İşbank 2019 Integrated Report Contents İşbank 2019 Integrated Report
at İşbank Sustainability Financial Profitability Performance andPerformance Contents About the Report
About the Report 3 İşbank's 2019 Integrated Report is the second integrated report published by the Bank. Approach
Management This report, which presents İşbank's sustainability performance for the period between Chairperson’s Message 4 January 1st, 2019 and December 31st, 2019 with an integrated perspective, covers the Message from the CEO 6 activities of İşbank in Turkey. Bank's subsidiaries and overseas operations are excluded from the scope of reporting. About İşbank 10 Sustainability at İşbank 12 İşbank works with the vision of becoming “The Bank of The Future”. The purpose of the Bank's 2019 Integrated Report is to provide up-to-date information about İşbank's efforts Experience İşbank Banking 18 conducted with its approach that focuses on creating sustainable and shareable value Flawless CustomerFlawless by addressing financial and non-financial capital elements together. İşbank gears up for Financial Performance and Profitability 32 its second century. The main content of İşbank's 2019 Integrated Report consists of the
Management Approach 36 value it creates for all its stakeholders, the risks and opportunities encountered in the process of creating value, and the integration of the Bank's sustainability priorities into its Flawless Customer Experience 44 business processes. Banking Responsible Banking 52 Responsible The report uses the capital classification of capital items suggested by the International Happy and Productive Employees 64 Integrated Reporting Council (IIRC). The 2019 Integrated Report has been prepared in Responsible Operations 74 accordance with the GRI Standards: Comprehensive option (Please refer to GRI Standards Content Index, p. 104). While creating the report content, GRI Standards Financial Services Positive Value for Society 80 Sector Supplement and the Provisional Standard for Commercial Banks released by the Annexes 88 Sustainability Accounting Standards Board (SASB) were also used. Happy andHappy Productive Employees Independent Assurance Report 100 The main indicators described in the report were subject to the independent external audit. (Please refer to Independent Assurance Report, p. 100). This report also includes the GRI Content Index 104 communication on progress report required by the United Nations Global Compact (UNGC) of which İşbank is a signatory. (Please refer to UN Global Compact Communication on Progress, p. 95). Besides, the report includes the Bank's contribution to the United Nations Sustainable Development Goals. (Please refer to Contribution Made to Sustainable Operations Responsible Development Goals, p. 30, 31). Society Positive Value for Value Positive
2 102-1 • 102-45 • 102-46 • 102-50 • 102-52 • 102-54 3 Chairperson’s Message İşbank 2019 Integrated Report
Chairperson’s Message at İşbank Sustainability Heading towards celebrating its 100th anniversary in 2024, İşbank has been operating as the symbol of trust and stability in all segments of the society with all the values it has created from its foundation to present. Financial Profitability Performance andPerformance Approach Management
Esteemed stakeholders of İşbank, This structure features a specific quality which is very rare sensitivity as required to minimize the environmental another major project in 2019 which thrilled us extremely, not only in Turkey but also around the globe. footprint we leave while carrying out our operations. by bringing İşbank Economic Independence Museum Heading towards celebrating its 100th anniversary in 2024, reflecting the economic development of Turkey and the İşbank has been operating as the symbol of trust and Originating from İşbank culture, which we inherited from We continue, without slowing down, our investments deep-rooted history of our Bank in our country. stability in all segments of the society with all the values it our founding ancestors and have diligently carried to in digitalization, which we regard as one of the most Experience has created from its foundation to present. present, and called “İşbank Banking” by us, our model important conditions of carrying İşbank to the future Just as it has always done since foundation, İşbank will keep Flawless CustomerFlawless of creating value focuses on delivering sustainable and strongly and stably, and maintain our pioneer position in on contributing to the economic and social development of With the Integrated Report published for the second sharable value for all of our stakeholders. We do not the technology- and innovation-driven transformation of our country in 2020 as well with its operations carried out
time this year, we present our esteemed stakeholders measure our success with financial criteria solely, but we the banking industry. Likewise, we are among the major with regard to its environmental and social impact. the value created with the operations of our Bank, which endeavour to sustain our operations as a fair employer setters of economic models with our contributions to the is a signatory of the Principles of the United Nations as we always have been, a business partner trustable by entrepreneurship ecosystem, starting to occupy a wider I would like to extend, in the name of our Board of Directors,
Banking my gratitude to all of our stakeholders, primarily my
Responsible Global Compact and which supports the Sustainable individuals and institutions, and an organization where area in today’s economies along with such transformation. Development Goals. This is how we can demonstrate the transparency, solidarity, and ethical and disciplined work are colleagues, who carried our Bank to our day successfully way our integrated perspective combining our financial and awarded and which, at the same time, is sensitive to the We are well aware of the importance of our human as one of the most prestigious financial institutions of the nonfinancial capital elements have been integrated with environment and the society. resource, which has been raised with İşbank culture and world which has been creating value for our country since business processes and transformed into performance. is our most precious capital element and we strive to foundation, not only with its financial size but also with its As İşbank, we use our knowledge and experience rooted maintain employee satisfaction at the highest level. As of reputation in the eye of the society. Established as the first national bank of our Republic, in our long-established corporate past to address the the end of 2019, the rate of our female employees and Happy andHappy Productive Employees İşbank has been one of the prominent economic actors in needs of all social segments with innovative products female managers are %55 and %45, respectively at İşbank, our country with its support for economic development and services. Besides the loans we provide in numerous which has exhibited an egalitarian approach towards from past to present. The backbone of the strength and areas from financing renewable energy to increasing female employees beyond the age since its foundation. stability of İşbank which at the same time protects and women employment and energy efficiency, as driven potently carries its values to the future is the capital by our concept of responsible banking, we create Driven by our founding philosophy, we continue to contribute structure, where İşbank Members' Supplementary Fund, multidimensional positive impact for economy with to our society in a multidimensional fashion with widespread, Operations Responsible the major shareholder representing the employees and environmental and social risk management we implement long-lasting and sustainable projects. In addition to our Füsun Tümsavaş retirees of İşbank is in the foreground. in new investment projects. Additionally, we display efforts ongoing for years in this respect, we launched Chairperson Society Positive Value for Value Positive
4 102-14 102-14 5 Message from the Chief Executive Officer İşbank 2019 Integrated Report
Message from the Chief Executive Officer at İşbank Sustainability We, as the “Bank of Turkey,” both contribute to the national economy and social development in line with our founding philosophy and adapt the change and transformation to our business processes with a holistic viewpoint. Financial Profitability Performance andPerformance Approach Management
Esteemed stakeholders, 2019 was a year when we reviewed our priority issues loans. We continued our uninterrupted financing of the We are consolidating our leadership role in technology in the field of sustainability in terms of risks and households, sectors and industries creating employment and innovation. Global trends, social risks imposed by population growth opportunities and we analyzed the global trends that and added value. and inequality, environmental factors related to climate had an influence on our operations. With our products In a digital age where customer requests are determinative, change, and increasing transparency expectations from and services intended for all segments of the society As a financial institution, we are aware of the importance each and every institution is inevitably forced to integrate the Experience all stakeholders, primarily the customers, have been and all sizes of businesses, we continued delivering of our role in transitioning to the low carbon economy. As technological change into their way of doing business. While Flawless CustomerFlawless redesigning ways of doing business in the banking sector multidimensional and sustainable value for all our part of this, we raise our financial support for renewable carrying out our projects that will consolidate our leading as well as in many others. This transformation process, stakeholders as a trustworthy business partner. energy projects and diversify our products in this area position in technology and innovation, we conduct our
offering opportunities if well managed in addition to a every passing year. As of the end of 2019, renewable operations which take customer satisfaction to a higher level, number of threats it brings along, obliges banks which are We preserved our position as the leader private bank of energy projects accounted for 67.3% of the total energy with a mindset which is more respectful to human beings, among the key elements of sustainable development, to Turkey. generation projects portfolio of our Bank. In addition, egalitarian and reliable in this ecosystem of our employees,
Banking implement new approaches in business models. we launched a commercial loan product called “Solar customers and all stakeholders. Responsible Despite the global economic agenda and geopolitical Loan by İşbank” intended for unlicensed solar energy We, as the “Bank of Turkey,” both contribute to the developments, we made our resources available for use plants to be installed on the roofs of industrial facilities We go on with our technology and innovation efforts national economy and social development in line by the national economy to enable them to make the for self-consumption. Likewise, we will continue, in the which shape the future with a global vision through our with our founding philosophy and adapt the change most efficient contribution possible in 2019 as well. We forthcoming period, concentrating on lending operations innovation centers, the last of which was launched in the and transformation to our business processes with a preserved our position as the leader private bank of Turkey targeting renewable energy investments which are Turkish Republic of Northern Cyprus in 2019 after the ones holistic viewpoint. Within this framework, we fulfill the in terms of total assets, shareholders’ equity, total loans positively differentiating from equivalents with respect to in Silicon Valley and Shanghai. We see that the investments Happy andHappy Productive Employees commitments of the Principles of the United Nations and total deposits. Our total assets topped TL 468.1 environmental and social impact. we have made and the innovations we have offered as part Global Compact, of which we are a signatory, and thus billion with an increase by 12.4% in 2019 compared to the of our Digital Transformation Initiative are welcomed by contribute to the Sustainable Development Goals with a previous year, and we provided the economy with a total our customers. Our number of mobile banking customers responsible financing approach, which handles economic, fund amounting to TL 363.4 billion as cash and noncash exceeded 7.8 million as of the end of 2019. In the same social and environmental effects as a whole. Operations Responsible Society Positive Value for Value Positive
6 102-14 102-14 7 Message from the Chief Executive Officer İşbank 2019 Integrated Report
at İşbank Sustainability We preserved our position as the leader private bank of Turkey in terms of total assets, shareholders’ equity, total loans and total deposits. Financial Profitability Performance andPerformance Approach Management
period, the total number of our digital banking customers, might avail themselves of the experience of large institutions. decision making with teams making customer needs economy and do business with a mindset respectful of, and number of ATM customers and number of our customers Within this framework, the number of entrepreneurs their center of attention. In agile spaces where we carried sensitive to, the society, human beings and the environment, using the internet branch reached 8.1 million, 9.8 million graduated from Workup Entrepreneurship Program, which out business in an extremely dynamic way and delivered reinforces its leadership in technology and innovation even and 2.5 million respectively. The proportion of transactions we launched in 2017 to enable technology-driven ventures results with end-to-end completion commitment for a task more through its investments realized with a visionary carried out from non-branch channels to total transactions to develop their business ideas and grow their business, taken on, we achieved an increase by 75% in the rate of standpoint. Experience went above 92%. The personal assistant Maxi, one of the totaled 49 in 2019. Maxis Innovative Venture Capital doing business in selected subjects and 18% in employee Flawless CustomerFlawless most important output of artificial intelligence developments Investment Fund, helping innovative business ideas being satisfaction. I would like to express my appreciation to all of our at our Bank, performed over 22 million dialogues with 4.9 implemented and committed a transfer of funds up to TL stakeholders, primarily my colleagues, for their efforts
million customers as of the end of 2019. İşCep, the first 100 million by our Bank, started to support ventures in The most significant asset carrying İşbank to our day and towards, and support in our success, who are carrying mobile banking application of Turkey, increased its total 2019. Furthermore, we continue our contributions to the preparing it for tomorrow is its qualified human resource. İşbank to the future without departing from our principle of number of functions to 316, with 44 new functions added in world of entrepreneurship in a wide range of areas, including While adapting technological change to our business “Intelligence, diligence, integrity; technical and methodical Banking 2019. our cooperation with Arya Women Investment Platform, processes, we do not position technology in place of our work” as set by Gazi Mustafa Kemal Atatürk, the founder of Responsible launched to subsidize women and young entrepreneurs, people but beside our people and we are attentive to our country and our Bank. We maintained our contributions to the entrepreneurship our coalition with Turkish Entrepreneurship Foundation improving our people’s competencies. ecosystem in 2019 as well in order to both create more formed to encourage young investors, and our support for Yours sincerely, added value for our country and offer the best for our entrepreneurs in the agricultural industry. Assuming significant responsibilities throughout the customers. We continue our activities in this area in an economic history of our country and witnessing all periods inclusive manner by touching all segments of the ecosystem, As of the end of 2019, 25 agile teams, formed by our of transformation and change, İşbank is heading for its 100th Happy andHappy Productive Employees in addition to Workup Entrepreneurship Program, one of employees competent in various lines of business, are anniversary with an inclusive and participative approach and the key elements of our support. We believe that large carrying out activities in Agile Atelier which we define as with its vision of becoming the bank of the future creating institutions such as İşbank should be enriched with the the organizational counterpart of our digital transformation sustainable value. This institution, which will continue to Adnan Bali dynamism of today’s entrepreneurs and that entrepreneurs efforts and which is a business model targeting quick allocate its resources to the primary needs of the national Chief Executive Officer Operations Responsible Society Positive Value for Value Positive
8 102-14 102-14 9 About İşbank İşbank 2019 Integrated Report
About İşbank
As of year-end 2019 Having celebrated its 95th year in 2019, İşbank is the largest private bank in Turkey with its total asset size of TL 468.1 billion as of the end of the year. With its 1,249 domestic at İşbank
Sustainability branches, İşbank has the largest branch network among the private banks, and with its 6,506 Bankamatik ATMs in total, it has the largest ATM network in the industry. With its 22 24,053 19.5 million overseas branches in total, the Bank provides services in 15 branches in the Turkish Republic Employees Customers of Northern Cyprus, two each in the UK, Iraq and Kosovo, and one in Bahrain. Financial Profitability Performance andPerformance
As of the end of 2019, with its 24,053 employees, İşbank of 2019, İşbank has direct partnership in 24 companies. Our Vision, Values, Strategic Goals and Approach provides services to 19.5 million customers. With its The number of companies controlled directly or indirectly by Strategy Management products and services provided in corporate, commercial, Bank is 111. SME, personal and private banking, the Bank drives the banking industry in Turkey. İşbank also continues to make With its wide shareholder base, the number of İşbank a difference in the next generation digital banking practices shareholders, which consist of institutional and individual by continuing its investments on technology incessantly. investors, is nearly 160 thousand. İşbank Member’s Our Vision Our Strategic Goals Supplementary Pension Fund, and institution that has the • Commitment to our country Becoming the bank of the future, creating sustainable Experience İşbank Group is an integrated group with its subsidiaries membership of nearly 50 thousand employees and retirees, • Strong and sustainable financial performance operating in many fields for the production of commodities holds 39.10% of the Bank's capital. value with an inclusive and participatory approach Flawless CustomerFlawless • Effective risk management and services domestically and internationally. As of the end • Flawless customer experience
• Value creating technology and innovation leadership Our Values • Happy and productive human resources
Banking • Ethical and responsible banking, that is Responsible Innovation, solidarity, common sense, reliability, compassionate towards people, society and sincerity, transparency guided by the principles environment Shareholding Structure* of «Intelligence, diligence, integrity; technical and methodical work» in reference to İsbank's founding philosophy. 28.09% 39.10% Our Strategy Atatürk Shares İşbank Members’ Happy andHappy Productive Employees (Republican People’s Party) Supplementary Managing our balance sheet to ensure sustainable Pension Fund and value added growth while using our internal and external resources in accordance with the priorities of the country's economy and preparing our enterprise for the future by continuously improving our business model in synergy with our group companies and all our business partners in the period of technological Operations Responsible * As of 31.12.2019 transformation. İşbank's Vision, Objectives, Values and Strategy were updated with the 32.81% decision of the Board of Directors dated 25.03.2020. Free Float Society Positive Value for Value Positive
10 102-2 • 102-4 • 102-5 • 102-6 • 102-7 102-2 • 102-4 • 102-5 • 102-6 • 102-7 11 Sustainability at İşbank İşbank 2019 Integrated Report
Sustainability at İşbank at İşbank Sustainability Among the most prestigious institutions of Turkey, İşbank formulates all of its strategic decisions and business processes with a long-reaching perspective. The Bank calls its powerful and productive business model "İşbank Banking", which focuses on producing sharable and sustainable value. Financial Profitability Performance andPerformance Approach Management
“İşbank Banking” lies in the foundation of İşbank’s İşbank creates value with sustainability approach. İşbank Banking is a business model that focuses on “sharable and sustainable value creation”
Experience by handling financial and nonfinancial capital elements its financial capital based on its strong financial Flawless CustomerFlawless of the Bank together. İşbank targets to create value for structure, all of its stakeholders with this strong business model,
both in the short and the long run. Called “İşbank Banking” and enabling integration of the Bank’s sustainability its human capital shaped by its competent and priorities into all decision making processes, this value experienced employees,
Banking creation model represents the sustainability concept of Responsible the Bank and the integration of sustainability into business processes. its natural capital covering its concept of resource management and environmentally-friendly products İşbank creates value through a mix of opportunities and services, offered by its robust financial structure, competent human resources, strong relations with its stakeholders, Happy andHappy Productive Employees corporate knowledge, brand value identified with trust its social and relationship capital allowing it to add value to the society and its stakeholders, and reputation, widespread physical and digital service network, and responsible products and services. İşbank also matches the output of its value creation process with its manufactured capital composed of its physical the UN Sustainable Development Goals to which the Bank infrastructure enriching its service quality, contributes with its activities. Thus, the Bank integrates its Operations
Responsible concept of producing sharable and sustainable value with global goals. and its intellectual capital enabling it to develop innovative products and services as nourished from its digital transformation capacity as well as its body of knowledge built upon its long-established history. Society Positive Value for Value Positive
12 102-21 • 102-31 • 417-1 13 Sustainability at İşbank İşbank 2019 Integrated Report
Highlights of 2019 at İşbank Sustainability
Financial Performance and Profitability Flawless Customer Experience Responsible Banking vwHappy and Productive Employees
2019 compared to 2018: Financial Profitability Performance andPerformance 19.5 12.5 % % % millions of customers Increase in the number of USD 222 million USD 395 million 55 1.86 digital banking customers Financing provided Financing provided for projects Rate of female employees Employee turnover rate % % 12.4 4.7 to renewable energy subjected to environmental Increase in total assets Increase in total loans investments and social risk evaluation Approach Management
st st 1 1 99 % 25.7 rank among private banks rank among private banks 18.4 % 20.7 % Unionization rate Average number of training Experience Increase in shareholders’ Growth in total in personal net promoter in commercial net promoter hours per employee per year Flawless CustomerFlawless equity deposits score score 45,629 4,410 Number of women Number of disabled- entrepreneurs supported friendly Bankamatik ATMs Positive Value for Society Management Approach Responsible Operations Banking Responsible
million 67.3 % thousand + 14 Auditing of 268 branches, business 98 % 40.4 million pages 21 Number of books given away units and affiliated companies by the Board of Rate of local suppliers Total paper savings thanks to Share of renewable energy projects in total energy Students provided with as part of "One Million Books, Happy andHappy Productive Employees Inspectors the digitilized processes generation projects portfolio financial literacy training One Million Children" campaign Operations Responsible ~750 Total number of students supported, including 54 graduates of 2019, within the scope of the 81 Students from 81 Cities Project Society Positive Value for Value Positive
14 102-21 • 102-31 • 417-1 15 Sustainability at İşbank İşbank 2019 Integrated Report
strategies, industry analyses and industry expectations;
Sustainability Management combating with climate change was added as one of the Focal Points and Material Issues İşbank Sustainability Management System is an sustainability priorities of İşbank. integrated management system evaluating all of the Financial Performance and Profitability
at İşbank Happy and Productive Employees Bank’s operations in terms of sustainability impacts. The In 2019, İşbank identified its “Focal Points” in the field Sustainability • Employee Rights and Satisfaction system allows for the integrated management of multiple of sustainability based on its priority issues. 21 topics Management Approach • Equal Opportunities and Diversity aspects from lending operations to employee development contained in the materiality matrix of the Bank were • Business Ethics • Risk Management • Regulatory Compliance • Stakeholder Dialogue • Transparency and Reporting • Talent Management practices and from purchasing decisions to the Bank’s grouped under the headers of “Management Approach,” environmental footprint. İşbank’s Sustainability Policy “Financial Performance and Profitability,” “Flawless Flawless Customer Experience Responsible Operations and other supplementary policies create a basis for the Customer Experience,” “Responsible Banking,” “Happy and • Digital Banking • Customer Focus • Data Security • Responsible Procurement operation of the Sustainability Management System. Productive Employees,” “Responsible Operations,” and • Environmental Footprint of the Bank
Financial “Positive Value for the Society.” Responsible Banking Profitability • Combating Climate Change • Finance Integrating ESG Criteria Positive Value for the Society Performance andPerformance Operating under the Board of Directors, the Corporate In 2019, the Bank conducted a “Sustainability Risk and • Responsible Products and Services Portfolio • Responsible • Social Investments Governance Committee is the highest management Marketing • Financial Inclusion • Financial Literacy body responsible for sustainability-related activities at Opportunity Assessment Study” for Sustainability Focal İşbank. Head of Investor Relations Division acts as the Points as well. In this research, all sustainability priorities Sustainability Coordinator to ensure coordination of of İşbank were assessed with a survey completed by activities among executive bodies. Involving different units, 165 Bank executives in terms of risk and opportunity
Approach potential. (The results of the risk and opportunity analysis
Management the Sustainability Working Group maintain execution of sustainability activities and information flow. are available on p. 26, 27). The results of the survey were also reviewed specifically with respect to Retail Banking, Corporate Banking, Commercial Banking and Private Banking. In the study, the contribution of İşbank business units to the Bank’s value creation process was also Responsible finance integrating assessed specifically with respect to the “Focal Points.” environmental social and Experience (The results of this study is available on p. 17). governance (ESG) criteria
Flawless CustomerFlawless Policies which set forth İşbank’s Sta eholder Combating Climate Change sustainability approach are available at dialogue Responsible products and services portfolio https://www.isbank.com.tr/en/about-us/ Financial Ris management
our-policies. performance and Detailed explanations about the Transparency profitability Financial and reporting materiality analysis are available on pages mportance for Sta eholders usiness literacy ethics Banking 26 through 29 of the Sustainability Report Financial Responsible of İşbank for 2017. inclusion Employee rights and satisfaction Sustainability Priorities Digital transformation Talent Management İşbank keeps track of a large number of economic, social Customer and environmental developments as mandated by industry These references used when orientation requirements and its corporate size. The Bank groups all of E ual opportunity Social investment Happy andHappy Productive Employees setting priorities and diversity programs these developments as topics which are directly related to its operations, priority issues for its stakeholders, and which Compliance with changing regulations Data safety and the Bank may have an influence on. The prioritization matrix Business strategies customer confidentiality of İşbank provides this grouping. The Bank conducts regular Responsible mar eting Corporate values risk and opportunity analyses for global trends affecting the Responsible procurement banking industry and the world. Global trends Environmental Operations Responsible İşbank sustainability priorities were established with a Stakeholder expectations footprint of the an materiality analysis conducted in 2017 and have been annually reviewed since. The materiality study of 2017 was Industry requirements carried out with a large sample selected in accordance with Examples of best practices the AA1000 Stakeholder Engagement Standard in such Importance for İșbank a way that it reflected opinions of İşbank employees and Corporate engagements Society external stakeholder expectations. In 2019, material issues UN Sustainable Development Financial Performance and Profitability Management Approach Flawless Customer Experience Responsible an ing
Positive Value for Value Positive were revised. As a result of the evaluation made paying Happy and Productive Employees Responsible Operations Positive Value for the Society regard to global trends, corporate engagements, business
16 102-19 • 102-20 • 102-21 • 102-31 • 102-32 • 102-44 • 102-47 • 103-1 • 103-2 • 103-3 102-21 • 102-31 • 102-44 • 102-47 • 103-1 • 103-2 • 103-3 17 Sustainability at İşbank İşbank 2019 Integrated Report
Value Creation Model – İşbank Banking Capital
Sustainability Focal Points
Social and at İşbank Financial Human atural ntellectual Relationship Manufactured Financial Performance and Profitability Contributed SDGs Sustainability Capital Capital Capital Capital Capital Capital
Stable financial performance is the foundation of İşbank’s value creation process. lobal rends External Factors Stakeholder Priorities The Bank uses its financial capital for creating products and services with added value, developing its human resource, and rendering social benefits. İșbank’s Vision and Strategy Financial Profitability Performance andPerformance
Relevant Financial Material Financial Performance and Profitability capital issue element Capital İșbank Banking
Approach Producing sharable and sustainable value Management Risks Opportunities Long-term planning getting harder due to uncertainties caused İşbank’s ability to make use of emerging opportunities quickly by global economic fluctuations through its strong financial structure Operation Fields Retail Banking Private Banking Corporate Banking Commercial Banking Experience İşbank’s dynamic and proactive business strategy Potential penalties and sanctions that may be imposed due to Flawless CustomerFlawless prioritizing healthy and sustainable growth Outputs changed regulations and incompliances
Maintaining competitive advantage with the Bank’s practices Return on average Women Share of renewable Number of digital Number of Total number of Shortcomings in meeting the expectations of the investor base enabling full compliance with laws and regulations through its tangible e uity employee ratio energy projects in ban ing customers customers branches internal audit and control mechanisms % % total energy million million Banking generation projects Uncertainties experienced in the process of transition to low Creating competitive advantage in the transition economy Responsible Total loans (cash Women ratio in portfolio Share of Customer Number of non-cash) management % non-branch satisfaction score an amati ATMs carbon economy (e.g. carbon pricing) through efforts such as tracking carbon markets, increasing the TL billion % channels % share of support provided for renewable energy investments in Share of renewable % Capital Turnover ratio the energy portfolio, etc. energy projects in Uncertainties created by COVID-19 which emerged in late 2019, ade uacy ratio % total financing % % its adverse effects on the Bank’s financial performance and Maintaining strengthened relations with stakeholders through Unionization rate profitability as well as global economy regular investor and shareholder notifications % Happy andHappy Productive Employees
Created Value Key Performance Indicators Targets
For investors and shareholders For customers For employees For society in 2020 - Solid financial performance - Financial support with responsible - Reputable and reliable employment - Contribution to social welfare with taxes paid - Reliable investment with ethical products and services - E ual opportunities in HR management - Contribution to the country’s economy transparent and responsible ban ing - Access to financial services for all - Decent modern healthy wor environment with finance provided - Products services and activities that
Operations approach segments of society with inclusive products both physically and psychologically Responsible contribute to combating climate change -Lifelong support with personalized - Professional and personal development - Support for education and culture with products and services opportunity long-term social investments - Support for increasing financial literacy 17.9% 12.1% 13.5-14.5% >15% Capital adequacy Return on average Credit growth Capital adequacy tangible equity Society ratio ratio Sustainable mpact Positive Value for Value Positive
18 201-1 19 Sustainability at İşbank İşbank 2019 Integrated Report
Sustainability Focal Points Sustainability Focal Points
at İşbank Management Approach Contributed SDGs Flawless Customer Experience Contributed SDGs Sustainability
In the foundation of İşbank Banking concept lies the importance the Bank attaches to İşbank, targets to become a bank which is available on a 24/7 basis and delivers ethical banking. The Bank acts with regulatory compliance and responsibility brought by flawless customer experience with its digital banking operations growing every the Ethical Principles, in all of its operations and stakeholder relations. The Bank’s effective year. İşbank pays the same amount of attention to ensuring data security as it risk management concept is designed to manage financial and nonfinancial risks in a proactive manner. The aim of the Bank is to create sustainable value for all stakeholders. pays to digitalization efforts. Financial Profitability Performance andPerformance
Business Ethics • Risk Management Relevant Relevant Digital banking • Customer focus • Data Material • Regulatory Compliance • Stakeholder Dialogue capital Intellectual Social and Material capital Intellectual Social and issue Capital Relationship Capital issue Security Capital Relationship Capital • Transparency and Reporting element element Approach Management Risks Opportunities Risks Opportunities
Penal sanctions which might be imposed due to regulatory non- Potential to maintain existing customer satisfaction and reach Data security risks growing with digitalization Ability to offer personalized products to customers through digital products and services, and 24/7 availability compliance new customers through ethical banking concept Opportunity to establish more effective communications with
Experience Managing workforce requirement diminishing Increasing investors’ attention with high reputation and customers with digitalized procedures Losses which might be incurred due to non-financial risks as a result of digitalization efforts Flawless CustomerFlawless brand value Increasing customer satisfaction by developing products and services shaped by customer expectations and needs through Creating competitive advantage through effective inclusion
Operational disruptions and difficulties in accessing new ideas as regular customer communications of environmental, social and governance (ESG) factors in risk Potential customer losses due to misunderstood customer needs a result of inadequate stakeholder dialogue management Becoming a preferred institution in the eye of stakeholders through data security investments
Banking Losses which might be incurred due to non-compliance with Creating added value taking stakeholder expectations into Failure to keep pace with accelerated economic and Responsible technological changes due to huge corporate structure Becoming a major actor in the new economy with supports provided principles of business ethics consideration in products and services development through to entrepreneurs effective stakeholder communication Strengthening business strategies through partnerships in the Falling outside of the developments such as platform business Risks of impaired reliability in the eye of stakeholders and of Contributing to reputation management and achieving field of FinTech exclusion from related engagements due to failure to meet models and sharing economy, which are the major components competitive advantage in different performance areas through Opportunity to make quick decisions and act upon them through reporting and information sharing requirements transparent information sharing of the new economy agile business models Happy andHappy Productive Employees Key Performance Indicators Targets Key Performance Indicators Targets
in 2020 in 2020 Operations
Responsible 6,506 8.1 million 7.8 million 84.6% Number of Number of digital Number of mobile Share of digital channels Bankamatik ATMs banking customers banking customers in non-cash financial transactions Developing cooperation Maintaining corporate Increasing the number Increasing the Maintaining Maintaining 7,577 with national and reporting activities of trainings provided to share of digital leadership leadership in channels in in Personal Commercial Number of employees international initiatives in line with current raise risk management developments in st st total sales Net Promoter Net Promoter participating in Anti-Bribery awareness of employees million % Society 19.5 1 1 81.2 Score rating Score rating and Anti-Corruption global standards Number of rank among private rank private banks Customer banks in personal in commercial net Positive Value for Value Positive customers satisfaction score trainings net promoter score promoter score
20 21 Sustainability at İşbank İşbank 2019 Integrated Report
Sustainability Focal Points Sustainability Focal Points
at İşbank Responsible Banking Contributed SDGs Happy and Productive Employees Contributed SDGs Sustainability İşbank supports the green economy paying regard to the environmental, social and İşbank incorporates people embracing its corporate values and upholds all of its employee throughout economic effects of projects in its lending operations and by financing renewable their career. In this scope, all executives are promoted through systematic, transparent and foreseeable energy projects. Adopting it as its principle to offer reliable, transparent and career paths in line with criteria including promotion exams, performance and tenure of work, have access to development opportunities they need in promotion processes, and take part in trainings comprehensible banking services consistently, İşbank works to increase financial required by executive positions at İşbank, where interim level executives are not hired, but all executives inclusion with services which are accessible for anyone, anytime, through both its are internally raised. It is among the Bank’s business priorities to offer a fair, safe and creative working widespread physical service network and digital service channels. environment contributing to professional and personal development where diversities are respected. Financial Profitability Performance andPerformance
Combating Climate Change • Responsible Finance Relevant Financial Capital Intellectual Capital Employee Rights and Satisfaction • Equal Relevant Material Integrating ESG Criteria • Responsible Product and Service capital Material Opportunities and Diversity • Talent capital Human issue Natural Capital Social and issue Capital Portfolio • Responsible Marketing • Financial Inclusion element Relationship Capital Management element Approach Management Risks Opportunities Risks Opportunities
Loss of skilled employees Developing products and services fit for the digital age by building a creative team through regular digitalization trainings Shortage of existing financial solutions as a result of the change Contribution to the green economy and combat with climate in the way of doing business and risk perception in the industry Experience change through effective ESG risk management Becoming a preferred employer for newly graduates with a due to global warming Failure of succession plans reliable brand and employer image Flawless CustomerFlawless
Increasing the Bank’s penetration with products developed for Keeping employee motivation high by paying attention to work-
life balance disadvantageous groups Not being preferred by newly graduates, i.e. the target audience Damage to the industry’s reputation by complicated and nontransparent financial transactions and processes Being a preferred organization for young employees with Developing products and services addressing all segments of the practices and extensive training programs in agile business Banking
Responsible society through customer-oriented banking approach Decrease in employee engagement due to new generation’s models, artificial intelligence, data analytics, etc. changing working habits Offering long-lasting career opportunities with İşbank’s internal promotion culture Inequalities arising from inaccessibility of financial resources for Increasing customer satisfaction by informing customers on all industries and segments products and services accurately and in a timely manner Loss of workforce and reputation due to failure to provide equal Being a bank preferred by employees by becoming one of the leading opportunities for potential and existing employees organizations of the industry in equal opportunities and diversity Happy andHappy Productive Employees Key Performance Indicators Targets Key Performance Indicators Targets
in 2020 in 2020 Operations
Responsible MW % 262 67.3 Enabling 500 women Total installed power of renewable Share of renewable energy projects entrepreneurs to place in >30* 120 energy projects financed by İşbank in total energy generation projects events aiming to support Number of events to be Number of technological in 2019 portfolio women entrepreneurs carried out to support SMEs entrepreneurs with facilitated entry into the banking system 55%* 25.7* 1.86% Intensifying digital Intensifying talent by 2022 Rate of female Average number of Employee turnover trainings with innovative management activities to employees training hours per rate and diversified learning enable developing digital
(*) employee per year opportunities competencies Society 13 4,410 34 1.25 million >80% Calculated excluding Private Number of financed projects Security Guard positions. The Number of disabled- Number of events Number of yearly İŞ'TE KOBİ website Increasing the ratio of disabled- subjected to environmental friendly Bankamatik aiming to support SMEs rate is 51% when employees Positive Value for Value Positive viewings reaching 1 million and 250 friendly Bankamatik ATMs to over (*) and social risk evaluation ATMs titled Private Security Guard Calculated excluding Private thousand. are included. Security Guard positions.
