Boubyan Bank - Sustainability Report 2023

Towards perfection

In the Name of Allah, Most Gracious, Most Merciful

"Verily, Allah is the All-Provider, Possessor of Power, the Mighty"

Allah the Almighty speaks the truth

H.H. Sheikh

Mishal Al-AhmadAl-JaberAl-Sabah

Amir of the State of Kuwait

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Boubyan Group | Sustainability Report | 2023

Boubyan Group | Sustainability Report | 2023

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Report Overview

Standards and Principles

Standards and Principles

Boubyan asserts its commitment to sustainable business practices by continuing to report on its Environment, Social, and Governance (ESG) performance for the fourth consecutive year. This report provides an overview of the Group's sustainability performance for the reporting period January 1, 2023 to December 31, 2023. Developed in accordance with the principles of the Global Reporting Initiative (GRI) Standards 2021 (among a selection of others), the report aims to provide a comprehensive understanding of Boubyan Group's most significant impacts on the economy, environment, and society, including its human rights implications, and how it manages these impacts.

Adhering to national and international sustainability drivers, Boubyan has aligned its reported ESG initiatives with the United Nations Sustainable Development Goals (SDGs), New Kuwait Vision, and the Kuwait Boursa Index.

Reporting Boundary

The sustainability report has been crafted for Boubyan Group, comprising Boubyan Bank and its affiliated entities, including Bank of London and the Middle East (BLME), BB2 Digital and Technology Services Limited (BB2 Tech Co), Boubyan Capital, Boubyan National, and Boubyan Takaful. The report boundary encompasses operational facilities, branches, and the Head Office located in Kuwait, with the exception of BLME and BB2 Tech Co, which operate outside Kuwait's jurisdiction. The sustainability performance detailed in this report pertains to the aforementioned entities, unless explicitly stated otherwise.

In the report, any mention of "Boubyan" or "Group" indicates group-wide data that covers: Boubyan Bank, BLME, BB2 Tech Co, Boubyan Capital, Boubyan National, and Boubyan Takaful.

Contact

If you have any queries about the content of this report, please contact the Boubyan's team via: info.sustainability@bankboubyan.com

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Chairman's Message

Abdulaziz Abdullah Dakheel Al-Shaya

Chairman (Non-Executive)

It is my pleasure to welcome you to our fourth Sustainability Report underpinning Boubyan's commitment to the noble Islamic values of fairness, honesty, integrity, and transparency. Through these guiding principles, we continue to address our stakeholder needs and define our character, culture and the foundation upon which our reputation stands.

In today's banking landscape, digital solutions play an increasingly vital role, offering enhanced accessibility, efficiency, and convenience for customers. Recognizing this, Boubyan continues to prioritize the advancement of our digital offerings, both internally within our operations and in the products and services we provide. We are proud to have been named the Best Digital Bank for Small and Medium-sized Enterprises (SME) in Kuwait 2023 by Global

Finance in testimony of our advancement in this area. Another testimony we are proud of is being named as World's Best Islamic Digital Bank and Best Islamic Digital Bank in Middle East by Global Finance.

In line with our values, we remain committed to compliance and business ethics. We take a proactive approach to addressing emerging risks, such as climate change and Anti-Money Laundering(AML), and this is reflected in our updated policies, enhanced cybersecurity controls, and investments in advanced technologies. Furthermore, our emphasis on digital innovation, with high adoption rates of our mobile applications among retail and corporate customers, underscores our dedication to enhancing customer experience and operational efficiency.

At Boubyan, our organizational management approach aims to foster diversity and inclusion, empower women, provide appropriate employee benefits, and prioritize employee health and safety. Knowing the value of a well- informed workforce, we ensure our employees receive the necessary training to excel in their roles through continuous engagement and development initiatives.

We are fully aware that our success is dependent on the satisfaction and retention of our valued customers. Thus, we remain committed to gathering feedback through various channels and conducting surveys to maintain a strong connection with our customer base.

As a key player in the economy, we understand the importance of driving sustainable practices

and aligning with countries' environmental goals. Accordingly, Boubyan aims to adopt less energy-intensive solutions, manage waste and water more efficiently, and work towards mitigating our Greenhouse Gas (GHG) emissions. This strategic approach aligns with our overarching goal of supporting national net-zero targets.

In closing, I hereby convey my deep appreciation to all stakeholders who have played a role in Boubyan's sustainability initiatives. We are pleased to share our progress in environmental impact, social empowerment, and governance excellence. Together, we are shaping a future that embraces sustainability and responsible banking.

