Filenews 25 February 2024
The launch of the Interbank Project for the Evaluation of Companies based on ESG (Environmental – Social – Governance) criteria in March was announced by the General Manager of Artemis Credit Bureau, a subsidiary company of the Association of Banks, Yiannis Tomasidis and the Head of the Project at Artemis Dimitrios Bourpoulas.
"Artemis, which currently provides banks and credit acquiring companies with useful information on the creditworthiness of their customers, responding primarily to the needs of banks but also of businesses themselves, in cooperation with the Association of Cyprus Banks and the banks represented, and through its strategic partnership with the international Credit Office CRIF S.p.A, proceeded with the implementation of the solution for the purpose of evaluating companies regarding their compliance with ESG criteria (Environment, Society, Corporate Governance)", he underlined.
He noted that the ESG-based assessment of businesses will be applied in 2024 to corporate customers of banks.
"The evaluation of businesses based on ESG criteria and the adoption of an ESG strategy is now a one-way street for businesses," he said, adding that "it is of value for companies regardless of size, sector and activity to chart a course and orient their actions in this direction for their own benefit."
More specifically, Mr. Tomasides said that in the first phase, banks will inform companies in Cyprus that choose to be assessed based on ESG criteria.
He said that Artemis, as a hub in this important interbank project, is the link between the companies and the Cypriot banks with which the companies cooperate.
The DG of Artemis explained that the evaluation of businesses will be done with a specialized questionnaire covering the whole range of sectors in Cyprus, with qualitative and quantitative characteristics, which the companies themselves will be asked to answer and which will be posted on the electronic platform called "Synesgy" and to which the companies will be invited by Artemis.
The Synesgy platform, according to Mr. Tomasidis, "is essentially a global alliance of companies that enhance the transition towards sustainability with data and information collected through an innovative digital platform that provides each company with its own assessment, including its entire supply chain, on the 3 pillars of sustainability (Environmental, Social, Corporate Governance)".
"In addition to the companies themselves, the Synesgy platform also supports the banking sector by providing it with a 'sustainable finance' tool, supporting banks' credit risk management policies, based on their supervisory requirements. The ESG rating allows financial actors to steer lending strategies towards more sustainable, responsible and transparent companies," he said.
For his part, Mr. Bourpoulas told CNA that the Synesgy platform is already available in 76 countries on 4 continents and now in 27 languages, adding that to date, 620,000 invitations have already been sent through the platform to companies worldwide. The platform meets all the requirements according to international and European guidelines on ESG criteria and will contribute to the proper evaluation and continuous development of businesses in a sustainable direction, which is the desired goal.
Mr. Bourpoulas said that any company, regardless of size, can benefit from the assessment through the platform and receive its ESG certificate, which has a duration of 12 months.
"The foundations are being laid for what will come in the future", underlined Mr. Bourpoulas, noting that "in this phase of operation of the platform it is important to create the culture in businesses for what will come in the future. It is important that companies understand the value of incorporating ESG criteria into their strategy and practices, primarily for their own benefit," he underlined.
The current period is a transitional stage in relation to ESG criteria, but "gradually these criteria will become mandatory even for companies themselves," he added. It is therefore a huge opportunity for companies at this stage to invest in new know-how and non-financial database management systems for the proper integration of ESG criteria.
More specifically, in relation to the questionnaire, Mr. Bourpoulas said that the company, based on the information it has entered in the questionnaire, will automatically receive the ESG Certificate, which can be published on the organization's website and other communication channels, the ESG Score, the Action Plan of the organization with prioritized suggestions for improving its performance in ESG criteria and the questionnaire itself with the answers in pdf format for reference purposes.
During the validity period of the certificate (12 months), companies will be able to take actions that improve their performance with the ultimate goal of improving their score in the next annual evaluation.
Explaining the three ESG criteria, he said that these concern the company's actions towards the environment (Environmental), the company's attitude towards society (Social) and the corporate governance applied by the company (Governance).
"These three ESG criteria, around which, over the years, legislation and regulatory obligations are set, in essence lead to the so-called sustainable development of an organization," he said, adding that in order to be developmentally sustainable, an organization must perform well on the three pillars of ESG, namely be an environmentally and socially responsible organization and have good governance.
He noted that the laws and regulations developed in the EU on the issue of sustainable development affect in the first phase the capital market and the banking sector and at the same time begin to affect the companies themselves.
"While a bank needs to assess its customers against financial criteria, it will gradually start to examine them against sustainable development criteria (environmental, social and good governance)," he added.
The role of Artemis Credit Bureau
—————
Referring to Artemis Credit Bureau's role among banks and businesses, Mr. Tomasides told CNA that Artemis is proceeding with the introduction of CRIF's global digital platform Synesgy, for the purposes of the Project, in Cyprus as well.
"ICAP CRIF, which is part of the CRIF Group, offers the platform through which companies will fill in the questionnaire," he said, adding that "the platform will collect the data, make the evaluation and give the results automatically to the company itself."
Through us, he continued, the results will also be given to the bank or banks that the company cooperates with.
He noted that if the company cooperates with more than one bank, it will fill in a single questionnaire and "this in itself has benefits for the business in terms of time and resource savings", while "standardization of both the information requested by businesses and the evaluation is achieved".
In addition, the DG of Artemis Credit Bureau said that with this Project, the foundations are laid for the creation of an ESG ecosystem in Cyprus on solid foundations.
"The good news is that in Cyprus, although at a slower pace than in other countries, I would say, environmental, social and Corporate Governance criteria have already begun to be incorporated into the framework of business strategy," he added. However, Mr. Tomasidis said that "there is still a long way to go as a country with the participation of key stakeholder groups, such as businesses, the banking industry and the state, because the integration of ESG criteria requires knowledge, experience and readiness, above all, by the companies themselves for radical changes that even touch the culture of the organization."
"As stewards of the ESG Interbank Project, we are optimistic that the implementation of this innovative solution provides significant advantages for all companies of all sizes that wish to increase their resilience and play a leading role in an increasingly complex and dynamic business environment," he underlined.
In addition, Mr. Tomasides said that "through the Project, an internationally reliable tool is introduced in the Cypriot market to assess the degree of compliance of businesses with regard to the ESG criteria that companies must meet in order to ensure their sustainable development for the benefit of the entire economy".
"Artemis is committed, as part of our strategic plan, to continuously offer even greater value to the economy with new infrastructure projects and this new interbank project is a tangible proof," he concluded.
KYPE
