: OECD
‒ All multinational companies operating in or from member countries are encouraged to adopt those
guidelines.

United Nations: Sustainable Development Goals (SDG)
APTimum
The United Nations (UN) is an intergovernmental organization founded right after
WW2, and now composed of 195 member countries. United Nations General Assembly
Headquartered in Ney York city, it is the most internationally represented, most
powerful intergovernmental organizations in the world
Objectives
‒ Maintain international peace and security,
‒ Develop friendly relations among nations
‒ Achieve international cooperation
‒ Be a platform for harmonizing the actions of nations

‒ The 17 sustainable Development goals set in 2015:
• Aim at achieving a better future
• Address global challenges such as poverty, inequality, climate change,
environmental degradation, peace and justice
• Are interdependent and should ideally be achieve by 2030
‒ There are 169 targets for the 17 goals. Each target has between 1 and 3 indicators
used to measure progress toward reaching the targets. In total, there are 232
approved indicators that will measure compliance
Scope/ degree of application

The 17 Goals were adopted by all UN Member States in 2015, as part of the 2030 Source: united nations
Agenda for Sustainable Development which set out a 15-year plan to achieve the
Goals.
Today, progress is being made in many places, but, overall, action to meet the Goals
is not yet advancing at the speed or scale required.
APTimum
13
Sustainable disclosure
metrics – an analysis
Work in progress

KPIs to assess the ESG and sustainability ecosystem
APTimum
Key ESG Pillars Key Environmental, Social and Governance KPI Areas
Climate Change Greenhouse Gas

Opportunities and (GHG) Emissions Environmental Policy
Risk
Environmental
Tax
Transparency KPI Areas
Environmental
Bio- Energy Effic iency Management
Risk diversity
Management Systems
Climate
Change
Corporate Stakeholder
Governance Pollution & Soc ial KPIs Health and Safety
Resources Engagement
Social
ESG
KPI Areas
Water Workforc e
Anti- Corruption Security Diversity and Equal Development/
Opportunity Human Capital
Labor Customer
Standards Responsibility
Human
Rights & Health &
Community Safety ESG Reporting
Compensation Polic y Governanc e Polic y
Standards
Governance
KPI Areas
Labour Polic y Human Rights Polic y

Common ESG & sustainability KPI areas (indicative) - 1
APTimum
Sl No KPI Criteria Rationale Policy Reference
Total Energy consumption, Energy Intensity

TCFD Metrics and
1 Energy Ratio, Renewable and Non Renewable
Targets, GRI, SFDR
Energies
GHG emissions (Scope 1,2 and 3), other TCFD Metrics and
2 Emissions gas emissions in metric tons of CO2 Targets, GRI, SFDR
equivalent, Ozone depleting substances
Amount of water being recycled or TCFD Metrics and

3 Water reused out of the total amount of water Targets, GRI, SFDR
withdrawn.
Percentage of land by cover TCFD Metrics and

4 Land Usage type, Deforestation Targets, SFDR
Amount of waste generated,

5 Waste recycled, Hazardous waste ratio, GRI, SFDR
Disposal process
Size of operational sites adjacent

6 Biodiversity to, protected areas and areas of GRI, SFDR
high biodiversity value in km2
Violations of Global guidelines,

7 Social And Employee Matters GRI, SFDR
Monetary and non monetary losses
Percentage of significant product

Customer Health and Safety and service categories for which GRI, SASB
8
health and safety impacts are
assessed
Amount invested in deployment of TCFD Metrics and

9 Capital Expenditure low-carbon technology, energy Targets, EU
efficiencies etc. Taxonomy
* Refer the exhaustive KPI libraries for further insight C apgemini Invent 2021.
Common ESG & sustainability KPI areas (indicative) - 2
APTimum
Sl No KPI Criteria Rationale Policy Reference
Percentage of individuals on basis of gender,

Diversity and GRI, SASB, SFDR
10 age group, Gender pay gap, Board gender
Inclusion
diversity
Number of incidents of violations GRI, SFDR

