Sustainability (Environmental, Social and Governance - ESG) Policy

Introduction

Purpose

The purpose of the Sustainability (Environmental, Social and Governance) Policy (the Sustainability Policy) is to establish Six Square Limited’s framework to address environmental, social and governance (ESG) matters.

Applicability

This Sustainability Policy applies to the members of the Board of Directors, all employees of the Company, and all relevant stakeholders outlined in Section IV of this policy.

Policy statement

The Company is committed to operating its business with integrity, supporting environmental and social responsibility, and building a diverse and inclusive workplace where our employees can thrive. We are committed to integrating sustainability into our overall business strategy, primarily in areas where the Company has the most influence, such as our operations and value chain. We define Environmental, Social, and Governance criteria as follows:
  • The environmental component of ESG refers to how our business practices affect the environment and vice versa. The scope of environment includes energy use, consumption of resources, waste management and disposal, water use and management, and climate risk. Our policies and programs strive to achieve sustainable operations and minimize impact on the planet.
  • The social component of ESG refers to how our organization’s operations affect our people, our customers, and the communities where we live and work. Our social policies and practices strive to build a healthy corporate culture and positive relationships with our stakeholders.
  • The governance component of ESG refers to how we operate, govern, and manage risk in a way that promotes sustainability and the longevity of the organization. Our governance policies and practices outline the way in which we make decisions, set business strategy and goals, comply with applicable laws and regulations, and communicate our progress.
This Sustainability Policy outlines our company-wide activities and commitments for each ESG focus area. We see sustainability leadership as a business opportunity, a risk mitigant and an essential aspect of our core values.

Scope

The Sustainability Policy applies across the Company and applies to all relevant stakeholders outlined in section IV. The depatments within the Company are expected to use this policy as guidance to assess ESG and sustainability considerations in their respective decision-making processes. This document outlines our commitments but will not include metrics of progress. ESG metrics will be reported in other forms of disclosure (i.e., ESG Report).

Governance

Sustainability starts with our Board which sets the tone at the top for responsible business practices and our commitment to ESG.
      1. The Board has direct oversight of ESG policies, practices, and disclosure, in addition to oversight of corporate governance and operational risks related to human capital and has oversight of the compensation structure for the leadership team.  They also have oversight of policies and practices relating to asset and liability management, including the Company’s investment portfolio management.
      2. The Finance and Administration department is responsible for the oversight of the Company’s enterprise risk framework and is responsible for establishing the Company’s risk tolerance and risk profile. This includes oversight of certain key company risks, including emerging risks and has oversight of the Company’s policies related to all aspects of the lending function and credit risk management
The responsibility for implementation and management of our ESG framework and strategy has been delegated to the Technical department that has aligned the ESG priorities and initiatives for the year for the Board’s approval, sets long-term objectives and goals, and leads the annual reporting process on ESG related topics. The department is also responsible for prioritizing initiatives, develop internal capabilities, and drive/monitor implementation. The department will call for meetings at least once annually and will report to the Managing Director.

Principles and Philosophy

The Company is committed to incorporating ESG into how we manage our business. We are committed to assessing the environmental, social, and governance factors that impact our business, managing the risks associated with such factors, and striving to improve the way the Company operates its business in accordance with these factors. This includes identifying opportunities to reduce the Company’s environmental footprint, enhancing the diversity of the organization, deepening our employees engagement and development, and increasing transparency in our supply chain, having a positive impact on the communities in which the Company operates, and operating with a strong culture of compliance. However, the Company recognizes that there is not a one-size-fits-all approach to ESG integration; rather, the we will strive to employ best practices and evaluate ESG factors in our decision-making. The following topics are considered ESG areas of focus for the Company. ESG is continuously evolving, therefore the list below is subject to change.

Environmental

  • Energy Management
  • Climate change risk
  • Ecological conservation
  • Recycling and waste management  
  • Water management

Social

  • Customer experience
  • Access and affordability
  • Responsible selling and buying practices
  • Customer privacy
  • Community engagement
  • Diversity, equity and inclusion
  • Training and development
  • Health and safety

Governance

  • Governance of ESG
  • Board composition, accountability, and executive compensation
  • Business ethics and compliance
  • Government relations and partnerships
  • Cyber security
  • Systemic risk management and business continuity
  • Vendor management
  • Incorporation of ESG in credit analysis

Relevant Stakeholders

We recognize that our commitment to managing ESG risks and opportunities is essential to long-term value creation for our stockholders, employees, customers, communities, and other stakeholders. To that end, the Corporation integrates sustainability and ESG into our activities, focusing on certain aspects among the different stakeholders as detailed below.

