UNEP FI Principles for Responsible Banking

The UNEP’s Principles for Responsible Banking (PRB) are a framework for ensuring that signatory banks’ strategy and practice align with the vision set out in the Sustainable Development Goals and the Paris Climate Agreement. There are over 270 current signatories with US$ 81 trillion AUM representing over 45% of banking assets worldwide.

Who is in scope?

Banks (non-banks can become ‘endorsers’ of the framework).

How do investors have to consider sustainability in general?

The framework consists of six Principles. Signatory banks commit to embedding these six Principles across all business areas, at the strategic, portfolio and transactional levels.

On which sustainability topics do investors have to report?

Signatory banks are required to provide information on their implementation of the Principles, in their existing public reporting, within the first 18 months of becoming a signatory, and every year thereafter. The bank has up to four years from signing to bring its reporting fully in line with the requirements.

Banks are required to complete the reporting and self-assessment template by providing references/links to where in their public reporting the relevant information on their implementation of the Principles can be found. In the same template, banks will assess their progress against six criteria:

Impact analysis
Target setting
Plans for target implementation and monitoring
Progress on implementing targets
Governance structure for implementation of the Principles
Progress on implementing the Principles

An assurer must provide limited assurance of the bank’s self-assessment. This can be done by including it in the existing assured reporting. Where third-party assurance is not feasible, an independent review may be conducted.

Does the initiative define specific sustainability indicators?

The targets, and their level of ambition, should be linked to the SDGs, the Paris Climate Agreement and other relevant national, regional or international frameworks (such as the UN Guiding Principles on Human Rights).

Banks are required to establish milestones/KPIs for monitoring progress against their targets, though the initiative does not set out specific KPIs.