Scope 1 Emissions
2022 Communication on Progress
DGB Financial Group
Published date
June 30, 2022
No. of questions
62
Supplemental files
DGB Human Rights Statement.pdfDGB Ending Coal Financing Declaration.pdfDGB Human Rights Statement.pdfDGB 2021-2022 ESG Factbook_sheet8.pdfDGB 2021-2022 ESG Factbook_sheet2.pdfDGB 2021-2022 ESG Factbook_sheet4.pdfDGB 2021-2022 ESG Factbook_sheet3.pdfDGB 2021-2022 Sustainability Report.pdfDGB Ending Coal Financing Declaration.pdfDGB 2021-2022 ESG Factbook_sheet1.pdfDGB 2021-2022 ESG Factbook_sheet9.pdfDGB 2021-2022 ESG Factbook_sheet6.pdfDGB 2021-2022 ESG Factbook_sheet7.pdfDGB 2021-2022 ESG Factbook_sheet5.pdfCEO Statement
Signed
Governance
Policies and Responsibilities
1. Does the Board / highest governance body or most senior executive of the company:
Optional commentThe annual sustainability report published by DGB Financial Group includes a CEO's message that addressess the relevance of sustainable development to the company. DGB Financial Group established the ESG Committee under the Board of Directors (BOD) in March 2021. As the highest decision-making body in relation to group-wide ESG strategy and performance, the committee consists of three or more members including the Chairman of DGB Financial Group. The committee will meet on a semi-annual basis and will be responsible for reviewing DGB Financial Group’s sustainability management strategy and direction, managing its ESG achievements and improvement plans, and offering ESG-related advice to the BOD and the Business Management Council. The Board of Directors, highest governance body of our company regularly reviews potential risks related to our business model.2. Does the company have a publicly stated commitment regarding the following sustainability topics?
Optional commentDGB Financial Group's Human Rights Statement covers the issues related to human rights, labor rights, anti-corruption. We also declared "coal exit financing", refusing to participate in financing projects or taking over bonds related to the construction of domestic and overseas coal power plants. The full statement can be found on our website. In addition, we joined the UN Global Compact in 2006 and has supported the Compact's ten principles in respect to human rights, labor rights, envirionment protection and anti-corruption. We are committed to making the ten principles and the Sustainable Development Goals a part of our strategy, culture and business operation.3. Does the company have in place a code of conduct regarding each of the following sustainability topics?
Optional commentDGB Financial Group has set forth the Ethics Charter, the Code of Ethics, and the Practical Guidelines on Ethical Conduct to properly guide employees’ decision making and conduct. We are the industry’s first to announce an ethical management brand to establish a corporate culture that puts ethical management before all else, and also Korea’s first financial holding company to develop an anti-bribery management system against ISO 37001. In 2021, we revised the Code of Ethics to ensure its applicability to all group-wide employees as well as those at DGB Financial Group and to establish an integrated ethical management system and governance. The Practical Guidelines were also amended in reflection of latest ethical issues. DGB Financial Group endeavored to disseminate its ethical management policy including anti-corruption provisions to respective subsidiaries and their suppliers and to integrate ethical management practices into the very fabric of its corporate culture.4. Has the company appointed an individual or group responsible for each of the following sustainability topics?
Optional commentRegarding human rights and environmental issues, ESG Strategic & Research Institute is in charge. Labor rights are in charge of the HR Corporate Culture Department, and anti-corruption is in charge of the Compliance Suppoert Department.5. Does the company have a formal structure(s) (such as a cross-functional committee) to address each of the following sustainability topics?
Optional commentWe established the ESG Committee under the Board of Directors (BOD) in March 2021. As the highest decision-making body in relation to group-wide ESG strategy and performance, the committee consists of three or more members including the Chairman of DGB Financial Group. The committee will meet on a semi-annual basis and will be responsible for reviewing DGB Financial Group’s sustainability management strategy and direction, managing its ESG achievements and improvement plans, and offering ESG-related advice to the BOD and the Business Management Council. We have established the ESG Management Council and the ESG Working-level Council to support the ESG Committee. The ESG Management Council is joined by executives responsible for strategy or ESG operations at respective subsidiaries, and is mandated to develop and implement ESG strategies, report to the ESG Committee and respond to ESG issues. The ESG Working-level Council consists of working-level staff from ESG departments at respective subsidiaries and serves to identify and implement ESG tasks and consult on group-wide ESG strategies and achievements on a regular basis.Prevention