11 Social Violations involving the rights of indigenous people
Health and safety management, number GRI, SFDR

12 Employee health and safety of work related injuries, Rate of
accidents
Human Rights Number of Cases and GRI, SFDR

13 Violations, monetary losses
Violations
Economic value generated,

14 Economic Performance GRI, SASB
distributed, retained
Number of Data Breaches,

15 Data Security and Privacy Complaints from regulatory, GRI, SASB
Practices monetary losses
16 Tax Non Co-operative Tax Jurisdiction GRI, SFDR
Corruption issues, employees

Anti Corruption training on Anti corruption, Legal GRI, SFDR
17
cases
* Refer the exhaustive KPI libraries for further insight C apgemini Invent 2021.
ESG & sustainability KPIs across key standards
General Reporting Initiative (GRI) Task Force of Climate Related Finance Disclosure APTimum
Greenhouse
GRI 200: Ga s Emi ssi ons Wat er Energy/Fuel
GRI 4 0 0 : Soci al
Economi c
GRI 201: Economic performance • Emission Level • W ater Usage • Energy Usage
GRI 202: M arket Presence GRI 401: Employ ment GRI 410: Security Practices • Emission intensity • W ater intensity • Energy intensity
GRI 203: Indirect Economic GRI 402: Labor/M anagement Relations GRI 411: Rights of Indigenous Projects • Embedded Emissions • W ater Source • Energy M ix
Impacts GRI 403: Occupational Health and Safety GRI 412: Human Rights Assessment
GRI 204: Procurement Practices GRI 404: T raining and Education GRI 413: Local Communities
GRI 205: Anti-corruption GRI 405: Diversity and Equal Opportunity GRI 414: Supplier Social Assessment
Ri s k A da pt ation Land Usage Locat i on
GRI 206: Anti-competitive GRI 406: Non-discrimination GRI 415: Public Policy
Behavior GRI 407: Freedom of Association and Collective GRI 416: Customer Health and Safety & Mi t iga tion
GRI 207: T ax Bargaining GRI 417: M arketing and Labeling
• Coastal Zone
GRI 408: Child Labor GRI 418: Customer Privacy • R&D • Land Cover
GRI 300: • Flood Zone
GRI 409: Forced or Compulsory Labor GRI 419: Socioeconomic Compliance • Capital Expenditure • Land Use Particles
Env i ronmental
Sustainable Finance Disclosure Regulation (SFDR)
GRI 301: M aterials
GRI 302: Energy P r i n c i p a l A d v e r s e I m p a ct s Pr incipal A dverse Impact s EU Taxonomy
GRI 303: W ater (2016) ( P A Is) K P Is - M a nda tor y ( PA Is) K PIs - Opt ional
GRI 303: W ater and Effluents Credit Asset I n v e s t m en t
• Green house gas emission • W ater, waste and material
• Resource consumption Non F i na ncial Managers
(Revised in 2018)
emission U ndert akings I n s t i t ut i o na l Fi rms KPIs
GRI 304: Biodiversity • Biodiversity , waste and water and biodiversity
• Social and employ ee matters • Green securities • Human rights KPIs KPIs
GRI 305: Emissions
• Real estate assets • Emissions, Energy • Governance • KPI Eligibility
GRI306: W aste • Net turnover KPI • Green asset ratio • Green Investment
Consumption • Anti Corruption and Anti • KPI Alignment
GRI 307: Environmental • CapEx KPI • Fees and commissions Ratio
Compliance Bribery • OpEx KPI KPI • Green Asset Ratio
GRI 308: Supplier • Financial Guarantees
Environmental Assessment CDP Recommendation (FinGuar) KPI
Insurance • Asset Under
• Portfolio emission Fi rms KPIs M anagement (AuM )
KPI
• Carbon intensity
• Portfolio carbon footprint • KPI Underwriting
• Exposure to carbon related assets • KPI Investment
Sustainability Accounting Standards Board (SASB)