a. Employees

  • Respect for diversity, and non-discrimination because of gender, race, age, sexual orientation, or any other condition.
  • Promotion of employment stability, work flexibility and work-life balance, as well as a safe and healthy workplace for employees.
  • Encourage equal opportunities among its employees, aspiring to have a balanced representation between men and women in all functions and responsibilities.
  • Ensure employees behave in accordance with certain ethical and responsible conduct principles and rules in accordance with our Code of Ethical Conduct.
  • Promote programs to make employees aware of social and environmental issues, including measures for good environmental management practices, social and environmental risks, and business opportunities.
  • Encourage corporate volunteering to help the communities we serve prosper and increase our employees’ pride in belonging to the Company.

b. Customers

  • Offer products and services that are accessible to our customers and provide them with accurate, sufficient and appropriate information.
  • Monitor exceptional situations or settings that may influence certain customers in order to offer them alternative solutions, in particular, among those groups in a situation of vulnerability or risk of social exclusion.
  • Consider ethical, social and environmental matters and financial and risk criteria pursuant to this Sustainability Policy.
  • Prevent and avoid the funding of illegal activity in compliance with the Anti-Money Laundering by taking any additional measures deemed necessary.
  • Promote specialized financial education with the objective of providing information to current and potential clients about products and financial services, as well as the expertise needed for decision-making.
  • Protect customer privacy and personal information by instilling proper security safeguards.

c. Shareholders

  • Offer thorough, clear, and accurate information to all shareholders through various communication channels annually.
  • Listen and incorporate advice and recommendations about ESG trends and disclosures.
  • Include ESG information and metrics in our annual financial disclosures and incorporate updates, where relevant, in shareholder communication.
  • Engage rating agencies that evaluate and rate the Corporation’s performance on ESG matters.

d. Suppliers and Vendors

  • Ensure suppliers, consultants, and independent contractors conduct their business ethically, responsibly, in full compliance with the law, and as detailed in the Corporation’s Service Provider Code of Conduct, which service providers are required to acknowledge.
  • Identify, prioritize, monitor, and control vendor risks that may impact the Corporation as further detailed in our Vendor Management Policy Manual.
  • Procure materials for the Corporation’s real estate portfolio that have ESG benefits, such as upcycled furniture, recyclable utensils and energy efficient appliances and lighting.

e. Communities

  • Improve the social and economic well-being of our communities, including the continuation of sponsorships and collaborative projects directly impact economic development, entrepreneurship, social services, education, health, affordable housing, and environmental conservation.
  • Support community development through the Corporation’s Community Reinvestment Donation (CRA) Program, including progress towards our established lending goals, investment goals, donations budget, and CRA activities goals defined for each region we operate in.
  • Provide relief for our communities experiencing natural disasters and other events impacting the geographical regions in which we operate through charitable donations, employee volunteering, CRA Program initiatives, and other efforts from the Corporation.
  • Foster volunteer opportunities for employees and create a company culture focused on giving and empathy.

Sustainability Commitments

a. Internal Management

  • Comply with applicable environmental laws and regulations.
  • Operate our facilities with cross-functional leadership driving continuous improvement and pollution prevention throughout our operations.
  • Reduce our carbon footprint through focused system optimization, energy conservation, renewable energy when feasible, and innovation for energy efficiency – within our direct operations and our supplier and customer collaborations.
  • Mitigate and prepare for the physical risks of climate change and emergency preparedness.

b. Banking and Financial Activity

  • Conduct environmental risk assessments for relevant loans to determine risks related to compliance with environmental laws, presence of hazardous substances, and management of waste.
  • Provide guidelines for commercial loans, including unacceptable credits.
  • Align with investments that may have social and environmental benefits.

c. Training

The Company participates in face-to-face, online, and virtual training, development activities, and workshops on various topics pertinent to our employee base. Upon onboarding and every year thereafter, every employee undergoes annual induction training. The Company offers diversity and unconscious bias online training. In addition, our hiring managers receive training on sexual harassment, recruitment process and best practices to promote fair competition.

d. Our Continuing Commitment

We strive to advance the principles outlined in this Sustainability Policy and continue to mitigate and manage relevant ESG risks, including the implementation of monitoring and due diligence protocols to ensure progress and adherence to our values. The Company is committed to issue an ESG Report on an annual basis which aligns to leading standards and frameworks.

e. Oversight and Maintenance of the Policy

We are committed to updating the Sustainability Policy periodically, but in no event less than every two (2) years, to reflect current commitments and relevant practices at the Company. The Sustainability Policy has been reviewed and approved by our management team and the Board.