6. Does the company have a process or processes to assess risk?
Optional commentHuman rights impact assessment is conducted to manage human rights and labor-related risks. Our environmental risk assessment procedures are detailed in the TCFD report. We conduct bribery risk assessments to thoroughly operate our anti-bribery management system. In 2021, all departments independently completed a bribery/corruption risk checklist and reflected high-risk items identified in each of the assessment category into their anti-bribery management plans.7. Does the company have a due diligence process through which it identifies, prevents, mitigates, and accounts for actual and potential negative impacts on sustainability topics?
Optional commentWe conduct a due diligence process every year to manage human rights and labor-related risks. DGB Daegu Bank has maintained an environmental management system suitable for international standards since it obtained ISO 14001 certification in 2011. DGB Financial Group established an anti-bribery management system that meets global standards by obtaining the anti-bribery management system(ISO37001) certification in 2018. ISO14001 review includes the environmental due diligence process and ISO37001 review includes the anti-corruption due diligence process.Concerns and grievance mechanisms
8. Are there any processes through which members of the company’s workforce can raise concerns about the company’s conduct related to human rights, labour rights, environment, or anti-corruption?
Optional commentTo promote the effectiveness of our whistleblowing mechanisms at all subsidiaries, we ensure that all whistleblowing reports remain anonymous. DGB Financial Group and respective subsidiaries operate a variety of anonymous whistleblowing mechanisms on their websites (Red Whistle, DGB mobile office, post, hotline, e-mail, computer system, etc.). In 2021, we upgraded our internal whistleblowing procedure and system to reinforce group-level internal controls and facilitate whistleblowing for employees working overseas, and opened the DGB Whistle-blow System as an anonymous whistleblowing mechanism available in English on the DGB Financial Group website. Under this system, whistleblowing reports are immediately submitted to the compliance support department for communication with responsible staff, and their anonymity is fully protected by making it impossible to trace their IP address. DGB Financial Group also rewards whistleblowers (limit: KRW 100 million) as a way to activate its whistleblowing mechanisms.8.1. Please provide additional detail regarding the process(es) the company has through which members of the company’s workforce can raise concerns about the company’s conduct.
Optional commentDGB Whisle-blow Guidance specifies provisions for confidentiality and whistle-blower protection. The guidance can be found on our website.9. Does the company provide or enable access to effective remedy to right holders / stakeholders where it has caused or contributed to the adverse impact?
Optional commentThe DGB Ethics Center engages in activities to protect the human rights of employees in real and substantial terms through reporting on human rights violations, counseling and remedy. DGB Whisle-blow Guidance specifies disciplinary measures that can be taken in the event of anti-corruption.Lessons
10. How does the company capture lessons regarding each of the following sustainability topics?
Optional commentWe conduct a group-wide assessment of human/labor rights issues in order to identify potential human/labor rights issues and take remediation actions. We also conduct bribery risk assessments to thoroughly operate the anti-bribery management system. In 2021, all departments independently completed a bribery/corruption risk checklist and reflected high-risk items identified in each of the assessment category into their anti-bribery management plans. The monitoring results of related issues are reflected in our policymaking and regulatory updates. In addition, we calculate and verify greenhouse gas emissions every year. The calculation results are used in the net zero pathway establishment process.Executive Pay
11. Is executive pay linked to performance on one or more of the following sustainability topics?
Optional commentDGB Financial Group has hosted the annual Ethical Management Awards for all subsidiaries since 2019. The awards are given to the best performer among subsidiaries based on assessments of their overall ethical management, with an aim to reinvigorate its ethical management practice programs. At the 3rd Ethical Management Awards held in 2021, DGB Capital was honored with the plaque and KRW 2 million in prize money. We plan to further segment evaluation criteria, increase the amount of rewards, and reflect evaluation scores into the performance appraisal of subsidiary CEOs from 2022 onwards. In 2021, DGB Financial Group added ESG-related indicators in assessing the performance of top management across all subsidiaries to establish an ESG management system and strengthen its execution. To systematically advance our group-wide ESG management strategy and encourage subsidiaries to engage in ESG operations in a more substantial manner, indicators related to governance improvement, GHG emissions reduction, and ESG finance expansion were added to performance assessment criteria. Furthermore, such ESG indicators were added in evaluating the individual performance of senior management including the CEOs of each subsidiary.Board Composition
12. Percentage of individuals within the company’s Board / highest governance body by:
Optional commentAs of the end of June 2022.13. Do you produce sustainability reporting according to:
