|Adoption Date:||11 December 2008|
|Country of Headquarters:||Colombia|
|Region of Headquarters:||Latin America|
|Institutional Reporting Hyperlink:||Environmental and social risk management report 2018|
|Current EPFI Reporting Year/Period:||2018|
|EPFI Reporting in Compliance:||Yes|
Reporting – Bancolombia S.A. (2018)
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Further information on this EPFI may be obtained through the Institutional Reporting Hyperlink above.
PROJECT FINANCE ADVISORY SERVICES
Total number mandated in the reporting period: 0
PROJECT FINANCE TRANSACTIONS
Total number that reached financial close in the reporting period: 4
Totals 1 3 0
Totals 1 3 0
Sector Category A Category B Category C
Mining Infrastructure 1 Oil & Gas Power 1 2 Others Region Category A Category B Category C
Americas 1 1 Europe, Middle East & Africa Asia Pacific Country Designation Category A Category B Category C
Designated1 Non-Designated 1 3 Independent Review Category A Category B Category C
Yes 1 2 No 1
1Designated Countries are those countries deemed to have robust environmental and social governance, legislation systems and institutional capacity designed to protect their people and the natural environment. For the list of Designated Countries, go to: https://www.equator-principles.com/index.php/ep3/designated-countries
PROJECT NAME REPORTING FOR PROJECT FINANCE TRANSACTIONS
|No.||Project Name||Sector||Host Country Name/ Project Location||Year of Financial Close|
|2||PCH Aguas de la Santa María||Power||Colombia||2018|
|4||P.A. Bucaramanga - Barrancabermeja - Yondó||Infrastructure||Colombia||2018|
PROJECT-RELATED CORPORATE LOANS
Total number that reached financial close in the reporting period: 0
IMPLEMENTATION OF THE EQUATOR PRINCIPLES
Bancolombia has adjusted and updated its processes and policies of Environmental and Social Risk Assessment to align itself with the third version of the Equator Principles and its entire application framework, based in particular on the evaluation of Climate Change, Human Rights, Transparency and Reporting, both in ordinary projects and operations as well as in Project Finance, Corporate Loans, Bridge Loans and Financial Advisors, in the business units of Corporate and Government Banking, SME Banking, Investment Banking, Leasing operations and receipt of guarantees.
The criteria, risk categorization and structured covenants are defined for each evaluation through the tools generated by the Equator Principles and the IFC Performance Standards, adjusted to the needs of Bancolombia, local regulations, the country and the region. Additionally, the scope of the fourth version of the Equator Principles is under study to carry out the updates or modifications in the internal environmental and social risk assessment policies.
For those operations that require it, the Risks Vice Presidency may present the evaluation of a project or activity before the Environmental Committee, consisting of risk, legal, commercial, sustainability, communications and other interest teams for the taking of decisions, determine the viability, result, qualification and procedure that will be carried out.
In Bancolombia we prevent and mitigate the environmental and social indirect risks that can materialize in the projects and activities that we finance to our clients and investors, while also identifying business opportunities with positive environmental impact. We focus on evaluating environmental, social and occupational health and safety aspects, following normative guidelines and international standards, complying with our commitment to adherence to the Equator Principles.
As a result of the joint and permanent work carried out between the Legal and Risk areas, the environmental and social clauses and commitments (covenants) were built for the contractual figures of: (i) Investment Banking, (ii) Leasing, (iii) Business and Government Banking and, (iv) SME Banking; doing due diligence in monitoring the environmental and social management of the financed operations.
We continue with the evaluation and analysis of environmental risks in the collection of guarantees and payment dations, mitigating the risks associated with environmental liabilities in real estate where made activities are significantly sensitive to environmental impacts.
To strengthen the process of environmental and social risks assessment, the Policy was updated giving a new scope to Corporate Banking, reducing the amount required for the environmental and social risk assessment, for operations over US$2,300,000 and emphasizing the sectors: (i) Mining; (ii) Energy; (iii) Tanneries; (iv) Cement; (v) Oil and Gas; (vi) Steelmakers; (vii) Chemicals and Agrochemicals; (viii) Oil Palm. In the same way, these sectors apply to SME Banking financial and leasing operations.
They are also considered other productive sectors, different from those mentioned, that also have the potential to present environmental and social risks that may affect the payment of financial obligations. These sectors are also subject to environmental authorizations, approvals, licenses and permits from local and national authorities. Some of these sectors are: (i) Basic Sanitation (sewerage and sanitation); (ii) Transportation and storage of hazardous substances; (iii) Food sector; (iv) Animal feed production plants; (v) Sugar mills (vi) Animal slaughter plants and zoo farms for commercial purposes; (vii) Road, airport and port infrastructure; (viii) Poultry and Pig Industry; (ix) Apparel and textile plants; (x) Forestry activities; (xi) Fishing and tuna; and (xii) Glass plants. For the previous sectors, environmental and social risk assessments are carried out at the express request of the commercial managers, attribution teams, credit risk management, legal areas, assets, compliance, customer relationship and sustainability, as long as it is reasonably supported.
The processes and registers for compliance with the Policy were updated, including the evaluation of ecosystem services, climate change and human rights in the assessment and determining how these may be affected or how they affect the development of the projects and activities.
Environmental and social risk management report 2018: