Climate Governance

■ Climate Change Governance Organizational Structure

E.SUN Bank continues to follow the TCFD (Task Force on Climate-related Financial Disclosures) framework: governance, strategies, risk management, and metrics & targets to disclose climate-related information. We have set comprehensive "coal phase-out" goals by 2035 and net zero by 2050. Our scientific approach and robust risk management are steadily moving us towards our net-zero target.

■ Climate and Environment Governance Structure

■ Climate Risk Management Measures

Based on the comprehensive climate change risk assessment results and climate change scenario (stress) testing analysis, E.SUN's management measures are summarized in the following table.

Scope Risk Factors Management Measures / Adaptation Plans
Low Carbon Transition Reduce own operational and investment-related carbon emissions
  • Inventory carbon emissions from Scope 1 and 2 and plan mitigation measures (such as installing solar panels, using renewable energy, etc.)
  • Follow PCAF methodology for carbon inventory of investment and financing activities
  • Set targets and reduce carbon emissions according to SBTi
Investment Stock and bond investments
  • Fulfill the responsibility of asset owners or managers by considering the corporate social responsibility performance of investment targets
  • Avoid investing in enterprises with direct or potential environmental and social impacts, such as coal mines or coal-fired power plants, and implement responsible investment
  • Promote or assist enterprises in sustainable operation issue awareness and implement ESG actions through negotiation
Credit Corporate loans
  • Through green financing, support renewable energy projects, green buildings, green equipment, and other energy-saving and low-carbon capital expenditures to help enterprises transition and respond to climate risks
  • Link credit conditions to enterprises' comprehensive performance in environmental, social, and corporate governance or sustainability indices, encouraging enterprises to invest more actively in resources
  • Refer to the guidance of the Banking Association's Equator Principles 4.0 for corporate credit review
  • Include ESG considerations in the credit process to avoid funds flowing to high-carbon projects such as coal-fired power project financing
Real estate collateral loans
  • Regularly assess and monitor the potential risk of real estate value impairment caused by climate change, continuously improve the database of physical risks, analysis methods, and scenario testing
  • Incorporate flood risk factors - hazard (e.g. heavy rainfall, increased typhoon frequency) and vulnerability (e.g. whether the area is prone to flooding) into the real estate collateral zoning standards, and set lending limits and loan-to-value ratios according to the zoning to control potential loss risks
  • Regularly conduct mid-term management for high flood risk cases, add a special note to the system for real estate collateral located in high climate risk areas with high loan-to-value ratios, and carefully assess collateral value and loan-to-value ratios
  • Refuse evaluations for collateral labeled as pollution-related sites, or those announced by government agencies as subject to the "Soil and Groundwater Pollution Remediation Act"
  • Strengthen review, inspection, appraisal of collateral, control of credit conditions, and raising of approval authority for collateral cases in high landslide risk communities
Own operation Disaster response
  • Developed the "Emergency Response and Crisis Management Measures" based on the competent authority's "Financial Institution Disaster Emergency Response Measures Manual Template" and operational overview to ensure operational continuity and organizational resilience
  • The "Continuous Information Service Management Regulation" takes into consideration power supply interruption and regional flooding recovery
  • E.SUN Bank collaborates with external consultants, introduces AR6 scenario data, domestic disaster potential data, and analytical techniques, and conducts a physical risk assessment of its own properties (from 2030 to the end of the century) to plan 100% adaptation measures for existing locations and to serve as a reference for selecting new locations. By 2025, high-risk operational locations should be reduced to within 2%, and existing high-risk locations need to be vigilant or prepared early for heavy rain special reports, such as installing floodgates, to reduce climate impacts through early monitoring and adaptation
  • E.SUN Bank implements sustainable procurement standards to manage suppliers
  • Established designs and measures to avoid greenwashing in the provision of green-related financial products and services, and sets up internal mechanisms for control
Supplier management
Compliance and reputation

■ Climate-related Product and Service Overview

■ E.SUN Carbon Emissions Structure

E.SUN FHC GHG Emissions Timeline

2019 2020 2021 2022
Scope 1 2,455 2,399 1,857 1,844
Scope 2 22,443 22,299 22,105 20,294
Scope 3: Financed Emissions1 916,408 4,710,269 3,672,612 3,898,4641
Scope 3: Others 52,100 53,713 49,181 56,015
Total (tons) 993,407 4,788,679 3,745,755 3,976,6171

Scope 3 Portfolio Emissions Inventory 

2019 2020 2021 2022
Financed Emissions (t-CO2e) 916,408 4,710,269 3,672,612 3,898,4641
Carbon Footprint2 2(t-CO2e/$M) 95.36 69.64 47.88 51.981
Inventory Coverage 3(%) 12.50% 73.69% 75.27% 75.68%1
PCAF Required Coverage(%) 100.00% 100.00% 100.00% 100.00%
  • Note 1: Emissions from investments and financing activities for 2022 have been estimated based on the increases or decreases in our total assets reported in our financial statements.
  • Note 2: Financed Carbon Footprint = GHG emissions from investment and financing companies / inventoried balance of investment and financing companies
  • Note 3: Inventory Coverage = inventoried balance of investment and financing companies / sum of FVPL, FVOCI, AC, loans, and discounted items
  • Note 4: Portfolio emissions for 2021 are inventoried using PCAF (2022) GHG Accounting and Reporting Standard. Second Edition. Inventoried results are verified (see Appendix 17 for details). Due to changes in boundary, attribution factor, and emission data updates, the numbers presented here are different from the numbers present in our "2021 Climate and Environment Report" published last year.

■ Financed Carbon Emissions

E.SUN has analyzed its greenhouse gas emissions from investment and financing assets by asset class, industry category, and region. We calculated data quality according to the PCAF methodology, overall data quality score in 2021 was 3.33 (1 being best and 5 being worst for data quality scoring) In accordance with the SBT, we have set carbon reduction targets for different asset types, planned control mechanisms for high-carbon industries, and encouraged internal staff to increase interactions with proactively low-carbon corporate clients or investment targets, in hopes to contribute to a net-zero emission future through financial influence.

Note: Detailed information can be found in Appendix 11, Financed Carbon Emissions