İş Leasing operates with the principle of positive value creation by considering all economic, environmental and social impacts, especially the transition to a low-carbon economy, with its climatology-centric sustainability management. In this regard, the Company’s targets for the 2022-2024 periods were set as acceleration of the “Green Transformation Vision” in line with Türkiye’s 2053 net zero emissions target. To this end, İş Leasing’s longterm sustainability journey, which was initiated at the end of 2020 with an environmental and social responsibility mindset, took another important step by launching of Environmental and Social Risk Management System (ESMS) Project. ESMS Project aims to create value by Green Development principle and a holistic approach by addressing environmental, economic and social sustainability factors and associated risks and opportunities in a unified fashion within both the Company’s management and the product/ service processes. Within the scope of the project, İş Leasing’s corporate sustainability approach was established, corporate governance and stakeholder interaction mechanisms were designed to manage its economic, environmental and social impacts, and relevant processes were structured.
Sustainability Policy guides sustainability activities of İş Leasing in line with its Green Transformation Vision. The principles of İş Leasing’s Sustainability Policy are presented below:
The Company aims to maximize its sustainability performance since its inception in line with its vision and mission of sustainable development. In this regard, it favors domestic contributions to economy and monitors direct and indirect economic, environmental and social impacts of its activities in accordance with its relevant policies and Environmental and Social Management Risk System.
The Company’s medium and long-term strategies are designed to protect the rights and interests of all stakeholders as well as the public interest.
It carries out all its activities in compliance with laws and regulations with a transparent corporate governance approach and a holistic view aimed at continuous improvement. Bribery and corruption are not tolerated in any way, and the Company acts upon Anti-Bribery and Anti-Corruption Policy when necessary.
The company acknowledges employee satisfaction as a source of its most precious asset, offers an inclusive and fair working environment respectful of human rights and equal opportunity, and aims to maintain lasting employment relationships by ensuring employee health and safety aligned with regulations and by continuously investing in employee development.
The Company takes measures to minimize direct and indirect impacts of its activities within the framework of combating climate change when evaluating risks and opportunities.
Aiming to support renewable energy, energy efficiency, resource efficiency, recovery and recycling projects that play an essential role in transition to a low carbon economy, the Company encourages that the funded equipment is cleaner, more environmentally-friendly, less waste-generating and more efficient.
By embracing a responsible procurement approach in procurement processes, it adheres to a fair, honest and impartial supplier selection process.
The Company aims to raise awareness and spread sustainability mentality across entire value chain by setting an example for its suppliers, customers and all other stakeholders through its approaches respecting human rights, enabling social justice, and providing equal opportunities.
It assesses both financial and non-financial risks by integrating risk management into all business processes with a holistic approach.
It follows the activities of multilateral initiatives that conduct national and multinational sustainability studies. It values participation in collaboration platforms in line with its sustainability goals and strategies.
The company shares its sustainability performance with all stakeholders through transparent communication channels, and reviews its business methods upon feedback from all its stakeholders.
With continuous improvement vision, it regularly reviews and updates İş Finansal Kiralama A.Ş. Sustainability Policy at least once per year to reflect changes in needs and operating circumstances.
It shares its sustainability activities through its corporate website.
The Environmental and Social Risk Working Group is responsible for updating the Policy. Updates and changes deemed necessary are effective upon approval by the Board of Directors.
Compliance with policy provisions is audited within the scope of internal audit.
To promote sustainability culture at İş Leasing, all employees are expected to fulfill their duties and responsibilities with a sustainability-oriented approach. Sustainability governance was structured within ESMS Project and all sustainabilityoriented activities adhere to the established governance structure.
Assessment and management of any economic, environmental and social impact caused by sustainable finance practices is essential for İş Leasing within the scope of its goal of supporting sustainable development and green transformation. The Company acts meticulously to analyze, monitor and manage environmental and social impacts and risks that may arise both directly from its own operations and indirectly through funded projects.
