Hana Financial Group is a financial institution that supports the growth of various entities of our society, including households, enterprises, and the government,
and incorporates Environmental (E), Social (S), and Governance (G) considerations across its businesses.
Hana Financial Group places top priority on sustainability as it offers financial products and services based on its capabilities and generates synergy
in each sector of finance for the happiness of all stakeholders.
Platform-building, global banking, and ESG financing are the Group¡¯s three major growth strategies.
Its sustainable financing framework promotes the sustainable growth of all stakeholders, especially customers, collaborators, and local communities,
and seeks to contribute to strengthening the sustainability of Korea¡¯s socioeconomic structure.
The Hana Financial Group¡¯s Sustainable Finance Framework (¡°the Framework¡±) sets out our methodology for classifying financing as sustainable and serves as the basis for tracking and disclosing our performance against our commitments. We are committed to being transparent about our definitions and approach.
Scope: Applies to all Hana Financial Group businesses globally.
Application: This Framework is designed to enable the classification and tracking of performance against our existing sustainable commitments.
External standards: Hana Financial Group is a participant in or signatory to the following principles to help guide our approach to lending, investing and other financing decisions.
Equator Principles
Partnership for Carbon Accounting Financials
Task force for Climate-related Financial Disclosures
To build the ESRM framework, the Group adopted the Equator Principles, and regarding loans subject to the principles (loans with total project cost of USD 10 million or more),
will consider whether such loans are for the following ineligible activities/industries or violate the Equator Principles.
Hana Financial Group Sustainable Finance framework
Environmental and social risks management (ESRM)Framework for managing the social and environmental impacts and risks of large-scale projects
Excluded activities
Child labor activities
Excluded industries
Adult entertainment industry, such as entertainment bars and gambling
Arms industry
Industries likely to be associated with internal terrorists or armed organizations, such as mining and refining of conflict minerals
Violations of principles
Mining and trading of rough diamonds without the Kimberley Process Certification
Shale gas and other unconventional extraction methods
Hunting and processing of IUCN Red List of Threatened Species
Projects to develop wetlands protected under the Ramsar Convention
Scope of application
Project finance or project finance advisory services where the total project capital costs are USD 10 million or more
Project-related corporate loans where the total aggregate loan amount and individual commitment (before syndication) are each at least USD 50 million, the loan tenor is at least two years, and the majority of the loan is related to a project over which the client has effective operational control.
Bridge loans with a tenor of less than two years that are intended to be refinanced by a project finance or project-related corporate loan that is anticipated to meet the relevant criteria described above.
Project-related refinancing where: (i) the underlying project was financed in accordance with the Equator Principles framework; (ii) there has been no material change in the scale or scope of the project; and (iii) the project has not yet been completed at the time of the signing of the facilities or loan agreement.
A massive amount of funds is required for the global response to climate change and sustainable development.
Hana Financial Group has established Hana Taxonomy, a classification system that clarifies which economic activities qualify as green and sustainable.
As it is necessary to fund green activities for social sustainability, Hana Taxonomy can help explore and implement sustainable economic activities and prevent greenwashing.
Hana Taxonomy is applied to all products and services to determine whether they are eco-friendly or sustainable assets.
Scope of application
Investment banks¡¯ financing and project finance
Green and sustainable bond issuance
All lending to corporations
Other financial instruments that can utilize Hana Taxonomy (green loans, eco-friendly/social thematic loans, green investment funds, etc.)
1Loans subject to Hana Taxonomy
Hana Financial Group applies Hana Taxonomy to lending to corporations by phase. Loans used to finance eco-friendly or sustainable assets according to the Hana Taxonomy standards may receive preferential treatment in the credit approval process.
Scope
Management method
First applied only to loans extended by the head office (bank), followed by branches (phased application)
Preferential treatment is offered if a loan meets the Hana Taxonomy standards.
2Green and sustainable bond issuance and management
The total amount of loans extended with preferential treatment afforded by Hana Taxonomy is recorded electronically as evidence of the supply of green or sustainable finance in tandem with the government¡¯s Green New Deal policy.
Scope
Management method
Issuance and management of green and sustainable bonds
Hana Taxonomy determines whether a bond generates environmental and social benefits.
Hana Financial Group may issue bonds to raise funds or manage the issuance of green or sustainable bonds by other issuers, in compliance with domestic green bond guidelines, Green Bond Principles (GBP) of the International Capital Markets Association (ICMA), Social Bond Principles (SBP), Sustainability Bond Guidelines (SBGs), and Hana Taxonomy.
The ESG integration framework of Hana Financial Group is a policy for reflecting the results of ESG-related external certifications, investigations, and assessments in financial decision-making. Hana Financial Group can refer to data, evaluations, and research results provided by third-party institutions, such as global research, materials from assessment institutions, and credit assessments done by credit rating agencies, in order to assess the ESG performance of corporations and bonds.
Hana Financial Group may apply ESG-related external certification, investigation, and evaluation results to its wide range of financial products and services. Listed below are only some examples of ESG investigation and assessment standards. The Group uses more comprehensive and diverse standards to provide ESG products and services.
Loan
Specific products and services (e.g., green loans) that take into consideration ESG awards, recognitions, certifications, and borrower¡¯s ratings
Investment
Refers to sustainability indices, assessments, and ratings or green/ESG bond ratings
Products
Investment funds and ETFs that tracks sustainability indices or reflect assessments and ratings
Bond issuance
Green and sustainability bonds certified by third-party institutions
Ratings
ESG ratings of corporations provided by credit rating agencies and credit information institutions
Certification
ESG and green-related certification system administered by the state
Global assessment
Globally-recognized assessments: Dow Jones Sustainability Indices (DJSI), MSCI ESG, and CDP
Bonds
Bonds rated by a professional third-party bond rating agency