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Boubyan Group | Sustainability Report | 2023

Boubyan Group | Sustainability Report | 2023

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Group CEO's Message

Adel Abdul Wahab Al-Majed

Group CEO

Dear Valued Stakeholders,

in these domains. Notably, our recent

It is with great pleasure that I present Boubyan's

comprehensive inspection yielded no financial

fourth Environment, Social and Governance

penalties, and we have expanded our testing

(ESG) Report, showcasing our persistent

unit to encompass our subsidiaries.

devotion to environmental sustainability, social

responsibility, and robust governance practices.

In our efforts to combat money laundering,

In line with our ethos of transparency and

we have diligently updated our Anti-Money

accountability, I am pleased to highlight our

Laundering (AML) risk assessment, enhanced

significant achievements across these crucial

our AML system, and refined our policies

areas.

and procedures. This proactive approach

underscores our commitment to mitigating

Governance

financial crime risks and leveraging advanced

Aligned with Islamic standards, Boubyan's

technology for enhanced AML capabilities.

governance structure prioritizes transparency,

accountability, and ethical conduct. Our

Recognizing the imperative of addressing

unwavering dedication to compliance and

climate change risks, BLME's risk department

ethical business practices forms the bedrock

conducted an assessment of climate-related

of our sustainability initiatives, evident in our

risks in 2023, reflecting our proactive stance

continuous progress and accomplishments

towards managing financial risk in the portfolio

resulting from climate change.

In 2023, we updated our Privacy Policy to align with evolving data protection and privacy standards, demonstrating our commitment to safeguarding customer information. Additionally, we made substantial investments in bolstering our cybersecurity controls to enhance visibility, detection, and response within our infrastructure.

Our dedication to digital innovation is evident in the high adoption rates of our mobile applications, with 73% of our retail customer base and 72% of our corporate customer base utilizing these platforms, thereby enriching their banking experience.

Social

In 2023, our achievements at Boubyan Bank reflected our commitment to organizational excellence and talent management. Notably, we successfully implemented a new approach to job evaluation, marking a significant milestone in realigning strategic organizational goals within job roles. Additionally, we made significant strides in our Kuwaitization efforts, achieving a Kuwaitization percentage of 70% across all levels, as outlined in the plan submitted to the Central Bank of Kuwait (CBK). Of particular note is the remarkable representation of Kuwaitis in our top management, reaching an impressive 89.5%. Furthermore, with 81.3% of our employees benefiting from training initiatives, we prioritize continuous learning and development.

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Boubyan Group | Sustainability Report | 2023

Boubyan Group | Sustainability Report | 2023

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Group CEO's Message

At BLME, we continue to empower the female workforce, with women constituting 46% of our workforce. Our ambition to achieve a 50% female workforce by the end of 2025 underscores our dedication to diversity and inclusion. Additionally, we have achieved a 32% representation of female leaders within the organization, with a targeted goal of reaching 35% by the end of 2025.

Our efforts in maintaining customer satisfaction have garnered widespread recognition from external entities. In 2023, our Complaints and Customer Protection Department received notable recognition for attaining the highest complaint resolution percentage among all Kuwaiti banks, Islamic and non-Islamic, according to an external study conducted by Service Hero. Furthermore, Boubyan Bank continued its longstanding success by securing the top position for the 13th consecutive year in the Retail Banks Index, as acknowledged by Service Hero. Moreover, we distinguished ourselves in 2023 as a leader among all Kuwaiti banks, Islamic or conventional, achieving a remarkable 95% in the Customer Satisfaction Index (CSI), while our Net Promoter Score (NPS) reached 73%.

Environment

At Boubyan, we are committed to minimizing our environmental impact and actively participating in remediation efforts. As part of our 2024 ESG strategy, we have set ambitious environmental targets, including a 20% reduction in Greenhouse Gas (GHG) emissions and achieving a 100% reduction in paper waste by year 5. Additionally, our strategy aims to decrease or maintain energy and water consumption, reduce plastic waste by 10%, and achieve 100% electronic waste recycling by year 5.

Furthermore, our installation of 22 electric vehicle (EV) charging stations at our Boubyan headquarters reflects our proactive approach towards sustainable mobility.

Driven by our sense of environmental responsibility, we continue our waste management efforts through various campaigns and projects. We have established dedicated locations for the collection and segregation of recyclables and have initiated paper recycling programs and a paperless project to mitigate paper waste. Our paper recycling endeavors have resulted in GHG emissions savings. Additionally, we launched a Plastic Recycling Project to address the challenges posed by plastic waste and implemented a Devices and Electronics Recycling Project to manage electronic waste effectively.

