Sustainable Finance Framework 2022
Sustainable Finance Framework 2022
Process for Project
Evaluation and Selection
Introduction Rationale for Framework
Management of Proceeds
Alignment
Use of Proceeds Evaluation and Selection
Reporting Verification Review Disclaimer
The projects developed in the context of this
framework will be analyzed according to the
eligibility criteria as described in Section "Use
of Proceeds". This eligibility criteria can be
used both (i) for qualifying a certain line of
credit offered by Sicredi to its clients (and
therefore all clients that use that specific line are
automatically eligible based on the filters applied
for using the line) or (ii) for qualifying a specific
investment proposed by a client. For projects
that have a broader scope (or require a project-
by-project approach), the Structured Operations
and Sustainable Finance department will be
responsible for evaluating the eligibility. The
department is also responsible for controlling
and monitoring the portfolio of projects eligible
to each Sustainable Instrument issued. To
make sure it has all the necessary information
regarding the projects, the department may
consult with other areas, such as (but not
limited to): Treasury, Socio-environmental
Risk, Credit Products and Sustainability.
Regarding risk mitigation, Sicredi carries out
several processes to mitigate the existing of
environmental and social risks. Among them, we
can highlight the following fronts: environmental
social risk questionnaires (collection of data on
environmental social practices and qualitative
assessment of responses), environmental and
social screening (evaluation of aspects related
to the regularization and use of resources,
responsible for preventing or allowing the loan),
geoprocessing (collection of coordinates of areas
benefited by operations, ensuring the exclusion
of environmental protection areas, conservation
units, indigenous lands, etc.), quantitative
assessments (monitoring indicators from the
Risk Appetite Statement (RAS) and calculating
the socioenvironmental rating of members), and
definition of excluded activities/sectors in line
with market practices. Also, Sicredi conducts a
credit analysis process which includes not only
the basic mechanisms of internal lending policy,
but also the questionnaire of Know Your Client
(KYC), which is focused mainly to avoid money
laundering resources to get into the financial
system. After the KYC is completed, Sicredi
extends the analysis for broader information
regarding the potential client, relating the
past transactions within the national financial
system. If all the process is affirmative, the
lending is confirmed.
Additionally, as a way of ensuring the correct
formalization of specific projects applied to
investments with a sustainable in agriculture,
such as projects contributed with resources
from the ABC Program 17, we provide a list of
mandatory documents to compose the proposal
dossier, as well as manuals with the appropriate
guidelines and related regulations. Furthermore,
we rely on the opinion of technical analysts who
guide and provide the necessary support for the
proper formalization of projects.
17 The ABC Program is a program created by BNDES (the Brazilian Development Bank) to foster investments that contribute to the reduction of environmental impacts caused by
agricultural activities. More information can be found in the following link: https://www.bndes.gov.br/wps/portal/site/home/financiamento/produto/programa-abc.
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