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The top 10 retail-NBFCs have made favourable progress by market capitalisation across key environmental indicators like green house gas (GHG) emissions and energy usage, a recent report by ICRA highlighted.
There has been an average decline in absolute values of GHG emissions and energy usage by 19% and 7%, respectively, over a three-year period ending FY2024.
The renewable energy adoption pace has remained slow; however, half of the sample set entities has achieved 100% waste recycling.
NBFCs aligned with UN SDG:
The ICRA ESG has observed that the sample entities have been aligning their operations with the UN SDGs. Eight out of ten NBFCs considered in the analysis are showcasing their alignment with SDGs, with six of them aligned with at least 12 SDGs.
The NBFCs have expanded their portfolio to include products like green affordable housing – lending for self-made houses using green components – support to MSMEs and digital innovation products.
ICRA ESG noted that the sector is the most aligned with SDG 3 (good health and well-being), SDG 8 (decent work and economic growth) and SDG 11 (sustainable cities and communities).
It further highlighted that the Cholamandalam Investment & Finance Company Ltd. (CIFCL) are increasingly aligning with the UN SDGs through their portfolio offerings as well as their CSR initiatives.
Highlighted key initiatives by NBFCs towards sustainable practices
The ICRA report has highlighted that the notable ESG initiatives included Bajaj Finance Ltd.’s (BFL) reduction of paper consumption and installation of 626.80 KW rooftop solar plants, and Cholamandalam Finance’ (CIFCL’s) expansion to 252 branches in under-banked districts.
Mahindra Finance (MMFSL’s) alignment with UN Global Compact Network and SBTi-validated targets are initiatives showcasing its alignment with sustainability, it said.
MMFSL is aligned with most of the sustainability reporting frameworks and initiatives namely, the Global Reporting Initiative (GRI), the International Integrated Reporting Council (IIRC), the UN SDGs, and the United Nations Global Compact (UNGC) Principles.
Entities like CIFCL have declared the number of ongoing projects against each SDG. For instance, towards SDG 4 (quality education), CIFCL runs the ‘My Dream Scholarship’ project, and towards SDG 6 (clean water and sanitisation) it has provided drinking water units and installed smart toilets in villages.
ABCL have linked SDGs 11 (sustainable cities), 12 (responsible consumption) and 13 (climate action) with its sustainability initiatives like installing LED lights, increasing its renewable energy portfolio, installing solar panels, and practicing waste management and recycling initiatives.
- Published On Feb 26, 2025 at 12:50 PM IST
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