Data Assurance
14. Is the information disclosed in this questionnaire assured by a third-party?
Optional commentThe assurance engagement followed the AA1000AS v3 assurance standards to provide Moderate Level & Type 2 engagement, which means that the assurance assessed the accuracy and reliability of the company’s statements and performance data provided in the sustainability Report. The third-party assurance statement is attached on DGB Financial Group's sustainability report.Human Rights
Materiality / Saliency
1. Which of the following has the company identified as material human rights issues connected with its operations and/or value chain, whether based on their salience (i.e., the most severe potential negative impacts on people) or another basis?
Optional commentDGB Financial Group advances human rights management in accordance with Korea’s Labor Standards Act and international standards and guidelines stipulated in such global human rights agreements as the UN Universal Declaration of Human Rights (UDHR), the UN Guiding Principles on Business and Human Rights (UNGPs) and ILO’s declarations with an aim to protect the human rights of all stakeholders including employees and customers.Commitment
2. Does the company have a policy commitment in relation to the following human rights issues?
Optional commentWe are posting the Personal Information Protection Policy on DGB Daegu Bank's website (https://www.dgb.co.kr/com_ebz_hlp_main.act).2.1. For each human rights policy, is it:
Optional commentEnsuring data privacy and data security for customers’ financial information constitutes an essential part of the responsibility we assume as a financial institution. A company that fails to manage its data performance may witness its income decline and consumer trust degenerate. As the growth of mobile banking and cloud storage continues and an increasing part of the banking operation depends on technology and the internet, this will further highlight the importance of data security management. Given that cyber security threats are on the rise, we need to secure cutting-edge technology and provide continuous workforce training to address such risks. DGB Financial Group clearly defines its roles and responsibilities concerning data protection and continuously pursue institutional and systemic improvements in preparation for the potential leak of customer data and critical internal data assets while engaging in information security and personal data protection activities to deliver safe customer services. DGB Financial Group appoints the CISO (Chief Information Security Officer) and the personal data protection officer, and designates all deputy managers at branches offices and officers as personal data protection managers and officers to build full preparedness for information security across all HQ departments and branch offices. To prevent information security threats from occurring at all levels, we have created a council consisting of heads of information security departments at respective subsidiaries to jointly take stock of our information security operations and discuss issues and their solutions while measuring internal/external security-related risk factors and developing response strategies to bolster our security system. To keep pace with the accelerating data-based digital financial innovation, DGB Daegu Bank and Hi Investment & Securities achieved ISMS-ISMS-P certifications in July 2021 and May 2018 respectively granted by the Financial Security Institute and other certification bodies, which testifies to the conformance of their information security and personal data protection management systems with these nationally-accredited certification standards. While Hi Investment & Securities is not subject to mandatory ISMS certification, the company obtained the ISMS-P certification to ensure the reliability of its information security which is examined by institutional investors in investing their assets. DGB Life and DGB U-Pay (mandatory target), and DGB Data System will pursue the certification in 2022, and DGB Capital will also follow suit in 2023.Prevention
3. In the course of the reporting period, has the company engaged with affected stakeholders or their legitimate representatives in relation to the following human rights issues?
Optional commentDGB Financial Group conducted the materiality assessment to identify major issues in the sustainability management area and transparently communicate with stakeholders in accordance with the principles of Sustainability Context, Materiality, Completeness and Stakeholder Inclusiveness that are recommended by the GRI Standards and ISO 26000. Cybersecurity and privacy protection were selected as the number one critical issue in the 2021 materiality assessment. Please refer to the sustainability report for a detailed description of how critical issues are managed.4. What type of action has the company taken in the reporting period with the aim of preventing/mitigating the risks/impacts associated with this human rights issue?