(*) Events on digital platforms are also included.
22 23 Sustainability at İşbank İşbank 2019 Integrated Report
Sustainability Focal Points Sustainability Focal Points
at İşbank Responsible Operations Contributed SDGs Positive Value for the Society Contributed SDGs Sustainability
İşbank strives to minimize the adverse effects of its operations and diffuse its İşbank, one of the leading banks in Turkey, has played an important role in the concept of business ethics throughout the supply chain as well. To this end, the Bank economic history of the country since its establishment. İşbank contributes implements a number of projects to reduce its environmental impact, and works to to social welfare with long lasting social responsibility projects along with the integrate its sustainability approach also into its procurement operations. services and financial support it provides. Financial Profitability Performance andPerformance
Relevant Relevant Responsible Procurement • Environmental Natural Social and Social and Relationship Material capital Material Social Investments • Financial Literacy capital Capital Relationship Capital issue Footprint of the Bank element issue element Capital Approach Management Risks Opportunities Risks Opportunities
Being a trustworthy bank in the eye of stakeholders with Loss of reputation due to unfavorable developments related to Being an institution unable to respond to stakeholder projects developed in line with stakeholder expectations
Experience the companies in the supply chain expectations Flawless CustomerFlawless Developing cooperation that will deliver efficiency with effective supply chain management Contribution to corporate reputation
Inability to understand financial products and services due to Potential operational risks due to disruptions in the supply chain inequalities in the educational quality Being part of the solution to global problems with contribution Banking Lowered operational expenses with energy efficiency, reduced Responsible to the UN Sustainable Development Goals water consumption and paperless banking applications
Increasing operational expenses due to rising energy costs Loss of reputation Proper communication opportunity with customers as a result of increased financial literacy Happy andHappy Productive Employees Key Performance Indicators Targets Key Performance Indicators Targets
in 2020 in 2020 Operations Responsible
Maintaining 98% 102,297 679 tons 345 130 98% Number of people taking Supports provided in Visiting Gifting students activities to thousand m3 part in financial literacy the field of education of museums by e-books as part of Rate of local tCO2e Paper A decrease by Rate of local help reduce trainings: Financial One Million Books suppliers Emission consumption Water 130 million suppliers adverse 116 consumption pages in paper Literacy training provided One Million Children Society environmental thousand people consumption for over 2 thousand campaign impact through digitalized Positive Value for Value Positive students. processes
24 25 Sustainability at İşbank İşbank 2019 Integrated Report
Global Trends, Risks and Opportunities
Subject Trend Risks and Opportunities İşbank's Response Subject Trend Risks and Opportunities İşbank's Response
While İşbank continues to grow with the Digitalization is a support of its strong financial capital, it phenomenon with
at İşbank attaches importance to maintaining and a rapidly increasing
Sustainability Within the scope of its digital transformation improving its financial structure. Bank closely impact at every The markets are approach, İşbank allocates significant amount tracks the factors that may pose a risk on stage of life, from undergoing a Along with the digitalization process, new of resources to the digitalization of its its financial capital. İşbank's balance sheet the daily life to transformation collaborations of changing demands are created processes, products and services. Bank not The fluctuations in domestic and overseas is managed with a dynamic and proactive business processes. process due to in the industry. It is predicted that digitalization only closely follows the legislation to take markets may pose a risk for financial services strategy that prioritizes healthy growth by Digitalization changes Change and economic and political will accelerate the competition in the industry and necessary measures regarding data security, Transformation providers in the short and middle term, which may focusing on strong liquidity and high quality Digitalization consumer expectations developments. In cause a necessity to a faster adaptation to the but also continuously improves its business in the Markets put pressure on the operatinal income, profits and assets. Along with credit and investment as well. In the parallel with the expectations. Cyber threats create both a serious processes. Continuous improvements are market shares. portfolios, a flexible balance sheet composition banking industry, the Financial global developments, threat of financial loss and a reputational risk for made in data security, resistance to possible Profitability has been created by taking into account factors expectation increases
Performance andPerformance Turkish markets also financial institutions. threats is increased, and Bank's capacity to such as efficient management of foreign day by day in digital had a dynamic year. make rapid decisions is improved in cases of exchange and liquidity positions, expansion of products etc in Internet undesirable situations. the deposit base, which is the main funding banking, mobile item, and monitoring of stable and diversified applications and funding policies. commercial banking.
Approach It is observed that the risks related to political Innovation is an Management and geopolitical balances also cause uncertainty increasingly important The banking and finance industry is directly in the financial environment, adversely affect the topic throughout The geopolitical risks affected by the increase in innovation, due to investment appetite, and change the spending With public-private collaboration models, the world regardless arising from political the fact that it provides financial support to trends of households. Increased mobility and different projects have been developed in of the industries. İşbank's open innovation approach, the instability in Turkey's different fields of the economy, and due to the communication on a global scale brings social healthcare, transportation and education Many innovations innovation centers in the United States, near geography, changes in the business conduct as a result of changes in many countries. A new demand industries in the recent years. For the purpose Innovation such as increased China and Turkey, practices such as Agile the demographic the developments in financial technology. Rapidly market is created for this change. In line with the of supporting the social development and digital technologies, Workshop and Work-Up, are the initiatives that Social Change mobility and the developing demand conditions and changing Experience expectation of social equality, there is a demand meeting the expectations, İşbank adopts the sharing economy and demonstrate the innovation approach. accompanying needs of the society may cause the competition for equal and unimpeded access to basic services objective of actively participating in sustainable platform business Flawless CustomerFlawless security concerns conditions in the financial services industry to such as education, healthcare, social security development-oriented investments for social models significantly lead to uncertainty become challenging. and basic infrastructures such as drinking water, welfare, and accordingly, it closely follows the change traditional in the operation
road and energy. This creates a new market and developments in this field. business models. environment. business opportunity for financial institutions that finance superstructure and infrastructure projects for services. Turkey's financial İşbank continues its emergency preparations Banking center is located with its advanced information technologies Responsible in the earthquake infrastructure and its emergency preparations The continuation of current business models points zone of Marmara that it keeps up to date with regular drills. out the fact that companies will face resource Natural disasters bring important business risks Region which also As part of our strategy for information problems in the middle and long term. This Disaster for many industries. The problems which may İşbank manages financial, environmental includes İstanbul. The technology data center, it will be ensured that situation poses a significant risk for the banks and Recovery arise in the supply chain, the production coming and social risks with an integrated risk evaluations made by an exact equivalent of our hall at our Atlas data other financial institutions that provide funding Readiness to a halt and outages in banking operations are The impact management approach. With the multi- the experts reveal that center in İstanbul will be created in Ankara; for companies and projects. The environmental important risks posed by this issue. of production dimensional sustainability management an earthquake, which all data will be transferred to this new hall; and social impacts of the financed projects can Happy andHappy Productive Employees processes and system launched in 2015, Bank manages will occur in the middle and thus, our Bank will be protected against lead to financial risks. Various risks may arise business activities both its own activities and environmental term, will significantly all physical risks to our ATLAS data center, from the stopping/slowing down of the activities on the environment and social risks arising from the projects it affect the region. specifically the İstanbul earthquake. of financed customers due to environmental or throughout the world finances, from a holistic perspective. İşbank social issues, stopping of sales, loss of turnover, is moving towards an continues its environmental and social risk Climate decrease in asset size, and disseize of a company With its approach for internal promotion, Change and irreversible point in management approach, which it applies in its due to legal incompliance. The occurrence of these İşbank offers to its employees an opportunity Environmental many respects. The crediting efforts, without any compromise, risks may also affect the loan repayments to be to advance in their careers, thereby guarantees Dynamics current consumption and improves its risk management experience The generation, also made to the financing bank. In the upcoming period, Operations long-term employment. The Agile Workshop Responsible propensity of against potential future impacts. called Generation Y, Researches indicate that the young generation's countries and international organizations are application continues to be an employer humanity is increasing İşbank has an important role in Turkey's The Changing which was born into propensity to work for a long time at the same expected to create new and more comprehensive preferred by the young generation with the much faster than the transition to a low carbon economy. Bank Preferences the digital world, has workplace decreased. This brings the risk of talent environmental legislations. This situation may development opportunities it offers in fields time needed when also provides direct support to reducing the of the Young different expectations loss for the enterprises. This generation, which cause compliance risks for customers. Climate such as artificial intelligence, data analytics it can reproduce or risks and impacts of the climate change by Generation in terms of working is apt to digital technologies, prefers fast and change and environmental dynamics also create and innovation. Young customers' interest recover the resources. financing renewable energy projects. Bank has life and customer personalized products also as customers. new opportunities for the finance industry. The in the Bank is kept alive by İşbank's digital the power to access resources that develop preferences. number of investments in this field increases transformation, anything it has provided as a internationally. Society with the importance of environmentally friendly first in this field in the industry, its personalized practices, green economy, transformation economy service approach and active use of social media. Positive Value for Value Positive and clean energy.
26 102-15 • 201-2 102-15 • 201-2 27 Sustainability at İşbank İşbank 2019 Integrated Report
Business Lines and Value Creation Process
Corporate Banking Retail Banking
Products and services Products and services İşbank's activities in Retail Banking are shaped through the objective of With its corporate banking services, İşbank provides customer specific Investment and Business Finance, Transaction Banking, Derivative Products, “being the financial solution partner that its customers prefer the most in Consumer Loan, House Loan, Instant Loan, Maximum Mobil, I Want To Become services and financial solutions to domestic corporate companies and large Digital Solutions, Foreign Trade and Foreign Service Export Finance, every phase of their lives”, and are carried out with the digital transformation A Customer, Inflation Indexed Term Account Products, Daily Deposit Account, multinational companies. International Corporate Banking, Investment and Asset Management strategy which is summarized as being the “companion of customers”. Pepper, Dask (Turkish Catastrophe Insurance Pool), Motor Vehicle Tax Payment,
at İşbank Consultancy and Cash Management Products Invoice Payments, Life and Non-Life Insurance Sustainability
In 2019, EMEA Finance, Bonds and More than 62% of total transactions are made via İşCep and Maximum Mobil. ■ The number In 2019, a total of USD 339.7 million in financing was provided to 7 projects subject Loans and IJ Global Project Finance and of digital customers reached 8.1 million with an increase of 12.5% compared to the previous to environmental and social risk assessments in the corporate banking area. ■ İşbank Retail Banking Business Unit was Infrastructure Journal, one of the outstanding year. İşbank was also ranked the first in the rankings of retail and commercial net promoter Highlights Thanks to digitalization efforts and technology-focused process improvements, Awards Highlights Awards granted with 29 awards domestically and international finance publications, granted 23 scores among the banks referenced in 2019. ■ Artificial Intelligence based product sales model more effective solutions were developed for the financial needs and expectations internationally in 2019 (Please refer to, in 2019 Received awards in various categories to the project in 2019 was expanded all over Turkey in 2019. ■ Maximum Mobil contactless payment transaction Received of our corporate customers and, customer satisfaction and productivity were Awards Received, p.90). financing transactions carried out by İşbank volume increased by 127%. ■ Attaching special importance to e-commerce, İşbank Financial increased. Profitability in the corporate banking field. maintained its leadership in this field with a 28.7% market share as of the end of 2019. Performance andPerformance
Contribution of Corporate Banking operations to the value creation process Contribution of Retail Banking operations to the value creation process
For our customers: With its holistic service For the economy of the country: By For the society: İşbank provides For our customers: İşbank Retail Banking Business Unit offers For the economy of the country: With For the society: With its informational
Approach approach, İşbank strives to stand by its customers establishing long-term relationships with all its financing for large infrastructure/ to our customers intuitive products and services that meet their its retail banking activities, İşbank aims activities, the Retail Banking
Management in every field and to become a solution partner in stakeholders in line with its corporate banking superstructure projects and renewable needs and contribute to their financial health. The Bank carries to ensure that all segments of the Business Unit works to ensure that an end-to-end business relationships chain. Being objectives, İşbank assumes a strategic partner energy investments, which are deemed out its individual banking activities with the objective of “being society have access to financial services all individuals make the right financial the main solution partner of corporate customers, role in the investments that will strengthen to contribute positively to the welfare the bank closest to the customer” in both geographical and and manage their individual budgets decisions at different phases of life. The Bank assumed the role of the key bank in the national economy in terms of employment of the society and also meet certain relational contexts. With its high value-added banking service properly. İşbank continues its efforts to Increasing the financial literacy and meeting their strategic and financial requirements and added value and makes a significant environmental and social standards. packages developed, İşbank aims to meet the expectations become the bank most preferred by the creating savings awareness are and continued to offer digital solutions for contribution to the country's economy. and needs of its customers at different phases of life such as savers and works for the development among the priorities of the Retail customer needs in all banking transactions. childhood, youth, working life and retirement. of savings awareness across the country. Banking Business Unit. Experience Flawless CustomerFlawless
Commercial Banking Private Banking
Products and services Products and services In accordance with its mission of establishment, İşbank stands by the With its Private Banking activities, İşbank offers personalized investment industrialists, tradesmen, SMEs, craftsmen and farmers. Operating at every Commercial Credit Card, Craftsman Loan, Flexible Term Account, Daily products based on the needs and risk preferences of its customers in its Banking Deposit Account, Real Estate Loan, Maximum İşyerim, Tekcep, Commercial Asset Management, Privia Credit Card, Privia Mutual Fund, Privia Personal
Responsible point of trade, İşbank offers lucrative products and services throughout specialized branches, which are positioned as investment centers, especially Turkey with its extensive branch network. Support Loan, Instant Commercial Loan, SME Loans, İMECE Card, İşim Card, thanks to its collaboration with financial affiliates. Loans, Privia Pension Plan, Financial Status Report, Privia Line Tarsim, İmece Mobil, Life and Non-Life Insurance Products
İşbank maintained its leadership among private banks in installment commercial loans "İş'le Buluşmalar" (The Meetings with İş), with a market share of 11.9% (*)(**). Its portfolio size reached TL 46.5 billion(**) as of the was granted with the Jury Special Award end of 2019. ■ With the Loan Agreement for IBRD-Inclusive Financing Access Project, a at the 18th Golden Compass competition Customer assets managed by the Private Banking reached TL 27 billion with an increase of 24%. ■ The customer assets managed in collaboration Highlights funding opportunity of USD 40 million was created. ■ İşim Card, which was developed for Awards organized by the Association of Public Highlights Happy andHappy Productive Employees with İş Portföy Yönetimi A.Ş increased by 58% compared to the previous year and reached TL 1.4 billion. ■ İşbank Private Banking hosted its in 2019 sole traders, was made available to İşbank customers. As of the end of the year, İşim Card Relations in Turkey. in 2019 Received customers in arts and sports events in line with their tastes and preferences during 2019. reached 15,951 customers. ■ Agricultural Entrepreneurship Competition was organized. TekCep was granted with the Gold Award ■ Activities have been organized in 32 regions where approximately 4,500 farmers in the Most Innovative Product Category contacted with our bank. of the PSM Awards.
Contribution of Commercial Banking operations to the value creation process Contribution of Private Banking operations to the value creation process Operations Responsible For our customers: İşbank Commercial Banking For the economy of the country: With its For the society: With its Commercial Banking For our customers: With the power of the For the economy of the country: İşbank For the society: Within the scope of Private Business Unit works directly and continuously Commercial Banking activities, İşbank plays a leading activities, İşbank supports entrepreneurship, synergy it creates with its affiliates, İşbank Private Banking Unit contributes to the Banking activities, with the innovative with all customer groups to understand their role in financing large-scale commercial companies, women's participation in the economy, offers investment alternatives that provide accumulated capital of both its customers and products and services offered also through craftsmen and SMEs. Bank develops regional business needs properly. In 2019, the field teams visited agricultural industry and renewable energy approximately 344 thousand customers and partnerships in order to produce the most appropriate optimal returns in line with the risk profiles of the country by offering the right products and the support of its affiliates, Bank contributes investments. The purpose of Commercial non-branch sales teams visited approximately 159 payment solutions for the needs of different customer its customers, and helps customers to transfer services to its customers with high amount of to managing the wealth of its customers thousand customers. İşbank reviews the local and groups. İşbank evaluates foreign financing opportunities Banking activities is to ensure that all their assets to the next generations in the accumulated wealth. with relatively high financial literacy and periodic needs of its customers operating in the in fields such as energy, agriculture and women members of the society participate in the safest manner. transferring their experiences to next Society agricultural industry through the analytical studies. entrepreneurship, and makes the resources, which economy and support sustainable economic generations. Channels such as "İŞ'TE KOBİ" (Website for SMEs) are it provides, available to its customers, in order to growth.
Positive Value for Value Positive used for maintaining regular contact with customers contribute to the development of commercial life.
