Together
for a sustainable future!

Discover how we are achieving our sustainability targets!

Together
for a sustainable future!

Discover how we are achieving our sustainability targets!

Our operations are based on three approaches to the ESG perspective. We believe it is important to fund and deliver objectives that are beneficial from an environmental, social and human rights perspective, while at the same time we exclude and refuse to promote those that have a negative impact. In our organisational processes, we focus on sustainability in our efforts to achieve positive social and environmental outcomes.

SOCIAL

SOCIAL

GOVERNANCE

GOVERNANCE

ENVIRONMENTAL

ENVIRONMENTAL

DISCOVER OUR ESG STRATEGY!

Our ESG strategy is designed to deliver sustainable growth in the fields of:

  • environmental responsibility (E),
  • social responsibility (S)
  • and transparent corporate governance (G).

We aim to create long-term value through green and sustainable solutions in all areas of our operation.

ESG STRATEGY
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ORGANISATIONAL MEMBERSHIPS

The Hungarian Banking Association is the interest representation body of Hungarian banks, the coordinator and representative of the official position of the banking community. Its main task is to represent the professional interests of its members. In order to develop professional opinions, the Hungarian Banking Association establishes working committees composed of banking experts. EXIM Hungary is an active participant in the Sustainability Working Group of the Hungarian Banking Association, to ensure first-hand information on the most important sustainability issues affecting banks.

The aim of the Chamber is to promote the foreign market presence of Hungarian entrepreneurs, primarily to prepare them for European integration, and to create opportunities for cooperation with businesses in neighbouring countries. The international relations among the chambers are remarkable – bilateral cooperation agreements have already been concluded with almost all neighbouring countries, and the Hungarian Chamber of Commerce and Industry has acceded to the Convention on Multinational Cooperation between Chambers of Commerce and Industry of the CEFTA countries. The Hungarian National Committee of the International Chamber of Commerce (ICC Hungary) has been operating in Budapest since 1996.

Hungary has been a member of the Organisation for Economic Co-operation and Development since 1996, which together with its 34 member states and the observer countries, works with 70 countries to develop multilateral agreements and guidelines in a number of areas. Furthermore, the organization carries out analyses on statistical, macro-economic and commercial topics and publishes them on a regular basis. The OECD Arrangement on Officially Supported Export Credits signed in 1978 and the related environmental, sustainability and transparency rules are key to the functioning of EXIM Hungary. Based on the related OECD environmental, sustainability and transparency rules, EXIM Hungary has developed its internal policy on due diligence of export transactions in order to assess the environmental, social and human rights impacts of the transactions to be financed and to eliminate transactions with adverse impacts.

Following Hungary’s EU accession, the supervision of state-owned export credit and export credit insurance is shared between the Directorate General for Competition and the Directorate General for Trade of the European Commission; the former playing an active role in the development of regulations and monitoring of practices in the field of state aid and the latter in the field of over-two-year transactions. EXIM Hungary represents the interests of Hungary in the Exports Credit Working Group of the Council of the European Union.

The Berne Union is a leading international organisation of state-owned export credit insurance companies. Since 2000, the Hungarian Export Credit Insurance Corporation Plc. has been a full member of the international institution, which together with the Prague Club has more than 70 members. The Berne Union was established to promote the international adoption of uniform principles of export credit insurance and is an important forum for the exchange of information and experience among its members. The organisation has an extensive network of relations, ensuring an international presence for its member organisations and their countries.

Members of the European Association of Public Banks (EAPB) include

  • financial institutions
  • funding agencies
  • public banks
  • or similar organisations operating in EU Member States, Switzerland or the EU Economic Area.

EAPB members, including EXIM Hungary, represent nearly 100 financial institutions from various European countries. Their European market share is around 15%, their combined balance sheet total is €3500 billion and they represent nearly 190,000 employees. In addition to general matters, EXIM Hungary participates in the work and meetings of the EAPB Sustainable Finance Working Group.

The European Investment Bank (EIB) is owned by the member states of the European Union. One of its main missions is to promote the objectives of the European Union by providing long-term financing for specific projects in the Member States. Eximbank has signed several agreements with the international institution:

  • Eximbank signed EUR 100 million and EUR 200 million refinancing framework agreements respectively in 2013 and 2014 with the EIB to support domestic exporters considering expansion in EU member states;
  • In 2017, the EIB and the Eximbank signed an agreement in the amount of EUR 400 million to support the financing of the enterprises employing less than 3000 employees;
  • Another agreement was signed in 2020 for 100 million EUR to mitigate the negative impacts of the COVID-19 pandemic contributing to safeguarding jobs in the SME sector;
  • In line with the sustainable strategy of EIB and EXIM Hungary, a new refinancing agreement was concluded in early 2023 in the amount of EUR 100 million aimed at supporting the green financing framework of EXIM Hungary and financing related projects.
  • As a result of the 2023 cooperation, EXIM has integrated the online screening application of EIB, the Green Eligibility Checker, into its operations to facilitate the process of accepting green transactions.