Optional commentTo prevent information security threats from occurring at all levels, we have created a council consisting of heads of information security departments at respective subsidiaries to jointly take stock of our information security operations and discuss issues and their solutions while measuring internal/external security-related risk factors and developing response strategies to bolster our security system. On monthly Information Security Inspection Day, we conduct self-directed information security reviews and training, and we perform regular checks to oversee compliance with regulations on the provision and use of customer data among subsidiaries. In addition, we provide information security training to all group employees to raise their awareness on information security. Each year, we make vulnerability analyses and assessments on our website and electronic financial infrastructure facilities, and reinforce our response to potential cyber-attacks through anti-phishing/smishing training, cyber information security training, and annual data breach response exercises for employees. In early 2021, DGB Daegu Bank upgraded its FDS (Fraud Detection System) to prevent financial scams that are increasingly diversifying amid the growth of virtual finance and the resulting digital technology advancement. This in fact generated remarkable performance in preventing digital financial fraud and telecommunications fraud. This achievement is largely attributable to the deployment of predictive modeling to detect abnormal financial transactions, voice phishing attempts and latest financial scam patterns that previously went unnoticed, which was made possible through the real-time monitoring and detection of fraudulent digital financial transactions and the leveraging of AI for the DFS. Prior to the system upgrade, the annual number of financial fraud attempts prevented and the amount protected stood at 132 cases and KRW 1.3 billion respectively in 2020. These numbers rosed to 203 cases and over KRW 2 billion as of October 2021, which is translated into more than 50% year-on-year improvement in preventing financial fraud.5. Who receives training for the following human rights issues?
Optional commentOn monthly Information Security Inspection Day, we conduct self-directed information security reviews and training, and we perform regular checks to oversee compliance with regulations on the provision and use of customer data among subsidiaries. In addition, we provide information security training to all group employees to raise their awareness on information security. Each year, we make vulnerability analyses and assessments on our website and electronic financial infrastructure facilities, and reinforce our response to potential cyber-attacks through anti-phishing/smishing training, cyber information security training, and annual data breach response exercises for employees.6. How does the company assess progress in preventing/mitigating the risks/impacts associated with the following human rights issues?
Optional commentOur company checks the customers' personal information protection status every quarter and discloses the inspection results in detail through our annual sustainability report.Response
7. During the reporting period, has the company been involved in providing or enabling remedy where it has caused or contributed to adverse impact associated with the following human rights issue(s)?
Optional commentDuring the reporting period, there was no complaint raised by external party and proven internally within organization. We are disclosing the method of remedy for infringement of rights and the contact information of the person in charge through the website of Daegu Bank.8. Briefly describe practical actions the company has taken during the reporting period and/or plans to take to implement the human rights principles, including any challenges faced and actions taken towards prevention and/or remediation.
In 2022, DGB Financial Group proclaimed the Human Rights Statement to protect human rights and prevent human rights violation of all stakeholders. We prevent human rights violations involving stakeholders by conducting a human rights impact assessment on a regular basis and fulfill our responsibilities to respect human rights by disclosing human rights-related issues in accordance with the UNGP(UN Guiding Principles on Business and Human Rights) Reporting Framework. For details of the content of the 2021 human rights impact assessment and information based on the UNGP reporting framework, please refer to the Human Rights Report on our website.Labour
Commitment
1. Does the company have a policy commitment in relation to the following labour rights principles?
Optional commentWe have the Human Rights Statement in relation to the following labour rights: prohibition on discrimination, prohibition on forced labor/child labor, guarantee of the freedoms of association and collective bargaining, guarantee of fair compensation and growth opportunity, guarantee of health and safety.1.1. For each labour rights policy, is it:
Optional commentIn 2022, We have establsihed the Human Rights Statement that compiles with global standards and guidelines of global human rights conventions such as the Korean Labor Standards Act, UN Universal Declaration of Human Rights, UNGP(UN Guiding Principles on Business and Human Rights) and ILO's Declaration on the Fundamental Principles and Rights at Work to protect the human rights of all stakeholders. The statement was developed by the expertise from our company and approved by the ESG Committee within the Board of Directors. The statement is applied to DGB Financial Group's all employees including domestic/overseas subsidiaries ad sub-sidiaries. The group also encourages all stakeholders including customers, suppliers and partners to comply with the statement's standards. The full contents of the statement are disclosed on our website.Prevention
2. In the course of the reporting period, has the company engaged with affected stakeholders or their legitimate representatives in relation to the following labour rights issues?