(*) Calculated using monthly sector data published by the Banking Regulation and Supervision Agency, disregarding interest accruals and rediscounts. Participation banks are excluded from sector numbers. (**) Includes overdraft accounts. 28 29 Sustainability at İşbank İşbank 2019 Integrated Report
Sustainable Development Goal 7: Sustainable Development Goal 9: Sustainable Development Goal 13:
Contribution to Sustainable Affordable and Clean Energy Industry, Innovation and Infrastructure Climate Action Development Goals Increased world population brings the need for inexpensive Infrastructure investments, innovation and digitalization Global warming severely affects human life, and the effects at İşbank The Sustainable Development Goals, which were announced in and clean energy. İşbank supports the transition to the emerge as important means to resolve global economic of climate change in many industries change the way of Sustainability 2015, have been a call for governments, companies andnon- low carbon economy and finances the renewable energy inequalities. İşbank supports the transition to the new doing business. İşbank, which supports the transition to governmental organizations to collaborate and take action in investments (Please refer to Responsible Banking, p. 52-63). economy with the importance it attaches to digital banking the low-carbon economy, takes the environmental impacts the fields critical for the common future. The banking industry (Please refer to Digital Transformation, p. 44), financing into consideration when offering its products and services. is in a significant position and has important resources to provided for infrastructure investments (Please refer to Material issue The environmental and social impacts of the projects offer both direct and indirect solutions to the global and Responsible Banking, p. 52-63), and innovation activities regional problems encountered today. It is important to take conducted within its organization (Please refer to Innovation financed are evaluated rigorously; it is ensured that the Responsible products and services portfolio, Responsible finance measures are taken to minimize/eliminate the risks arising
Financial Sustainable Development Goals as a guide when using the integrating environmental, social and governance (ESG) criteria and Entrepreneurship, p. 48, 49). Profitability transformative power of the financial industry in the economy. from the projects (Please refer to Environmental and Performance andPerformance Material issue Social Risk Management in Lending, p. 55, 56). The Bank İşbank supports the United Nations Sustainable Relevant capital also contributes to the combat against climate change Development Goals. The Bank considers its contribution to Responsible finance integrating environmental, social and by reducing its environmental footprint (Please refer to these goals as an important component of the value creation Social and governance (ESG) criteria, Digital transformation, Financial Environmental Impact, p.77, 78). process. İşbank provides indirect support to the goals by Financial Relationship Natural inclusion, Financial performance and profitability, Responsible Capital playing a leading role in providing the required financing Capital Capital products and services portfolio, Customer orientation Approach
Management to solve the problems pointed out by 17 development Material issue goals determined. İşbank directly contributes to 6 goals in Relevant capital its predominant domain as they stand out in line with its Combating with Climate Change, Responsible finance activities. These goals, the corresponding priority issues, the Sustainable Development Goal 8: integrating environmental, social and governance (ESG) relevant capital element and the featured practices are listed Decent Work and Economic Growth Financial Manufactured criteria, Responsible products and services portfolio, Capital environmental Footprint of the Bank below. Capital The prosperity created by the global economy is not shared Experience proportionally around the world. Inequalities increase in Natural Capital Intellectual
Flawless CustomerFlawless Capital regions where growth is slower, and job opportunities do not Relevant capital Sustainable Development Goal 4: increase at the same rate as the growing workforce. İşbank Quality Education believes that the banking and financial industry plays an important role in supporting inclusive business models and Social and Financial Relationship Natural ensuring that economic prosperity is shared by all segments. In Sustainable Development Goal 10: Capital Capital Capital İşbank believes in the importance of prevalent and qualified addition to its widespread branch network and digital banking Reduced Inequalities
Banking education for sustainable development. Therefore, Bank applications (Please refer to Digital Transformation, p. 44), the Responsible both makes investments in the development of its own Bank supports access to financial services and contributes to social welfare through its products and services (Please refer İşbank is against all types of discrimination. The Bank is employees (Please refer to Talent Management, p. 69-72) to Financial Inclusion, p. 61, 62) developed for disadvantaged working for the aim of creating sustainable value for all its and contributes to the education quality of the country customer groups. The Bank reflects its intellectual knowledge stakeholders by providing a fair working environment (Please with its programs within the scope of long-term social on different stakeholders by opening its neutral and refer to Equal Opportunity and Equality, p. 68, 69), increasing responsibility projects implemented (Please refer to comprehensive economic reports prepared to unlimited access the access of disadvantaged groups to financial services in digital environment. The Bank also creates value with its fair Positive Value For Society, p. 80-87). (Please refer to Financial Inclusion, p. 61, 62) and supporting Happy andHappy Productive Employees and decent working environment that it offers to its employees (Please refer to Employee Rights and Satisfaction, p. 64, 67). the long-term social responsibility programs (Please refer to Positive Value For Society, p. 80, 87). Material issue Material issue Employee rights and satisfaction, Talent management, Material issue Financial inclusion Financial performance and profitability, Employee rights and satisfaction, Business ethics, Risk management, Responsible Employee rights and satisfaction, Digital transformation, finance integrating environmental, social and governance (ESG) Financial inclusion, Responsible products and services Operations Responsible criteria, Responsible products and services portfolio, Digital portfolio, Equal opportunity and diversity, Talent management, Relevant capital transformation, Financial inclusion, Transparency and reporting, Social investment programs Talent management Financial Intellectual Capital Capital Relevant capital Relevant capital Social and Human Social and Financial Financial Intellectual Society Relationship Capital Capital Capital Relationship capital Capital Capital
Positive Value for Value Positive Social and Human Natural Capital Intellectual Relationship Capital Capital Capital
30 31 Material Issue Contributed SDGs Relevant capital element Financial Performance and Profitability
Financial Performance and Profitability İşbank 2019 Integrated Report
Financial Performance and Profitability at İşbank
Sustainability Steady financial performance is the basis of İşbank's value creation process. İşbank utilizes its financial capital to create value steadily for its investors, to develop and provide value-added products and services, to enhance its human resource and to provide social benefits. Financial Profitability Performance andPerformance Approach Management Experience Flawless CustomerFlawless 12. 4 % 4.7% 18.4% 20.7%
Banking
Responsible Increase in total assets Increase in total loans Increase in Growth in total deposits shareholders’ equity Happy andHappy Productive Employees İşbank nourishes its financial capital with
Wide-spread and stable customer and shareholder bases
Robust equity structure Operations Responsible Sustainable profitability facilitating internal capital generation
Wide-spread deposit base and capability to access alternative funds Society Positive Value for Value Positive
32 103-1 • 103-2 • 103-3 • 201-1 • 203-1 • 203-2 33 Financial Performance and Profitability İşbank 2019 Integrated Report
The non-deposit funding items utilised by the Bank
Wide-spread and Stable Customer and Sustainable Profitability Wide-spread Deposit Base and Capacity Shareholder Bases to Access Alternative Funds include repo transactions, syndication and securitization In 2019, İşbank maintained its leadership as a leader among transactions, bilateral loans, securities issued in domestic One of the most important institutional characteristics private banks with its total assets and with loan, deposit and Among private sector banks, İşbank has the largest TL and international markets, and subordinated debt at İşbank of İşbank is its wide-spread shareholder base comprising equity size. Total assets of İşbank reached TL 468.1 billion, Sustainability funding volume. Deposits, the main funding item, are one instruments. The share of the Bank’s non-deposit funds in of individual and institutional investors approaching 160 with a growth of 12.4% compared to the previous year. of the key elements of İşbank’s financial capital. Total total liabilities was 18.4% as of the end of 2019. thousand. 39.10% of İşbank’s capital belongs to the İşbank deposit size of İşbank reached TL 295.9 billion with an The Bank’s total loans rose to TL 270.4 billion as of the end of Members' Supplementary Pension Fund whose members increase of 20.7% in 2019, compared to the end of the 2019, with an increase of 4.7% in comparison to the previous are İşbank employees and retirees, with a number around previous year. 50 thousand, as of the end of 2019. year. The Non-Performing Loan (NPL) ratio remained at 6.5%, below the private banks' average at the end of 2019. Deposit Financial
Profitability As of the end of 2019, İşbank serves 19.5 million size of the Bank reached TL 295.9 billion with an increase of
Performance andPerformance customers, and uses its financial capital to contribute to 20.7% when compared to the end of the previous year. Performance Indicators 2018 2019 the sustainable development through its diversified loan Total Loan Growth (%) 8.7 4.7 portfolio. Being on the top in terms of total deposits, Turkish Lira (TL) deposits and foreign currency (FC) deposits among private Non-Performing Loans (%) 4.12 6.5 Leverage (%) 8.27 9.07 Robust Equity Structure banks, İşbank maintained its leadership position among private banks in demand deposits and TL savings deposits as well. Net Interest Margin (%) 3.66 3.71 Approach
Management İşbank is the leader among private banks in Turkey, with an Net Fees and Commissions Growth (%) 30.6 26.4 equity size of TL 58.9 billion as of the end of 2019. İşbank’s shareholders’ equity rose to TL 58.9 billion in 2019. The Bank’s robust equity structure increases sustainable The Bank’s capital adequacy ratio was 17.87% as of the end of Operating Expenses Growth (%) 8.7 21.8 2019, well above the legal limit. With a net profit of TL 6.1 billion growth and competitive capacity of the institution. Cost/Income (%) 36.4 38.8 in 2019, İşbank’s return on average tangible equity was 12.1% and average return on assets was 1.7%. Return on Average Tangible Equity (%) 15.5 12.1
Experience Average Return on Assets (%) 1.70 1.39
Flawless CustomerFlawless Capital Adequacy Ratio (%) 16.49 17.87 Tier I Capital Ratio (%) 13.72 14.97
Leverage (%) 8.27 9.07 Total Assets Total Deposits Banking Responsible Million TL 12.4 % Million TL 20.7 % Increase Increase 468,059 295,922 416,388 245,269
2020 and beyond Happy andHappy Productive Employees
2018 2019 2018 2019 Total loan growth of the Bank is expected to be in NPL ratio is estimated to remain below 7% in 2020. In the the range of 13.5-14.5% in 2020, and it is projected following 2 years, it is also predicted that the asset quality to continue at similar levels over the next 2 years, indicators will improve gradually in line with the recovery considering the expectations for loan growth in banking in economic activity. Shareholders equity Total Loans (*) sector.
Operations While the capital adequacy ratio is expected to be above Responsible Million TL 18.4 % Million TL 4,7 % Increase Increase In line with the decreasing funding costs, net interest 15% in 2020, it is aimed to keep this ratio above this margin is anticipated to be 3.8-4.0% in 2020, with a slight level also in the 2021-2022 period. Bank also intends 58,873 270,360 49,721 260,316 increase compared to the previous year. The net interest to improve the return on tangible equity, which is one of margin is expected to decrease gradually in line with the the most important indicators of internal capital creation (*) In order to ensure that the periods are comparable, while calculating the growth rate, the loan pursued repricing of assets in the period of 2021-2022. capacity, gradually in 2020 and beyond, compared to the in the Other Financial Assets reflected in the Fair Society 12.1% level realized by the end of 2019. Value Differential Profit Loss, which was extended to the special purpose company in the period of Positive Value for Value Positive 31.12.2019, was not included in the credit balance 2018 2019 2018 2019 in the period of 31.12.2018.
34 103-1 • 103-2 • 103-3 • 201-1 • 203-1 • 203-2 203-1 • 203-2 35 Material Issue Contributed SDGs Relevant capital element Business Ethics • Risk Management • Regulatory Compliance • Stakeholder Dialogue • Transparency and Reporting Management Approach İşbank 2019 Integrated Report
Management Approach
th
at İşbank Celebrating its 95 year in 2019, İşbank is a bank identified with trust Sustainability and prestige, as a result of the pioneering steps it has taken in banking sector since its foundation and long-established corporate history. While carrying this position to the future, the Bank adopts a transparent, fair, and accountable management structure without compromising its concept of Financial Profitability prestigious and principled banking. Performance andPerformance Approach Management Experience Flawless CustomerFlawless 268 7,577 6,292 2.6 million
Banking
Responsible Auditing of 268 Number of employees Number of suggestions Number of followers on branches, business participating in Anti- communicated by social media units and affiliated Bribery and Anti- employees companies by the Corruption trainings Board of Inspectors Happy andHappy Productive Employees Operations Responsible Society Positive Value for Value Positive
36 103-1 • 103-2 • 103-3 37 Management Approach İşbank 2019 Integrated Report
3,115
at İşbank The principles of the United Nations Global Compact, to which the Bank is a Sustainability signatory, are taken into account in all business processes. Total hours of training in Anti-Bribery and Anti-Corruption Financial Profitability Performance andPerformance
Corporate Governance Business Ethics In the “Working Order and Discipline Practices” class under İşbank carries out communication activities in several the Branch Managers Development Program, disciplinary channels to introduce its Anti-Bribery and Anti-Corruption practices of the Bank are shared. The Bank’s Board of Policy to its employees and all of its business partners. The The Board of Directors, the highest management body of For economic stability, it is of utmost importance that Inspectors are provided with trainings to help detect and Policy is shared with employees via the Bank’s corporate
Approach İşbank, is responsible for steering the strategies and policies banks, as reputable institutions creating trust, operate in a
Management prevent irregularities and misconduct. The “Policy for Intranet site and all stakeholders via its website. Employees of the Bank. The Board of Directors of İşbank consists of fair competition environment. İşbank adopts the Principles Combating Financial Crimes and Sanctions and Compliance sign a document asserting their acceptance of compliance 10 members, 2 of which are women. Having 3 independent of Banking Ethics of the Banks Association of Turkey. Program” e-training, assigned to all relevant employees as with the articles of the Anti-Bribery and Anti-Corruption members, the Board of Directors is composed of non- Additionally, the Bank works to integrate the concept of compulsory distance training with content established by Policy and consequences of any violation thereof. Any executive members, except the CEO. The position of CEO business ethics into corporate processes through policies the Corporate Compliance Division, provides information on update to the Policy is shared with employees through and Chairperson of the Board are performed by different including Anti-Bribery and Anti-Corruption Policy, Gifts and “Anti-Bribery and Anti-Corruption.” announcements. individuals in the Bank. The Board of Directors has several Hospitality Policy, Human Rights and Human Resources Experience governance committees in place established to support the Policy, Policy for Combating Financial Crimes and Sanctions, Flawless CustomerFlawless activities of the Board of Directors in various areas. etc. The Principles of the United Nations Global Compact, of which İşbank is a signatory, are also regarded in all of the İşbank’s Principles of Banking Ethics,
Responsible for implementing the strategies established Bank’s business processes. Anti-Bribery and Anti-Corruption Policy, by the Board of the Directors and led by the General Gifts and Hospitality Policy, and other complementary policies are available on Manager, the Executive Board has 10 members, 3 of New employees are provided with information on the Banking principles of banking ethics as part of their I Start My Career the Bank’s website. Responsible which are women. Training programs. Within the scope of orientation and development programs organized for branch management roles at different levels, anti-bribery and anti-corruption and ethical principles are discussed in trainings provided by the Detailed information on the corporate Bank’s Board of Inspectors. 2018 2019 governance structure of İşbank is
Happy andHappy Number of participants in Anti-Bribery and Anti-Corruption trainings Productive 914 7,577 Employees available on pages 94 through 103 of the 2019 Annual Report. Total hours of training in Anti-Bribery and Anti-Corruption 3,605 3,115
Number of participants in Ethical Principles trainings 363 664
Total hours of training in Ethical Principles 175 506
Number of participants in Human Rights trainings
Operations 379 260 Responsible Total hours of training in Human Rights 1,086 733 Society Positive Value for Value Positive
38 102-16 • 102-17 • 102-25 • 102-26 • 10-27 • 102-28 • 102-29 • 103-1 • 103-2 • 103-3 • 205-1 • 205-2 • 205-3 • 412-2 102-16 • 102-17 • 103-1 • 103-2 • 103-3 • 205-1 • 205-2 • 205-3 • 412-2 39 Management Approach İşbank 2019 Integrated Report
The risk management process, giving precedence to “good corporate governance,” is a FINANCIAL RISKS structure in İşbank where independence of risk taking executive units and internal audit
at İşbank and surveillance units from one another is assured, the risk is defined in accordance with Sustainability international regulations, and measurement, analysis, monitoring, reporting and supervising Asset/Liability activities are carried out within this framework. Credit Risk Management Risk Business Risk Other Risks
Counterparty Risk Market Risk Insurance Risk
Financial Credit Concentration Risk Structural Interest Securitization Risk Profitability
Performance andPerformance Rate Risk Settlement Risk Risk Management and Compliance In parallel with international best practices, the Risk Liquidity Risk Management Division carries out internal and legal Country Risk Risk management activities of İşbank are conducted by capital adequacy activities in line with Basel framework, Investment Risk the Risk Management Division reporting to the Board of and works to develop and validate risk measurement
Approach Residual Risk
Management Directors. Financial and non-financial risks are monthly methodologies, and optimize capital adequacy reported to the Risk Committee and, through the Audit management process. The Bank’s level of risk exposure Committee to the Board of Directors respectively. A Risk is systematically monitored in accordance with the Committee was established to share risk management written risk policies and implementation procedures. The principles within the Bank and reflect them on the Bank runs the risk management process as per internal NONFINANCIAL RISKS decision making and implementation processes. The regulations approved by the Board of Directors, including
Experience Risk Committee engages in the activities of preparing Capital Adequacy, Credit Risk, Asset/Liability Management consolidated and unconsolidated risk management
Flawless CustomerFlawless Risk, Operational Risk, Stress Testings, Reputational Risk, strategies and policies of the Bank, submitting such Consolidated Risk and Information Systems Management strategies and policies for the approval of the Board of Policies. Directors, and following up relevant implementations. Operational Risks Reputational Risk Strategic Risks Potential risks which may be encountered during activities The risk management process, giving precedence to are defined and classified through the “Risk Catalogue” of Banking
Responsible “good corporate governance,” is a structure in İşbank the Bank. In the Risk Catalogue, risks are detailed in two Fraud Risk Transaction, Process Macroeconomic / Regulatory Change where independence of risk taking executive units and main groups: financial and non-financial risks. Systemic Risks Risk internal audit and surveillance units from one another is and Products Financial Crime Risk assured, the risk is defined in accordance with international In measuring operational risks, impact-likelihood analysis, regulations, and measurement, analysis, monitoring, lost case data analysis, scenario analysis, stress tests and Human Resources Business Strategy Environmental reporting and supervising activities are carried out within key risk indicators are used as well as risk assessments for Conduct Risk Risk Risk Management Risk this framework. risk prioritization. The risks which are defined in the Risk Happy andHappy Productive Employees Catalogue and whose management principles are detailly Regulatory Physical Damage Political Risk Talent Management Risk management practices of the Bank cater for the described in risk policies are regularly reviewed, at least Compliance Risk creation of a common risk management culture across annualy and relevant definitions and principles are kept Risk Risk Climate Change Risk the organization. In risk management efforts, regulations up-to-date. and best practice guidelines published by the Banking Model Risk Information New Technology/ Regulation and Supervision Agency (BRSA) are taken as Implementation of best practices in the management Competitive Risk of risks related to climate change is one of the most Technologies and Digitalization Risk Operations
Responsible basis. In addition to compliance with legal limits, the Bank also takes care to maintain capital and liquidity adequacy prominent issues for İşbank. Risks related to climate change Cyber Risks against all risks undertaken by the Bank, within the scope were classified under strategic risks as part of nonfinancial of Internal Capital Adequacy Assessment Process (ICAAP). risks, as a result of studies carried out in 2019. Society Positive Value for Value Positive
40 103-1 • 103-2 • 103-3 • 102-11 • 102-15 • 102-30 103-1 • 103-2 • 103-3 • 102-11 • 102-15 • 102-30 41 Management Approach İşbank 2019 Integrated Report
Existing and potential risks are identified and solutions
Reputational Risk Performance Indicators are proposed for the elimination of risks. In the event of In İşbank, reputational risk is defined as the potential loss identification of any violation of anti-bribery and anti- resulting from impairment of trust in the Bank or damage corruption policies during the audits, action is taken as per Business Ethics Compliance with Regulation at İşbank to the reputation of the Bank as a consequence of negative 2018 2019 Sustainability internal disciplinary provisions and legal regulations. views of parties such as current or potential customers, Number of participants in partners, opponents or supervisory authorities about As part of activities in 2019, risk assessments taken Audits carried out by the Board of Directors Anti-Bribery and Anti- 914 7,577 the Bank, or failure to act in accordance with applicable as a basis in the identification of staff-related risks and Corruption trainings 2019 legal regulations. In monitoring the reputational risk, the development and maintenance efforts regarding various practices intended for quick and qualified data provision reputation index, created by the Bank to serve as an early Number of domestic branches warning for elements which may potentially impact the for internal misconduct detection and investigative actions 245
Financial Total hours of training in Profitability Bank’s reputation, is used. Assessments of reputational were carried out. Anti-Bribery and Anti-Corruption 3,605 3,115 Performance andPerformance risk level are reported to the senior management at least In 2019, auditing of a total of 245 domestic branches quarterly. It is the senior management’s responsibility to Number of overseas branches including 5 affiliated branches was completed and auditing 2 monitor compliance with the corporate governance concept of 2 overseas branches was started by the Board of which constitutes the basis of reputational risk, and take Risk Management Directors. Branch audits were supported with company, improvement efforts in this respect. Number of subsidiaries portfolio and regional audits. Auditing of 7 subsidiaries and 2019
Approach 7 Management Compliance 14 Head Office Division/Unit was completed or started. Audits on Banking Processes and Information Systems Number of Risk Committee meetings 12 Compliance with rapidly changing regulations is a priority are annually conducted as part of the Management Number of Head Office units 14 issue for the entire banking industry. The responsibility to Declaration. track compliance activities of İşbank lies with the Corporate Loss event data analysis conducted Compliance Division acting under the Board of Directors, Stakeholder Dialogue
Experience through the Audit Committee. The Corporate Compliance İşbank strives to create sustainable and sharable value for Flawless CustomerFlawless Division ensures that activities of the Bank are carried all of its stakeholders. Regular, on time and bidirectional Scenario analysis completed out and managed in line with the applicable legislation, Transparency and Reporting communication with stakeholders is a priority in all regulations and standards. activities of the Bank. A summary of communications with Manager of the Corporate Compliance Division acts as the stakeholders within the reporting period is available on Impact-likelihood analysis conducted Integrated report revealing environmental, legal “Compliance Officer” as well, and fulfills, under the page 92. social and economic performance from a holistic Banking
Responsible Bank’s Policy and Compliance Program, their duties and perspective published responsibilities arising from the Law on the Prevention Transparency and Reporting of Laundering Proceeds of Crime and other applicable İşbank carries out reporting activities in different channels Top-down Risk Assessment conducted legislation. for diverse stakeholder groups throughout the year as Carbon Disclosure Program reporting (CDP) Carrying out all banking activities in line with the Bank’s required by transparency and accountability principles. goals and policies, legislation, regulations and standards In 2019, the Bank published its Annual Report to Happy andHappy Productive Employees are the fundamental duty and responsibility of all Bank provide a summary of its annual activities, and the first Stakeholder Dialogue Integrated Report giving information on the integration employees. 2019 2020 and beyond of the sustainability approach into business processes and the sustainability performance. In 2019, the Bank Number of feedback Internal Audit and Control communicated to the Customer started reporting to the Carbon Disclosure Project as well. In the following period, the Bank targets to increase Relations Program 466,708 İşbank’s Board of Auditors carries out periodical and İşbank corporate website serves current information on the number of trainings provided to develop risk management skills of employees and raise awareness
Operations risk-based inspections to tackle bribery and corruption
Responsible developments in the Bank and products and services of as part of routine auditing activities conducted as per the the Bank available for its stakeholders. All stakeholders of in this respect for the purpose of spreading the Number of suggestions International Internal Audit Standards. Results of audits İşbank also have access to the Bank’s all reports, Material effective risk management approach throughout communicated by employees 6,292 are reported to the authorized functions of the Bank as Event Disclosures, Investor Presentations, and Credit the entire corporation. Valuing stakeholder dialogue required by the current legislative provisions and results of Ratings on the Bank’s corporate website. and sharing its social, economic and environmental reports are followed up. performance with an integrated perspective as Number of followers on social required by its concept of transparency, the Bank Society Million media 2.6 aims to maintain this approach by incorporating Positive Value for Value Positive developments in the global standards as well.
42 103-1 • 103-2 • 103-3 • 102-33 • 102-34 • 102-42 • 102-43 43 Material Issue Contributed SDGs Relevant capital element Digital Banking • Customer Focus • Data Security
Flawless Customer Experience İşbank 2019 Integrated Report
Flawless Customer Experience
at İşbank Developing technology and increasing rate of digitalization deeply affects the Sustainability banking sector. New technologies enable more inclusive, easily accessible, innovative financial products. With its digitalization efforts, İşbank aims to provide benefits in numerous fields including effective customer relations, personalized products and services, high-efficiency operations, and expansion Financial Profitability of banking activities. Performance andPerformance Approach Management
st st 19.5 million 12.5% 1 1 Experience Flawless CustomerFlawless
Customers Increase the number First rank among First rank among
of digital banking private banks in private banks in customers personal net promoter commercial net
Banking score promoter score Responsible
Digital Transformation Happy andHappy Productive Employees
Developing technology and increasing rate of digitalization Totaling 6.8 million as of the end of 2018, the number deeply affects the banking sector. New technologies enable of active mobile banking customers of İşbank exceeded more inclusive, easily accessible, innovative financial 7.8 million at the end of 2019. In the same period, the products. Digital transformation is one of the main axes Bank’s total number of digital Banking users reached of İşbank Banking and a critical component of the Bank’s 8.1 million, the number of customers using Bankamatik Operations Responsible business strategy. Therefore, İşbank allocates significant ATMs reached 9.8 million, and the number of customers amount of resources to digital transformation efforts. using internet branch reached 2.5 million. Besides İşbank customers, 8.3 million customers from other banks used With its digitalization efforts, İşbank aims to provide Bankamatik ATMs, 2.4 million residing overseas and 5.9 benefits in numerous fields including efficient customer million residing in the country. With the above figures, the relations, personalized products and services, high- ratio of transactions through non-branch channels to total
Society efficiency operations, and expansion of banking activities. transactions exceeded 92% at İşbank. Positive Value for Value Positive
44 103-1 • 103-2 • 103-3 45 Flawless Customer Experience İşbank 2019 Integrated Report
Volume of income generating monetary transactions Maxi was engaged in over 22 million dialogues with carried out from within Maximum Mobil application, at İşbank Sustainability 22 million 4.9 million customers as of the end of 2019. 117 % increased by 117% compared to the corresponding period of the previous year. Financial Profitability Performance andPerformance
Innovative products and services one dialogue experience, Personal Banking assistant Maxi an ecosystem offering end-to-end shopping experience” or opening to use; in transactions within the Maximum allows customers to carry out transactions by talking or since the introduction of the application. Volume of income Mobil ecosystem such as giving orders from Yemeksepeti, Instant Commercial Loan texting. Maxi was engaged in over 22 million dialogues generating monetary transactions carried out from within loading İstanbulkart, purchasing tickets from Cinemaximum, with 4.9 million customers as of the end of 2019. Total Maximum Mobil application, with a total download count and paying bills; in e-commerce transactions and in mobile Allowing commercial customers to apply via digital Approach number of Maxi’s competencies was increased to 164 of 5.1 million as of the end of 2019, increased by 117% payments with their NFC-compliant phones with Android Management channels without going to a branch, even if they used up through improvement of natural language capabilities and compared to the corresponding period of the previous their line of credit, Instant Commercial Loan product is a operating system. Upon request, card holders may use year. Volume of mobile contactless payment transactions first to offer an instalment commercial loan facility over an transaction diversity. Integrated with Facebook Messenger their physical cards for shopping and cash withdrawal or carried out from the application grew by 127.1% yearly. end-to-end digital channel. in 2018, Maxi became the first Turkish Bank application card holders may continue to use their card in digital form to integrate with Google Assistant in February 2019. In İşbank intermediated the payment of TL 9.2 million from without requesting a physical card. In addition to Bank Electronic Letter of Guarantee September, integration with WhatsApp was completed. almost 432 thousand transactions as part of İstanbulkart customers, other people may also apply for cards on their integration and TL 17.1 million from almost 32 thousand own behalf and on behalf of their children over 12.
