Harnessing the power of data governance, digital finance, AI, and IoT to deliver products that integrate ESG into investment and business decisions. One solution is to divest portfolios by exercising policy influence and changing overall risk and return. Asset managers are already making a significant shift in their investment priorities by getting out of businesses that lack long-term value by concealing their decarbonization activities.
With recyclable cards, loyalty points for a low-carbon lifestyle, and green bonds for investment banking, the adoption of green practices will lead to the transition to net zero.
- Tracking metrics with sophisticated systems like Birlasoft’s supply chain management cloud to keep ESG data relevant and reduce the footprint in the process.
- Banks are evaluating climate impact based on short- and long-term risk strategies. Based on the data captured, simulations are run based on different configurations to compensate for losses and achieve decarbonization.
- Recognizing climate change as a global security priority
Financial institutions worldwide are implementing cloud service offerings with value-added service options. The implementation solely depends on the level of automation and technology to deliver high-end coverage with cloud services.
Data centers require maximum energy, and organizations are looking to reduce power costs tied to CPU consumption, cooling to ambient temperatures, and consolidating storage.
FIs may be able to further sustainability aims by adopting a digital strategy. Banks can benefit from several different FinTech services in addition to advancing AI-based techniques. With digital banking solutions, reduced paper/plastic usage and reduced travel will help reduce footprint and increase accessibility.
- Provide users with the convenience of digital services infused with human interaction at different touchpoints.
- Engaging customers with customized financial coaching by providing rich, immersive digital experiences.
- Leveraging AI to understand customer needs and delivering new approaches with digital-only models.
Creating a Strong Ecosystem of Partners
Consideration of ESG factors in business and capital planning, with active referencing from data to create transparency based on different strategies implemented. Integrating purpose-driven KPIs with internal and external reporting and restructuring individual and group incentive structures across customer-facing and leadership positions.
- Poor data measuring and storing capabilities affect the digital maturity index and undermine the company’s ability to achieve diversity goals. Collaborate with CIO about digital transformation goals and their impact on ESG’s plan.
- Forge new alliances and share resources to start and define a combined ESG framework to work on focussed initiatives with targeted investment plans.
Know Your Supplier
Banks are keen to highlight the positive environmental practices of their suppliers. Banks are now able to rank the environmental practices of their suppliers to increase their green credibility. They are also able to use the system to increase their competitive advantage by highlighting the green practices of their products.
- With Net Zero targets defined for years to come, FI’s are taking steps to mitigate risks with green funds and socially responsible funds by offsetting carbon emissions
- Identify sources and credibility of supplier-specific location data (production site) to measure climate risks.
- Assess the impact of climate change on existing financial assets and credit rating of suppliers/customers