Optional commentDGB Financial Group conducted the materiality assessment to identify major issues in the sustainability management area and transparently communicate with stakeholders in accordance with the principles of Sustainability Context, Materiality, Completeness and Stakeholder Inclusiveness that are recommended by the GRI Standards and ISO 26000. Lanour rights issues such as freedom of association, forced labour, child labour, non discrimination, and occupational safety and health were reviewed by the representatives of each stakeholder group in the 2021 materiality assessment. Please refer to the sustainability report for a detailed description of how critical issues are selected and managed.3. What type of action has the company taken in the reporting period with the aim of preventing/mitigating the risks/impacts associated with this labour rights issue?
Optional commentDGB Financial Group’s human rights management principles span the prohibition of child labor and forced labor, health and safety, guarantee of the freedom of association, non-discrimination and guaranteed work hours. In this regard, we operate a range of human rights protection and training programs in addition to the DGB Ethics Center. The DGB Ethics Center operates the ‘Reaching Out Grievance Counseling’ program whereby counselors visit branches offices across the nation to provide in-person counseling to help resolve employees’ grievances. This improves accessibility to our whistleblowing mechanisms and the one-on-one counseling approach ensures that whistleblowers remain anonymous throughout the entire counseling process. Counseling results are analyzed and reflected in our human rights protection activity plans, and this program aims to visit all branches offices on a biennial basis. To eliminate unjustified practices at the group level, DGB Daegu Bank integrated the DGB Human Rights and Ethics Center established in 2017 under the direct control of the CEO with the Corporate Ethics Center and placed it under the leadership of the Compliance Officer in 2019 to strengthen its management oversight function. The DGB Ethics Center engages in activities to protect the human rights of employees in real and substantial terms through reporting on human rights violations, counseling and remedy.4. Who receives training for the following labour rights issues?
Optional commentThe DGB Human Rights and Ethics Center provides human rights training to help all employees raise human rights awareness and make a difference through action. The center is organizing and offering training programs consisting of real-life cases to address workplace harassment which has critical impact on corporate culture and is emerging as a social issue, and has conducted legally-mandatory training in virtual setting on the prevention of workplace sexual harassment and the improvement of awareness on people with disabilities.5. How does the company assess progress in preventing/mitigating the risks/impacts associated with the following labour rights issues?
Optional commentWe conduct annual monitoring of the relevant indicators and data such as labor union paricipation rate, industrial accident rate and records of grievance counseling program.Performance
6. What is the percentage of employees covered under collective bargaining agreements?
Optional commentUnder domestic law, all employees are subject to collective bargaining agreements.7. What is the percentage of employees in a trade union or other workers' organization?
Optional commentCurrently, among affiliates, there are labor unions in DGB Daegu Bank, Hi Investment & Securities, DGB Life Insurance, DGB Capital and DGB U-pay. The average union membership rate of five companies in 2021 is 82.31%.8. In the course of the reporting period, what was the percentage of women in:
Optional commentWe focus our resources on ensuring a diverse and inclusive corporate culture. We have one female non-executive directors in the board, thereby contributing to gender equality and diversity in the workplace.9. What was the average ratio of the basic salary and remuneration of women to men (comparing jobs of equal value) during the reporting period?
Optional commentConsidering the average number of years of service between men and women in our company, there is no gender pay gap.10. In the course of the reporting period, how frequently were workers injured (injuries per hour worked)?
Optional commentDuring the reporting period, no occupational accidents have occurred.11. In the course of the reporting period, what was the company’s incident rate?
Optional commentDuring the reporting period, no occupational accidents have occurred.Response and Reporting
12. In the course of the reporting period, has the company been involved in providing or enabling remedy where it has caused or contributed to the adverse impact associated with the following labour rights issues?
Optional commentDuring the reporting period, no negative impact events have occurred in the above mentioned five areas.13. Briefly describe practical actions the company has taken during the reporting period and/or plans to take to implement the labour rights principles, including any challenges faced and actions taken towards prevention and/or remediation.