Investment Secur ity and
Consumer Asset Management & M or t gage Managed Car e –
Commer cial Banks Banking & Commodit y Insur ance
Finance C ust ody A ct i v i ti es Finance He a l t h I n s u r a n c e
Br oker age Ex changes
• Data security• Incorporation of • Customer • T ransparent information & fair • Lending practice • Professional integrity • Promoting T ransparent • T ransparent Information, Fair • Customer Privacy
• Financial ESG factors in privacy advice for customers • Discriminatory • Sy stemic risk management and Efficient Capital advice • Access to coverage
inclusion and credit analy sis • Data security • Employ ee diversity and inclusion lending • Employ ee incentives and markets • Incorporation of ESG • Plan performance
capacity • Business ethics • Selling • Incorporation of ESG • Environmental risk risk taking • M anaging Conflicts of • Policies to incentivize • Climate change
building • Sy stemic risk practices • Business Ethics to mortgaged • Incorporation of ESG Interest responsible behaviour impacts on human
management • Sy stemic Risk M anagement properties • Business Ethics • M anaging business • Risk Exposure health
continuity and Technology • Sy stemic Risk M anagement • Improved
Risks Outcomes
* Refer the exhaustive KPI libraries for further insight

insights Common KPI areas across Standards C apgemini Invent 2021.
ESG & sustainability data requirements & sources
APTimum
Environmental, Social and Governance data requirements ESG Data Providers / Sources
GRI SASB TCFD SFDR EU Taxonomy NFRD CSRD
vb
KPI Criteria Metrics Other Requirements

vb
KPI Criteria Metrics
Total Energy c onsumption, Energy Intensity Diversity and Perc entage of individuals on basis of
External Sources
Energy Ratio, Renewable and Non Renewable Security Reference
Inclusion gender, age group, Gender pay gap
Energies Data
GHG emissions (Sc ope 1,2 and 3), other gas Number of inc idents of violations
Emissions emissions in metric tons of CO2 equivalent, Social Violations
involving the rights of people
Ozone depleting substances Corporate Structure
Amount of water being rec yc led or reused Health and safety management, Data
Water Employee health
out of the total amount of water number of work related injuries,
and safety
withdrawn. Rate of ac c idents
Corporate Financials
Perc entage of land by c over type, Human Rights Number of Cases and Violations,
Land Usage monetary losses Data
Deforestation Violations
Amount of wast e generat ed, recycled, Economic Ec onomic value generated,

Waste Hazardous waste ratio, Disposal Performance distributed, retained Capital Structure
proc ess Data Internal Internal ESG
Ledger- rating and
Internal Sources
Size of operational sites adjac ent to, Data Security and Number of Data Breac hes,
Subledger scoring data
Biodiversity protected areas and areas of high Privacy Practices Complaints from regulatory,
biodiversity value in km2 monetary losses Annual Macro
Supply Chain Data sustainability scenarios &
Soc ial And Violations of Global guidelines, Monetary Tax and Capital Non Co- operative Tax Jurisdic tion, report parameters
Employee Matters and non monetary losses Expenditure Amount invested in Green energies
Financ ial Proxy
Customer Health Perc entage of significant product and Corruption issues, employees
Funding and Holdings statement reports
and Safety
Anti Corruption training on Anti c orruption,
servic e c ategories for which health and Data
safety impac ts are assessed Legal c ases
ESG and sustainability KPIs are measured according to the financial materiality assessment as recommended by different standardsand frameworks

