Fair Finance Philippines Bank Policy Assessment Report
The bank policy assessment reveals that banks have made progress in areas strongly supported by existing regulations, such as financial inclusion, consumer protection, data privacy, anti-corruption measures, and the exclusion of new coal-fired power plants. However, there are still significant gaps in the clarity, comprehensiveness, and enforceability of their sustainability policies.
Regarding the environmental themes of biodiversity and climate change, the results indicate only moderate improvement. RCBC received the highest score on biodiversity because it applies the IFC Performance Standards in its credit evaluations, while BDO Unibank leads in climate-related policies.
Despite these developments, none of the banks have adopted policies that exclude or phase out oil and gas, and commitments related to plastics remain limited, mainly to LANDBANK. Additionally, the bank policy assessment finds uneven progress in social themes. Consumer protection and financial inclusion show the strongest performance, with Metrobank and Security Bank receiving the highest scores. However, gender equality, human rights, and labor rights remain weak. No bank meets the target level of women’s participation in leadership, and only a few banks report gender-disaggregated data on MSME lending. Human rights disclosures are limited, and only BDO Unibank recognizes that its financing may contribute to negative impacts. Governance results show similar gaps. While all banks have basic anti-corruption policies, their tax disclosures, beneficial ownership verification, and reporting on financed activities remain limited or absent.
Thus, the bank policy assessment recommends that banks adopt measurable and time-bound sustainability targets, integrate ESG requirements into contractual agreements and due diligence processes, and publish clear and comprehensive exclusion lists aligned with domestic and international standards. It also recommends strengthening grievance mechanisms to include external stakeholders and actively promoting gender parity within leadership structures. These actions are essential for closing the gap between policy statements and actual practice. Philippine banks are urged to move beyond compliance-driven approaches and proactively embed ESG considerations in their core financing decisions to support meaningful environmental protection, social equity, and responsible governance in the country.