The Multilateral Investment Guarantee Agency (MIGA) was founded in 1988 and currently has 165 member countries. Its mandate is to provide insurance against political and non-commercial risks to investors in developing countries. Examples of these types of risks include: state expropriation, civil unrest, wars and breaches of contract. MIGA also plays an important informational role, on the one hand in communicating investment opportunities to international markets and on the other hand, in promoting and facilitating investment. MIGA also assists the resolution of disputes between investors and governments.

EXIM Hungary has borrowed €300 million from ING Bank under a guarantee from the Multilateral Investment Guarantee Agency (MIGA), which was granted to ING Bank on 30 June by the World Bank Group agency. The loan amount, which has a final maturity of 12 years, will be used by EXIM Hungary to support energy efficiency, renewable energy, sustainable real estate development and other climate protection objectives of domestic small and medium-sized enterprises and large corporations with export activities.

Disclosures

Pursuant to its environmental policy, it plays a key role to perform risk assessment for projects in order to review their environmental and social risks. Accordingly, the Bank does not support a transaction that has a negative, i.e. adverse environmental impact, or transaction which demonstrably violates fundamental human rights standards or results in significant greenhouse gas emissions. In order to screen these projects at an early stage of financing, the Bank applies environmental and social risk assessment.

 

PROCESS OF ENVIRONMENTAL AND SOCIAL EVALUATION:

 

Pre-screening – screening and assessment of project whether the transaction falls under the scope of the procedure. Pre-screening is implemented at an early stage of the transaction. During this stage some basic information should be obtained from the exporter.

Transactions outside the scope of the procedure – i.e. project period does not exceed 2 years, and exports of goods / services relate to basic agricultural products and military assets (livestock, cereals, etc.) and where risk is not on the exporter – are not classified but indicated with “K” and are exempted from further steps of the environmental and social risk assessment.

 

Screening – all the information provided by the exporter is reviewed during screening. Screening can only be applied to projects with a risk-taking period of more than 2 years and if the value of the transaction exceeds 10 million SDRs, or if the project is on or near sensitive area or sector, or if it can be assumed that the implementation of the project involves potential environmental risk.

 

Classification – the project is classified into two main categories (new project or existing facility) and three environmental and social risk categories (A – sensitive, B – moderate, C – neutral). Further information can be obtained from the exporter if it is required.

 

Three categories of environmental and social classification:

  • Category A: a project is classified as Category A if it has the potential to have significant adverse environmental and/or social impacts, which are diverse, irreversible and/or unprecedented. These impacts may affect an area broader than the sites or facilities subject to physical works. Category A includes projects in sensitive sectors or located in or near sensitive areas.
  • Category B: a project is classified as Category B if its potential environmental and/or social impacts are less adverse than those of Category A projects. Typically, these impacts are few in number, site-specific, irreversible, and mitigation measures are more readily available.
  • Category C: a project is classified as Category C if it has minimal or no potentially adverse environmental and/or social impacts.

Result of the classification may vary flexibly (reclassification) on a case by case basis depending on the scope, depth and timing of the necessary information.

 

Information required for environmental and social risk categories:

  • Category A: Environmental and Social Questionnaire, Environmental and Social Impact Assessment (hereinafter referred to as ESIA) and if it is necessary Human Rights Impact Assessment (hereinafter referred to as HRIA)
  • Category B: Environmental and Social Survey Questionnaire (on a case-by-case basis ESIA)
  • Category C: no further information is needed (on a case-by-case basis ESQ)

Assessment – The assessment of the environmental and social impact of the transaction is based on the Questionnaire and all the relevant information and documentation that had been provided previously. In order to be able to perform the appropriate evaluation of projects different kind of information should be obtained depending on the environmental and social category of the project.

In order to evaluate the financing of category A, client must provide the ESIA on environmental impacts and documents on mitigating compensatory measures.

ESIA may be requested on a case-by-case basis for assessing category B projects which has a moderate impact on the environment, but the classification and evaluation of the project will be implemented based on the outcome of the Questionnaire and the consideration of the relevant environmental impacts.

For category C projects, only the result of the evaluation of the Questionnaire and the evaluation of the documents provided will be taken into account as the environmental and social risks of the transaction are negligible. However after evaluating the ESQ additional documents can be requested.

