Moving the dial on sustainability — an interview with Ambika Jindal of ING
Ambika Jindal will be speaking at the The Race to Net Zero: Decarbonising Your Operations session and ING will be hosting the Moving the Dial on Sustainability summit at HBI 2024 on Monday 10 June at 2.00 pm in London. Final places are available, but filling quickly at the time of going to press.
Ambika Jindal, Group Head of Sustainability Integration & Implementation, ING
With HBI 2024 now under a week away, we spoke with Ambika Jindal, Group Head of Sustainability Integration & Implementation at ING, about the bank’s sustainability journey and the importance of sustainability generally in the healthcare sector.
“I’m part of the Global Sustainability team, which reports to our Group CEO. We set the direction for ING on sustainability, providing a focus on what good looks like, not just for us but also for business and society. To set the bank’s priorities, we make sure that we keep our eyes on the horizon to identify opportunities and be prepared for what’s coming next.
“Our objectives cannot be achieved by my team alone; hence we have embedded sustainability throughout the organisation aiming to put sustainability at the heart of everything we do.”
What does good look like for sustainability?
“Sustainability is embedded in ING’s purpose and business strategy. We strive to make a difference for people and the planet because it’s the right thing to do, and because it future-proofs the businesses of our clients and therefore future-proofs ING too.
“The UN-defined ‘triple planetary crisis’ (climate change, biodiversity loss & pollution) and the impact on people informs our sustainability approach. We focus first on fighting climate change, and also strive to protect nature and biodiversity, ensure human rights and a just transition, and support the financial health of people in the communities where we operate.
“We aim to be a banking leader in sustainability, focusing on climate action. We show our leadership through our ambition and commitments, our transparency and our actions. We act with the aim of steering our own portfolio and supporting our clients in their transitions, and also strive to take the lead in standard-setting and advocacy by collaborating with peers, industry bodies and international organisations.”
ING’s sustainability journey sounds like it has been a process, rather than an event?
“Sustainability has evolved and matured as a concept at ING. We started with a strong ESG risk approach based on the principles of “do no harm”. Also from a risk perspective, we stopped new financing of coal-fired power plants (2015), became the first global player to pledge to reduce our exposure to thermal coal to close to zero by 2025. We continue to strengthen this risk approach by focussing on the most material impact in terms of sectors, projects or assets that we finance.
“In 2018 (at COP24 in Katowice, Poland) we brought together four other international banks to pledge to align our lending portfolios with global climate goals, paving the way for the UN-convened Net-Zero Banking Alliance (NZBA). We commit to the strictest global climate scenario, with the target to limit global warming to 1.5 degrees by 2050. To guide us we’ve set intermediate goals for both our own footprint and that of our lending portfolio, which we manage – not only measure – year-by-year.
“Sustainability however is not only a risk or about stopping business, it also brings opportunity. In 2017, ING structured the world’s first sustainability linked loan for Philips. This allowed us to start engaging with our clients and support them in accelerating their transition to more sustainable business models. These discussions future proof our loan books, but also give us the opportunity to tap into new markets and add value to our clients. Sustainability has been a big differentiator for us in building our client relationships.
“To be on this journey requires commitment and a long-term vision, especially by our bank leaders, so that they empower our bank to ensure sustainability isn’t about marketing, or compliance- but is the business strategy.”
But the company’s sustainability journey has not been without its challenges?
“A decade ago when I started in sustainability, there was little clarity. One had to operate without much standardisation and could shape things. Now, we’re in a phase where sustainability is much better understood. It’s much more regulated. There are many experts, much more data and a lot more is becoming standardised.
“Differentiating in sustainability is now much tougher with the increased competition, than it was as a first mover- and this is a good thing. It pushes us to keep striving for more impact.
“Better understanding and regulation are an opportunity and a challenge at the same time. How do you make sustainability part of every risk and commercial decision? You need to bring the whole organisation along which requires understanding this very complex, ever evolving dynamic topic. We need to set an extremely clear story first. As a bank, we are regulated and that’s great because that puts everybody on the same page. But I have never seen the amount of regulations, disclosures or the speed at which they are being introduced as I am seeing now.
“It is all about materiality, prioritisation and staying true to what we believe has the most impact.”
“We have not figured everything out yet and in the absence of models and data cannot predict the future with much certainty. We’re all learning.
“Analysing risk and profitability in our business is our core competency. We now need to expand that competency towards sustainability. Sustainability isn’t only a non-financial risk anymore, we understand that ESG risks can convert into financial risks, reputational risks, legal risks and so on. To be able to integrate sustainability fully in our bank we need to upskill our organisation and change our processes and IT. None of this is easy, but with intention and investment, we are moving in the right direction.
“What sometimes gets in the way of learning is also greenwashing and the opposite, green-hushing. If banks and other players are scared and cannot openly share the reality of where they stand and the challenges they face, we will slow down our ability to meet our sustainability goals. Luckily with changing data requirements, transparency will be higher than ever before”.
In addition challenges throughout the sustainability journey, there have also been surprises
“What I found most surprising is how quickly this topic went from being explorative to extremely technical. The dependencies, complexities and interlinkages between topics can sometimes overwhelm you when you’re trying to address issues like climate, nature and human rights. There are no simple solutions and silver bullets, but we need to begin and take action based on what we know and can reasonably forecast”, Jindal adds.
Healthcare is one of the bank’s priority sectors
“We cover 200 clients globally and we operate a loan book of 10 billion euros to service our clients. This is a sector we are committed to. As society ages and populations become increasingly older, we need to make sure that we start taking action in this important sector which has a considerable impact. That’s why we are the ESG sponsor of the HBI conference. Our commitment is evidenced by the business we do in this sector. For example we coordinated a €268 million sustainability-linked loan with Spanish healthcare provider, Recoletas Salud.
“Their financing is linked to the sustainability KPIs that they have set. If they meet these KPIs we give them a discount on their interest rate and if they don’t, they get a premium. Amongst others, they committed to reducing their emissions by 31% by June 2029.
“We also financed the global healthcare group, Fresenius. This was a €2 billion sustainable improvement linked loan. There, we set KPIs linked to their management score calculated by Sustainalytics. Their credit facility’s interest rate will be adjusted up or down according to changes in their sustainability performance.” Jindal explains.
Jindal applauds the sustainability work already being done in the healthcare sector by those who have “taken it upon themselves” to understand the importance of improvements in this area and their impact on sustainability:
“For instance, within hospitals we see increasing efforts on procurement of sustainable energy, energy efficient refurbishing or simply more actions taken to reduce electricity consumption. There is more awareness around the carbon footprint of specific procedures, medical devices and drugs. Hospitals are keen to drive change in that area to further reduce their emissions. Looking forward there is a great interest in telemedicine which from an environmental perspective reduces the need for patient and provider travel as well as required space within the hospital buildings reducing the demand for heating, cooling or humidifying.”
On the back of this Jindal is “excited to meet these leaders and to hear real life stories, experiences and solutions” and “keen to hear from others how they mobilise their organisations in owning this topic and moving it along” at HBI 2024.
Who will be speaking at HBI 2024’s “The Race to Net Zero: Decarbonising Your Operations” session?
Who will be speaking at HBI 2024’s “Moving the Dial on Sustainability” summit?
