sustainability governance

alrajhi bank has set up an ESG Committee (Sustainable Finance Working Group) to lead its sustainability efforts, advance ESG initiatives, and mainstream ESG considerations across the bank’s operations. The ESG Committee is chaired by the Chief Financial Officer (CFO), and comprises the Chief Risk Officer (CRO), the General Managers of both B2B and B2C business verticals, and the Group Treasurer. The Committee’s oversight lies with the Board Risk Management Committee, where the Board is responsible for the committee’s direction, in order to guarantee that ESG related goals are integrated into the bank’s governance system, business model and decision-making procedures. All these efforts are disclosed in the accountability reports that are prepared in compliance with the required local standards.

The following ESG governance framework presents a clear strategy that shall be followed by the bank in order to ensure sustainability and good corporate governance practices are applied across the bank, thus contributing towards the Kingdom’s Vision 2030 objectives, and Saudi Arabia’s multidimensional approach to emission reduction in reaching its Net Zero 2060 target. The framework focuses on the four key pillars of the earlier mentioned sustainability strategy framework, with the main strategic plans focusing on the improvement of the financial accessibility of various services and products, development of green financing concepts, digitalization of services and products, and compliance with the existing regulations as well as meeting the customers’ needs.

The ESG Committee is central to the governance structure and meets at least bi-annually. The Committee reports its outcomes to the Board Risk Management Committee.

The bank’s new Business Strategy ‘harmonize the group’ is customer-focused and supports increased cross-sales with efficiency from support businesses, creating multiple growth opportunities.

The Bank’s ‘harmonize the group’ strategy focuses on the use of governance structures as the means to ensure that business targets correlate to the ESG standards, where stakeholders’ engagement is seen as an enabler. The strategy aligns all operations from B2C, B2B, support functions, and digital/data to integrate ESG governance throughout the company.

Stakeholder engagement is a critical factor in this alignment and the objectives include leading customer experience, cultivating employee support, and developing careers throughout the company. These initiatives exhibit a direct relation to the governance framework which protects the sustainable banking policy as well as the aspirations to adhere to the best practice with respect to financial conduct.