Case Study: How One Georgian Bank Is Educating Its Clients Whilst Leading the Charge in Environmental Improvement

ProCredit Bank, compared to its competitors in Georgia, is leading the charge when it comes to reducing the Georgia’s environmental footprint.  Sophie Sosebashvili, Finance Control Manager at GrECo Georgia chats with Irine Kikvadze, who is responsible for energy efficiency at ProCredit Bank Georgia about the structure of their pioneering environmental policy and how it works.

Sosebashvili: ProCredit Bank Georgia has a unique environmental management system.  Please can you tell us more about it?

Kikvadze: We have created an environmental management system designed especially for financial institutions within the ProCredit group.  It is based on three core principles: improving the sustainability of resource consumption; managing social and environmental risks; and green finance.

Sosebashvili: Can we look at each in turn to determine more about each of them?

Kikvadze: Sure. Let’s start with pillar one: We are heavily invested in improving the sustainability of our resource consumption through our physical assets and beyond. We ensure our environment management system continually evolves to keep up with the ever-changing needs to protect to the planet. 

Let me give you some examples of what we are doing.  Our head office in Tbilisi was built using environmentally friendly and energy-efficient materials, such as special low-emissivity glass which minimises the amount of infrared and ultraviolet light that comes through the glass, without minimising the amount of light that enters the building.  We also used Rockwool insulation as a sustainable way to insulate the office.  In 2019 the bank installed a rainwater harvesting  system, which helps us to significantly save water, and in 2020 we installed solar panels on the roof of the headquarters. Nowadays 10/12% of the building’s electricity usage is supplied from our solar panels.  We have also invested heavily in our BMS (Building Management System), which regulates the heating, cooling, ventilation, and lighting systems at HQ – it’s been a gamechanger in improving our energy efficiency.  

We’re proud the building is often sited around the world as a noteworthy green building.  What is more, it is the first building in Georgia to have its resource efficiency confirmed with an internationally recognised EDGE certification.  EDGE stands for Excellence in Design for Greater Efficiencies, and the certification recognises buildings that have a reduced environmental impact through the reduction of direct energy consumption, the cutting back of water consumption, and the use of construction materials which minimise its energy footprint.  As a responsible lender, ProCredit has adopted EDGE for all its headquarters buildings around southeast and eastern Europe, and we are the first organisation in Europe to be awarded an EDGE Zero Carbon certification.

Sosebashvili: You mentioned earlier that it wasn’t just the bank’s physical assets which were included in this process.  What else is included?

Kikvadze: That’s right.  It’s no use having a super-efficient, resource-saving HQ if the staff don’t know about it.  All our staff at a local, regional, and international level are trained on environmental issues and we ensure they are aware of how we are reducing our resource consumption, and how they can contribute to that goal. We find it is a real eye-opener for many of them and has had a real impact in driving E&S messages across the organisation.

Sosebashvili: Let’s take a look at the second pillar.  ProCredit Bank is often heralded as the forerunner in the Georgian banking industry when it comes to managing social and environmental risks and the impact of lending.  What does this part of your event management system look like and how is it helping your clients improve their environmental awareness?

Kikvadze: ProCredit Bank on a group level has established standards for managing the environmental and social risk and impact of lending.  All credit applications are screened against the bank’s exclusion list.  All other projects or economic activities are discussed and assessed with regards to their environmental and social risk and according to their environmental risk categorisation.  Activities which have an irreversible impact on environmental and social issues appear on our institutions’ watch list.

By incorporating mitigation measures for E&S issues into the loan approval process, we have created an opportunity to communicate with our clients about their own environmental and sustainability reduction processes.  We are raising awareness of the need for our clients to continually evolve and better their own processes, and leading by example in the process whilst driving new business by showing them how we can help them to improve their environmental footprint.  

Sosebashvili: Green finance is a growing trend in the banking world.  What are you doing in this arena?

Kikvade: We strive to promote economic development that is as environmentally sustainable as possible.  The bank offers its clients financial services for investments in energy efficiency (EE), renewable energies (RE) and other environmentally friendly “green” (GR) projects. The aim of these activities is to decrease the negative impact of our clients’ business activities on the environment, and to use our green finance services and approach to increase public awareness and understanding of environmental protection. Our green finance share is growing year-on-year.  Currently  it is around 16% of the whole portfolio.