Imrovements made in 2021 Non-discrimination: We Specified in our internal anti-discrimination regulations that local cultures and institutions are respected and religious/cultural rights are protected in relation to overseas business operations. Occupational safety and health: We recommended subsidiaries to take a gender-based approach and include the issues of workplace violence and harassment in their collective agreement in accordance with the ILO’s convention on the prevention of workplace violence and harassment, and expanded the scope of relevant guidelines to workers whose contract was terminated, job seekers and customers as well as our employees, business partner employees and anyone who has entered into a contract with us in order to better protect the human rights of stakeholders. We also improved the accessibility of facilities that we operate and products and services that we provide for people with disabilities.Environment
Commitment
1. Does the company have a formal policy on the following environmental topics?
Optional comment[Climate Action] In March 2021, DGB Financial Group declared ""coal exit financing"", refusing to participate in financing projects or taking over bonds related to the construction of domestic and overseas coal power plants. [Water] DGB Financial Group signed UN Global Compact CEO Water Mandate in 2010. We measure water usage and report it in our annual sustainability report.1.1. For each environmental policy, is it:
Optional comment[Climate Action] DGB Daegu Bank, the flagship subsidiary of DGB Financial Group, has maintained an environmental management system suitable for international standards since it obtained ISO 14001 certification in 2011. In March 2021, DGB Financial Group oficially launched the ESG Committee within the BOD, and officially made a coal phase-out pledge in order to take action to achieve sustainable management. In line with this move, each affiliate is formulating an investment policy that meets the coal-exit standards, on the one hand, and continuing to do their utmost to go carbon neutral for DGB Financial Group to become an exemplary green financial institution. [Water] DGB Financial Group signed UN Global Compact CEO Water Mandate in 2010. We measure water usage and report it in our annual sustainability report.Prevention
2. In the course of the reporting period, has the company engaged with affected stakeholders or their legitimate representatives in relation to the following environmental issues?
Optional commentDGB Financial Group categorizes stakeholder groups into employees, shareholders & investors, customers, business partners, communities & NGOs and central/local & relevant institutions. We operate a range of communication channels in consideration of characteristics of each group, and use these channes in collecting issues that interest stakeholders as well as their feedback while integrating such input in our business operations. More details on the communication channels and stakeholder engagement policy are disclosed in our sustainability report.3. What type of action has the company taken in the reporting period with the aim of preventing/mitigating the risks/impacts associated with these environmental topics?
Optional commentDGB Financial Group has recognized climate change as a new threat since 2019. Extreme weather events and the transition into a low carbon economy may bring far-reaching impact. This prompted us to regulatory monitor climate risks in order to improve our capital adequacy and asset quality by reducing our exposure to carbon-intensive industries and tightening risk management. In accordance with the carbon-intensive industry classifications recommended by the Bank of Korea and SBTi's guidance for financial institutions, we analyze our EAD (Exposure at Default) and risk exposure levels in industries exposed to climate risks to identify and manage industries with high risk exposures out of our owned assets.4. How does the company assess progress in preventing/mitigating the risks/impacts associated with the following environmental topics?
Optional commentDGB Financial Group plans to reduce its group-level internal carbon emissions by 19% by 2025 and by 46% by 2030 to mitigate carbon emissions in accordance with the goal set under the Paris Agreement. We will also reduce the carbon emissions generated from our group-wide asset portfolio by 20% by 2025 and by 40% by 2030. We expect that we could be carbon neutral for internal carbon emissions (Scope 1 & 2) by 2040 and achieve carbon neutrality for financed carbon emissions (Scope 3) by 2050 by setting our short/mid/long-term targets and implemeting action plans. Climate Action: Annual target and time-based progress tracking results are disclosed in our TCFD report. Water / Waste / Energy & Resource Usage: Time-based progress tracking results are disclosed in our ESG Factbook.4.1. For each environmental topic in which the company sets timebound goals / targets, what kind of targets has the company set?
4.2. For each environmental topic in which the company sets timebound goals / targets, how is progress against target / goal tracked?
Optional commentWe established the ESG Committee under the Board of Directors (BOD) in March 2021. As the highest decision-making body in relation to group-wide ESG strategy and performance, the committee consists of three or more members including the Chairman of DGB Financial Group. The committee meets on a semi-annual basis and establishes ESG-related strategies and policies, such as climate change and socially responsible management. Progress on climate action is disclosed annually through our sustainability report and the TCFD report. We are also joining global initiative such as CDP and PRB.5. In the course of the reporting period, has the company been involved in providing or enabling remedy for any actual impacts associated with the following environmental issue(s)?