Established with diverse participation from across departments, the Sustainability Committee is directly responsible for setting sustainability strategies and targets, managing and supervising sustainability activities, and providing flow of information. The head of Sustainability Committee is the Assistant General Manager for Investor Relations who is appointed as Chief Sustainability Officer and has ultimate responsibility for management of economic, environmental and social impacts.
General management of internal and external impacts arising from İş Leasing’s activities is carried out by ESMS Officers including Corporate Loans Officer, Corporate/ Commercial Sales Managers, Financial Management Officer, Treasury and Financial Institutions Officer. The main duties of the ESMS Officers are to ensure the effective management of İş Leasing’s external environmental and social risks, to monitor internal environmental and social impacts, to ensure continuous improvement in the ESMS, to represent the ESMS before the Credit Committee and Senior Management of İş Leasing.
An Environmental and Social Risk Management Working Group was created to carry out activities in line with İş Leasing’s sustainability goals, to develop an environmental and social risk management approach, to identify and manage environmental and social risks and impacts caused by leasing activities, to ensure effective communication across departments and to convene regularly to control and manage the Company’s direct economic, environmental and social impacts. The Environmental and Social Risk Management Working Group is chaired by the ESMS Manager. The Working Group reports its activities directly to the ESMS Manager. The Working Group includes representatives of İş Leasing’s Loans, Corporate Sales/ Commercial Sales, Treasury and Financial Institutions, Asset Management, Investor Relations, Financial Management, Procurement, Human Resources and Administrative Affairs Departments and the ESMS Correspondents.
To promote sustainability culture at İş L easing, all employees are expected to fulfill their duties and responsibilities with a sustainability-oriented approach.
ESMS Project, which was initiated by İş Leasing initially to integrate its corporate culture with business processes enabling transition to sustainable and low-carbon economy, was also designed to monitor environmental and social sustainability as well as economic sustainability in leasing practices. This project aims the integration of leasing activities with environmental and social risk management. Sustainability became a central element of business practices along with processes defined under the Project and community-benefit oriented efforts. Therefore, it was aimed to turn both sustainability and the Green Development vision into an essential element of İş Leasing’s main strategy. On the other hand, the establishment of this system, allows creation of cumulative positive value for sustainability by raising environmental and social awareness of customers. Under this system, all İş Leasing activities are treated and monitored holistically within the framework of relevant policies and processes.
The processes defined within the scope of the ESMS Project are listed below;
Sustainability Governance
Identification of Environmental and Social Goals and Targets
Assessment of Internal Environmental Impacts
Assessment of Environmental and Social Risks in Leasing Activities
Competence, Training and Awareness
Grievance Mechanism
Communication
Regulation Updates
Internal Control
Document Control
Management Review
The procedures of all processes designed in the ESMS, which was initiated to ensure economic, environmental and social sustainability, will enable İş Leasing to achieve continuous improvement in line with the following objectives:
Assessment of the Company’s performance and the internal environmental impacts caused by its operations and consumption.
Assessment of the environmental and social risks of leasing customers as well as potential leasing operations.
Raising environmental and social awareness of employees
Determination of how the complaints, requests and suggestions of employees, customers and other parties regarding direct or indirect environmental and social impacts of İş Leasing’s activities will be transmitted to İş Leasing, how they will be recorded, and how the management process will be handled
Identifying how to develop, approve, implement and communicate environmental and social goals and objectives
Determining and communicating legal and other requirements regarding environmental and social affairs
Within the scope of the project, several subtitles gained spotlight and are reflected in business processes such as energy management, combating climate change, financial inclusion, digital transformation, corporate governance, financial performance and profitability, diversity and inclusion, talent management and the management of environmental impacts. In this way, İş Leasing aims to be a pioneer in the industry by transparent disclosure of environmental and social impact management as well as economic performance. The basic principles for the assessment and management of environmental and social impacts potentially attributable to İş Leasing’s activities are published in the Environmental and Social Impact Policy available to stakeholder access.