Experience Upon legal enforcement of issuing letters of guarantee API Investments transactions as part of flight ticket integration. with secure electronic signature by banks, an Electronic
Flawless CustomerFlawless Digital Transformation Center Letter of Guarantee Platform was created, enabling letter Driven by the vision of “banking everywhere”, investments Maximum İşyerim of guarantee transactions to be carried out electronically increasingly continued throughout the year in the field of In order to be able to meet digitalization needs of SMEs and Application Programming Interface (API) which enables Maximum İşyerim app was downloaded over 89 thousand at the level of the Credit Reference Agency. İşbank provide them with guidance they need in this matter, İşbank times by the end of 2019. The Bank provided services completed the integration into the relevant platform in customers to reach İşbank products and services anytime became a sponsor for the “Digital Transformation Center” to over 114 thousand member merchants and over September 2019 and started processing letter of guarantee and anywhere they need. APIs were enriched in line with project developed by TÜRKONFED (Turkish Enterprise and 58 thousand commercial cards through the platform. Banking transactions in the electronic environment. İşbank is able customer needs and the number of APIs totaled 32. Business Federation). Development areas were identified Responsible In Maximum İşyerim application, new features were to issue electronic letter of guarantee and letter of intent for 150 businesses selected among 500 SMEs applied for incorporated: one providing analysis reports which addressing the General Directorate of Customs and Export Single Digital Identity the project supported by Istanbul Development Agency allow the member merchants to scrutinize their sales Credit Bank of Turkey. Driven by the vision of “single digital identity”, access (ISTKA) and these businesses were provided with assistance and performances; “QR POS” allowing use of a mobile to Anadolu Sigorta website was enabled through in reaching technology firms which may provide service phone as a POS machine, and QR payment feature with TekCep authentication by İşbank, as part of efforts to allow sign on to them in these areas. As part of the project, 10 free Alipay. Additionally, “Pay by Link” was made available for to third party applications with İşbank credentials. All of the public events were organized to raise awareness of digital Making it possible for corporate customers, via İşCep customers for remote collections without requiring a POS Happy andHappy Productive transformation and almost 150 participants were reached. Employees functions offered by Anadolu Hayat Emeklilik via its mobile Commercial or Commercial Internet Branch, to securely machine. Collection of POS receivables before maturity and application were made accessible from İşCep as well. access their accounts in other banks and instantly view card transactions installment and postponement features, their balances and account activities through a single Digital Business Platform Robot Pepper which our commercial customers perform frequently account in 2019, TekCep is one of the most prominent via branches, were added to the Maximum İşyerim app, Digital Business Platform was expanded in 1000 branches development efforts of the Bank. Efforts to extend the use of humanoid robot Pepper to 14 and thus the customers have been provided with the with many innovations including enriched customer İşbank branches were completed and Pepper was engaged opportunity to carry out these operations effortlessly and recognition screen, “Bir Bilene Sor” (Ask an Expert) İşCep in an average of 24 thousand interactions with customers instantly with a practical customer experience. application, and messaging with customers. Operations Responsible The first mobile banking application and the mobile banking per month. Pepper was introduced to visitors in November platform with the widest selection of transactions, İşCep at İşbank Museum. Pepper drew a great deal of attention Digital MaxiPara Card Digital Approval was enriched with 44 new functions, and enhancements especially from child visitors and helped future generations As part of efforts to digitalize its products, applications and As part of Digital Approval which allows issuing forms that improve customer experience, with its total number of meet robotic technologies. services in parallel to rapid developments in technology, and agreements in the digital environment for banking functions increased from 272 to 316 in 2019. İşbank started accepting Digital MaxiPara Card applications products made available for use by personal customers and Maximum Mobil Ecosystem through Maximum Mobil application, the digital payment giving approvals over tablets in branches or İşCep, issuing Personal Banking Assistant Maxi Society Campaigns and announcements were carried on in line with ecosystem of the Bank. Cardholders may use their Digital customer consents and declaration forms was enabled Running on İşbank’s artificial intelligence and natural customer demands and needs in keeping with the primary MaxiPara Cards which are issued immediately after the in the digital environment and technical efforts were Positive Value for Value Positive language processing technologies and offering one-to- goal of maintaining Maximum Mobil’s pledge to “deliver application without any activation, specifying any password completed to sign transaction slips with signature tablets.
46 47 Flawless Customer Experience İşbank 2019 Integrated Report
Artificial Intelligent (AI) received more than 1,500 applications, 26 of which were With Design Thinking and Customer Journey methods,
Innovation and Entrepreneurship approved. Of those, 20 graduated with Demo Day events İşbank continuously improves communication processes, İşbank continues to work towards developing technology One of the most significant capabilities that turns data into held in June and December. and seeks to identify the needs and problems of customers and business models accommodating new competitive value and causes it to be evaluated as the contemporary by empathizing with them, eliminate their problems using at İşbank conditions with a view to correctly foreseeing the strategic equivalent of oil is Artificial Intelligence (AI). At İşbank, 7 Workup Entrepreneurship Program graduates received
Sustainability innovative solutions, and measure the success of solutions moves that may change competition in the digital world AI is positioned as a natural part of corporate culture an investment worth USD 462 thousand in 2019, and 72 by testing them again with customers. Customer Journeys where technology rapidly evolves, and taking action and processes that support it. In line with this approach, different trainings and events were organized under the illustrate customer experiences from end to end from accordingly. In this scope, the Bank adopts an open İşbank’s AI vision and strategy were created in 2019 program. In a 3-day accelerated training program involving customer’s perspective. innovation approach, and capitalizes on initiatives to with a view to maximizing customer experience from 11 startups, entrepreneurs were informed about how to extend to the US market. 3 entrepreneurs selected at the develop new products and services in particular as well as the customer’s perspective and, from the employee Customer Feedback ideas and technologies developed by institutions such as perspective, guiding them towards fields where they can end of the program traveled to San Francisco, USA for one
Financial İşbank collects customer feedback through numerous Profitability technology companies and universities. create higher value through automation of jobs with low week in October and met potential investors, customers
Performance andPerformance channels. Applications made by customers directly to the added value by supporting employees with AI algorithms. and accelerators. Through its innovation centers in the USA, China and Turkey, Bank through corporate website,the internet branch, call the Bank keeps track of new technologies, and carries out In this arena, which is one of the highest priority issue of Technology Entrepreneur Package center, branches, Customer Care Unit email, fax or post are proof of concept studies to employ digital technologies and 2019, “agile business model” was implemented and AI Agile İşbank supports entrepreneurship ecosystem with its recorded in the Customer Relations Program and evaluated; analytical methods and create new products. Space was created by building a team of 60 people with the products and services. The Technology Entrepreneurship and the Bank takes steps to meet demands or resolve roles of product owner, data scientist, data engineer and problems in the fastest manner possible. Approach As part of initiatives to propagate an innovation culture, the Package, created to support technology-driven Management Bank organizes many internal and external workshops and data architect. entrepreneurs in establishment phase, has reached 400 In 2019, İşbank received 466,708 instances of feedback events, and processes are run that create innovative value Within the AI Agile Space, AI projects were launched to users as of the end of 2019. through these channels, all of which were addressed. propositions under “İş’te Yeni Bir Lider” (A New Leader At İş) maximize customer experience, support profitability and Customer demands and complaints are closely tracked Programme. Customer Focus growth strategies, manage risk more effectively, and lower from social media and platforms such as Şikayetvar. İşbank operational expenses. Among these projects, “Prediction of Doing business with a seamless and sustainable growth Agile Atelier ranked the first in the annual evaluation of Şikayetvar.com Product Needed by the Customer” AI models, and “Savings strategy to become “the bank closest to customers”, İşbank
Experience called “Customer Experience Index” in 2019 by scoring the works to deliver a banking experience addressing customer 240 employees competent in different lines of business Deposits Pricing”, and “Personal Loan Pricing” AI models highest in the private banks category. İşbank Call Center Flawless CustomerFlawless play role in the business model targeting fast decision expectations and needs. The Bank’s service concept were developed and launched in Personal and Commercial has been holding, EN ISO 15838 Customer Contact Centers making with teams making customer needs their center of which centers around customer experience both helps Banking areas in 2019. Pilot studies are underway in Standard certification since 2011. attention. 4 “Agile Spaces” made up of 25 agile teams as of Personal and Commercial Banking areas for AI models increase satisfaction and contributes to the organization’s the end of the year continue activities focusing on small- developed for loan allocation decisions and those for pricing profitability. İşbank aims to provide access to financial Customer Satisfaction sized businesses and enterprises, personal customers, of products used by SMB Customers. products and services for all segments of the society and In digital rating studies started in March 2019 in İşbank, Banking present responsible products and services. more than 650,000 of customer feedback were reached
Responsible artificial intelligence implementations and robotic process In 2019, İşbank started to identify potential disruptions in automation. through different channels throughout the year. As a its strong technological infrastructure through Anomaly Customer Experience result of the study on the received feedback, satisfaction In 2019, successful business outcomes were delivered and Detection AI models before they take place. As the most preferred bank of Turkey, İşbank strives to scores of digital channels were measured 91% for İşCep, employee satisfaction significantly increased with the “agile offer excellent and secure customer experience for its 89% for Personal Internet Branch, 88% for Commercial business model”. In selected subjects in Agile Spaces, rate of Workup 19.5 million banking customers in total from individual, Internet Branch, and 82.5% for Bankamatik ATM. Instant doing business increased by 75% and employee satisfaction Supported by İşbank as the main sponsor, Workup commercial, corporate and private banking segments from and ongoing customer experience measurements taken Happy andHappy Productive Employees by 18%. Through enhancements realized in 2019, demand Entrepreneurship Program has been carried out in all points of contact. in all branches continued in 2019 as well and satisfaction deposit balance of commercial customers within the Agile Kolektif House Levent since 2017. Launched to speed was found to be increasing. Over 2.6 million instances İşbank’s Customer Experience Principles aspire to Atelier increased by 42%, and cash loan balance by 12% up technology-driven, early stage startups that have a of feedback were collected through kiosks in branches. understand customer needs, produce fast, personalized, compared to the previous year. sustainable and scalable business model in place and Satisfaction score measured through such feedback easily accessible solutions, and deliver a consistent and Being one of the first organizations implementing this have reached prototype or MVP phase, this program reached 74% with an increase by 3% compared to the integrated customer experience. globally prevailing business approach, İşbank ranked provides enterprises with offices in Kolektif House Levent previous year. Operations Responsible for 6 months, mentorship from more than 50 specialists, İşbank updates its business processes in a way to improve the first in Sardis 2019 Awards Enterprise Innovation According to the results from a 2019 research by business development opportunity with İşbank and group the banking experience of customers. Redesigning its Category and the third place in IDC’s Turkey Finance and Futurebright independent research institute, İşbank, when traditional banking services as part of digital transformation, Technology Awards 2019 Best Enterprise Transformation companies, AWS, Google, Radore, etc. loans, and access compared to other banks of similar size, has the highest İşbank maintains high customer satisfaction by offering a Project category with its Agile Atelier. Agile Atelier, one to business and investment world. In 3 years, more than Net Promoter Score (NPS) among private banks. of the most noteworthy initiatives in the world banking 9,000 startups have applied for the program and 80 of more enjoyable and fast banking experience. industry, got visitors from nearly 100 internal and external them have been accepted. 49 startups graduated in these
Society institutions/organizations, was presented as a case study first 5 terms and the program continues its 6th term
Positive Value for Value Positive in conferences, and covered by written and visual media with 12 startups. 13 of graduated startups received a numerous times. seed investment of USD 1.5 million. In 2019, the program
48 103-1 • 103-2 • 103-3 49 Flawless Customer Experience İşbank 2019 Integrated Report
Social Media employees from the Headquarters and branches on cyber Performance Indicators security, social engineering, and information security. İşbank also uses social media actively for customer communication. The Bank was active in Facebook, Twitter, The Board of Inspectors makes regular and risk-based Digital Transformation 2018 2019
at İşbank Instagram, Youtube, Linkedin, Pinterest, and Medium audits to check the adequacy of measures taken across Number of Bankamatik ATMs 6,560 6,506 Sustainability Blog with 37 different social media accounts belonging to the Bank. With such internal audit activities, it is evaluated Number of digital banking users (million) 7.2 8.1 the brands İşCep, Maximum, Maximiles, İş’te Üniversiteli, whether necessary controls and structures are in place for Maximum Gaming and Workup in 2019. information systems across the Bank and security of data Number of mobile banking users (million) 6.8 7.8 in these systems. In 2019, Internal Control Department Data Security and Privacy information systems internal control team reviewed 36 Share of digital channels in non-cash financial transactions (%) 81.8 84.6 Digitalization brings along increasing data security risks checkpoints in information security in daily, weekly and Share of digital channels in sales (%) 30.9 40.1 Financial
Profitability as well. Like in digitalization efforts, İşbank exercises monthly periods with respect to second level controls. In
Performance andPerformance due diligence and attaches importance to data security. addition, an external audit activity and a penetration test Number of cardless transactions performed through Bankamatik ATMs (million) 32.5 33.8 The Bank is highly sensitive in fulfilling its obligations activity were carried out in information systems in 2019. Amount of cardless transactions performed through Bankamatik ATMs (billion TL) 20.02 24.78 regulated by the banking legislation, other legislative The same level of compliance with high information Saving from paper consumption secured by digitalization (page) 11.9 million 40.4 million regulations, and the Personal Data Protection Law. The security standards set by İşbank is also expected from Bank works toward ensuring the security of information suppliers which provide service to İşbank. Supplier YoY increase in the number of digital banking customers (%) 22.5 12.5 Approach assets as per international standards and raising performance is regularly tracked and agreements with Management awareness of data security across the Bank. Share of non-branch channels (%) 88.5 92.2 suppliers stipulate penal sanctions about information In security architecture, there are multiple layers created security. Number of users reached by Maxi (million) 1.3 4.9 in the communication network of the Bank. All server and As part of auditing activities, internal control systems of Number of questions answered by Maxi (million) 2.3 22.6 endpoint devices are protected with endpoint security the Bank’s subsidiaries and affiliates and service providers solutions. Volume of end-to-end digital commercial loan disbursement through Instant Loan (million TL) 6.9 143.98 are also evaluated for information security. Internal audit
Experience İşbank established the Security Intelligence and Defense also covers reporting of all examination results from the Succesfull Transactions Index for IT Critical Services (6-Sigma)* 4.78 Sigma 4.83 Sigma
Flawless CustomerFlawless Center (SIDC) to track cyber security incidents 24/7, and audits to the Board of Directors via the Audit Committee Customer Focus 2018 2019 prevent new vulnerabilities and malware. To promote the and monitoring of all measures taken by the heads of Number of customers (million) 19.1 19.5
Center’s capability to respond to security incidents, the related sections within the frame of audit reports. Bank follows current technology trends and ensures that İşbank continued pioneering activities in data security Personal Net Promoter Score 37 33 best practices are implemented across the Bank. Since in 2019 as well. İşbank is the first bank in Europe to Banking 2012, regular penetration tests have been conducted to Personal Net Promoter Score Ranking (among private banks) 1 1 Responsible migrate to EMV 3DS (3D Secure 2.0), the current version identify potential vulnerabilities in the system. Commercial Net Promoter Score 56 43 of 3D Secure infrastructure enabling authentication of To raise information security awareness across the Bank, card holder in internet shopping with card. With this new Commercial Net Promoter Score Ranking(among private banks) 1 1 trainings are provided and phishing tests are conducted. technology, the Bank aims to deliver better customer Customer satisfaction score (%) 84.5 81.2 In 2019, 4,952 hours of training was provided to 1,423 experience with more security. Data Security 2018 2019 Happy andHappy Productive Employees Fines imposed due to data security breaches (TL) 30,000 0
* Index for IT Critical Services is the value calculated by the ratio of the number of successful transactions passing through critical channels (İşCep, ATM, internet branch, card systems, Maximum Mobile, branch systems) used by the Bank's customers or directly affected by the number of transactions passed through these channels.
2020 and beyond Operations Responsible
Driven by its vision to be the bank of the future by creating sustainable value, İşbank positions flawless customer experience among its strategic goals. It is a priority objective to maintain leadership in Net Promoter Score in personal and commercial segments. The Bank will continue digitalization investments without gearing down and follow new technologies in information security rigorously. The Bank targets to get the share of digital channels in total sales to the Society level of 60% within 3 years. It will also continue efforts focusing on continuous improvement of customer experience. Positive Value for Value Positive
50 103-1 • 103-2 • 103-3 51 Material Issue Contributed SDGs Relevant capital element Combating Climate Change • Responsible Finance Integrating ESG Criteria • Responsible Product and Service Portfolio • Responsible Responsible Banking Marketing • Financial Inclusion İşbank 2019 Integrated Report
Responsible Banking at İşbank
Sustainability İşbank's responsible banking approach involves developing products, services and solutions in many areas such as financing renewable energy projects which support the low carbon economy, strengthening women entrepreneurs and SMEs which form the backbone of the economy and management of environmental and social risks arising from the investments to which it extends financing. Financial Profitability Performance andPerformance Approach Management
395 222 67.3% 45,629 USD million USD million Experience Flawless CustomerFlawless
Financing provided Financing provided Share of renewable Number of women
for projects subjected to renewable energy energy projects in total entrepreneurs to environmental and investments energy generation supported
Banking social risk evaluation projects portfolio Responsible Happy andHappy Productive Employees Combating Climate Change
İşbank is committed to developing products and services The World Economic Forum's 2020 Global Risk Report that will add value to the lives of its stakeholders. The Bank shows that all five of the most important risks affecting the gives priority to minimizing any adverse effects arising from global economy and humanity stem from environmental investments to which it provided finances in the process issues. Climate change ranks first in this risk list, which Operations Responsible of value creation, ensuring that disadvantaged groups can includes adverse conditions caused by extreme weather benefit from financial services, supporting transition to conditions, decrease in biodiversity, increase in human- low carbon economy, and strengthening SMEs. Therefore, caused environmental disasters and natural disasters. İşbank creates sustainable value for all of its stakeholders. Nature's capability is insufficient to meet human needs due With its responsible banking concept, the Bank provides to the increasing population, irresponsible production and assistance in the resolution of problems covered by the UN consumption behaviors. Society Sustainable Development Goals. Positive Value for Value Positive
52 103-1 • 103-2 • 103-3 53 Responsible Banking İşbank 2019 Integrated Report
at İşbank Sustainability
Environmental and Social Risk Investments under evaluation are assessed with reference Management in Lending to national legislation and international best practices such as IFC (International Finance Corporation) Performance Standards, EBRD (European Bank for Reconstruction
Financial Incorporation of environmental and social impacts into loan Profitability and Development) Performance Requirements, and
Performance andPerformance evaluation processes is among sustainability priorities of the banking industry. İşbank is one of the first signatories of Equator Principles, and a Project Environmental and Social Business models, which do not take environmental factors institutions to finance renewable energy and energy the Turkey’s Declaration on Sustainable Finance published Evaluation Certificate is prepared for every individual into consideration, show that companies will face resource efficiency. The weight of products that support the green by Global Compact Turkey, guaranteeing assessment of investment. problems in the medium and long term, which will create economy, such as İşbank Green Bond, Solar Loan by İşbank, environmental and social risks in credit processes. In all of the projects established as “high risk-Category A”, multi-dimensional risks for financial institutions. Decreasing TEMA Environment Variable Fund, in the Bank's product Approach Potential environmental and social risks of new investment and in those as deemed necessary independent of their
Management resources bring with it the need for more comprehensive portfolio is increasing day by day. risk category, as a result of the assessment of İşbank environmental legislation. Changes such as environmentally projects with a total investment sum of over USD 10 million Environmental and Social Risk Management Team (ESRM), friendly practices, green economy, transformation economy İşbank carries out efficiency projects to minimize the are evaluated by İşbank with Environmental and Social Risk an independent Environmental Consultant is designated and increasing importance of clean energy indicate environmental impact of its operations. An environmental Evaluation Tool (ERET). to act on behalf of the Bank. An Environmental and Social opportunities in this field. management system at international standards has been By establishing “customer” and “project” risk categories of Assessment (ESA), which includes the current status, established at the Bank. Various environmental indicators such investment loans through this model, a roadmap is compliance and consultant remarks of any license/approval
Experience İşbank's efforts to combat climate change proceed in two are monitored at the Bank's Head Office buildings and created to limit and eliminate possible environmental and processes with respect to environmental obligations, and
Flawless CustomerFlawless main areas. The Bank supports the green economy with its branches. Digitalization studies are carried out for paperless social impacts of the investment. Investment projects are an Environmental and Social Action Plan (ESAP), which products and services in line with its responsible banking banking. Details of İşbank's activities in this area are evaluated with ERET with respect to 26 different criteria intends to limit and eliminate these impacts and manage approach and works to reduce its environmental impact included in the “Responsible Operations” section of the
including use of natural resources, solid waste, air, soil and the process, are prepared and submitted to the Bank. In resulting from its operations. report (Please refer to: Responsible Operations, p. 74-79). water quality, noise, dust, occupational health and safety, high risk projects, an additional Environmental Impact public health and safety, involuntary resettlement and Assessment Report (EIA), which includes more detailed
Banking Addressing financial, social and environmental risks with an İşbank supported the "First Turkish Arctic Scientific stakeholder engagement, etc. As a result of the evaluation, current status analyses, might be requested in addition to Responsible integrated risk management approach, İşbank risks related Expedition" conducted by the İstanbul Technical University, projects are classified into four categories by their the EIA application file prepared in accordance with legal to climate change were classified under strategic risks in Polar Researches Application and Research Center (PolReC) risk,levels: high (Category A), medium high (Category B+), requirements. It is requested to prepare, and provide the 2019. with the sponsorship of the Turkish Arctic Scientific medium (Category B-), and low (Category C). Bank with, an Environmental and Social Management Plan Expedition and contributed to global climate change and (ESMP) related to proper management of project risks and The Bank also includes environmental and social impacts sea ice physical science studies. impacts. Environmental and social monitoring activities in the loan evaluation processes. İşbank contributes are carried out through field visits by the Environmental Happy andHappy Productive Employees to reducing the risks and impacts of climate change İşbank will continue to closely monitor the risks and Consultant with the participation of ESRM Team in by financing renewable energy projects. The Bank also opportunities created by climate change, and to continue its connection with actions as laid down in the ESAP. develops collaborations with international financial corporate engagements in this field in the future. Activities Not Financed In all projects, “Public Participation Meetings” are organized İşbank rejects any loan applications for activities as a minimum as part of the EIA, and additional stakeholder on the İşbank Exclusion List, which the Bank communication meetings are held and corporate social
Operations responsibility efforts are undertaken in all projects financed
Responsible names in the schedule to its Environmental and Social Impacts Policy, without even evaluating in accordance with the international standards. them. Among activities not financed by the Bank are investments involving forced labor and child employment, the production of weapons of mass destruction and landmines, the production and
Society trading of internationally prohibited chemicals, drugs or substances that are harmful to the ozone-layer. Positive Value for Value Positive
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Clean energy generated by RE projects financed by at İşbank
Sustainability 38.8 İşbank (total of 2019 and 2018) million MWh The Bank requires investing companies to make One of the impacts of financed projects is the cases of commitments, as exemplified below, in line with forced relocation. In some projects, financial hardships may assessments specific to projects, in order to eliminate/ arise as a result of people’s exposure to forced relocation mitigate or compensate any environmental and social or relocation of their workplace due to expropriation or Financial Profitability adverse impacts of such projects it financially supports: consolidation of lands. Among these type of projects, in Performance andPerformance those which are subject of financing up to international • Forestation to reduce and offset carbon emissions, use standards, people and groups affected by the project Products and Services Contributing of indigenous species suited to the area in forestation Responsible Products and Services are identified with “Relocation Plan” and plans for efforts, relocation of trees to spots matching with the to the Green Economy “Restructuring Means of Living” and plans are implemented While designing its products and services, İşbank looks project site as closely as possible, and conservation of to eliminate any adverse effects. out for different lifecycles, economic needs and industrial Financing Renewable Energy endemic species, Approach requirements of its customers. In the foundation of İşbank’s Management As of 2019, 127 projects were subjected to ERET rating In transitioning to low carbon economy, encouraging • Taking measures required to preserve biodiversity in concept of responsible product and service offering lie the and 81 of these were financed. Of these projects with alternative energy resources is paramount. Renewable specific and protected areas, development of products and services for every segment of a financing sum of USD 395 million in 2019, 12% was society, communication of correct information on products energy investments should support not only fight against • Prioritizing the purchases of lands through agreements, classified as Category A, 43% as B+, 38% as B- and 7% as C to its customers, and supporting an awareness of savings the impacts arising from climate change but also social preparing a resettlement plans and/or a plan for considered based on the amount of financing. in the country. development through new areas of employment such restructuring means of living in projects involving forced investments create. By providing financing for renewable Experience physical or economic relocation as part of expropriation, energy projects, İşbank contributes to the reduction of risks
Flawless CustomerFlawless Total Power Generated in 2019 with RE projects and impacts stemming from by climate change. • Developing social responsibility projects which are financed by İşbank (kWh) countervailing for locals within the sphere of influence of After 2015, all new project financing provided by İşbank 873,280,488 2,421,950,604 the project and aiming to create a new income sources, In 2019, the following finances were provided: BEP RES for electricity generation investment was allocated to giving priority to locals when meeting labor force and renewable energy projects. This is targeted for 2020 as GES 964,504,396 JES 3,799,121,010
Banking purchasing requirements of the investment, well. As of the end of 2019, the share of renewable energy Responsible financing in the total power generation projects portfolio • Taking into consideration the opinions of employees, 13,840,744,626 21,899,601,124 USD 48 million BES TOTAL was 67.3%, and in total financing was 6.5%. locals and other stakeholders on the project as part of for 1 project in risk category "A" investments, and creating a “Stakeholder Engagement Plan” by building internal and external complaint mechanisms to address their inconvenience, Happy andHappy Productive Employees • Taking additional measures in environmental and USD 170 million social management plans with additional studies for 2 projects in risk category "B+" including Cumulative Impact Analysis, Ecological Impact Assessment, etc., Distribution of Renewable Energy Finance Extended in 2019 Total Installed Capacity Cash Risk Non-cash Risk Total Risk (C+NC) • Ensuring compliance of the investor with Occupational Type Number Health and Safety (OHS) legislation in both its current USD 149 million (MW) (million USD) (million USD) (million USD) Operations Responsible operations and investment operations, increasing for 7 projects in risk category "B-" BEP 1 4.8 9.2 0 9.2 occupational health and safety practices, and developing emergency action plans. SEP 68 107.6 62.6 24.2 86.8
The compliance of these commitments by investing WPP 2 52 14 24.6 38.6 companies is also guaranteed through loan agreements USD 28 million
Society GEP 3 98 74.6 12.7 87.2 and monitored as part of financing process. Through for 3 projects in risk category "C"
Positive Value for Value Positive management of social risks which may be encountered in TOTAL 74 262.4 160.4 61.5 221.9 this scope, social impact is controlled as well.