We also offer our customers a unique, one-of-a-kind opportunity to have a green account and a ProGreen bank card made of organic materials. 80% of the card is organic and only 20% is plastic – the minimum amount necessary for the card to work properly.  Moreover, the green account incorporates all major banking products at a flat rate.

The product is original in both its concept and the range of services it provides. It is an attractive offering for individuals who are enthusiastic in supporting green efforts and are committed to ecological and environmental sustainability. Customers who open a green account will participate in environmental activities planned by the bank, and the service fee goes towards environmental activities for which the bank allocates significant funds. To promote green investments, the bank also uses green accounts/deposits to fund environmentally friendly investments and we provide our customers with regular updates our various green initiatives.

Sosebashvili: How do you make sure all three pillars of your environment management system dovetail into one cohesive plan and run efficiently?

Kikvadze: We have an Environmental Management Unit, which is testament to the bank’s dedication to environmental and social responsibility. This unit is responsible for coordinating the activities related to the three pillars and for ensuring the proper implementation of the bank’s environmental policy. The Environmental Management Unit plays an important role in increasing the environmental awareness of staff, clients, and the public. The responsibility of the unit covers the development and implementation of the bank’s internal environmental management system – establishing the scope of environmental and social standards of lending and setting standards for the disbursement of “eco loans”.  It is also involved in the financing and supporting  of  Energy Efficiency, Renewable Energy and Environment Friendly investments.

Snapshot: Fast fashion needs environmentally forward-thinking fashion houses
The fashion industry, particularly the manufacture and use of apparel and footwear, is a significant driver of greenhouse gas emissions and plastic pollution. The rapid growth of fast fashion has led to around 80 billion items of clothing being consumed annually, with a large number going to landfill. 

Efforts have been made by some manufacturers, retailers, and consumers to promote sustainable fashion practices, such as reducing waste, and improving energy, water efficiency and using eco-friendly materials for their clothes and other fashion items.  One such manufacturer in Georgia is Materiel, a successor of one of the country’s oldest local apparel manufacturers, Fashion House Materia, whose roots date back to 1949.  The organisation was recognised as one of the leading regional companies for implementing industry innovation and international standards.  In 2014, Maia Gogiberidze rejuvenated the company direction and founded Materiel, and today it is still renowned as one of the most environmentally friendly companies in the Georgian fashion industry.

Based on the latest production data, over 96% of the fabrics used per collection are certified environmentally friendly and recycled. No animal-derived leather, fur, or feather is allowed for clothing production. No fabric is accepted until suppliers provide complete transparency with documents showcasing the fair treatment of animals, and the source of the material.

Attesting to this sustainable brilliance, Materiel now holds a plethora of certificates recognising their environmentally sound practices: Recycled Claim Standard, Organic Blended Contact Standard, SGS Certificate, Responsible Wool Standard, Global Organic Textile Standard, V-Label, European Flex, OEKO-TEX, and Global Recycled Standard.

Snapshot: Waste not want not – sustainable waste management solutions in the Georgian food industry
Agrohub LLC is a Georgian food retailer and organic food production company. It is the first vertically integrated retail company in Georgia to offer both domestic and imported organic groceries.  As part of this model the company itself produces several of the products on offer in its hypermarkets.  From its own milk processing plant, meat production enterprise, and bakery to a cannery, greenhouses, wine cellar, and poultry and livestock farms, Agrohub has control over the production of its offerings at every level.  Through the purchase of raw materials to the sales on the shop floor, the organisation’s  mission is to provide the highest quality foods to its customers as sustainably as possible. 

One major aspect attesting to their mission and their environmental credentials is their company-wide waste management plan which they introduced from the start and have implemented since their inauguration in 2016.  “Since day one, our waste management plan has clearly classified both solid and liquid waste and includes a technical report about out wastewater, air pollution, and harmful substances,” said Tamar Pruidze – Head of Production at Agrohub LLC.   We are immensely proud of our efforts to be as green and clean as we can in all that we do.”

Irine Kikvadze

ProCredit Bank Georgia

Sosebashvili Sophia

 Sophie Sosebashvili

Account Executive
GrECo Georgia

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