台新金控

Sustainable Finance
Sustainable Finance

Sustainable Policies and Actions

Sustainable Finance Policy

Taishin supports the Sustainable Development Goals (SDGs) of the United Nations as well as Taiwan's major policies for Nuclear-free Homeland, energy transformation, and environmental conservation. We actively extend loans to green energy industries, including renewable energy, energysaving technology, and environmental protection industries with the aim of encouraging companies to pursue low-carbon economic development and sustainable development by directing capital to green energy technologies.

Action Description
  • Development of Related Rules for Principles of Responsible Investment

  • To fulfill requirements for responsible investment, Taishin FHC actively complies with the six major principles of Principles for Responsible Investment (PRI) initiated from United Nations as the basis for operations and disclosure to ensure that investees implement environmental protection, corporate social responsibility, and corporate governance. Taishin Bank established the "Stewardship Principles for Institutional Investors" in accordance with the PRI to create voting policies for the management. Taishin Bank discloses its participation and votes in the shareholders' meeting of investees and the Stewardship Report each year. Taishin FHC continues to monitor news regarding investees as well as their financial performance, environmental protection practices, social responsibility, labor rights, and corporate governance issues. We also engage them in dialogue and interactions through appropriate channels. Taishin Securities Investment Trust published the Statement of Compliance with Stewardship Principles for Institutional Investors in 2016 and Taishin Securities also established the "Stewardship Policy" in 2018. They disclose their stewardship implementation status to customers or beneficiaries on a regular or ad hoc basis (e.g., participation in votes of shareholders' meetings of investees and the Stewardship Report). They also continue to pay close attention to the communication and management of investees and disclosure of stewardship reports.

  • Establishment of Green Finance Principles

  • Taishin FHC established the "Green Finance Principles" in 2018 in accordance with important international norms such as the exclusion list of the International Finance Corporation (IFC) and the UN Global Compact. The Principles apply to all subsidiaries and business operations of the Group. They specify the targets that should be supported or avoided, and emphasized that ESG risk management must be included in transaction reviews and post-transaction management. Taishin and its subsidiaries have adjusted related business rules or procedures in accordance with the Green Finance Principles including adjustments of 13 rules for retail banking, wholesale banking, securities, venture capital, and investment trust, and 17 business review procedures based on business requirements. We continued to carry out Taishin's "Green Finance Principles" implementation through out the entire group in 2020 and made 100% of transaction activities and financial products for all subsidiaries to include ESG risk assessments. In addition to following the global principles and Taishin's own specifications, the drug industry, illegal weapons manufacturing and gambling industry are listed as the relevant industries that refuse to undertake or should be declined by customer attributes according to the high risk factor assessment results. The total number of assessments using the "Green Finance Assessment Worksheet" or similar methods reached total of 6,218 cases in 2020 which included 100% of our financial products and services. Among these cases, 92 cases were not approved or approved with conditions (e.g., cases where a company violates regulations, industries that should be avoided, or integrity issues in the management). And in 2020, 32 cases were determined to be avoided (including tobacco, gambling and coal business) while 3 cases were declined after comprehensive review (including coal business and gambling).

  • Signed and Adopted the Equator Principles

  • Taishin Bank has implemented reviews on new, existing credit cases requesting for limit increase or change of terms loan applications based on the Equator Principles (EPs) since 2015. When the Bank reviews an application that meets requirements for project financing, the Bank is required to investigate and disclose environmental and social risks of the applicant or the place of the project as the basis for evaluating the application. Taishin Bank officially signed the Equator Principles and joined the Equator Principles Association in 2019. The Wholesale Credit Administration Division established a specific team and appointed an external professional institution to serve as a consultant for interviews and reviews of the credit extension process. We formulated the "Guidelines for Loan Applications Applicable to the Equator Principles" and the "Environmental and Social Risk Assessment Form " for evaluating cases. The evaluation of financing projects based on Equator Principles include risk ratings for environmental sensitivity, ecology, environmental pollution, communities, labor, regulations, and management mechanisms. We also implement the Principles through multiple rounds of education and awareness campaigns for the business and review units.