56 103-1 • 103-2 • 103-3 • 304-2 • 412-3 • 413-1 • 413-2 103-1 • 103-2 • 103-3 • 417-1 57 Responsible Banking İşbank 2019 Integrated Report
İşbank issued its first Green Bond on August 21st, 2019. This In 2019, İşbank met almost 4,500 producers in 32 localities through Farmer Meetings and took part in more than 20 local, at İşbank USD issuance is also the first 100% Green Eurobond transaction TL Sustainability national and international agricultural fairs. Cash loans extended in million billion performed by Turkish banks. the agricultural sector in 2019 exceeded TL 5 billion. Financial Profitability Performance andPerformance
In 2019, İşbank financed 74 projects developed in biomass, Sustainability Bond Framework. Through the funds to be Soil Erosion, for Reforestation and the Protection of By developing Cold Room Investment Loan product, İşbank solar, wind energy and geothermal fields and having secured from the bonds issued within the scope of this Natural Habitats (TEMA) by 0.02% of the amount of each took an important step in supporting storage of vegetable, an installed power of 262 MW. Total installed power of framework, loans will be financed for ventures with positive transaction carried out by our customers with this card. animal and water products under sanitary conditions from renewable energy projects financed by İşbank was 8,074 social impact such as SMEs and women entrepreneurs With the application “Yuvarla” (round off), of which İşbank producer to consumer, and in maintaining food safety. Approach
Management MW as of the end of 2019. Additionally, 21.9 million MWh in underdeveloped areas, in addition to projects creating is among main sponsors, our customers can round off the In 2019, a Digital Agriculture Project was launched, in of clean energy was generated in 2019 as part of the positive environmental impact in the fields of renewable amount of their transactions to the nearest higher whole cooperation with Vodafone Business, where predictive and projects financed by İşbank. energy, energy efficiency, recycling, organic agriculture, number and donate the rounded amount to an association, early warning systems based on advanced technology are clean transportation, green buildings and circular economy. foundation, or NGO which they will select from the used in agricultural activities. While İşbank continues to increase its financing support application. With Yuvarla and TEMA Card applications, over for renewable energy production, it continues its efforts to The opinion of an external evaluation institution was To discover and support entrepreneurs with innovative TL 2 million was donated to foundations and associations in projects in the agricultural sector, an Agricultural reduce its financing share of energy generation from coal obtained for the Framework prepared in line with Green Experience 2019, with an increase by 46% when compared to 2018. Entrepreneurship Competition was organized and the and natural gas fired power plants in its energy portfolio. Bond Principles, Social Bond Principles and four key
Flawless CustomerFlawless winning team became eligible for İşbank Workup program. components of Sustainability Bond Guidelines issued by the TEMA Environmental Variable Fund Cooperation with International Financial International Capital Market Association (ICMA). With İmeceMobil application made available for agricultural
A first in Turkey, Environmental TEMA Variable Fund is producers for free, producers may access a bunch of Institutions for Green Economy st İşbank realized its first Green Bond issue on August 21 , a product developed to allow environmentally-friendly information significant for production, from meteorological 2019. This issuance is also the first 100% Green Eurobond investors to use their savings to promote environmental İşbank promotes cooperation with international financial warnings to wholesale market hall and stock exchange prices,
Banking transaction performed by Turkish Banks. The amount of efforts. With the resource allocated from the Fund to İmece Card campaigns, and information on İmece Card.
Responsible institutions for financing renewable energy and energy the bond is USD 50 million and the term of the bond is 10 TEMA, sustainable financing is provided for environmental efficiency. This way, renewable energy and energy efficiency In 2019, İşbank met almost 4,500 producers in 32 localities years. The first green bond in Turkey issue is important as projects. The fund, allocating part of its portfolio to invest projects of small and medium size enterprises are financed through Farmer Meetings and took part in more than 20 it reflects the holism of İşbank’s sustainability approach, in businesses which have an effective environmental through loans provided by international financial institutions. local, national and international agricultural fairs. Cash loans it provides access to different investor groups, and it is a management systems in place, emphasizes that businesses which pay regard to environmental impacts will extended in the agricultural sector in 2019 exceeded TL 5 billion. long-term funding. Since 2008, İşbank has been procuring medium/long achieve better financial results in the long term. term, special purpose financing from various international Products and Services for Raising Savings Awareness Happy andHappy Productive Solar Loan by İşbank Employees financial institutions including KfW, EIB, EBRD, Proparco, Support for Agriculture Sector Driven by its mission to spread savings awareness at OPIC and IFC to finance industries and activities that In line with its mission of being a pioneer and leading bank all levels of the society, İşbank increases the diversity of İşbank believes agricultural sector is a priority sector in the contribute to sustainability. With these resources, women in sustainable energy industry, İşbank developed, and made financial products it develops in accordance with the needs sustainable development of the country. 63 Agricultural available for use by its customers in 2019, a commercial and expectations of its customers in their different life cycles, entrepreneurs, SMEs, agricultural businesses, businesses Officials serving in the Non-Branch Sales Unit of İşbank, and evolving life styles. located in priority development areas, and businesses with loan product for financing unlicensed solar energy plants which continued its agricultural banking activities in 2019, 250 to 3,000 employees are financed as well as energy (SEP) to be installed on the roofs of industrial facilities for work to support the country’s agriculture in 61 provinces. Tracking the Spendings from Maximum Mobil
Operations self-consumption. İş’te Güneş Kredisi aims to assist in Responsible efficiency and renewable energy projects. The list of loans Agricultural Officials provide on-site services to producers procured by İşbank from international financial institutions developing and spreading the efficient, flexible, concurrent and farmers by traveling from village to village to facilitate With newly added feature İşbank customer can set card or and which were open as of the end of 2019 is available in production-consumption model which is spread to the access to banking services. sector based spending limits via Maximum Mobil and get the “Annexes” section of the report. base, called “distributed production,” and in providing service notifications when they reached spending limit met, in an In 2019, efforts continued in agricultural banking as per for the energy transformation process on macro scale. effort by İşbank to contribute its customers’ development of the protocol signed between İşbank and the Agricultural financial literacy. İşbank Green Bond Maximum TEMA Card and Yuvarla and Rural Development Support Institution (TKDK), as part Society To ensure that Eurobond issuances, having a significant of the European Union’s Instrument for Pre-Accession A first in the industry, Maximum TEMA Card enables the Assistance -Rural Development Program. Positive Value for Value Positive share in İşbank non-deposit fund resources, are realized as Bank to contribute to the Turkish Foundation for Combating green, social or sustainability bonds, İşbank created İşbank
58 103-1 • 103-2 • 103-3 • 417-1 103-1 • 103-2 • 103-3 • 417-1 59 Responsible Banking İşbank 2019 Integrated Report
Moneybox users exceeded 14 thousand as of year- Total financing provided to SMEs in cash and non-cash at İşbank TL end 2019, and overall balance of Deposit Moneybox TL Sustainability loans is TL 86.1 billion in 2019. million Account rose above TL 13 million. billion Financial Profitability Performance andPerformance
Üstü Kalsın (Keep the Change) Savings in the Short Run Maximum Genç Türk Eximbank-sourced Export Support Loan for Women Entrepreneurs and Young Entrepreneurs With an “Üstü Kalsın” (keep the change) instruction for their With Daily Deposit Account, our customers are offered the In line with our primary goal of maintaining a lifelong credit cards, İşbank customers may round up their credit opportunity to value their savings daily whenever they wish service relationship with our individual customers, we To allow women and young entrepreneurs to have more card balance to a higher predetermined rounding amount, develop banking service packages that include products presence in exports, two protocols, “Women Entrepreneur Approach to, without waiting for long terms, for a nominal fee. With Management and transfer the amount in excess of their credit card İşbank Maximum Time Account, our personal customers needed in different phases of life such as childhood, youth, Export Support Loan” and “Young Entrepreneur Export balance to their investment account to put this amount to who wish to value their savings in the short term both working life and retirement by considering expectations in Support Loan,” were signed with Export Credit Bank of the investment fund. As of the end of 2019, the number of secure their automatic payments and get interest yield each of these phases. In this scope, in 2019, we continued Turkey (Türk Eximbank) in support of women and young investors using the application rose to 131 thousand and overnight from deposits. to work to launch the brand “Maximum Genç” which is a entrepreneur exporters in June 2019. İşbank is the first the total net asset value of the fund reached to TL 68.5 new banking program targeting studying or working young bank to sign the “Young Entrepreneur Export Support Loan.” million. Gold Banking people between 18 and 25. Support for SMEs
Experience As part of our mission to increase savings at all levels of MaxiPara Card (Prepaid Card) Financial Inclusion İşbank develops numerous products and services to help
Flawless CustomerFlawless the society, we offer various gold banking products and MaxiPara Card – For Me is available for our customers services. Through Gold Account, which is a demand deposit SMEs grow stronger and be more stable economically. In İşbank aims to make social welfare shared by developing who want to control their budget effectively and spend the account, our customers may buy and sell gold easily from order to address financing requirements of our customers,
products and services for all segments of the society. amount they loaded to the card in advance for shopping digital points of contact 24/7. İşbank customers may also we organized Commercial Support Loan, Support Loan and cash withdrawal transactions. earn interest income in grams of gold by opening a Term Support for Women Entrepreneurs for Small-Sized Businesses, Women Entrepreneur Loan Gold Deposit Account for their gold savings. Gold Meetings and Urban Transportation Loan campaigns with favorable
Banking Moneybox Hybrid Fund Cooperation with Arya Women Investment Platform interest rates. Total financing provided to SMEs in cash and
Responsible are held at İşbank branches to introduce so-called under- the-mattress-savings to the banking industry. non-cash loans is TL 86.1 billion in 2019. İşbank moneyboxes, the symbol of saving in Turkey, have İşbank believes sustainable development is only possible with the participation of women’s businesses in the Cooperation with Small and Medium Enterprises been helping get children adopt the habit of saving since Investment Insurance for My Child 1928. With Moneybox Hybrid Fund product, in addition economy and increase of woman labor force. Therefore, Development Organization of Turkey (KOSGEB) With Insurance Investment for My Child our customers can the Bank uses both its own resources and foreign funds it to traditional moneybox, parents are offered a savings İşbank helped SMEs access financing, and supported small choose to invest in Turkish Lira, USD or Euro to cover the procures to support women’s businesses. plan securing the future of their children. Number of businesses in areas struck by natural disasters, through the investors of Moneybox Hybrid Fund, making great education costs of their children or support them when they Happy andHappy Productive Employees İşbank carries out activities in support of women support programs carried out with KOSGEB. As part of start working. The product also offers benefits including contributions to the awareness of long-term investment, entrepreneurs as part of the sponsorship agreement signed this cooperation, the Bank took part in Düzce and İstanbul discounts at contracted healthcare institutions and tax reached 185 thousand as of the end of 2019. with Arya Women Investment Platform, one and only Emergency Support Loan Protocol, Samsun Province, Terma advantages. Digital Moneybox women-oriented investment platform in Turkey. and Salıpazarı Districts, Emergency Support Loan Protocol, and SME Financing Support Programs in 2019. Fund Consultancy As part of Arya Retreat Event in 2019, 15 entrepreneurs Classical İşbank moneybox was developed as Digital went through training, feedback and mentoring processes Access to Inclusive Finance Project Moneybox to enable the ones under the age of 18 to save First promoted in July 2019, İşbank Robofon Consultancy service offers fund consultancy services to help anyone for 6 weeks and were provided with the opportunity to Operations Responsible money digitally and made available for use by the younger An Access to Inclusive Finance Project Loan Agreement wishing to make savings take investment decisions suiting share their projects with successful business people and generation in 2017. It is possible to transfer money to was signed between Industrial Development Bank of Turkey their risk preferences. Through this service offered to experienced and new investors with the final event held in Digital Moneybox easily via İşCep, and such amounts are (TSKB) and International Bank for Reconstruction and everyone wishing to save even with the smallest amounts, Bodrum. With a competition organized in the scope of the valued in Time Moneybox Account. Number of Digital Development and, under the agreement, a resource of USD the Bank facilitates savings and investment decisions for event, the winning projects became eligible for support. Moneybox users exceeded 14 thousand as of the end of 20 million was made available for use by our customers in customers by identifying the most appropriate, personalized 2019, and overall balance of Deposit Moneybox Account In Arya Business Workshops organized with Arya Platform, support of areas adversely affected by the refugee influx fund from Robofon Family managed by İş Portfolio expertise. rose above TL 13 million. women entrepreneurs were provided with training in and SMEs promoting women employment. Society financial literacy-balance sheet management, sales, brand
Positive Value for Value Positive and digital marketing, data management and human resources.
60 103-1 • 103-2 • 103-3 • 417-1 103-1 • 103-2 • 103-3 61 Responsible Banking İşbank 2019 Integrated Report
Foreign Trade Support for SMEs and “YandexInstallment,” widely used in Russia, got the is not misleading, which facilitates customer’s decision
Responsible Marketing opportunity to receive installment and deferred payments making processes, and which addresses customer needs. İşbank has continued to offer products and services which from overseas consumers via İşbank’s payment gateway. One of the important expectations of customers in the will make foreign trade more comprehensible and feasible Installment payment option, which is critical for businesses finance industry is communication of correct information It is important that customers understand the risk of for SMEs, with its branches specialized in foreign trade and at İşbank exporting goods and primarily the tourism industry, was first by institutions about their products and services. The products and services they are going to make use of Sustainability efforts of field forces which provided specialized support introduced by İşbank in Turkey. fact that İşbank sees it as its responsibility to inform properly. To this end, the Bank takes it seriously to guide to SMEs. Export loan campaigns were organized which customers about products and services correctly, reliably, customers effectively in selecting the right products and encourage SMEs to engage in exportation. Farmer Meetings clearly and transparently plays an important role in services and ask the right questions. İşbank invests in the putting İşbank in a prestigious position based on trust in In 2019, ‘İş’in Uzmanından Uygulamalı Akreditif’ training Seeing the agriculture and livestock industry as one of the development of the relevant capabilities of all employees the industry. With its approach driven by customer focus, (Hands-on Letter of Credit Training from A Dab Hand) was priority industries for sustainable development of Turkey, who provide such information to customers directly or the Bank provides its customers with information which organized for foreign trade customers wishing to learn İşbank develops a vast number of products and services for indirectly.
Financial about letters of credit. İşbank works to be the best business Profitability the industry. In 32 Farmer Meetings organized in 2019, almost
Performance andPerformance partner of its foreign trade customers with its extensive 4,500 producers were provided with trainings by experts in experience and product and service quality. production, agricultural insurances, and financial literacy. Performance Indicators Exporter Card Support for Disadvantaged Groups Leading the way in the industry in supporting exporting Responsible Finance Integrating ESG Criteria 2018 2019 SMEs, İşbank launched “İhracatçı Kart (Exporter's Card)” İşbank works to help make financial services accessible
Approach With this card, exporter companies may both make use of by all segments of the society. 756 domestic branches of Field visits made as part of environmental and social risk evaluation 18 22 Management all features of a corporate credit card and earn MaxiPuan İşbank were rearranged to accommodate the needs of the from export operations they carry out through İşbank. With orthopedically disabled individual. In 466 branches, there Number of financed projects subjected to environmental and social risk evaluation 15 13 are tactile ground surface indicators. The Bank continues e-export solutions offered to SMEs, the Bank continues Sum of financing provided for projects subjected to environmental and social risk efforts to increase the number of disabled-friendly 915.3 395 working to make İhracatçı Kart, which provides additional evaluation (million USD) advantages, more widespread and, in this context, support branches. 62.5% of İşbank Bankamatik ATMs are suitable the country’s exports. for use by customers who are visually impaired. Number Responsible Product and Service Portfolio 2018 2019
Experience of Bankamatik ATMs serving the visually impaired rose to Foreign Trade Packages 4,068, with an increase by 13% compared to 2018. 609 Number of people reached through Farmer Meetings 4,325 4,485 Flawless CustomerFlawless Bankamatik ATMs are suitable for use by the orthopedically In 2019, new Foreign Trade Packages, namely Exporter Number of technological entrepreneurs with facilitated entry into the banking system 136 117 handicapped. Package and Maxi Package, were launched.
Number of campaigns organized for promoting products of technological entrepreneurs 6 7 İşCep IOS application supports Voice-over which articulates İŞ’TE KOBİ Clean energy generated with financed renewable energy projects (million MWh) 16.9 21.9 the elements on the screen and Android application
Banking The Bank continued providing service to SMEs also in supports TalkBack which provides audio feedback. As part Financial Inclusion 2018 2019 Responsible of İşCep Renovation Project to be implemented in 2020, 2019 via its website İŞ’TE KOBİ (Website for SMEs), which, Number of disabled-friendly Bankamatik ATMs 3,979 4,410 since 2009, has been enabling quick access to industry text size will be adjustable on İşCep by enlarging and information and news needed by SMEs. SMEs may receive downsizing. In addition, Maxi, personal assistant application Number of women entrepreneurs placed in events for supporting women entrepreneurs 350 425 consultancy services by asking questions to experts in of İşCep and Maximum Mobil applications, allows both Number of events organized in support of SMEs 26 34 many fields such as taxes, accounting, entrepreneurship, audio and written transactions, and enables visually- agriculture and livestock, and promote their company disabled users to carry out many banking transactions Number of İŞ'TE KOBİ SME website viewings 1,083,401 1,112,126 easily by audio means. İşbank Internet Branch is compatible Happy andHappy Productive Employees product and service details via İŞ’TE KOBİ by adding their company to SME Market with Jaws.
Extensive Local Payment Network and Services In 2019, an application was introduced enabling hearing- impaired customers, if they wish, to chat with a representative While 18 alternative payment methods were supported who can speak in sign language over the call center. 2020 and beyond in İşbank’s payment gateway service in 2018, number of alternative payment methods rose to 38 as a result of As part of SME Financing Support Program undertaken Operations Responsible steps taken in 2019. This allowed foreign customers to by KOSGEB, entrepreneur businesses can get a financial İşbank will keep on developing responsible and inclusive products and services and aims to broaden the share of shop using the payment methods existing in their country, support up to TL 50,000, and women entrepreneurs, young renewable energy projects in its entire portfolio of energy generation projects. The bank intends to increase the rate of helping exporter customers, including SMEs, with sales, entrepreneurs, the disabled, war veterans and first degree disabled friendly Bankamatik ATMs above 80% in 2022 with a view to achieve a higher degree of financial inclusion. As a new customer acquisition, and turnover increase. relatives of martyrs up to TL 70,000. The program covers bank always standing by its customers as a business and solution partner in addition to procuring financing, İşbank plans Young Entrepreneurs as defined by KOSGEB as merchants to support almost 500 women entrepreneurs annually with activities targeting women entrepreneurs. Additionally, the Turkish enterprises doing business overseas using “Bank who have not turned 30 as of the date of first application Bank will continue activities to help support SMEs and efforts to facilitate the entry of technological entrepreneurs into
Society Transfer,” the bank transfer method of Klarna which is for the program and eligibility for the program is dependent the banking system. It is foreseen that the number of viewings of İŞ’TE KOBİ website, allowing SMEs to quickly access widely used in European countries and the USA, “Pay Later,” on establishment as a young or women entrepreneur with Positive Value for Value Positive industrial information and news they need, will approach 1 million and 250 thousand annually in 2022. allowing to defer payments, “Slice it,” enabling installments, the support of KOSGEB.
62 103-1 • 103-2 • 103-3 103-1 • 103-2 • 103-3 63 Material Issues Contributed SDGs Relevant capital element Employee Rights and Satisfaction • Equal Opportunities and Diversity • Talent Management Happy and Productive Employees İşbank 2019 Integrated Report
Happy and Productive Employees at İşbank
Sustainability İşbank's workforce, which consists of qualified and happy employees, is among the important competitive advantages of the Bank. In line with its vision of being “the most preferred employer”, İşbank offers a fair, egalitarian and safe working environment that respects people and enables personal and
Financial professional development. Profitability Performance andPerformance Approach Management
55% 1.86% 99% 25.7 Experience Flawless CustomerFlawless
Rate of female Employee turnover rate Rate of unionized Average number of
employees employees training hours per employee per year Banking Responsible Happy andHappy Productive Employees Employee Rights and Satisfaction
It is among the high-priority issues of İşbank to develop İşbank's diverse human resources management approach practices that will ensure satisfaction by respecting the and corporate culture make it an employer that is preferred employee rights and to becoming a Bank that attracts by young talents. Bank provides a working environment talented young people. where the employee rights are protected and which allows Operations Responsible long-term employment. Society Positive Value for Value Positive
64 103-1 • 103-2 • 103-3 65 Happy and Productive Employees İşbank 2019 Integrated Report
In 2019, 3,529 employees İşbank respects its employees' freedom of association. attended the OHS trainings.