Under its Environmental and Social Impact Policy, İş Leasing evaluates the potential environmental and social risks and impacts of leasing activities exceeding a certain amount within the framework of national and international regulations, standards and good practices. When deemed necessary, the Company develops action plans and monitors investor activities to mitigate the risk level impacts identified during contract period. In order to raise awareness, İş Leasing informs its customers, suppliers and all other stakeholders about environmental and social affairs and encourages them to develop sustainable practices.
In addition, İş Leasing does not support the activities listed below nor the companies engaged in these activities:
Activities that involve harmful and abusive forms of forced labor1/child labor2 which are against human rights
Projects that limit people’s personal rights or violate human rights
Production of weapons of mass destruction and land mines
Production and/or trade of any product or activity deemed illegal according to national regulations and international agreements to which it is a par ty, including:
Production or trade of products containing PCBs (Polychlorinated Biphenyl)
Production and trade of internationally-prohibited drugs, pesticides / herbicides and other harmful substances (Rotterdam Convention, Stockholm Convention)3
Production and trade of internationally banned ozone depleting substances (Montreal Protocol)4
Activities associated with the manufacturing, commercial use, storage, transportation or trade of products containing friable asbestos fiber
Cross-border movements of wastes prohibited by national or international laws (Basel Convention)5
Activities in wetlands designated as RAMSAR (Wetlands of International Importance) sites
Activities that threaten the cultural heritage properties of places in the UNESCO World Heritage List and activities involving significant damage to or destruction of a cultural heritage / Activities involving disputes over, damages to or destruction of a significant cultural heritage
Wildlife trade and the trade or production of wildlife products regulated under the CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora) Convention
Activities related to pornography or prostitution
Transportation of oil or other hazardous materials in tankers that do not comply with IMO requirements (IMO, MARPOL, SOLAS and Paris MOU)6
Production or trade activities of radioactive products (except healthcare equipment, quality control devices and the use of radioactive materials in an extremely limited or insignificant way or where adequate protection is provided)
If a leasing request received by the Company is included in the List of Unaccepted Activities, the request is rejected and the process is stopped. If the leasing activity is not included in the mentioned list, the preliminary evaluation and categorization of the application is performed, and compliance with national environmental regulations is checked. Cross-risk assessment is performed according to the sector in which leased asset will be used, the type of leased asset, the potential environmental adverse impacts of the leased asset, and the social impacts of the transaction. At this stage “Impact”, “Manageability” and “Probability” are separately assessed while assessing environmental and social risks of the transaction. At the end of the assessment, the environmental and social risk category (A, B+, B-, C) of the leasing activity is determined.
Transactions in category A are identified as potentially risky transactions. Environmental and social assessment is carried out for transactions under category A.
Category B+ transactions carry lower negative environmental or social risks compared to Category A. Environmental and social assessment may be requested for category B+ transactions.
Category B- transactions are less negative and more limited, minor, site-specific, and have potentially reversible impacts compared to category B+. Although environmental and social assessment is not mandatory for category B- transactions, it is requested when necessary.
Category C transactions, on the other hand, consist of activities that have insignificant or no negative potential social and environmental impacts.
İş Leasing establishes an Environmental and Social Management Plan for leasing transactions identified as A, B+ and B- categories. The actions in the plan must be completed by the investor company. In addition, each project categorized as A, B+ and B- is monitored at least once a year.
Forced labor refers to all actions or services that individuals do not voluntarily work/do, which results from punishment or use of force.
Forced child labor refers to jobs that monetarily exploit children or affect their development in terms of their education, well-being, physical development, mental health, spiritual development, moral development, or social development.
Ozone Depleting Substances (ODS): Chemical compounds that react with and exit the stratospheric ozone,http://www.unep.org
Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal, http://www.basel.int
Tankers prohibited by the International Convention for the Prevention of Pollution from Ships (MARPOL), the International Convention for the Safety of Life at Sea (SOLAS) (including but not limited to), the International Safety Management Code, the Paris Memorandum of Understanding on Port State Control (Paris MOU) and a single tanker older than 25 years should not be used due to liquidation as per the MARPOL Regulation 13G. https://www.imo.org