About Capgemini Invent
As the digital innovation, consulting and transformation brand of the Capgemini Group,
Capgemini Invent helps CxOs envision and build what’s next for their organizations.
Loc ated in more than 30 offices and 25 c reative studios around the world,its 7,000+
strong team c ombines strategy, technology, data science and creative design with deep
industry expertise and insights, to develop new digital solutions and business models
of the future.
Capgemini Invent is an integral part of Capgemini, a global leader in partnering with

companies to transform and manage their business by harnessing the power of
tec hnology. The Group is guided everyday by its purpose of unleashing human energy
through tec hnology for an inc lusive and sustainable future. It is a responsible and diverse
organization of 270,000 team members in nearly 50 c ountries. With its strong 50 year
heritage and deep industry expertise, Capgemini is trusted by its c lients to address the
entire breadth of their business needs, from strategy and design to operations, fueled by
the fast evolving and innovative world of c loud, data, AI, c onnectivity, software, digital
engineering and platforms. The Group reported in 2020 global revenues of €16 billion.
Get the Future You Want | www.capgemini.com/invent
T his presentation contains information that may be privileged or confidential and

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Copy right © 2021 Capgemini. All rights reserved.

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C apgemini Invent 2019. All rights reserved | 1

Steering & Sponsorship ESG Think-Tank

Julien Omar Dalia Ludovic François Jean-Daniel

Gaurav BEDEKAR Aniruddha GUHA BISWAS

Julien Riddhima Hakim Jean Adrien Martin

Rajesh VARMA Somobrata BALLABH

Omar Amaury Anis

Mayank KHATRI Pallavi ROY Satya Akshay GHIREPUJE

Rob Marco Erekle DFRC I NDI A

C apgemini Invent 2021.

C apgemini Invent 2019. All rights reserved | 3

Creation of the European

Law 2008-496 regarding French Energetic

1970 - 2000 2000 - 2010 2010 - 2020

C apgemini Invent 2021.

Dec. 2020 Mar. 2021 Apr. 2021 Dec. 2021

June 2021 C apgemini Invent 2021.

Status: fully applicable

Climate KEY PRINCIPLES:

C apgemini Invent 2021.

C apgemini Invent 2021.

Int’l organizations Local regulators Market standards Rating agencies

▪ UN principle for Responsible ▪ PCAF (Partnership for Carbon

C apgemini Invent 2021.

SFDR NFRD/CSRD EU Taxonomy

Jun 2021 Jan 2022 Jun 2022

Stewardship Code and Revision of

2016 2020 July 2020 2021/2022 2021/2022

2011 2020 Jan 2021

Disclosure Disclosure Temperature scenario benchmarking

C apgemini Invent 2021.

Appendix: detailed landscape

1 Corporate Sustainability Reporting Directive 7 Science-Based Target initiative

2 Sustainable Finance Disclosure Regulation 8 Paris Agreement Capital Transition Assessment

3 EU Taxonomy 9 Partnership for Carbon Accounting Financials

4 Task Force on Climate-related Financial 10 Carbon Disclosure Project

C apgemini Invent 2019. All rights reserved | 13

C apgemini Invent 2019. All rights reserved | 14

EFRAG is the European voice of financial reporting

EFRAG’S WORK AND MISSION EFRAG & EU TAXONOMY

C apgemini Invent 2021.

❑ Introduction of Double Materiality

❑ Integrated with EU Sustainability Regulation

C apgemini Invent 2021. All rights reserved | 16

What is the Scope of reporting requirements? Applicable to which companies?

When will it be applicable? Is 3rd Party Assurance needed?

How should it be reported?

Accounting directive 2013/34/EU The accounting directive was

Nov 2016 Jun 2019 Apr 2021 2023

C apgemini Invent 2021. All rights reserved | 18

CSRD SFDR EU Taxonomy

Disclosure requirements for financial

EU Taxonomy Regulation aids reporting entities in complying with

C apgemini Invent 2021. All rights reserved | 19

C apgemini Invent 2019. All rights reserved | 20

Transparency at 2 levels: entity and product Quantitative indicators to assess the

FMPs* and Report for

Entity – Level 1 disclosure Product – Level 2 disclosure

Publish the policy in Report on the policies

Publish the policy in

Source : https://sustainalize.com/2021/01/sfdr-eu-esg/ More details provided on next slides