at İşbank 99% of the Bank employees are covered by the 3,529 16,092 The OHS training provided to Sustainability employees hours Collective Bargaining Agreement. employees is 16,092 hours in total. Financial Profitability Performance andPerformance
Rights Provided to Employees Family Friendly Employer In this context, employee loyalty measurement is support to various non-governmental organizations performed once every three years. Employee loyalty forms through the purchase and/or sales of new or second-hand The Remuneration Policy, which is created based on İşbank implements various practices to be an employer that the basis of the Bank's business success and results. The products. the Collective Agreement and applicable legislation, respects the family life of its employees. In the reporting loyalty survey also reveals the key indicators that define Approach defines all economic and social rights of employees. The period, 99.53% of the female employees, who took Awards were granted to employees in the competitions Management the Bank's potential to improve long-term business results Remuneration Policy, which covers Bank's employees maternity leave, have returned to work. The positions of the in the field of human resources. Building on the idea that organized in different subjects such as sports, travel, and managers at all levels, is under the responsibility of female employees of the Bank, who are on maternity leave, maintaining high-loyalty in an organization and corporate literature etc. In addition, in the field of e-sports which is the Remuneration Committee affiliated to the Board of are preserved at their units, and they can continue their culture is as important as its creation, efforts to implement one of the effective ways to increase contact with young employees whose expectations have changed with the Directors. A transparent and measurable system is applied duties in the same position following the end of their leave. the right human resources practices that will positively for compensations. The salaries of executive managers are The important reasons for the high rate of return from digitalized world; being the first within the organization, affect loyalty are ongoing. determined in line with the Bank's strategies, long-term maternity leave include the fact that the positions of the the e-sports tournament was held online and offline. Experience objectives and risk management structure, and in a way to employees who give birth is not changed; the employees The loyalty survey was carried out throughout the Bank, High satisfaction rates were recorded in the assessment Flawless CustomerFlawless prevent excessive risk taking. can use up to 2 hours of breastfeeding leave per day, which with an average level of 90% participation of employees. surveys made after the events. is more than the time stipulated in the legislation, after the
Bank's salary package consists of salary, bonus, lunch start of their duties; the employees can benefit from the Internal Communication and Employment Engagement The system “I Have a Suggestion” was designed with an allowance, foreign language proficiency allowance, dividend rights of part-time maternity leave and part-time working aim to jointly create new applications and solutions by payout as determined by the Articles of Incorporation of right upon their request; and the mother and child can İşbank attaches importance to its communication using the knowledge and background of the employees, to Banking with its employees, respects its employees' freedom improve and develop customer experience, to improve the Responsible İşbank, and other fringe benefits depending on seniority benefit from the Bank's comprehensive healthcare benefits. and/or job scope. In addition, in line with the individual Male employees, whose spouses give birth, are also of expression, and enables employee engagement by creativity of the employees, and to increase their sense performance of the employees, there are also applications granted with 5 business days of paternal leave. receiving feedbacks through complaint and reporting of satisfaction with the job by allowing them to be more where payments such as high efficiency allowance, mechanisms participatory. 6,292 suggestions were shared in 2019 product-based sales premiums and managerial bonuses Employee Satisfaction through the system “I Have a Suggestion”. are made. Union of Banking, Finance and Insurance In February 2019, Employee Communication Platforms Workers (BASİSEN) and İşbank sign Collective Bargaining İşbank regularly measures the loyalty and satisfaction of and Programs (ECPP) added a new dimension to employee İşbank employees can communicate any of their views, Happy andHappy Productive Employees Agreements every two years. Under the Collective employees. Total 6 human resources fields of application, communication. Communication channels were increased evaluations, requests and complaints to the relevant Bargaining Agreement signed with BASİSEN, employees which are the factors that support employee loyalty and with innovations such as cultural trips, employee social units through the HR Help Desk and Negative Feedback receive health benefits as per the guidelines covered in satisfaction, are evaluated within the scope of the survey: responsibility, competitions and e-sport activities. The Line application. The “Negative Feedback Line” is an İşbank’s Regulation on Health Benefits. training activities, performance management, career responses provided by more than 15 thousand employees to online communication application where the privacy management, recruitment process, human resources the trend survey contribute to the preparations of new events. of employees is protected at the highest level and İşbank respects its employees' freedom of union communication process, compensation and rewarding. the matters reported can only be viewed by a limited
Operations Throughout 2019, the ECPP team took part in charity Responsible organization. 99% of the bank employees are covered by the The survey results in all fields are shared with the Human number of executive managers defined in the system. Collective Bargaining Agreement. The Collective Bargaining Resources Function managers, and the improvement efforts runnings and collected donations of more than 100 The application is available for use by all employees. The agreement signed every two years between the Union of within the fields of activity of the relevant business unit thousand TL for the benefit of the TEMA (The Turkish employees, who generated the record, are responded Banking, Finance and Insurance Workers (BASİSEN) and managers are carried out. Thus, the results of the survey Foundation for Combating Soil Erosion, for Reforestation by Mr. Adnan Bali, the CEO. In 2019, 287 entries were İşbank is a guide in determining the employee rights. enable the accessibility of the good practices in Bank to and the Protection of Natural Habitats) Foundation - created by 258 Bank’s employees and resolved. increase, while being a guide also for the improvements in Brotherhood of Trees Project. On the other hand, the
Society the fields where deficiencies or insufficiency are identified. employees participating in the Givin application provided Positive Value for Value Positive
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Occupational Health and Safety (OHS) Furthermore, İşbank aims to transfer the experience, culture in Bank's business units, and the technology and İşbank considers it to be among its priorities to provide its innovation within the Bank to university students by İşbank was the only Turkish Bank among the “Top 500 Employers” in employees with a working environment where their physical collaborating with the student clubs and career centers of at İşbank and psychological health is protected. The Department the “Forbes Global World’s Best Employers 2000” list in 2018 and 2019
Sustainability the leading universities of Turkey in terms of education and Manager of the Human Resources Management is the culture. In addition, it is aimed for İşbank to have access to and proved its strength as an employer as well. highest authorized person responsible for OHS and is qualified human resource which is essential for sustaining two reporting levels away from the General Manager. its activities for many years, and to increase the Bank's Pursuant to the provisions of the Occupational Health and recognition as an employer. Safety Law, the occupational health and safety boards are established in the Bank buildings, where there are more İşbank enables university students to get to know the Bank Financial
Profitability than 50 employees, and the employees are represented better through an internship program organized for the Performance andPerformance on these committee. As of the end of 2019, there are OHS 3rd and 4th grades of universities. Thus, it is aimed for the employees to observe the generations that will become Committees in 36 İşbank buildings. A total of 348 board İşbank believes that gender equality plays a major role transferred to future generations. The intellectual capital, their colleagues in the near future and to benefit from the members, 161 of which were employee representatives, to ensure equal opportunity. Based on this belief, Bank which grows within the institution and is transferred to new perspectives of young people. Bank conducts joint activities attended 141 OHS boards held during the year. In 2019, supports women in working life. More than half of Bank's employees, enables the Bank to offer competitive products with non-governmental organizations and organizes 3,529 employees attended the OHS training at the Bank. The workforce in the last three years consists of female and services. Approach OHS training provided to employees is 16,092 hours in total. development programs. In these development programs, Management employees. university students are supported for both receiving Due to its nature of being an institution that trains its own Being the Most Preferred Employer education and their personal development in terms of The Human Rights and Human Resources Policy, which managers, İşbank's Performance Management System is culture in areas such as mentoring, the right to benefit from based on “competency and target based annual appraisals” As a large family with its employees and retirees, İşbank sets out the basic principles and essentials adopted by training activities within the bank, and the opportunity to that support employees’ performance development. was the only Turkish Bank among the “Top 500 Employers” İşbank in equal opportunities and diversity, was announced participate in artistic events organized within the Bank and According to the performance results, it is possible to in the “Forbes Global World’s Best Employers 2000” list to all employees on the internal portal. Regarding the İş Sanat. behaviors detected to be in violation of the Bank's policies, take actions about employee’s career progression and to Experience in 2018 and 2019, and also proved its strength as an the required disciplinary penalties are imposed, which provide feedback or training support for their professional Flawless CustomerFlawless employer. In line with the Bank's vision and goals, campus Equal Opportunities and Diversity development. communication is maintained face to face and online in can result in the termination of the employment contract order to further strengthen its employer position preferred within the framework of the relevant provisions of the
İşbank believes that social diversity increases corporate Personnel Regulation and Collective Bargaining Agreement. İşbank nourishes its intellectual capital with the practices by employee candidates and university students. Although success. At the Bank, no discrimination based on factors The notifications submitted to the Board of Inspectors that support information sharing among employees. With it varies based on the position, our young people are such as gender, religion, political view, race, cultural or social regarding the violation of principles specified in the Human the practices such as Practitioner Trainer and Training Banking prevalently provided with job opportunities throughout origins, age, mental or physical disability is made among
Responsible Volunteer, professional knowledge and experience sharing Rights and Human Resources Policy are addressed the country through exam and recruitment processes the employees in any process from recruitment to human is ensured by subject matter experts. In addition, the sensitively by the Department. conducted online. resources practices. training activities provides the opportunity to convey İşbank aims to organize seminars and training activities in experiences of managerial roles such as branch managers diversity, inclusion and social gender equality in order to through experience sharing sessions. In 2019, more than support women in business life as of 2020. 300 employees acted as Practitioner Trainers and provided approximately 6,000 hours of training. Orieantation Happy andHappy Productive Employees Talent Management Training Program is organized within the framework of the onboarding program for the employees who have just Distribution of Distribution of Executive Distribution of In line with its lifelong learning approach, İşbank provides started their careers at the Bank. Employees by Gender* Managers by Gender* Managers by Gender* its employees with various training programs and learning opportunities in order to develop their talents and increase While the employees at İşbank find the opportunity to benefit from various training activities in line with their own 45% 25% 45% their knowledge and skills throughout their careers. The Operations
Responsible needs and preferences through the Training Catalogue, they Male Female executive Female average training hour per employee at İşbank, which was 23.1 in 2018, increased by 2.6 hours in 2019 to 25.7. can also participate in seminars and keynote speeches on different subjects. In 2019, within the Training Catalogue, Executives at İşbank are raised from within. This tradition more than 1,800 employees participated in the training allows all employees to be promoted to managerial activities organized in 27 topics covering technical banking, 55% 75% 55% positions in line with their performance. Thus, the Bank's competency and skill development.
Society Female Male executive Male investment in human resources is maintained and Positive Value for Value Positive
* Employees with the title of Private Security Guard are exclud- * Board of Directors and Executive Committee Members * Submanager and above titles ed. Rates including Private Security Guards F: 51%, M: 49%
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In 2019, within the scope of digital transformation, 7,989 employees from mixed branches received more than 100
at İşbank thousand hours of training, while 559 employees from Sustainability 7,989 commercial and corporate specialized branches attended the trainings designed specifically for their roles. Financial Profitability Performance andPerformance
Featured training programs Every year, training activities with various technical and Management, the Art of Persuasion, Digital Transformation Glossary of Banking Terms managerial courses are offered within the scope of the of the Business World and Change Management, Evolving Data Analytics Academy: The program was implemented Branch Managers Training Catalogue in order to increase Customer Experience in the Digitalizing World, Future It was created for the purpose of informing the Bank's with the objectives of becoming a data literate institution the banking knowledge of branch managers which lead the Trends and Technologies, Data Analytics for Managers, employees through a reference source about the concepts Approach
Management and ensuring that the employees analyze the data digital transformation at the Bank, to help them manage Digital Transformation, Innovation and In-House and terms related to banking and other relevant fields, accurately, transform it into meaningful outputs and the changing customer experience process more effectively Entrepreneurship. and ensuring the use of a common language in in-house transfer it properly. in the digitalizing world, and to reinforce their leadership meetings and correspondence, and was made available for skills. In 2019, 551 Branch Managers participated in the The following digital resources were prepared to be used digital use. Artificial Intelligence Academy: The Artificial Intelligence training activities organized within this framework. by Bank's managers and prospect managers in each course Academy was prepared to support the knowledge and and were made available on the Learning World page, an IT Development Program: With the program; managers skills of Bank employees, who work in customer analytics The Branch Manager Successors Program starts with online development platform that is open to the access of and prospect managers, who work at the Information Experience and artificial intelligence, in a way to design artificial “My Career as a Manager”, which is designed to prepare all employees: Technologies and Data Management Department, are Flawless CustomerFlawless learning-based solutions and decision support systems employees, who work as prospect Branch Managers supported in managerial areas, and the employees, who on big data. The Academy was put into practice in 2019 to by being promoted to the submanager role, for their Branch Manager's Handbook conduct critical roles or are candidates for these roles, are complement the Data Analytics Academy. management roles. The Program which is widely carried identified and supported. out for approximately 18 months, consists of financial It is a digital resource that brings together the regulations Innovation Academy: The Academy is conducted with the analysis, credit management, sales management trainings in different legislative resources and documents regarding International Training Programs Banking aim of raising awareness of innovation efforts carried out the duties, authorizations and responsibilities of the Branch Responsible and internships and coaching training. in parallel with İşbank's digitalization process, and enabling Managers, and provides access to the information, which Harvard Business School - Advanced Management the decision makers, who manage the innovation process, Grow for Future is a development program designed may be needed, in a short time. Program: Every year since 2014, participation from the to reach a similar level of knowledge. The academy focuses to support submanagers and specialists, who work as Branch Manager or Department Manager level in the on innovation culture, the importance of innovation, the prospect managers, to get prepared for their future Strategic Branch Management Advanced Management Program (AMP) training, which is creation of an innovation strategy in compliance with the managerial roles. organized by Harvard Business School (HBS) and known organizational structure and processes of institutions, The book was prepared and presented in digital as the school's “flagship” program, is ensured. Happy andHappy Productive Employees trends and technologies that stand out in the industry, in- The Marketing Academy was organized for the employees environment for the purpose of guiding the execution of house entrepreneurship and design thinking methodology. of different business units of Bank, primarily the managers the duties of the Branch Managers. The book includes the Institute of International Finance (IIF) - Future Leaders: and prospect managers working in marketing departments. Bank strategy, the role of branches within this strategy, IIF Future Leaders Group is a program that brings together Manager Development Programs The Academy aims to introduce the techniques and components that comprise the profit, customer relations young leaders with different experiences and backgrounds methods of modern marketing knowledge which is an and employee management, and the screen applications working in finance from different regions of the world New Branch Managers Development Programs: Having important component of the bank strategy. that can help with monitoring, evaluating and improving the twice a year. The purpose of the program is to enable the
Operations been conducted since 2010, the Program consists of 2 branch performance. participants to reflect on the future of the financial industry, Responsible sections entitled “Audit and Management” and “Credit Management Development Program: The program, which and to create an environment where the participants from Allocation and Tracking” which prepare new Branch started in 2018, is conducted with a modular structure with different cultures can learn from each other. One manager Managers to the jobs and processes required by their new the participation of Regional Managers, Branch Managers from İşbank participates in the program every year. job descriptions to support their career development. In and managers working in the Head Office Departments. addition to the technical training activities, the program The program offers a personalized learning journey also includes a session where the participants meet and to the participants. Having started with the Basics of Society exchange ideas with the experienced branch managers. Leadership theme, the program focuses on Strategic Bank Positive Value for Value Positive
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Performance Indicators "İşGame" won Gold in "Best Use of Games for Learning" category at the 1 Brandon Hall HCM Excellence Awards 2019, and the Bronze in "Best Çalışan Hakları ve Memnuniyeti ( ) 2018 2019 at İşbank Sustainability Learning Game" category at the Learning Technologies Awards 2019 Employee turnover rate (%) (1) 2.00 1.86 internationally. Number of applications supporting employee satisfaction 16 18
Total number of ideas obtained from employees 7,168 6,292
Participation rate in the employee satisfaction survey (%) 88 90 Financial Profitability
Performance andPerformance Unionization rate (%) 99 99
Satisfaction with the Human Resoruces Implementations score as part of the Training Activities Organized Within the Scope of 109 different e-learning courses were provided to 69 67 Working Life Evaluation Survey (WLES) Digital Transformation employees in 2019 through the “Learning World”, and these courses have reached 90,026 completions in total. Within the framework of İşbank's new business model The number of videos, which are provided through the Equal Opportunities and Diversity 2018 2019 Approach
Management implemented under the Digital Transformation Program, corporate video learning platform, "IsTube", reached 288. Ratio of female employees to total employees (%) (2) 56 55 various learning initiatives were designed and presented The learning videos were viewed 25,609 times in 2019. specifically for the roles in order to support the employees 2,360 employees were trained through the Live Training Ratio of female employees in senior and middle management (%) (Submanager and 46 45 to adapt quickly to changing roles and responsibilities. Webinars by using Cisco Webex application. above titles) Within this context, in 2019, 7,989 employees from all branches received more than 100 thousand hours of “İşGame”, İşbank's corporate learning game, was played Talent Management 2018 2019 by 3,903 employees in its first period in 2018. A total of
Experience training, while 559 employees from commercial and corporate branches attended the training activities 4,403,727 questions were answered in technical subjects Average number of training hours per employee per year (3) 23.1 25.7 Flawless CustomerFlawless designed specifically for their roles. Furthermore, training and expertise areas in the game. The second period of (3) activities were organized for Regional Managers to support İşGame was launched on 28.11.2019 with new features. Share of digital training activities within total training (%) 35 30 the embracement of digital transformation in the field. "İşGame" won Gold in "Best Use of Games for Learning" Training hours per person for the management and leadership development programs (4) 15.1 14.2 category at the Brandon Hall HCM Excellence Awards 2019, Within the ongoing training program “Sales Academy”, and the Bronze in "Best Learning Game" category at the
Banking Training hours per person for IT competency development programs 27.6 27.1
Responsible 531 employees received over 6,000 hours of training in Learning Technologies Awards 2019 internationally. 2019 to enhance upskilling sales competencies in the field. Training hours per new hire in the first year of employment (3) 156 164 Additionally, training activities were presented to support In the IsReality (VR) Studios located at İşbank’s learning the technical knowledge and competencies of the relevant facilities, 2,526 employees were provided with virtual Satisfaction with the training score as part of the Working Life Evaluation Survey 73 71 roles in HQ, Retail Direct Sales teams, and Commercial reality experience in 2019, emphasizing the changes in the Direct Sales teams. physical structures and way of business conduct of the (1) branches. The "IsReality (VR)" application won Gold in “Best Only those who quit through resignation were taken into consideration.
Happy andHappy (2) Productive Employees Calculated excluding Private Security Guards. Rates including the employees with the title of Private Security Guard 51% in 2018 and 2019. Use of Virtual Worlds for Learning” category at the Brandon Learning World (3) The number of training activities does not include those who participate in the private security renewal training, and the actual number of employees does not include the Hall HCM Excellence Awards 2019, and Silver in “Corporate Private Security Guard and the Servant Staff. In “Learning World” (Öğrenme Dünyası) platform, the Learning/Workforce Development Solution” category at the (4) Restated for 2018 due to the updated calculation method. employees can access easily anytime anywhere the new Stevie - International Business Awards. generation digital learning solutions and tools such as 2020 and beyond video, game and e-learning. Specified e-learning courses İşbank was granted with the 2020 BEST Award in Operations
Responsible were designed for the purpose of supporting the effective talent development, given by the Association for Talent use of new applications and products implemented Development (ATD) to organizations that invest in the İşbank will continue to implement practices aiming to improve employee satisfaction and competency. It is among the within the scope of the Digital Transformation Program. talent development of their employees and use talent Bank’s priority objectives to carry out talent management activities to enhance reskilling and upskilling employees with They are offered to all employees through the Learning development as a strategic means to achieve their targeted future competencies. Through the requirements arising along with digitalization. The Bank aims to intensify digital World platform. In order to increase the knowledge of all goals. trainings with innovative learning practices that offer continuous improvement to its employees while diversifying training employees about digital concepts, Digital Culture videos, opportunities for employees.
Society which explain 20 concepts that will affect the future of the Banking industry, are also offered to employees through Positive Value for Value Positive this platform.
72 103-1 • 103-2 • 103-3 • 404-2 73 Material Issues Contributed SDGs Relevant capital element Responsible Procurement • Environmental Footprint of the Bank Responsible Operations İşbank 2019 Integrated Report
Responsible Operations at İşbank Sustainability İşbank implements many practices and projects in order to minimize the adverse effects of its operations and to deploy high working standards throughout the entire supply chain. Financial Profitability Performance andPerformance Approach Management
98% 40.4 129 4.3
million pages tons tCO2e/number of employees) Experience Flawless CustomerFlawless
Rate of local suppliers Total paper savings Recycled paper Emissions per
thanks to the digitilized employee processes Banking Responsible Happy andHappy Productive Employees Responsible Procurement
The management of risks, which may arise from supply İşbank manages the supply chain with its vision of activities, comes to the forefront as a priority issue for becoming an innovative, transparent, fair, pioneering and all enterprises. İşbank establishes relationships with its exemplary procurement center in its field. In line with this suppliers based on openness and trust. Bank focuses vision, long-term strategic partnerships are established Operations Responsible on establishing a financially strong, operationally with the suppliers, Bank's competitive structure is environmentalist and reliable in terms of production quality supported by providing cost efficiency and a strategy based and continuity. on growth with our stakeholders is adopted. Society Positive Value for Value Positive
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In 2019, domestic suppliers accounted for 98% of total suppliers, while procurements at İşbank Sustainability local procurements from domestic suppliers accounted for 81% suppliers of total procurements. Financial Profitability Performance andPerformance
İşbank's ethical banking approach also guides the supply In supplier selection, İşbank respects the criteria based Environmental Impact of İşbank (Atlas) was specially designed with green IT chain management and procurement principles. Supplier on environmental and social risks. Measures are taken practices to minimize environmental impacts and ensure Management Principles created accordingly determine the to reduce or eliminate the environmental impacts by İşbank develops efficiency projects to minimize the energy efficiency. Atlas, which has high technology and main principles in the procurement of goods and services. evaluating the environmental impacts of the product and environmental impacts of its operations. To this end, security standards in addition to its eco-friendliness, is Approach
Management These principles were determined by referencing the UN service to be purchased. It is essential not to purchase different environmental indicators are monitored in the certified with the LEED v4 Gold for Data Centers. Atlas is Global Compact and İşbank Human Rights and Human goods and services from suppliers that are found to be main domains of Bank, such as waste formation, water and the first data center at these standards in Turkey. Resources Policy. The Supplier Management Principles, involved in bribery and corruption. energy consumption and carbon emission at Bank’s Head Automation renovation, which covers all systems such as Anti-Bribery and Anti-Corruption Policy and Gift and Office buildings and branches. In addition, digitalization lighting, heating, cooling and CCTV, will be planned to be İşbank increases its influence in the country's economy Entertainment Policy, which are also available on the Bank's efforts for paperless banking also continue. performed in the Head Office building. With the renovation, by preferring local suppliers. In 2019, domestic suppliers corporate website, are also published on the home page the existing lighting fixtures will be replaced with LED accounted for 98.1% of total suppliers, while procurements Experience of İş'te Marketim application which is our main platform Paperless Banking fixtures. The lighting will be automatically dimmed and from domestic suppliers accounted for 81% of total Flawless CustomerFlawless in procurement processes and is actively used by all our turned on by means of the sensors based on the amount of procurements. İşbank continues its efforts to reduce paper consumption suppliers. Within this context, all Bank's suppliers are light received by the floors during the day. All systems such through digitalization projects. The number of digital expected to show due diligence to act in compliance with as heating-cooling, fire and lighting will be integrated into approval transactions from the branches reached 1 million the Supplier Management Principles, including the Anti- the building automation system, and consumption analyses 720 thousand in 2019. Thus, approximately 7 million 860 Bribery and Anti-Corruption Policy, Gift and Entertainment will be made through the central automation. With the thousand pages of paper were saved. Total paper savings
Banking Policy, and ethical principles, and avoid any conducts that The Supplier Management Principles are scenarios created by the analyses, reducing the consumption Responsible achieved 40.4 million pages through digitalized business would be incompliance with such principles. In accordance available at is targeted. In addition, procurement activities were started https://www.isbank.com.tr/ processes in 2019. with the Sustainability Policy, Bank endeavors to minimize en/about-us/Documents/sustainability/ for the renewal of building heating and cooling pumps. These the negative environmental and social impacts caused by devices, which have an important place in the building energy suppliercodeofconduct.pdf With the project launched by İşbank together with the suppliers, and to raise the positive impacts to maximum consumption, will be replaced by next generation efficient TEMA Foundation in 2012, Bank delivers paper waste to levels. devices. Rainwater is collected, stored and reused in the the TEMA Foundation, and the Foundation plants a sapling facility. Thus, the use of mains water is reduced. All wastes for each 100 kg of papers donated. 386,350 kg of paper Happy andHappy Productive Employees are separated and delivered to authorized organizations for were delivered to the Foundation in 2019-2020 period. As recycling. İşbank, The Head Office Building BREEAM In-Use part of this cooperation, forests were created in various Certificate was obtained at “excellent” level in two different parts of the country on behalf of İşbank. With respect to the categories; “Building Performance Certificate” and “Building waste paper delivered in 2019-2020, 3,864 saplings will be Management Performance Certificate”. planted in Tekirdağ field. In TUTOM building, all mechanical/electrical systems operate Operations Responsible Environment-Friendly Buildings connected to the automation infrastructure. In 2019, with the revisions made for partial working conditions in the İşbank's big main buildings, such as its Head Office heating installation, a decrease in natural gas consumption building, operations center and data center, were designed was ensured. The system created for the collection, to minimize the environmental impacts caused by the purification and reuse of rainwater was deployed, and a operations of Bank. İşbank Head Office building in Levent, decrease in the use of mains water was ensured.
Society İstanbul holds the BREEAM In-use Excellent certificate. All wastes are separated and recycled within the scope of Tuzla Technology and Operations Center (TUTOM) obtained
Positive Value for Value Positive ISO14001 Environmental Management System Standard in the LEED Gold certification in 2017. Tuzla Data Center Head Office and TUTOM buildings.
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Performance Indicators Energy consumption is reduced by using the energy, which is Responsible Procurement 2019 Total Number of Suppliers 2,604 at İşbank generated during cooling in the ATLAS Data Center building, for the Sustainability Number of Local Suppliers 2,554 heating of office areas. Rate of Local Suppliers 98 The Rate of Procurement From Local Suppliers (%) 81 Environmental Impact 2017 2018 2019
GHG Emissions (ton CO2-equivalent) Scope 1 4,886 20,472 21,789
Financial Scope 2 21,248 68,599 71,781 Profitability Scope 3 2,461 10,563 8,727 Performance andPerformance Total 28,595 99,635 102,297 Energy consumption is reduced by using the energy, In the partial or comprehensive renovations made at Energy Consumption which is generated during cooling in the ATLAS Data the branches, LED fixtures are transformed. With the Total Electricity Consumption (kWh) 37,961,619 135,408,773 139,726,038 Total Natural Gas Consumption (m3) 1,709,335 4,126,643 3,879,943 Center building, for the heating of office areas. At Atlas transformation of LED fixtures, an average of 50% energy is Fuel Oil Consumption (lt) 8,000 6,400 Data Center, the data halls with IT cabinets are air-cooled saved per fixture. At the renovated branches, more efficient
Approach Coal Consumption (kg) 170,586 78,713 Management uninterruptedly, based on the principle of redundancy, with lighting and heating-cooling devices with lower energy Diesel Oil Consumption (lt) 417,479 351,180 packet type cooling devices. After the cabinets are cooled, consumption are preferred to substitute the old devices, Total Energy Consumption (Gj) 203,343 756,517 670,254 the heated air is mixed with the outdoor air and used for and energy efficiency at the branches is increased. Water Consumption (m3) heating the air conditioning systems; thus, energy is saved. Total Water Consumption 112,707 371,244 345,389 In addition, rainwater coming from the precipitation is Air conditioners of high-energy class are preferred for the Mains Water (Blue) 105,559 365,424 335,964 collected and re-used after purification. air conditioning requirements of the branches and ATMs. Waste Water (Grey) 0 0 0 R32 refrigerant-powered models also started to be used 7,148 5,820 9,425 Experience Spring Water (Green) in the procurement of air conditioners. One of the most Recycled / Reused Water 7,148 5,820 9,425
Flawless CustomerFlawless Efficient Branches important advantages of using R32 gas air conditioners Fuel Consumption of Vehicles (lt) The activities for the environmental efficiency of Bank's is that the air conditioners operate with a much smaller Fuel Consumption by Company Vehicles (Diesel Oil) 204,804 2,718,367 4,012,798 service buildings continue over an extended period of time amount of gas, thus reducing the refrigerant consumption. Fuel Consumption by Company Vehicles (Gas) 6,205 15,335 11,982 and with a continuous improvement perspective. In order to Fuel Consumed by Personnel Shuttles (Diesel Oil) - 562,655 541,627 minimize the environmental impacts of its branches, İşbank İşbank carries out the required activities for the operation Paper Consumption (ton) 105 808 679 Banking Amount of Recycled Waste (ton)
Responsible makes choices that increase resource efficiency at all newly of an environmental management system at international Recycled Hazardous Waste 3 13 5 opened and renovated branches. Within the scope of the standards. Bank obtained the ISO 14001 Environmental Recycled Non-Hazardous Waste (glass, plastic, metal) 23 29 41 Management System certificate for its Head Office and “Branch Remote Monitoring System” project developed to Recycled Paper - 200 129 Tuzla Technology and Operation Center buildings and 34 monitor the resource consumption of the branches and to Electronic Waste 16 30 make the necessary savings plans, the activities continue branches in 2019. Gradually, it is aimed to obtain ISO 14001 Emission Intensities at the pilot branches. It is aimed to determine energy loss Environmental Management System certificate to cover all Emission per employee (tCO2e/number of employees) 4.4 4.3 locations of the Bank. Happy andHappy Productive and ensure decrease in the emissions by monitoring all Emission by consolidated total assets (tCO e / million TL) 0.2 0.2 Employees 2
consumption at branches. Emission by consolidated net profit (tCO2e / million TL) 14.94 17.02
The emission and consumption data reported by considering the Head Office buildings for 2017 were included in 2018, all branches and regional offices in the country and Atlas Data Center in 2019. The inclusion of the data center in the coverage was effective in the increase in electricity consumption in 2019.