 

Decision – the Bank mainly take into consideration the information for which the customer is responsible when assessing environmental and social impacts. It is the responsibility of the client to be able to provide the necessary documentation, basic and additional information to the Bank. In addition, the Bank may obtain independent information if it is required (e.g. from a funder, other insurer, green organization, etc.).

Based on the outcome of the due diligence, the transaction will be accepted, conditionally accepted or rejected.

 

Monitoring – in case of all project classified as category A, the Bank requires regular ex post reports and related information to be provided during the involvement in the project to ensure that relevant potential environmental and/or social impacts are addressed according to the information provided by applicants during the environmental and social review. If project monitoring is included as a condition in the contract client should periodically provide a monitoring report on the environmental and social impact as long as the Bank is in risk.

The Bank should publish national ECA environmental and other related policy statements or principles and procedural guidance relevant to the implementation of the OECD common approaches.

 

For Category A projects the Bank should disclose publicly project information, including project name, location, description of project (ESIA report, summary) as early as possible during the review process but at least 30 calendar days before a final commitment to grant official support.

 

The Bank is ready to share information between other entities in case of co-financing or other partnerships.

 

The project sponsor is encouraged by the Bank to publish information with regards to the environmental and social impacts. Information related to the transaction shall not be disclosed by the Bank in accordance with business secrecy without the consent of the parties. The Bank considers legal and competition aspects for the protection of business secrets in accordance with the law on publishing environmental information.

 

The Bank provides information on funded projects (A, B, C) for OECD on a continuous basis, but at least in every six months. The Bank prepares reports annually (ex post) on A and B categories projects accepted according to the form and content of the OECD common approaches.

 

At least annually, the Bank ensures the availability to the public – considering the possibilities of national legislation –, all environmental information of categories A and B transactions.

 

In case of category A and B projects, if the provisions of the OECD Common Approaches have been applied, the projects will be reported to the OECD. The OECD annually publishes a summary of these reports on its website. In this manner, this information is made available to the public in an aggregated form. The report can be accessed using the following link: http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?cote=tad/ecg(2017)3/final&doclanguage=en

 

The Bank annually publishes (on its website) the information (project description, technical data, standards, regulatory compliance, etc.) of the accepted environmentally and socially screened projects including categories A, B and C as well.

 

If you have any questions or concerns about the disclosure of environmental data for projects, please contact us at the following e-mail address: csecsei.adam@exim.hu

 

The OECD recognized that it can promote the coherence between the international environmental, climate change, social and human rights policies of the export credits and their commitments of relevant international agreements and conventions, thereby contributing to the sustainable development and the reduction of adverse environmental impacts through the export credit policy.

The OECD Common Approaches was developed and adopted in 2003. It established a set of rules for the environmental risk assessment of officially supported export financing. The document contains common practices for identifying and mitigating the environmental impact of projects. In addition to the impact on the environment, there has been an increasing emphasis on assessing social impacts. The OECD has expanded its existing approach with elements on social impact assessment and finalized it in 2012. In 2016, it has been revised which is the current version in use. The OECD Common Approaches aims to develop procedures for assessing the environmental and social impacts of officially supported export financing, to prevent and mitigate the adverse environmental and social impacts of projects, and to create the overall process of financial risk assessment for a supported project.

Hungary is being a full member of the ECG decision-making process. In 2001 the country formally declared that it accepts and will implement the common approaches. Accordingly, the institutions dealing with export credit financing and insuring had to integrate the environmental monitoring system, which is being operated according to the OECD Common Approaches. Hungarian legislations related to the Bank contain the condition according to which the environmental screening must be carried out.

Related Legislation and Regulatory Documents:

  • Government Decree 85/1998. (V. 6.) on the Interest Equalisation System of the Hungarian Export-Import Bank
  • Government Decree 435/2012. (XII. 29.) on Guarantees Assumed by the Hungarian Export-Import Bank with a State Payment Guarantee and on the Conditions and Detailed Regulations of the Replacement and Interest Costs of Foreign Currency and Interest Swap Transactions
  • Government Decree 312/2001. (XII. 28.) on the terms of the insurance of non-marketable risks by the Hungarian Export Credit Insurance Plc. with a government payment guarantee provided from the central budget
  • Act XLII of 1994 on the Hungarian Export-Import Bank PLC and the Hungarian Export Credit Insurance PLC
  • TAD/ECG(2016)3 recommendation of the council on common approaches for officially supported export credits and environmental and social due diligence (the “common approaches”)
  • Government decree 232/2003 on Tied Aid Loans Disbursed by Eximbank