  • The Announcement of Environmental and Social Risk Management Sector Guidelines

  • Taishin FHC conducted a comprehensive evaluation of the environmental and social risk ratings of the industries in investment and loans and identified five major industries including the "Manufacture of Basic Metals", "Power Supply", "Chemical Materials Manufacturing", "Manufacture of Electronic Parts and Components", and "Manufacture of Electric Equipment" in 2019. Taishin then announced the "Environmental and Social Risk Management Sector Guidelines" (hereinafter referred to as the "Guidelines") in 2020. The contents of the Guidelines were an expansion of the "Green Finance Principles" established in 2018 and included Taishin FHC's expectations and requirements on human rights protection and climate change. We identified significant environmental and social risks by industry-specific and provided an assessment framework with best practices to to evaluate the structures. By understanding the appropriateness of our partner's management of major environmental and social issues to improve our decision-making foundation.

Responsible Investment and Lending

Taishin offers sustainable finance products with responsible investment and lending themes in 4 different categories: “Investment/Wholesale Banking”, “Retail Banking”, “Project Finance” and “Asset Management”. According to “Taishin Financial Holdings Green Finance Principles”, 100% of transaction activities and financial products are all executing ESG risk assessment. In the meantime, all subsidiaries are required to incorporate environmental and social risk evaluations as part of their lending and investment policies.

 

In 2020, retail banking has the highest ratio at 54.5% of Taishin FHC’s consolidated net revenue and gains, followed by 22.2% in wholesale banking business. The proportion of net revenue and gains of both project finance and asset management are not over 1%; among the others with 22.3% , which consisted of a number of subcategories including long-term investment income, securities, and leasing. We will then state these ESG products by four major categories “Investment/Wholesale Banking”, “Retail Banking”, “Project Finance” and “Asset Management” with the descriptions of the products and the proportions one by one.

Investment and Wholesale Banking Business

 

In terms of Wholesale Banking for Sustainable Finance, The major ESG-related products and services include “green energy and environmental protectionindustry” lending, investment for “green bond”, dealing with “Sustainable Index constituent stocks” and fundraising support for “green energy industry”, etc.

 

The Bank has been adopting the spirit of Equator Principles since Oct., 2015. All new loan applications and all existing lending cases requesting for limit increase or change of terms are required to complete a “Project Finance Application Social/Environmental Risk Investigation and Disclosure Worksheet” (also known as “CSR Worksheet”) to verify if it is in line with the project finance. Taishin Bank needs to investigate and make sure the disclosure on environmental and social risk details, including environmental pollution, not correct use of raw materials, false advertising, and violation against labor laws/regulations with penalty records or major announcements. In the first half of 2019, the “ESG and CFD Checklist for Corporate Banking Credit Application Cases” was formulated with the sensitive industries, to step up the review of social and environmental issues in specific industries. 

ESG Product Name Description Proportion of ESG Product
in 2020 (%)
  • Loans on Green Energy and Environmental Protection Industries

  • Participated “5+2 Industries Innovation Program” to lend the newly designated key industries

  • 8.13
  • Underwriting and Investment on Green Bonds

  • Invested and underwritten on green bonds issued by the banking industry and the enterprises

  • 3.66
  • Investment on ESG or Sustainability Index Constituent Stocks

  • Holding stocks issued by corporates with outstanding sustainability performance

  • 94.74
  • Fundraising for Sustainable Industry

  • Provided fundraising assistance as well as the green energy industry assessment

  • 39.24
  • Loans on Sustainable Infrastructure

  • Promote the ESG loan business in the supply of renewable energy, remediation for sewage/waste disposal, public transportation.