2020 and beyond Operations Responsible
İşbank will continue to strive to develop its supply chain by observing environmental and social criteria and reduce its environmental footprint left by its operations. Giving preference to procurement of its needs through local suppliers, the Bank targets to maintain its local procurement ratio of 98%. İşbank, taking necessary action to operate an environmental management system up to international standards, aims to obtain ISO 14001 Environmental Management System certification for all of its locations gradually. In this scope, it is foreseen that the Bank will complete certification of nearly
Society 400 locations in 2020. The Bank foresees a significant contribution from digitalization efforts to reduction of paper consumption. It is predicted that total reduction in paper consumption will exceed 500 million pages in the period between
Positive Value for Value Positive 2020 and 2022 through digitalized processes.
78 103-1 • 103-2 • 103-3 • 201-2 302-1 • 302-2 • 302-3 • 302-4 • 302-5 • 303-1 • 303-2 • 303-3 • 305-1 • 305-2 • 305-3 • 305-4 • 305-5 • 306-1 • 306-2 79 Material Issues Contributed SDGs Relevant capital element Social Investments • Financial Literacy
Positive Value for Society İşbank 2019 Integrated Report
Positive Value For Society
at İşbank İşbank conducts projects in education, environment and culture-arts with the Sustainability aim of transmitting the added value it creates in its core business to the widest possible audience. Social investment programs including the Bank's corporate social responsibility projects are conducted under the supervision of the Corporate Social Responsibility Committee which operates directly affiliated to Financial Profitability the Board of Directors. Performance andPerformance Approach Management 21 14 ~750 thousands + million Experience Flawless CustomerFlawless
Students provided Number of books Total number of students
with financial literacy given away as part supported, including 54 training of One Million Books, graduates of 2019, within
Banking One Million Children the scope of the 81 Students Responsible campaign from 81 Cities Project Happy andHappy Productive Employees Projects in Education
İşbank ensures effective stakeholder participation in social İşbank conducts inclusive and long-term projects in responsibility projects via developing collaborations with education by being aware of its effective role in ensuring different stakeholder groups, primarily non-governmental the persistence of social development. The purpose of the organizations. These projects are designed to contribute to Bank is contributing to raising generations that adopt the Operations Responsible the Sustainable Development Goals and to respond to the principles of Atatürk and will play a role in allowing the needs of the society. society to reach the modern civilization level. Society Positive Value for Value Positive
80 103-1 • 103-2 • 103-3 81 Positive Value for Society İşbank 2019 Integrated Report
Chess İşbank Chess Classes
İşbank makes contribution to chess education in order to Chess classes are opened with an aim to encourage İş Bankası Kültür Yayınları are sent to schools and public make chess easily accessible and prevalent specifically children to play chess in primary and secondary schools,
at İşbank libraries throughout Turkey. In 2019, nearly 58 thousand
Sustainability 58 among children. With the objective of transforming chess to draw the attention of teachers and parents to this field, into a mass sport in Turkey, the Bank became the main thousand books were delivered to more than 3 thousand schools and and to eliminate the inadequacy of materials at the schools books sponsor of the Turkish Chess Federation (TCF) in 2005. with limited possibilities. In 2019, 2,000 chess classes were libraries. opened, and the total number of chess classes opened at schools reached 25,000. Main Sponsorship of the Turkish Chess Federation Main Sponsorship of the Northern Cyprus Financial Profitability Chess Federation Performance andPerformance After İşbank's main sponsorship of the Turkish Chess In parallel with TSF's main sponsorship, İşbank also Federation; In addition to Turkey and Turkish Republic of Northern sponsored the Northern Cyprus Chess Federation (KKSF) in 81 Students from 81 Cities Cyprus, the campaign book was also sent to Bahrain, licensed players increased from 2013. After the sponsorship, chess sports started to take With the “81 Students from 81 Cities” project launched Georgia, Iraq, England and Kosovo branches of İşbank, and place as a club activity once a week at primary schools in in the academic year of 2008-2009 in collaboration with İşbank AG and İşbank Russia. As in the previous years, Approach to the Turkish Republic of Northern Cyprus. All schools in the
Management 30,000 931,742 Darüşşafaka Educational Institutions, İşbank launched also in 2019, a specific number of books were printed in Turkish Republic of Northern Cyprus have a chess class. one of the most comprehensive and long-term corporate the Braille alphabet and sent to the libraries of schools chess trainers increased from Turkey Junior, Youth and Veterans Chess social responsibility projects in education in Turkey. With the that provide education for visually impaired students. Championships project, all educational expenses of 81 students, who pass Furthermore, books were gifted to the students studying at 2,000 to 86,858 the Darüşşafaka Educational Institutions admission exam, the Regional Boarding Secondary Schools and the children In 2019, a total of 2,636 players from 81 cities in Turkey from the fifth grade until the end of the high school, are staying at the Homes of Love (Sevgi Evleri) affiliated to the
Experience covered by İşbank every year. The number of students who General Directorate of Children’s Services. chess tournaments increased from and from the Turkish Republic of Northern Cyprus competed
Flawless CustomerFlawless in Juniors (aged 7-12) Chess Championship of Turkey graduated from high school in 2019 is 54. Book donations to schools and libraries 400 to 9,600 and Youth (aged 13-18) Chess Championship of Turkey, organized concurrently in Antalya. Within the scope of the project, İşbank continues to support Darüşşafaka students who get into university. In addition, As an extension of the Bank’s social responsibility activities chess clubs increased from School Sports Turkey Chess Championship within the scope of Koç University's "Anadolu Scholarship in contribution to education, the books published by İş Holders" program, the education expenses of a certain Bankası Kültür Yayınları are sent to schools and public Banking Responsible 600 to 2,136 School Sports Turkey Chess Championship has been number of Darüşşafaka graduates are covered by İşbank libraries throughout Turkey. In 2019, nearly 58 thousand conducted since 2015 with the collaboration of the School every year. The total number of students supported in the books were delivered to more than 3 thousand schools and project approached 750. libraries. title-holder chess players increased from Sports Branch under the Ministry of Youth and Sports Directorate General of Department of Sports Activities and One Million Books, One Million Children Kumbara Magazine (Kumbara Dergisi) 6 to 187 TSF (Turkish Chess Federation). School Sports Turkey Chess Championship 2019 was held in Karaman between June Having been launched in 2008 as one of the largest book In 2019, "Coding Training Activities with Scratch 3.0" and Happy andHappy Productive Employees 9 and 13, 2019. 100 school teams and 511 players from campaigns performed so far in Turkey, the " One Million "Video Chess Training Activities" were prepared in Kumbara The number of medals won in international many cities participated in the competition. Books, One Million Children " campaign aims to support the Magazine portal prepared with the aim of providing the development of children's cognitive and cultural skills, to children with quality, instructive and entertaining contents. tournaments reached 487 İşbank Chess Super League support the creation of a generation that reads and queries, In 2019, Kumbara Magazine was visited by more than 65 As the most powerful league in Turkey in its field, İşbank and to establish a warm communication between İşbank thousand individual users, and reached a number of nearly To date, a total of Chess Super League is among the most powerful leagues in and children at an early age. 500 thousand clicks. Operations Responsible Europe. Tatvan Chess Training Club became the champion of "İşbank Chess Super League 2019". Within the scope of the campaign organized for the Golden Youth Award 25 world championships, 30 second places and 12th time with the book entitled "Siyah İnci(Black Pearl)" Every year since 1971, students who succeed in the 39 third place titles in wordwide organizations, distributed at the end of the academic year of 2018-2019, 14 million books in total were brought together with university admission exams are awarded with the "Golden 68 European championships, 67 second primary school students. Youth" programme. The number of award recipients topped 3.500. Society place and 58 third place titles in Europe-wide
Positive Value for Value Positive organizations were achieved.
82 83 Positive Value for Society İşbank 2019 Integrated Report
Kültür Yayınları continues its publication life with the principles The number of saplings planted within the "81 Forests in 81 Cities" of quality publication, contributing to the development of Turkish at İşbank project exceeded 3 million. As of the end of 2019, the success rate in Sustainability 3 10 language and gaining reading habit at an early age. It has brought million forest lands was 83%. million together more than 10 million books with its readers in 2019. Financial Profitability Performance andPerformance
The Sponsorship For The First Turkish Arctic 81 Forests in 81 Cities Kültür Yayınları In Kibele Art Gallery and Ankara Art Gallery, there are Scientific Expedition exhibitions of master artists in plastic arts. In the season The “81 Forests in 81 Cities” project was launched in Established in 1956, İşbank Kültür Yayınları offers works of 2018 - 2019, a thematic exhibition entitled “Journey to The "First Turkish Arctic Scientific Expedition" was carried 2008 in collaboration with the TEMA Foundation and the with high print quality and enriched contents. Kültür Nâzım” and the retrospective exhibitions of Mustafa Ayaz, Approach
Management out by İstanbul Technical University, Polar Researches Republic of Turkey, Ministry of Agriculture and Forestry. Yayınları continues its publication life with the principles Erol Kınalı, Maria Kılıçlıoğlu and Gürol Sözen were held at Application and Research Center (PolReC). It was sponsored The project was realized with the aim of protecting the of quality publication, contributing to the development of Kibele Art Gallery. The season of 2019 - 2020 started with by İşbank between July 11-26, 2019 in order to contribute environment and raising environmental awareness of Turkish language and gaining reading habit at an early age. the "Memory of Kibele" exhibition prepared on the occasion to the studies of global climate change and sea ice physics the public, primarily / particularly the children. 2,205,000 It has brought together more than 10 million books with its of the 20th anniversary of Kibele Art Gallery. studies. saplings were planted on a land of 1,500 hectares in all readers in 2019. cities, and 35,200 saplings were planted on a land of 25 Ankara Art Gallery, which was opened with Mevlüt Akyıldız's exhibition in May 2019, started the season of Experience The expedition included observations and analysis of the hectares in Turkish Republic of Northern Cyprus. Within the Art and Music Activities type of arctic sea ice, verification of sea ice terrestrial 2019 - 2020 with the "Journey to Nâzım" exhibition.
Flawless CustomerFlawless scope of the project, the maintenance works, which will measurements through remote sensors, arctic maritime continue for five years following the plantings, continued İş Sanat meteorology, sky quality research, taking permanent in 2019 as well. Nearly 1 million companion plantings have Mimar Sinan Fine Arts University, Artworks İşbank's cultural & art activities have been continued under organic pollutant samples, microplastic research studies, been performed so far with maintenance works. Thus, Conservation and Restoration Laboratory the roof of İş Sanat since 2017. With its stage and music bio-productization studies and the stages of arrival at 80 the number of saplings planted with companion plantings North points. events, the activities in plastic arts and its contributions to The “Artworks Conservation and Restoration Laboratory”
Banking exceeded 3 million. As of the end of 2019, the success rate
Responsible the preservation of Turkey's cultural heritage, İş Sanat is was established in collaboration with Mimar Sinan Fine in forest lands was 83%. During this expedition that was organized for the first one of the most important art platforms in the country. Arts University with an aim to support academic researches time for scientific purposes, data have been gathered Projects in Culture and Art on the restoration and conservation of artworks and to for 41 researches of different universities and academic In season 19 of İş Sanat, 22 concerts and dance shows, 5 contribute to the training of qualified workforce. In this disciplines. The findings obtained are expected to contribute İşbank contributes to the enrichment of the art life of children events and 9 poetry recitals were held. In addition, Laboratory, maintenance and repair works of the artworks to the scientific world for many years. the country and bringing the activities in international art within the scope of the "Shining Stars" series, 12 young in İşbank Artworks Collection are carried out. Within the artists took to the stage at Milli Reasürans. In season scope of the collaboration, the undergraduate program of Happy andHappy Productive and culture arena to Turkey. The Bank also supports the Employees Projects in Environmental Area projects aimed at revealing the archaeological heritage in 19, the activities were watched by nearly 27 thousand Artworks Conservation and Restoration was established in the country, bringing it together with new generations and people. The season 20 was opened with the concert of the 2013-2014 academic year within the university. İşbank aims to create a more livable environment in preserving it in such a way that it can be transferred to the Borusan İstanbul Philharmonic Orchestra with the soloist cooperation with non-governmental organizations, future. performance of Demirhan Gökbudak, the Shining Star of the Contributions in Archeology contribute to the preservation of natural resources, draw previous season. attention to the environmental problems associated with Contribution is made to archaeological excavations for the Operations Responsible deforestation, and to develop environmental awareness, purpose of revealing the enriched archaeological heritage primarily of our children. of Turkey, and preserving and bringing such heritage to the world heritage. The contribution made to the “House of the Muses” excavations, which is one of the excavation sites in Zeugma Ancient City, started in 2012, and the works were completed as of October 2019. Society Positive Value for Value Positive
84 85 Positive Value for Society İşbank 2019 Integrated Report
at İşbank Sustainability
With Şişecam and the Industrial Development Bank At İşbank Museum, an exhibition entitled “Independence” Performance Indicators of Turkey (TSKB), excavation works were started to be was opened for the 100th anniversary of the War of supported for “Patara” Ancient City in Kaş/Antalya in 2016; Independence in March 2019. The exhibition, which Social Investments 2018 2019 for “Teos” in Seferihisar / İzmir in 2018; and for "Nysa" in attracted great attention of the visitors, reached a record Financial
Profitability Contribution to equal opportunity in education Sultanhisar / Aydın in 2019. Prof. Dr. Havva İşkan Işık, the number on October 29 and was visited by 10,919 people. Performance andPerformance Head of Excavation for Patara Ancient City, compiled a book The number of students Total number of students, The museum was received by more than 580 thousand entitled “Patara City Harbor Cult” which was published in 81 Students from 81 Cities reached 700 with the including 54 graduates of 2019, visitors in 2019. The number of people who have visited the Turkish and English. Archaeological values will be revealed graduates. has approached 750. with the support to be provided to the excavation works in museum since its foundation has reached to 1.7 million. Patara, Teos and Nysa Ancient Cities for five years each. It Supporting the raising of generations that reads and questions, and the children's cognitive and cultural development
Approach is thought that these values will not only shed light on the İşbank Economic Independence Museum (Ulus, Management Ankara) With the campaign carried out history of civilization of Anatolian lands but also make great With the campaign carried out for the 12th time at the end of contribution to the world cultural heritage. for the 11th time, a total of 13 The historical building in Ankara Ulus, which also served as 2018-2019 academic year, a One Million Books, One Million Children million books have been gifted In 2019, a contribution was also made to repair the the Headquarters of İşbank, was opened on May 2, 2019 total of 14 million books have to elementary school students warehouse, where the ceramic pieces found during the in order to bring together the Bank's long-established been gifted to elementary to date. Kaman-Kalehöyük excavations which are carried out by the corporate history and the economic development of Turkey school students to date. Experience Japanese Anatolian Archeology Institute. with visitors from Ankara. In addition to the guided tours Flawless CustomerFlawless specific to student groups, the museum has hosted over More than 52 thousand books In 2019, more than 58 Museology and History Studies 1,800 students during its workshops so far and, was Book donations to schools have been sent to 2,844 thousand books have been sent received by more than a total of 62 thousand visitors in schools and libraries. to 3,116 schools and libraries. İş Bankası Müzesi (İşbank Museum,Yenicami, 2019. Independence Exhibition was opened at Economic İstanbul) Independence Museum in Ankara as well. The total number Financial Literacy
Banking of visitors of the exhibition in two museums exceeded 500 Responsible Opened to visitors in 2007, Turkey İşbank Museum A total of more than 21 thousand. A total of 20,400 students explains the Bank's long-established corporate history and Improving financial literacy and the awareness of thousand students participated participated in the workshops economic development of Turkey through banking supplies, saving up in the workshops organized at Technology History Book organized at İşbank Museum. documents, communication devices, photographs, pictures, İşbank Museum. advertisement-promotional materials and movies. A book entitled “The Road to Eskişehir is 8 km/İşbank's Information Technologies History From Past To Present", Happy andHappy Productive Employees The museum collection consists of objects which are an which narrates İşbank's technology history, was prepared. indispensable part of daily life, have been used since the foundation of the Bank, and reflect the transformation İstanbul Foundation For Culture and Arts phases of banking in Turkey during the Republic Era. (İKSV) - International İstanbul Music Festival 2020 and beyond
Several workshops aimed for children are conducted at İşbank sponsored the "Soloists of Moscow & Yuri Through social responsibility initiatives which İşbank plans as long-lasting and wide-reaching activities, the Bank intends the Museum ,such as Budgeting and Saving, Money of Bashmet" concert realized as a part of the 47th İstanbul Operations
Responsible to contribute to social development. With projects in education, environment, culture and art which the Bank implements the World, My Museum Memory, My Pocket Money In My Music Festival organized by the Istanbul Foundation for or supports, it makes powerful investments for the future as well as today, and creates permanent value. İşbank will Pocket In addition, Financial Literacy Training courses for Culture and Arts. continue social investment programs where it will create positive value also in forthcoming periods and increase the adults are also provided. More than 21 thousand students number of people reached through projects. Under One Million Books, One Million Children (Karneni Göster Kitabını Al) participated in the workshops held at the Museum in 2019. Campaign, the Bank aims to give away over 1 million books every year. 81 Students from 81 Cities (81 İlden 81 Öğrenci) Project will continue. Society Positive Value for Value Positive
86 87 Annexes İşbank 2019 Integrated Report
Annexes
Loans Granted by International Financial Institutions (open as of 31.12.2019 by İşbank)
International Date of Maturity Financial Amount Purpose of Extending Loans at İşbank Signature (years) Sustainability Institution
13.04.2009 € 250,000,000 12 Financing SMEs 09.12.2011 € 150,000,000 10 Financing SMEs Financing of energy efficiency and renewable energy projects as part 28.06.2012 (1) € 75,000,000 12 of the MidSEFF Program
Financial 04.12.2013 € 150,000,000 8 Financing of SMEs and enterprises with 250 to 3,000 employees Profitability
Performance andPerformance European Financing the loans to be extended to residential buildings that fall Investment Bank under the scope of Law No. 6306 and conform to the EIB criteria, 09.05.2014 € 200,000,000 10 (EIB) in order to improve earthquake safety and energy efficiency in Corporate Memberships residential buildings 30.10.2015 (1) $221,200,000 10 Financing of SMEs and enterprises with 250 to 3,000 employees European Association for Banking and Financial History International Chamber of Commerce Turkey - Commission on (EABH) Banking Techniques and Practices Financing of energy efficiency and renewable energy projects as part Approach $111,200,000 13 1 Management 01.12.2016 ( ) of the MidSEFF Program European Financial Management and Marketing Association National Education Foundation $47,600,000 10 Financing of SMEs and enterprises with 250 to 3,000 employees (EFMA) 27.10.2011 $6,660,000 15 Financing of energy efficiency projects as part of the TurSEFF Program Financing of energy efficiency and renewable energy projects as part European Association of Communication (EACD) Advertisers’ Association of Turkey 28.06.2012 (1) € 50,000,000 12 of the MidSEFF Program The Research Institute of Banking and Commercial Law Association of Risk Manages € 25,000,000 Financing of women entrepreneurs as part of the WiB Program Experience 09.05.2013 € 15,000,000 7 Financing of energy efficiency projects as part of the TurSEFF Program Flawless CustomerFlawless The Interbank Card Center (BKM) Information Systems Audit and Control Association (ISACA) € 10,000,000 Financing of agricultural investments as part of the TuRAFF Program Darüşşafaka Society Turkish Historical Society European Bank for Financing of energy efficiency and renewable energy projects as part Reconstruction 18.12.2013 (1) € 50,000,000 12 of the MidSEFF Program Turkish Marine Environment Protection Association and Development The Banks Association of Turkey - Ethics Commission (TURMEPA) (EBRD) $60,000,000 7 Financing of energy efficiency in residences as part of the TurEEFF Banking 1 Responsible 30.03.2015 ( ) $15,000,000 15 Program Working Group of the Banks Association of Turkey on the Foreign Economic Relations Board of Turkey (DEİK) $55,000,000 5 Financing of women entrepreneurs as part of the TuRWiB Program Role of the Finance Sector in Sustainable Growth Financing of energy efficiency and renewable energy projects as part 21.10.2016 (1) $55,000,000 12 Elginkan Community The Institute of Internal Auditing - Turkey of the MidSEFF Program Financing of renewable energy and resources efficiency investments 06.12.2017 (1) $55,000,000 7 Integrated Reporting Türkiye (ERTA) Turkish Institutional Investment Managers’ Association as part of the TurSEFF Program Happy andHappy Productive Employees Turkish Human Resources Management Association 09.12.2010 € 50,000,000 12 Financing of renewable energy and energy efficiency projects The Bankers’ Association for Finance and Trade (BAFT-IFSA) (PERYÖN) PROPARCO Financing of loans extended to residential buildings conforming to 01.03.2013 € 50,000,000 10 domestic energy efficiency criteria in Turkey Global Relations Forum Turkish Industry and Business Association (TÜSİAD) Financing of SMEs, prioritized regions in development, and women OPIC 10.12.2014 (1) $220,000,000 14 entrepreneurs Global Compact Turkey - Sustainable Banking and Finance Institute of International Finance (IIF) Financing of housing loans, especially green mortgages conforming to
Operations Working Group $105,000,000 Responsible IFC energy efficiency criteria IFC 28.12.2017 (1) 9 Provided for use in financing green mortgage loans ensuring energy İstanbul Foundation for Culture and Arts (İKSV) Vehbi Koç Foundation $20,000,000 efficiency, by the Clean Technology Fund through IFC Association of Corporate Communicators Platform of Entrepreneur Institutions Society (1) Resources provided through the transactions made within the scope of the securitization program based on cash flows. Positive Value for Value Positive
88 102-12 • 103-13 89 Annexes İşbank 2019 Integrated Report
Awards Received in Retail Banking Field in The Reporting Period Stakeholder Dialogue
Name of Award Awarded Project Award Stakeholder Communication Communication Method Group Frequency at İşbank GOLDEN SPIDER-Mobile Application Banking & Finance İşcep Public’s Favorite Sustainability Branches, ATM, Internet Branch, Telephone Branch and mobile banking channels, customer GOLDEN SPIDER - Mobile Application Banking & Finance İşcep Jury’s Best Customers Continuous relations representatives, meetings, customer satisfaction surveys, social media GOLDEN SPIDER -Digital Marketing-Online Advertising Campaign Maxi Jury’s Second Best General Assembly and investor meetings, investor presentations, analyst/investor days, GOLDEN SPIDER -Most Reachable Mobile Application Maximum Mobil Jury’s Third Best introductory meetings, teleconferences, communication by the Investor Relations Division, Investors and Continuous İşbank Investor Relations web page, Public Disclosure Platform, Information Society Services MARTECH – Best Use of AI Maxi First Prize Analysts Platform established as per the Turkish Code of Commerce, Annual Report, Sustainability Report, Financial
Profitability MARTECH – Best Use of Technology in Financial Sector Maxi First Prize joint projects Performance andPerformance SARDİS- Ecosystem Strategy Maximum Mobil Gold Sardis Employee satisfaction surveys, stakeholder analysis as part of sustainability, training activities, Employees Continuous performance assessment, internal communication platforms, regular executive meetings Workup Entrepreneurship SARDİS-Innovative Acceleration and Incubation Programs Gold Sardis Program Subsidiaries Continuous Joint projects SARDİS- Internal Innovation Agile Workshop Gold Sardis
Approach Public Institutions Management SARDİS-Product and Service Innovation Maxi Silver Sardis Minimum four and Regulatory Reporting processes, consultation meetings times a year STEVIE-New Products & Product Management Categories / Financial Services Maxi Gold Stevıe Agencies
STEVIE-Mobile Site & App Categories /Financial Services- Banking Maximum Mobil Bronze STEVIE Nongovernmental Organizations and Very Frequent Informative or press conferences, special meetings, answering written questions, joint projects STEVIE-Customer Service Team of the Year İşbank Call Center Team Bronze STEVIE Sector Unions Social Media Awards-Socialbrands Data Analytics Awards /Banks Turkey İşbank Silver Prize Experience Financial
Flawless CustomerFlawless Minimum once Assessment and information meetings, Annual Report, Sustainability Report, answering written Social Media Awards-Socialbrands Data Analytics Awards /Credit Cards Maximum Gold Prize Institutions and a year questions Rating Agencies Social Media Awards-Socialbrands Data Analytics Awards / Credit Cards Maximiles Silver Prize
Social Media Awards-Socialbrands Data Analytics Awards /Online Banking İşcep Silver Prize International Organizations and Very Frequent Conferences, seminars, congresses, workshops, answering written questions Mma Smarties Turkey-Brand Awareness Maxi Gold Prize Initiatives Banking
Responsible Mma Smarties Turkey-Product Launch Maxi Silver Prize Media Continuous Information communication, press conferences, special meetings, answering written questions Mma Smarties Turkey-Innovatıon Maxi Gold Prize Daily communication with goods and service suppliers, initiatives aiming at raising sustainability MMA SMARTIES TURKEY Mobile Gaming, /Gamification & E-Sports Maximum Gaming Silver Prize Suppliers Continuous awareness among suppliers Efma-Accenture Customer Insight & Growth Banking Innovation Awards Maxi Bronze Prize
IDC Turkey Finance Technology Awards/Digital Channels Maxi First Prize Happy andHappy Productive Employees Isbank AI-Based Product IDC Turkey Finance Technology Awards/Big Data & Analytics First Prize Sales
IDC Turkey Finance Technology Awards/Enterprise Transformation Agile Workshop Third Prize
FELİS-Media-Financial Services Maxi ile Kafan Rahat! Achievement Award
Workup Entrepreneurship Operations Responsible Webrazzi-Enterprise Accelerator of the Year Third Prize Program
Webrazzi-Best Technology User Bank of the Year Turkey İşbank First Prize
Webrazzi-Digital Banking Application of the Year İşcep First Prize Society Positive Value for Value Positive
90 102-40 • 102-42 • 102-43 • 102-44 91 Annexes İşbank 2019 Integrated Report
Number of Employees by Seniority 2017 2018 2019
Human Resources Indicators 0-5 years 4,001 3,650 3,122 2017 2018 2019 5-10 years 6,554 5,615 4,451 Total Number of Employees 24,868 24,570 24,053 at İşbank 10+ years 14,313 15,305 16,480 Sustainability Female Male Female Male Female Male Total 24,868 24,570 24,053 Number of Employees 12,755 12,113 12,583 11,987 12,252 11,801 Number of Employees Covered by Collective Bargaining Agreements 12,504 11,927 12,381 11,845 12,064 11,655 Employee Turnover Rate (%) 2017 2018 2019
Number of Employees per Employment Type 2017 2018 2019 1.75 2.00 1.86 Financial
Profitability Full Time 24,762 24,443 23,923
Performance andPerformance Partial Time 44 81 123 Number of Employees by Educational Background 2017 2018 2019 Part Time 62 46 7 Primary School 77 68 60 Total 24,868 24,570 24,053 High School 4,083 3,954 3,730 Graduate School (2- and 3-year college) 554 548 538 Number of Employees per Region and Branch 2017 2018 2019 University (4-year college) 19,096 18,908 18,592 Approach Management Head Office 6,235 6,571 7,065 Post Graduate 1,043 1,075 1,113 Branch 17,863 17,204 16,244 PhD Degree 15 17 20 Region 770 795 744 Total 24,868 24,570 24,053 Number of Employees Benefiting from Maternity Leave and 2017 2018 2019 Returning After Maternity Leave Experience Number of Employees by Gender and Age 2017 2018 2019 Benefiting from Maternity Leave 970 986 780 Flawless CustomerFlawless Upper Management Female Male Female Male Female Male Returning after Maternity Leave 969 970 1,072 (Board of Directors and Executive Committee) Return to Work Rate after Maternity Leave 99.5%
