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Our core banking activities – client acceptance, investment and lending – are always underpinned by our sense of corporate social responsibility. For more information about sustainability in our core banking business, please consult our 2019 Annual Report.
We have a rigorous client due diligence (CDD) policy in place, under which we properly establish information about our clients, such as the origin of their assets. This policy also guards us against providing services to clients who may be involved in financial and economic crimes, such as money laundering or financing terrorism. Our CDD policy supports sustainability, as we test new corporate borrowers on our responsible lending criteria ‘at the gate’.
Private clients, charitable societies, associations, church groups and institutional investors increasingly demand responsible investment, while civil society institutions are encouraging banks to make their investment processes ever more sustainable.
Responsible investment processes are based on both financial and non-financial data, and Van Lanschot Kempen’s investment process clearly reflects both. We opt for a strategy of engagement – a dialogue with companies and/or fund managers – and will exclude companies and investment funds if such engagement proves ineffective. It is our experience that engagement can result in changes in company policies.
To underpin our engagement activities, Van Lanschot Kempen draws on the expertise of an independent, specialist consultant, which screens companies and/or investment funds. To this end, the screening is based on the UN Global Compact Framework, the Principles for Responsible Investments (PRI) and the OECD GL and comprises many sustainability themes and criteria. The frameworks have been translated into an extensive convention list containing international conventions, directives, regulations or standards. See our Convention Library.
Via our engagements, we aim to improve the ESG practices of companies and investment funds in which we invest. Companies that do not show improvement may be excluded. An overview of engagements can be found on the Kempen website.
Our external stakeholders, and particularly civil society groups, clients and investors – institutional or otherwise – typically question us on our lending policies. The main thing they want to know is whether Van Lanschot Kempen puts its clients’ money – savings, deposits and current accounts – towards responsible lending exposures.
These questions have prompted us to draw up a responsible lending policy, which we’ve been implementing since 2011. The policy translates Global Compact and ILO principles – to which we are a signatory – on human rights, labour standards, environment and anti-corruption into a responsible lending process, and we’ve added a number of other themes, including weapons, fur, gambling, pornography, animal testing and nuclear energy. More information regarding the responsible lending policy can be found in the document below, 'Responsible lending policy in detail'.
In addition, we have expanded our responsible lending policy by adding rules governing banking relationships with other financial institutions. This is how we seek to prevent funds entrusted to us from ending up with financial institutions with few or no corporate responsibility policies, in the shape of interbank loans for instance. Together with our responsible lending policies, this supplementary policy for financial institutions also informs the periodic screening of our own investment and trading portfolios.
In the past period, banks’ recovery sections have come in for a great deal of scrutiny, with debate raging about their roles and practices. To create more transparency, the Dutch Banking Association (NVB) has drawn up its Handreiking Bijzonder Beheer (‘Guide to financial restructuring and recovery’, in Dutch only) in close collaboration with the country’s banks, which sets out what clients can expect from banks’ recovery departments. Van Lanschot Kempen was involved in its creation and fully endorses the document.
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