Optional comment[Climate Action, Energy & Resource Usage] We have developed a strategy and detailed action plans for reducing greenhouse gas emissions. We are pursuing energy efficiency and expanding the use of renewable energy to implement the strategy. [Waste] DGB Financial Group has switched from paper to e-mail bills for customers as a way to reduce paper consumption. To create a paperless work environment and establish digital competitiveness, DGB Daegu Bank has installed the tablet branch (ODS, OutDoor Sales) and the PPR (Paperless Process Reengineering) system across all branch offices. In 2021, all branches exceeded 50% in their use of electronic documents, and their paper printing expenses declined by 17% from the previous year. Hi Investment & Securities also became the first mid-sized securities firm to adopt a paperless system for counter operation at all branches.Climate Action
6. What were the company’s gross global greenhouse gas emissions for the reporting period?
Scope 2 Emissions
Scope 3 Emissions
7. What percentage of the company's revenue was invested in R&D of low-carbon products/services during this reporting period?
Optional commentThe following costs were classified as R&D expenses: service charge for publishing sustainability report, costs for hosting ESG conference, budgeted amount of ESG Strategy & Research Institue, total amount of funding for CDP, UNEP FI and UN Global Compact. But the proportion of such expenses was found to be insignificant in total revenue.8. Has the organization acted to support climate change adaptation and resilience?
Optional commentWe conducted a comprehensive analysis on the impact of climate change risk and opportunity factors, and established response strategies for each factor. We are focusing on establishing countermeasures for five high-risk industries (transport, cement, iron and steel, chemicals, fossil fuel), which is expected to have a high-level effect in the transition to a green and low-carbon economy among the various carbon related assets owned by DGB Financial Group. We plan to reduce our portfolio investment for these industries and actively induce customers to reduce carbon emissions. We also seek to integrate climate-related risks and opportunities in our Group's business strategies such as development of financial products and services that are connected to envrironmental evalulation and expansion of eco-friendly investments. We have provided funding for CDP, UNEP FI and UN Global Compact.Energy / Resource Use
9. Please report the company's renewable energy consumption as a percentage of total energy consumption in the reporting period.
Technology
10. What percent of the company's revenue came from environmentally friendly products / services during this reporting period?
Sector-specific Questions
11. Which sector(s) does the company operate in? If diversified, choose top 3 by revenue.
Overall Environment
21. Briefly describe practical actions the company has taken during the reporting period and/or plans to take to implement the environment principles, including any challenges faced and actions taken towards prevention and/or remediation.
Following our commitment to endorsing climate finance to achieve carbon neutrality by 2050, we committed yet again to end coal finance in March 2021 not to participate in project financing for coal power plant construction in Korea and overseas and refuse any underwiring of bonds issued for the purpose of building coal-fired power plants, making efforts to respond to climate change and expanding green finance. Hi Asset Management decided not to serve as an underwriter for corporate bonds issued to build a new coal-fired power plant in Samcheok, Korea, in accordance with our group-wide coal exit policy. [6 Commitments Made to Endorse Climate Finance to Achieve Carbon Neutrality by 2050] ① Proactively support the initiative to reach carbon neutrality by 2050 ② Fully incorporate ESG (Environmental, Social and Governance) considerations including climate-related risks into our entire financial business ③ Endorse climate-related disclosures made in accordance with international standards and proactively endeavor to disclose our financial data accordingly ④ Proactively demand that businesses required to disclose their ESG data to provide such data, including climate-related data ⑤ Take a range of climate actions to change the destination of capital injections from carbon-intensive industries to carbon-free ones ⑥ Launch a range of financial products in relation to climate change response [Expanding Investment in Renewable Energy] To help achieve a low-carbon society, we continue to expand green investments in renewable energy and environmentally friendly educational facilities (green smart school). Hi Asset Management established the ‘DGB New Deal Infrastructure Private Equity Fund Special Asset Investment Trust 1’ to invest in renewable projects (photovoltaics, wind power, biomass), and DGB Life and DGB Daegu Bank also joined in as collective investors. In 2021, Hi Asset Management also made KRW 1.46 billion principal investments (warrant-linked bonds) in the Taebaek Hasami Wind Park’ to be built in Taebaek-si, Gangwon-do, Korea. The company created an alternative investment team to advance into the infrastructure/renewable energy PF market that is expanding in line with the Korean government’s carbon neutrality policy initiative. Approximately KRW 300 billion ESG funds will be