As we continue our journey towards sustainable growth and positive impact, Boubyan Bank remains steadfast in upholding the highest standards of environmental stewardship, social inclusivity, and corporate governance. We extend our heartfelt gratitude for your ongoing trust and collaboration as we strive towards a brighter future.

9 Boubyan Group | Sustainability Report | 2023

Boubyan Group | Sustainability Report | 2023

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ESG Highlights

22

0.18

tCO2e

Electric Vehicle

Emissions

(EV) charging

savings from

stations with

paper recycling

dedicated

at Boubyan Bank

parking slots at

Boubyan HQ

70% 89.5%

175,219.84

tCO2e

Total

Greenhouse Gas

(GHG) Emissions

81.3%

73%

95%

84%

68%

46%

NPS score

CSI score

Organizational

Percentage of

Percentage

Health Index

promotions

of female

(OHI) survey

awarded to

employees at

result

women in BLME

BLME

86%

73%

72%

Kuwaitization

Kuwaitization

Percentage

rate across all

rate-top

of employees

levels at the

management

receiving training

Bank

levels

out of total

employees across

Boubyan Bank

BLME's Employee

Retail app users'

Corporate app

Engagement

percentage

users' percentage

Index Result

out of total

out of total

customer base

customer base

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Boubyan Group | Sustainability Report | 2023

Boubyan Group | Sustainability Report | 2023

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Table of Contents (ToC(

Report Overview

3

Standards and Principles

3

Reporting Boundary

3

Chairman's Message

4

Group CEO's Message

5

ESG Highlights

7

Table of Contents (ToC)

9

1.

About Boubyan

11

1.1

Group Profile

12

1

1.2

Mission and Vision

30

1.3

Memberships, Associations and Partnerships

32

1.4

Awards and Recognition

32

2.

Addressing ESG at Boubyan

35

2.1

ESG Strategic Aspirations

36

2

2.2

Stakeholder Engagement

38

2.3

Materiality Assessment

40

3.

Steering Boubyan's ESG

46

3.1

Corporate Governance

47

3.2

Organizational Structure

63

3.3

Compliance and Business Ethics

67

3

3.4

Proactive Risk Management

72

3.5

Cybersecurity and Data Privacy

85

3.6

Innovative Digital Solutions

90

3.7

Customer Experience and Satisfaction

99

4.

Enacting ESG Endeavors

104

4.1

Organizational Management and Development

105

4

4.2

Community Empowerment

132

4.3

Responsible Procurement and Supply Chain

164

5.

Measuring ESG Impact

168

5.1

Energy Consumption

170

5

5.2

Greenhouse Gas Emissions

172

5.3

Waste Management

178

5.4

Water Management

179

6.

Appendices

181

6.1.1

GRI Index

181

6.1.2

GRI 3-3

236

6.2

Boursa Kuwait Index

242

6.3

Gulf Cooperation Council (GCC) Stock Exchange Index

246

6.4

Performance Disclosures

256

6.4.1

Financial Disclosures

256

6.4.2

ESG Disclosures

258

6.5

Consumer Banking Products and Services

279

6.5.1

Consumer Banking Services

279

6.5.2

Consumer Banking Accounts, Cards,Deposits, and Private Banking

280

6.5.3 Boubyan Corporate Banking and Business Banking Services to Customers

and SMEs

281

6.6

Training Index

283

6

6.6.1

Boubyan Bank's Trainings Provided Per Department

283

6.6.2

Boubyan Bank's Trainings Provided to Customer-facing Employees

284

6.6.3

BB2 Tech Co Training Courses

289

6.6.4

Trainings Provided for Boubyan Takaful Employees

289

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Boubyan Group | Sustainability Report | 2023

Boubyan Group | Sustainability Report | 2023

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1

About

Boubyan

Appendices

Measuring ESG

Enacting ESG

Steering

Addressing ESG

About

Impact

Endeavors

Boubyan's ESG

at Boubyan

Boubyan

In this chapter:

  1. Group Profile
  2. Mission and Vision
  3. Memberships, Associations and Partnerships
  4. Awards and Recognition

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Boubyan Group | Sustainability Report | 2023

Boubyan Group | Sustainability Report | 2023

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Boubyan Bank KSCP published this content on 22 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 22 April 2024 10:01:01 UTC.