  • 87.14

Note: The monetary value(NT$ million): Green technology (28,768), Circular economy (56,939), New agriculture/Bio-medical technology (6,607)

Retail Banking Business

 

In terms of Retail Banking for Sustainable Finance, The major ESG-related products and services include "online consumer lending" and "investment products that meet the spirit of ESG such as funds, stocks and offshore ETF", etc. When offering retail lending products, Taishin Bank conducts detailed assessments on the needs and financial capabilities, of each customer, and approves appropriate credit lines accordingly. As a result, all loan customers are subject to credit check, due diligence and engagement on ESG risks and opportunities. This process enables the Bank to check 100% customers, with no exceptions, develop full understanding of customers' financial status, with no exceptions. With regards to personal planning and consulting services, all investment products recommended by financial advisors have been reviewed in accordance with product management principles prior to being launched. Information from independent, third-party sources such as Bloomberg, Morningstar etc. is also referenced to perform ESG assessments on the products evaluation.

ESG Product Name Description Proportion of ESG Product
in 2020 (%)
  • Low Carbon Transportation

  • Covered the charge for electric scooter sharing, purchase of electric motors and vehicles for carbon reduction.

  • 0.4
  • Retail Online Consumer Lending

  • Through technologies, we have made consumer lending available online gradually, thereby enabling consumers to receive home loans, car loans and unsecured lending with no time limit or no restriction by place of application 

  • 29.08
  • Funds/Stocks and Foreign ETFs

  • The investment products meet the ESG spirit are provided, such as green energy or water resources

  • 1.07

Note: Low Carbon Transportation􏘪category is the new added statistics for ESG product in 2020.

Project Finance

 

Taishin Bank has been adopting the spirit of Equator Principles since 2015. All new loan applications and all existing credit cases requesting for limit increase or change of terms are required to complete a "Project Finance Application Social/Environmental Risk Investigation and Disclosure Worksheet" (also known as "CSR Worksheet") to verify if it is in line with the project finance. Later in Nov. 2019, Taishin Bank officially announced being the signatory of Equator Principles and initiated the Task force by Wholesale Credit Administration Division and also cooperated with the independent advisory institution to complete standards for inspection process and related documents for Project Finance.Taishin Bank established the "Guidelines for Loan Applications Applicable to the Equator Principles" and generated the "Environmental and Social Risk Assessment Form" to evaluate the items on environmental sensitive, ecology, environmental pollution, society, labors, regulatory and management mechanisms to give scores on each risk and made into levels. In the meantime the sufficient training sessions are delivered to business and review units in order to do reliable implementation.

 

  • Outcomes of project finance reviewed based on Equator Principles
Year Rejected Approved with condition Approved Total cases reviewed Total amount of loan applied (NT$100 million)
  • 2020
  • 0
  • 1
  • 0
  • 1
  • 16.23

Asset Management

 

As an asset manager, Taishin Securities Investment Trust (“TSIT”) enforces responsible investment practices by following Taishin FHC’s “Green Finance Principles” and applying “Taishin Securities Investment Trust Green Finance Assessment Worksheet” as a supporting tool to reduce ESG risks of all-targeted investments. The TSIT has also designed its own documents to facilitate review of risks associated with different assets and industries. This particularly involved in the businesses of: (1) tobacco, alcoholic beverage or gambling (including unlicensed and online operators), or confirmed to have caused harm to human health as a result of food safety incident, radioactive substance, or genetic engineering; (2) generating high levels of pollution, failure to comply with local environmental regulations, and are unable to propose feasible improvements solutions; (3) illegal activities; (4) violations of human rights; and (5) controversial nature, which the company will avoid direct engagement. In addition, to meet with Socially Responsible Investment (SRI), TSIT operates a discretionary account under a government fund, it first includes outstanding enterprises that meet ESG conditions into the MainList (stock pool), and then prioritizes good ESG performance companies from the stock pool as the investment targets. "Taishin ESG Emerging Marktes Bond Fund" was launched in January, 2021 and the scale of assets amounted to approximately NT$9.5 billion in the end of February, which was a record high for IPOs of TSIT.

ESG Product Name Description Proportion of ESG Product
in 2020 (%)
  • ESG Fund Portfolio

  • Compliant with SRI investment (including public and private equity funds,  discretionary agency operations, etc.)

  • 21.95

Questionaire

Questionaire

You are invited to fill in the questionnaire to assist us realizing the CSR fulfillment.

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