raised, and nearly KRW 100 billion of them is set for investment execution. [Launching Special Loans for Environmentally Friendly Businesses] DGB Financial Group signed an MOU with the Korea Environment Industry & Technology Institute (KEITI) to respond to the Korean New Deal policy and provide financial support to green businesses with exceptional environmental performance. KEITI evaluates SMEs for their environmental performance based on the environmental data held by the government, and shares evaluation results with financial institutions through enVinance, a financial support system for green businesses. In August 2021, DGB Daegu Bank launched the ESG Grow Up special loan program to offer favorable interest rates set based on the environmental ratings awarded in alignment with enVinance. This program allowed the bank to provide much needed funding at special interest rates to companies noted for excellent ESG management performance including those rated BBB and above. [DGB Cyber Green Branch Operation] DGB Daegu Bank has been operating DGB cyber green branches specialized in green-themed products and services since 2010. These branches provide a range of eco-conscious deposit and loan products – Green Deposits, Green Health Installment Savings, DGB Green Loan, and DGB Green Card – to raise environmental awareness among customers. The bank sets aside a portion of the proceeds generated through green cards that offer green mileages as well as green deposit and installment savings products that provide favorable interest rates in line with environmentally friendly activities undertaken by customers, to fund local environmental conservation activities.Anti-corruption
Commitment
1. Does the company have an anti-corruption compliance programme?
Optional commentDGB Financial Group has set forth the Ethics Charter, the Code of Ethics, and the Practical Guidelines on Ethical Conduct to properly guide employees’ decision making and conduct. We are the industry’s first to announce an ethical management brand to establish a corporate culture that puts ethical management before all else, and also Korea’s first financial holding company to develop an anti-bribery management system against ISO 37001.2. Does your company have policies and recommendations for employees on how to act in case of doubt and/or in situations that may represent a conflict of interest, e.g. with regard to gifts and hospitality, donations, sponsorship, or interactions with public officials?
Optional commentWe are posting the Code of Ethics that defines the service ethics of our employees on our website (http://www.dgbfg.co.kr/ad1002.fg).Prevention
3. Who receives training on anti-corruption and integrity?
Optional commentDGB Financial Group has made it compulsory for all employees, including senior management, to attend ethical management training, and obliges employees to take anti-money laundering training at least once a year. In 2021, we provided employees with cyber training on our Code of Ethics and the Practical Guidelines on Ethical Conduct. Our employees make monthly self-reviews on regulatory compliance to ensure that they are not directly or indirectly complicit in any financial fraud or crime. We identify anti-money laundering issues at respective subsidiaries and share them across the board on an on-going basis.3.1. How often is such training provided?
Optional commentDGB Financial Group has made it compulsory for all employees, including senior management, to attend ethical management training, and obliges employees to take anti-money laundering training at least once a year. In 2021, we provided employees with cyber training on our Code of Ethics and the Practical Guidelines on Ethical Conduct. Our employees make monthly self-reviews on regulatory compliance to ensure that they are not directly or indirectly complicit in any financial fraud or crime. We identify anti-money laundering issues at respective subsidiaries and share them across the board on an on-going basis.4. Does the company monitor its anti-corruption compliance programme?
Optional commentThe Code of Ethics is supported by varying compliance mechanisms such as the creation of the Global Compliance Oversight Council and maintenance of the ISO 37001 international anti-bribery certification.Response and Reporting
5. Please report the company's total number and nature of incidents of corruption during the reporting year.
Optional commentDuring the reporting period, there has been no case of anti-corruption.6. Within the reporting period, what measures has the company taken to address suspected incidents of corruption independently or in response to a dispute or investigation by a government regulator?
Optional commentDuring the reporting period, there has been no case of anti-corruption.7. Does your company engage in Collective Action against corruption?
Optional comment8. Briefly describe practical actions the company has taken during the reporting period and/or plans to take to implement the anti-corruption principle, including any challenges faced and actions taken towards prevention and/or remediation.
We provide anti-bribery management training and conduct bribery risk assessments to thoroughly operate the anti-bribery management system. In 2021, all departments independently completed a bribery/corruption risk checklist and reflected high-risk items identified in each of the assessment category into their anti-bribery management plans.