ADIB Emerges as Regional Leader in ESG Practices, Setting New Benchmarks in Environmental, Social, and Governance Standards
Abu Dhabi Islamic Bank (ADIB) has earned a significant upgrade in its environmental, social, and governance (ESG) rating from MSCI, a leading global provider of ESG indexes. In the annual MSCI update, ADIB’s rating has been elevated to AA, moving up from an A rating on a scale that ranges from AAA to CCC. This upgrade marks a pivotal achievement for the bank, placing it in the “Leadership” category on the MSCI index. Notably, ADIB is now the only bank in the region to attain this distinction for 2024, further solidifying its position as a leader in ESG practices.
Leadership in ESG Risk Management and Business Ethics
The upgrade to an AA rating reflects ADIB’s substantial advancements in managing ESG risks and enhancing its governance practices. The bank’s leadership is recognized in several critical areas, including the disclosure of sector-specific credit policies and the establishment of a robust escalation procedure for ESG risks. Additionally, ADIB has successfully implemented comprehensive ESG due diligence processes, underscoring its commitment to responsible banking.
ADIB’s achievements extend beyond ESG risk management. The bank has also received ISO 27001 certification for its cybersecurity practices, highlighting its dedication to maintaining the highest standards of information security. The MSCI report praises ADIB’s leadership in business ethics, particularly noting its stringent anti-corruption policies, proactive staff engagement surveys, and meaningful educational partnerships. Furthermore, ADIB’s consumer protection initiatives stand out as a key component of its ethical business practices, ensuring that the bank remains aligned with the needs and rights of its customers.
Commitment to Environmental Goals and Community Engagement
Underpinning ADIB’s strong ESG rating is its ambitious commitment to environmental sustainability. The bank has set a net-zero emissions target for FY2030, demonstrating its proactive stance on climate action. As part of its ongoing efforts, ADIB achieved an impressive 65 percent reduction in Scope 1 emissions compared to 2022. The bank has also outlined 2030 emissions reduction targets for six key portfolio sectors, further embedding sustainability into its core operations.
In 2023, ADIB financed Dh5.567 billion in sustainable finance activities, reinforcing its role as a catalyst for green financing in the region. This financial commitment is complemented by the bank’s strengthened ESG governance framework, which includes the formation of new committees and the introduction of updated policies. These initiatives are designed to ensure that ADIB continues to operate with a clear focus on sustainability, diversity, and inclusion.
ADIB’s ESG efforts are not confined to its internal operations. The bank has actively supported local communities through various grants and initiatives, fostering social responsibility and contributing to the welfare of the communities it serves. These actions highlight ADIB’s holistic approach to ESG, where environmental goals are pursued alongside social and governance objectives.
A Vision for the Future
Commenting on the achievement, Mohamed Abdelbary, Group Acting Chief Executive Officer of ADIB, stated: “We are pleased to receive this upgrade to an AA rating from MSCI, which reflects our continued commitment to enhancing our ESG practices and governance. This achievement is a direct result of our focused efforts to enhance transparency, implement rigorous risk management processes, and set ambitious environmental targets, including our net-zero emissions goal. We remain dedicated to further advancing our ESG strategies and delivering positive impacts across our operations and the communities we serve.”
ADIB’s AA rating from MSCI not only distinguishes the bank as a regional leader in ESG practices but also places it among the top 27 percent of organizations listed on the MSCI ACWI index globally. This recognition underscores ADIB’s excellence in managing ESG risks and its ongoing efforts to integrate sustainability into every aspect of its operations. As the bank continues to forge ahead with its ESG commitments, it sets a new benchmark for responsible banking in the region, paving the way for a more sustainable and inclusive future.
