HDFC Bank to become carbon neutral by 2031-32

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Ahead of the World Environment Day on June 5, India’s largest private sector lender HDFC Bank announced on Thursday, its plans to become carbon-neutral by 2031-32.

The bank is planning to reduce its emissions, water consumption, and energy as a part of this initiative and will continue to incorporate and upscale the use of renewable energy in its operations, as a part of this initiative. Ashima Bhat Group Head (CSR, Business Finance and Strategy, Administration and Infrastructure) thinks that as being one of the largest banks in the country the bank must not only be a socially responsible corporate but also an environmentally conscious one too. So the bank today has pledged to become carbon neutral by the financial year 2031-32, she told the reporters.

She said that going forward, the bank has a broad strategy in place and the bank will fine-tune it and introduce new measures if necessary. To achieve its objective to become carbon neutral, the bank has a three-point strategy: reduce consumption, transition to renewable energy, and offset carbon footprint.

 As part of the strategy, it is planning various initiatives, which includes decreasing absolute emissions and energy consumed from the current level of 3,15,583 MT CO2 emissions, convert 50 percent of its total sourced electricity to renewable energy, plant 25 lakh trees, create single-use plastic-free corporate offices and reduce water consumption by 30 percent.

Bhat said that, the data center is a big energy consumer for the bank and that they are depending on the energy measurements and trying to offset the same. As a part of its ESG (environmental, social, and corporate governance) strategy the bank will also focus on offering loans for green products like electric vehicles at lower interest rates and incorporating ESG scores in its credit decisions. The bank is also looking at energy-efficient measures at ATMs.

The bank is in the process of setting up a percentage target in terms of how much finance they will provide. There would be a difference in the interest rate if the customer is going for something which has a positive impact on the environment or climate change, Bhat added. The bank is working on creating a framework for issuing green bonds.

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