The sustainability policies of five prominent commercial banks in Pakistan have come under scrutiny, revealing a significant deficit in commitments to key areas such as climate change, human rights, gender equality, and labor rights. The revelations were part of a report titled “Benchmarking the sustainability policies of banks in Pakistan,” presented by Fair Finance Pakistan. The report evaluated Habib Bank Ltd (HBL), Allied Bank Ltd (ABL), National Bank of Pakistan Ltd (NBP), Meezan Bank Ltd (MBL), and MCB Bank Ltd (MCB) across 10 thematic areas.
Senator Farhatullah Babar expressed concern during the report’s launch, particularly highlighting low scores in human rights criteria and questioning the lack of transparent policy disclosure by the banks. The assessment, based on the Fair Finance Guide International methodology, highlighted the banks’ highest average scores in financial consumer protection, corruption, gender equality, and transparency. However, in other crucial areas such as climate change, nature, arms, and tax, the banks scored below one out of 10, indicating a deficiency in public policies on various sustainability topics.
Results of FFP’s 1st policy rankings highlight greater need for Pakistani commercial banks to align with intl. standards on #climate #human & #labour rights #genderequality, #tax, among others. pic.twitter.com/hyWfVAQqPv
— Fair Finance Pakistan (@fair_pakistan) December 4, 2023
Notably, the banks demonstrated low policy commitments to climate change, with an average score of 0.5 out of 10, and none had publicly disclosed climate policies aligned with the Paris Agreement. The human rights policy ratings averaged 0.72 out of 10, reflecting a lack of disclosure on human rights policies related to investments or financing, contrary to UN Guiding Principles on Business and Human Rights.
Labor rights policies also received low scores, as the assessed banks lacked commitments to international labor rights standards or adherence to national laws for worker welfare. Gender equality scores averaged 1.48 out of 10, with none of the banks reporting measures for equal participation and access to senior positions.
Additionally, the banks demonstrated a lack of commitment to tax policies, primarily due to the absence of public disclosure on tax transparency. Transparency and accountability practices, as well as risk control and grievance mechanisms, were notably deficient in all five banks assessed.
Fair Finance Pakistan urged a repurposing of finance to address societal challenges, emphasizing the importance of prioritizing nature and tax considerations. The report highlights the need for increased efforts in clean air, clean water, and environmental preservation for future generations.