A ranking of 29 banks that were assessed based on their Environmental, Social and Governance (ESG) practices and reporting has shown Zenith Bank along with 9 other banks emerged in the top 10 position.
The Corporate Finance Institute defines an ESG score as “an objective measurement or evaluation of a given company, fund, or security’s performance with respect to Environmental, Social, and Governance (ESG) issues”.
In simple terms, an ESG rating measures a company's exposure to long-term environmental, social, and governance risks which bothers around energy efficiency, worker safety, and board independence.
According to the IPC, the ratings were benchmarked against the leading global ESG rating companies such as S & P Global and MSCI Sustainability Ratings.
Top 10 banks according to ESG ranking
The survey carried out by the Independent Project Monitoring Company (IPC) Limited ranked the top 10 Nigerian banks according to their scores as follows:
1. Zenith Bank
Zenith Bank was ranked first at 65.22%.
2. Access Bank
Access Bank came next at 60.33%.
3. Stanbic IBTC
Stanbic IBTC Bank was ranked in third place at 60.16%.
4. Fidelity Bank
Fidelity Bank came fourth at 57.73%.
5. United Bank for Africa
UBA came in fifth place with 57.19%.
6. Sterling Bank
Sterling Bank ranked sixth with 55.10%.
7. FCMB
FCMB followed at seventh position with 54.97%.
8. WEMA
WEMA Bank came in eighth position with 54.64%.
9. ECOBANK
ECOBANK was ranked in ninth position at 54.25%.
10. Union Bank
Union Bank came in 10th place with 53.81%.
The report further noted that in determining the ratings, a comprehensive analysis of both global rating standards and the specific nuances of the Nigerian business landscape was put into consideration. With this in mind, 13% was allocated for environmental factors, 43% for social factors and 44% for governance factors.