KB Fosters Green Management Culture
This is the second in a seven-part series of articles on the nation’s vision to become a green economic power in the global community and the recent developments of ``green finance’’ in Korea to support the vision. ― ED.
By Kim Jae-kyoung
KB Kookmin Bank, the nation’s largest lender, is taking the lead in local financial firms’ green drive by launching a green finance taskforce and introducing a wide variety of environment-friendly financial products.
The move was designed not only to support the government’s vision to transform the country into a green economic power but also to get upper hand in the rapidly-growing area both at home and abroad.
“For sustainable growth, major countries have come up with green growth initiatives and the Korean government has also unveiled its ambitious vision to promote `low carbon and green growth’ as the nation’s new vision,” Kookmin Bank CEO Kang Chung-won said.
“To support the government’s green growth vision and keep up with global paradigm shift, we will try to reorganize our business portfolio by finding new business opportunities in the green finance industry. By doing so, we will seek to solidify our leading position in the local financial industry and strengthen our image as an eco-friendly enterprise,’’ he added.
In order to nurture green finance more systematically, the lender launched a taskforce called ``Green Finance Management Team’’ headed by CEO Kang in February. In addition, the bank formed a green finance consultation committee consisting of all executives to secure consistency.
Most recently, Kookmin started selling ``green bike insurance’’ in June in line with the government`s plan to nurture the local bicycle industry. The product, developed by Samsung Fire and Marine Insurance, is designed to cover policyholders from any damage from accidents or theft.
Kookmin allocated a large amount of money for investment in low-carbon growth industry, while launching green financial products with prime interest rates. The lender signed a contract with Kibo Technology Fund to provide 750 billion won in loans for companies doing eco-friendly businesses. Under the contract, Kibo guarantees loans offered to green companies.
The lender introduced ``Green Growth Time Deposit,’’ which donates one percent of interest payments to green organizations. It is also offering the ``KB Green Growth Loan,’’ offering favorable interest rates for green industries and it donates 0.5 percent of lending interest to the development of green growth.
It also developed a new type of savings product dubbed ``Business Preferential Installment Savings,’’ which offers an additional 0.3 percentage points in interest for enterprises seeking ``low carbon, green growth.’’ It established a 330-billion-won ``Renewable Energy Private Equity Fund’’ with the government.
The bank is also applying the green growth concept to its management. Executives and staff use bicycles to move to other buildings for meetings in a move to save energy and reduce air pollution. In February, the lender also replaced lights at its headquarters and some major branches with energy efficient LED (light-emitting diodes) lights.
In March, the bank sponsored and joined the ``Eco-Tree Campaign,’’ an environmental campaign jointly developed by the Ministry of Environment, the Korea Environment Industry Technology Institute, the army and private companies. It plans to continue to sponsor and participate in public eco-friendly campaigns designed to prevent global warming and protect ecosystems.
Kookmin Bank is also running the ``KB Green Economic Education Service Team’’ which consists of 310 executives and staff with a proven track record in voluntary activities and experience. Since April, the team has visited local elementary, middle and high schools to provide lectures on economy and finance.
The curriculum includes various programs, such as a field trip, an economic lecture for the underprivileged and an economic education camp. In particular, during the lecture, the lender stresses the importance of green growth by placing an emphasis on saving energy, protecting the environment and eco-friendly businesses.
In order to provide financial support for low carbon, green growth industries, Kookmin signed a contract with Samsung LED in May to offer KB Green Growth Loans for 100 subcontractors of the LED manufacturer.
“We have sought to develop green management into our corporate culture by supporting eco-friendly companies through the establishment of a green growth-related investment association or fund,’’ a Kookmin executive said.
“To create such a corporate culture, our employees’ minds should first be changed. Green management should be taken as a long-term strategy to develop future revenue source for sustainable growth, not as short-term event to respond to the government’s policy,’’ he added.
“At the same time, we will strengthen cooperation with the government and environment organizations to nurture green growth and fulfill our role as a responsible corporate citizen,’’ he added. “Corporate social responsibility (CSR) is essential for long-term viability of corporation and a main element of CSR is environmental enhancement attained through green finance.’’
As a result of its seamless efforts to protect environment and support green growth, Kookmin won the ``Grand Award’’ at the Korea’s Environment Award Ceremony on July 15 organized by the Ministry of Environment and Chosun Ilbo. It was the first time a financial company had won the award.