Over 50 2 14 2 16 3 13 Retention Rate after Maternity Leave 96.2% 30-50 3 5 3 2 2 2 Under 30 0 0 0 0 0 0 Banking
Responsible Employees in Management Position (Division Manager Female Male Female Male Female Male Total Employment Created In Subsidiaries 2017 2018 2019 and above) Number of Subsidiaries 105 110 111 Over 50 4 20 6 23 6 24 Number of Employees in Subsidiaries 33,222 34,036 34,207 30-50 8 45 6 41 6 39 Under 30 0 0 0 0 0 0 Trainings Provided to Employees * 2017 2018 2019 Happy andHappy Productive Employees Average Annual Training Hours per Employee 21.3 23.1 25.7 Number of Employees by Age 2017 2018 2019 Average Annual Training Hours per Female Employees 19.00 20.8 22.3 Over 50 235 271 353 Average Annual Training Hours per Male Employees 24.2 26.1 29.9 30-50 21,408 21,596 21,510 Under 30 3,225 2,703 2,190 * The number of training activities does not include those who participate in the private security renewal training, and the actual number of employees does not include the Private Security Guard and the Servant Staff. Total 24,868 24,570 24,053 Operations Responsible Anti-Corruption and Bribery Ethical Principles Human Rights Sustainability
Number of Trainees 7,577 664 260 538 Person*Hour 3,115 506 733 4,760 Society Positive Value for Value Positive
92 102-8 • 405-1 401-1 • 401-2 • 401-3 • 404-1 • 404-3 93 Annexes İşbank 2019 Integrated Report
OHS Indicators 2019 OHS Indicators 2019
UN Global Compact Communication on Progress Injury Rate (Injury Rate) Contractors 0 Principles Report Section Direct Employment 0.131111243 Female 0
at İşbank Human Rights Female 0.088817294 Male 0 Sustainability Male 0.042293949 Number of Work Related Fatalities Principle 1: Businesses should support and respect the protection of internationally Happy and Productive Employees, proclaimed human rights. Management Approach Contractors 0 Direct Employment 0 Principle 2: Businesses should make sure that they are not complicit in human rights Happy and Productive Employees, Female 0 Female 0 abuses Management Approach Male 0 Male 0 Labor Occupational Disease Rate (ODR) Contractors 0 Financial
Profitability Principle 3: Businesses should uphold the freedom of association and the effective Happy and Productive Employees Performance andPerformance Direct Employment 0 Female 0 recognition of the right to collective bargaining. Female 0 Male 0 Principle 4: Businesses should uphold the elimination of all forms of forced and compulsory Happy and Productive Employees Male 0 Number of Incidents labor Contractors 0 Direct Employment 94 Principle 5: Businesses should uphold the effective abolition of child labor Happy and Productive Employees
Female 0 Female 63 Principle 6: Businesses should uphold the elimination of discrimination in respect of Approach Happy and Productive Employees Management Male 0 Male 31 employment and occupation. Lost Day Rate (LDR) Contractors 0 Environment
Direct Employment 2.909823717 Female 0 Principle 7: Businesses should support a precautionary approach to environmental Responsible Banking, Responsible Operation challenges Female 1.463370648 Male 0 Principle 8: Businesses should undertake initiatives to promote greater environmental Male 1.446453069 Accident Frequency Rate * Corporate Memberships
Experience responsibility Contractors 0 Direct Employment 0.397609403 Flawless CustomerFlawless Principle 9: Businesses should encourage the development and diffusion of Female 0 Responsible Banking, Responsible Operation Female 0.266467479 environmentally friendly technologies Male 0 Male 0.131118829 Anti-Corruption Injury-Related Absenteeism Number of Employee Working with a Principle 10: Businesses should work against corruption in all its forms, including extortion Management Approach Direct Employment 688 High Risk of Occupational Diseases and bribery Banking
Responsible Female 346 Direct Employment 0 Male 342 Contractors 0
(*) Accident Frequency Rate (IR): Total number of injuries/(Total working hours-Lost hours) * 200,000 Happy andHappy Productive Employees Operations Responsible Society Positive Value for Value Positive
94 403-1 • 403-2 • 403-3 95 Annexes İşbank 2019 Integrated Report
Reporting Guidance
Environmental Indicators • Recycled non-hazardous waste includes plastic, metal and glass. • Amount (tons) and types of recycled • Recycled hazardous waste includes florescent lamps, batteries, toner cartridges and car batteries hazardous waste Total energy consumption covers electricity, natural gas, diesel (for heating purposes), fuel, oil and coal • Recycled paper waste includes paper, cardboard boxes, and similar waste paper. consumption figures. Electricity and natural gas consumption are included in the total energy consumption • Amount (tons) and types of recycled calculations. Electricity consumption was initially calculated in kWh and then converted to GJ. In this conversion, non-Hazardous Waste Reporting limits on waste include ATOM, TUTOM, İş Kuleleri Kule-1, Atlas and Oditorium buildings. at İşbank 1 kWh = 0.0036 GJ conversion factor was used. • Amount of recycled paper (tons) While calculating the amount of recycled waste, receipts and dispatch notes provided by authorized recycling firms Sustainability 3 were taken into account. Total Energy Consumption (GJ) After calculating monthly natural gas consumption in 2019 in m , it was converted to kWh by using the monthly- based upper heat values on the invoices. The annual total consumption is calculated by summing these monthly • Electricity consumption (kwh) consumptions. Annual total consumption was converted to GJ using the conversion factor mentioned above and 3 Renewable Energy Portfolio of İşbank • Natural gas consumption (m ) added to the total energy consumption. Diesel and fuel oil consumption figures were converted from LT to GJ, whereas coal consumption was converted from kg to GJ via IPCC conversion factors. Renewable energy projects financed during the reporting period included, Reporting boundary for this KPI covers Turkey operations of İşbank. Branches, which were closed during the year, • Hydroelectric Power Plant (HEPP) were excluded from above mentioned calculations. • Wind Power Plant (WPP),
Financial • Biomass Power Plant (BES) Profitability Greenhouse gas emissions refer to carbon emissions from energy consumption during the reporting period. • Solar Power Plant (GES) Performance andPerformance Greenhouse gas emissions resulting from activities are calculated in accordance with The Greenhouse Gas • Number of renewable energy Protocol: A Revised Corporate Accounting and Reporting Standard by S360 Sustainability Services Inc., a firm projects financed in 2019, installed • Geothermal Power Plant (GPP) offering strategy, management and reporting services in the area of sustainability. power size (MW) and loan amount The loan amount provided for the projects has been determined over the total limit information by taking the Greenhouse gas emissions are calculated in 3 different scopes: Scope 1 (Direct Greenhouse Gas Emissions), Scope provided to these projects (million sum of cash and non-cash loans extended by the Corporate Loans Allocation, Commercial Loans Allocation 2 (Indirect Greenhouse Gas Emissions) and Scope 3 (Other Indirect Greenhouse Gas Emissions). USD) and SME Loans Allocation Departments of the Bank. In this process, the loan allocation files of the projects IPCC 5th Assessment Report factors were used for emission factors. Network Emission Factor has been were taken as reference in determining the total loan amounts provided to the projects along with the calculated in accordance with the data provided by TEİAŞ. Direct greenhouse gas (GHG) emissions (Scope 1) and information on installed power size. The number of renewable energy projects covers the number of power indirect energy greenhouse gas (GHG) emissions (Scope 2) were made according to the GHG Protocol – According plants financed. When calculating Installed power capacity for projects financed by consortium structures, Approach
Management to location-based criterion. bank shares are not taken into consideration in calculating and total installed power information of the power Other indirect greenhouse gas (GHG) emissions (Scope 3) are reported according to the GHG Protocol. DEFRA plant/plants is reported. emission factors were used for air travel emissions and Environmental Paper Network emission factors were used for paper consumption. Environmental and Social Risk Indicators While calculating greenhouse gas emissions, the following sources causing carbon emissions were considered: Greenhouse Gas Emissions Scope 1 Emissions: As detailed under the Responsible Finance section of Responsible Banking, evaluations within the • Scope 1 Emissions (tCO e) 2 • Natural gas, diesel, fuel oil and coal consumption for heating purposes, Environmental and Social Risk Evaluation Tool (ERET) included projects with an investment amount of 10 • Scope 2 Emissions (tCO e) Number of financed projects 2 • Fuels used in generators (Diesel), million USD and above, for which loans were allocated or contracted during the reporting year. Projects • Scope 3 Emissions (tCO e) subjected to environmental and
Experience 2 undergoing ERET evaluation process are evaluated with reference regulations such as national, environmental • Company vehicles fuel Consumption (Diesel and Gasoline) social risk assessment and risk and international regulations, IFC (International Finance Corporation) Performance Standards, EBRD • Refrigerants (Leaks reported during installation and maintenance phases are considered); categories Flawless CustomerFlawless (European Bank for Reconstruction and Development) Performance Requirements, Equator Principles. A Scope 2 Emissions: Electricity Consumption Project Environmental and Social Assessment Document is prepared for each project. Scope 3 Emissions:
• Personnel service vehicles* Field visits within the scope of Definition of this indicator covers the number of field visits carried out within the scope of environmental and • Domestic business travels (Airplane, Bus, Taxi) environmental and social risk social risk assessment during the reporting period to monitor the projects financed in 2019 or before. • International business travels (Aircraft) assessment • Paper Consumption* Banking
Responsible Reporting boundary for this KPI covers Turkey operations of İşbank. Consumption by branches closed during the Talent Management Indicators year was not included in above mentioned calculations. Data provided by Atlas Data Centre, is included in the scope as of 2019. • Average annual training hours per * Personnel service vehicles include the vehicles transporting İşbank employees at İş Kuleleri Kule 1, ATOM, TUTOM and Atlas Data Center. employee Training hours are calculated considering all trainings, excluding private security renewal trainings given to ** Receipts printed by branches are excluded from calculations. • Average training hours per female employees during the year. In this context, the calculations are made by dividing the total hours of training employee given to the employees during the reporting period by the number of employees as of 31 December 2019 Fuel consumption of vehicles Company vehicles cover all vehicles in the Bank’s fleet also including transportation vehicles. Fuel consumption • Average training hours per male (private security and servant staff are not included in these calculations.). • Fuel consumption by company data by those vehicles was provided by the supplier firm. employee vehicles (Lt) Personnel service vehicles include the vehicles transporting İşbank employees at İş Kuleleri Kule 1, ATOM, TUTOM Happy andHappy Productive Employees • Fuel consumption by personnel and Atlas Data Centre. Fuel consumption was calculated over total distance figures, provided by the supplier firm, service vehicles (Lt) transporting İşbank employees. Anti-Bribery and Anti-Corruption, Ethical Principles, Human Rights and Sustainability trainings are covered • Number of employees received by the training modules including those subjects. Calculations for this indicator consider the number of employees participated in those trainings and the amount of time allocated to those issues within these 3 Anti-Bribery and Anti-Corruption Total Water Consumption (m ) Water consumption was evaluated in 3 different categories: mains water (blue), waste water (grey) and spring training and total training time trainings. There are no trainings directly devoted to Anti-Bribery and Anti-Corruption, Ethical Principles, • Total mains (blue) water water (green). Human Rights and Sustainability issues within the Bank. However, these issues have been addressed within 3 consumption (m ) Mains water (Blue) covers the amount of water purchased from utilities such as İSKİ. Waste water signifies the • Number of employees received certain training programs for certain periods of time. Therefore, when calculating the total hours of training • Total waste (grey) water amount of water used for any purpose and recycled (grey). Surface and groundwater formed by natural methods Ethical Principles / Business Ethics and the number of participants, the time allocated for these titles is taken into account within the existing consumption (m3) are within the scope of spring water (Green). While calculating spring water (Green) meter readings made by the training and total training time training programs. On the other hand, when calculating the training periods, the duration of the training given Operations Responsible • Total spring (green) water building management are taken into consideration. Spring water consumption also reflects the total amount of • Number of employees received in these areas in the training programs organized by the Board of Inspectors for the Board Members are not consumption (m3) recycled/reused water. Human Rights training and total included. • Total amount of recycled/reused Reporting boundary for this KPI covers Turkey operations of İşbank. Consumption by branches closed during the training time The subject of human rights is also mentioned in the course of Law on Private Security Services and 3 year was not included in above mentioned calculations water (m ) • Number of employees received Individual Rights, which is provided to private security personnel as part of the renewal trainings at certain Sustainability training and total time intervals. This subject was not included in calculations, since it is a subject mentioned within the 10- Emission Intensities training time hour renewal trainings provided by different suppliers in different provinces. Intensity of GHG emissions over consolidated net profit and consolidated assets calculated by dividing Scope 1, • Emission according to consolidate • Number of employees received Calculations for total hours of information security trainings, considered the number of employees total assets (tCO e/TL) Scope 2 and Scope 3 greenhouse gas emissions with the consolidated total assets of İş Bank and consolidated 2 net profit values. Consolidated total assets and net profit values of the bank are taken from the 31 December Information Security training and participated in trainings covering information security related issues (cyber security, social engineering and Society • Emission according to consolidate 2019 financial statements which was approved by an independent auditor. Emissions intensity per employee total training time information security etc.) and the number of hours devoted those subjects. net profit (tCO e/TL) 2 is calculated via dividing total value of Scope,1, 2 and 3 emissions with total number of employees of İşbank at Positive Value for Value Positive • Emission per employee (tCO2e/ Turkey operations. number of employees)
96 97 Annexes İşbank 2019 Integrated Report
Hours of training per newly recruited employees in the first year indicates the ratio of the total hours of Calculated by considering the days of absence due to work accidents. In this regard, calculations are made training received by new employees during the reporting period to the number of newly recruited employees. Injury Related Absenteeism according to the periods as stated in the doctor/hospital reports of the employees those had reported work • Hours of training per newly In calculation of the relevant indicator, private security staff, members of the administrative council and accidents to Human Resources Management Division. recruited employees in the first servant staff were excluded. year Hours of management and leadership development programs per person is calculated by dividing the The ratio of accidents during the year to total working time is calculated. In this regard, calculations are made at İşbank • Hours of Management and total hours of training management and leadership development programs by the number of managers by the formula of “Total number of accidents/(Total working hours - Lost hours)*200.000”. The number of Sustainability Leadership Development Program (Submanager and above) as of 31 December 2019. accidents in this formula is obtained from the accident report forms filled out by employees. While calculating Accident Frequency Rate total working hours, official holidays within the year are subtracted and 1 workday is accepted as 8 hours. training per person Hours of IT competence development training per person is calculated by dividing the total hours of “IT • Hours of IT competence Business Line Trainings” during the reporting period with the number of employees within the Department of Lost hour data is reported by calculating total number of work hours lost by the number of daily absences due to accidents. development trainings per person Information Technologies and Data Management (excluding private security guards and servant staff) as of 31 December 2019. • Share of digital trainings in total Covers the ratio of the number of days lost due to work accidents to total work hours. This calculation uses trainings Digital trainings include distanced education such as videos, e-trainings and e-games. The share of digital Lost Day Rate (LDR) the following formula “(Total number of lost days*200.000)/Total work hours”. The lost days in the formula trainings in total trainings is calculated by dividing the total duration of Digital Trainings completed in the covers absences due to accident. reporting period by the total hours calculated for all trainings. Financial Profitability Number of OHS Committees The indicator covers the number of OHS committees established at İşbank buildings with an employee Performance andPerformance Human Resources Indicators established and the total number population of 50 or more, in accordance with the law number 6331 on OHS. In this context total number of members and representatives of members corresponds to the total number of members to OHS committees. Union representatives are Total number of employees covers all employees of İşbank those are employed at Turkey and overseas working on the committees considered as natural employee representatives. operations as of 31st of December 2019. Interns; subcontractors; employees of Bank-Finance and Insurance Total Number of Employees Workers Union (BASİSEN) and Türkiye İş Bankası A.Ş. Mensupları Emekli ve Munzam Sandık Vakıfları; and Other Indicators subsidiary employees at Turkey and overseas operations are excluded from the total number of employees. The indicator covers all İşbank clients (including real and legal persons) as of 31 December 2019 except for cancelled customers (customers whose accounts were closed) and customers with non-performing loans, Approach This indicator refers to breakdown of total number of employees by gender and employment type (Full Time, Number of customers also including individual clients with inactive accounts and persons who had engaged with the Bank (those Management Part Time and Partial Time Status). Employment types include full time, part time and partial time status who made a credit application or a money transfer as well as those who possess a supplementary card and Breakdown of employees by gender employees. Part time employees include those, for whom, a working day consists of 4 hours. Whereas partial those who represent an İşbank client) hence seen as a potential client. and type of employment time status employees include those, for whom a working day consists of 5 hours. Partial time status is provided to contract-based employees as well as permanent staff who had returned from maternity leave or The number of customers who have successfully logged into any of the individual İşCep, commercial İşCep, their partners. Number of digital banking customers Maximum Mobil, Maximum İşyerim, Individual Internet Branch or Commercial Internet Branch channels with their customer number and password during the reporting period. Covers the ratio of the total number of employees who resigned during the year to the average number Employee Turnover Rate of employees. The average number of employees is calculated by dividing the sum of number of Bank’s The number of customers who have successfully logged into any of the individual İşCep, commercial İşCep,
Experience employees determined at each month by 12. Number of mobile banking users Maximum İşyerimor Maximum Mobil channels with their customer number and password during the reporting period. Flawless CustomerFlawless Covers the ratio of total number of female employees with the title of submanager and above to the total number of employees working with the title of submanager and above, as of 31 December 2019. Customer Satisfaction Score The indicator covers scores reflected in individual and commercial customer experience surveys conducted by (submanager and above titles include second manager, IT manager, managers and members of the Board of Net Promoter Score independent research companies during the reporting period. Women Ratio in Management Directors.) In the reporting period of 2018, the definition of the indicator included the titles of deputy manager and Total Amount of Cash Loans Covers the total amount of retail and commercial cash loans extended to the agriculture and livestock above. During the reporting period of 2019, this definition was revised to cover submanagers. Extended to the Agricultural Sector sector during the reporting period and also includes loans covered by the NACE A code. The labelling and (billion TL) classification of loans on the system has been checked and tested. Banking Responsible This İndicator covers the ratio of employees who are members of BASİSEN to the total number of employees Definition of this indicator in previous years, covered individual and commercial cash loans extended to SMEs. Unionization rate st Total Financing Provided to SMEs as of December 31 , 2019. During the reporting period of 2019, the definition was extended to cover individual and commercial cash and (billion TL) non-cash loans extended to SMEs. Number of employees benefited Covers the number of employees who had left for paid or unpaid maternity leave during the reporting period. from maternity leave Includes the number of users logged into İşbank’s www.istekobi.com.tr website which has been active since Number of views of İŞ'TE KOBİ 2008, during the reporting period. Calculations within this indicator took into account Google Analytics data. Number of employees returned from Covers the number of employees who had returned from paid or unpaid maternity leave during the reporting maternity leave period. Includes the total number of ATMs belonging to İşbank in Turkey and Turkish Republic of Northern Cyprus Happy andHappy Productive Employees Number of Bankamatik ATMs (TRNC) as of the reporting period. In this context data provided by the Interbank Card Center for December 2019 has been taken into account. The ratio of return from maternity leave is defined as the ratio of female employees who had returned Rate of return from maternity leave to work from (paid or unpaid) maternity leave during the reporting period to the total number of female Number of Disabled Friendly Includes the total number of ATMs belonging to İşbank, located in Turkey and TRNC which are accessible to a employees whose date of return from (paid or unpaid) maternity leave was within the reporting period. Bankamatik ATMs wheelchair and/or includes a headphone jack as of the reporting period.
Retention rate after maternity leave covers the female employees those who continue to work at İşbank as Total paper savings thanks to The indicator reflects the difference of the total number of pages printed in same brand printers in İşbank of the end of reporting period. Reporting and calculations for those employees cover one year prior to the digitized processes (Number of branches during the reporting period compared to the previous year. During the calculations number of print Retention rate after maternity leave reporting period. The rate of retention reported for 2019 reflects the rate of female employees who had pages printed) reports provided by the printers were taken into account. Operations
Responsible returned from (paid or unpaid) maternity leave in 2018 and continued to work at İşbank for 1 year to the number of female employees who had returned from (paid or unpaid) maternity leave in 2018. Number of trees planted during Includes the number of trees which will be planted in 2020 in exchange to the paper waste (papers belonging the year within the scope of the to the expired files collected from archives) donated by İşbank to TEMA in between February 1, 2019 - OHS data on the basis of female and male employees project carried out with the TEMA February 29, 2020. 1 tree is planted for every 100 kg of paper waste donated. In this context, receipts of Foundation collected paper waste from İşbank archives were examined. Number of Incidents Occupational Health and Safety related data covers İşbank employees within the borders of the Republic of Number of graduates from “81 Includes the number of graduates during the reporting period from Daruşşafaka within the scope of the Turkey. Students from 81 Cities” Project scholarship program, 81 Students from 81 Cities, conducted by İşbank with Darüşşafaka. An official letter It covers the definition of work accident within laws numbered 6331 and 5510. In this context, calculations conducted with Darüşşafaka provided by Darüşşafaka was taken into consideration. Society are made by considering the statements of the employees who reported work accidents, the hospital reports, the workplace doctor or the institution doctor reports. Positive Value for Value Positive
98 99 Independent Limited Assurance Report İşbank 2019 Integrated Report
• Number of OHS committees established and the total number of members and representatives at İşbank
Sustainability working at the committees Kpmg Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik A.Ş. • Average training hours per employee per year (with a gender breakdown) İş Kuleleri, Kule 3 Kat:2-9 • Number of training hours per newly recruited employees in the first year Levent 34330 İstanbul Tel: +90 212 316 60 00 • Number of employees who attended to training on “Fight against Corruption and Bribery”, “Principals of Ethics/ Faks: +90 212 316 60 60 Business Ethics”, "Human Rights” and “Sustainability” and number of training hours www.kpmg.com.tr • Number of employees who attended to information security trainings and number of training hours Financial Profitability • Share of digital trainings in total trainings (%) Performance andPerformance Independent Assurance Report • Number of training hours per person for management and leadership programmes • Number of training hours per person for IT competency development trainings To the Board of Directors of T. İş Bankası A.Ş. • Greenhouse Gas Emissions • Scope 1 (tCO2 ) We were engaged by Türkiye İş Bankası A.Ş. (hereinafter “Company” or “İş Bankası”) to provide limited assurance 2 Approach • Scope 2 (tCO ) Management on the “Selected Information” contained as defined in the Reporting Guidance of the Integrated Annual Report 2
(hereinafter "the Report") for the year ended 31 December 2019. • Scope 3 (tCO2e) The scope of our assurance is limited to the Selected Information listed below which are defined in the Reporting • Electricity consumption (kWh) Guidance section of the Report: • Natural gas consumption (m3) • Number of renewable energy projects financed during the year, installed power size (MW) and loan amount • Total energy consumed (GJ) provided to these projects (million USD) • Fuel consumption of company vehicles (lt) and personnel service vehicles (lt) Experience • Total amount of cash commercial loans extended in the agricultural sector (billion TL) 3
Flawless CustomerFlawless • Total water consumption (m ) • Total financing provided to SMEs (billion TL) • Total mains water consumption - Blue (m3) • Number of projects and risk categories financed through environmental and social assessment 3 • Total ground water consumption - Green (m ) • Number of field visits within environmental and social risk management • Total waste water consumption - Gray (m3) • Number of saplings planted during the year within the scope of the project carried out • Amount of recycled water (m3) Banking Responsible with the TEMA Foundation • Paper consumption (tons) • Total number of employees • Amount of recycled paper (tons) • Breakdown of employees by gender and type of employment • Amount and types of recycled hazardous waste (tons) • Employee turnover (%) • Amount and types of recycled non-hazardous waste (tons) • Women ratio in management (%) • Emission Intensities Happy andHappy Productive Employees • Unionization ratio (%) • Emission per employee (tCO2e/number of employees) • Number of employees benefited from maternity leave • Emission according to consolidate total assets (tCO2e/TL) • Number of employees returned from maternity leave • Emission according to consolidate net profit (tCO2e/TL) • Rate of return from maternity leave (%) • Number of views for İŞ'TE KOBİ • Retention rate after maternity leave (%) • Number of customers • OHS data on the basis of female and male employees
Operations • Net Promoter Score Responsible • Number of accidents • Customer Satisfaction Score • Number of fatal cases • Number of Bankamatik ATMs • Number of occupational diseases • Number of disabled-friendly Bankamatik ATMs • Injury related absenteeism, • Number of digital banking customers • Accident frequency rate, • Number of mobile banking users Society • Lost day rate, • Total paper savings thanks to digitized processes (Number of pages printed) Positive Value for Value Positive • Occupational disease rate, • Number of graduates from “81 Students from 81 Cities” Project conducted with Darüşşafaka
100 101 Independent Limited Assurance Report İşbank 2019 Integrated Report
Management's responsibilities The procedures performed in a limited assurance engagement vary in nature and timing from, and are less in at İşbank
Sustainability extent than for, a reasonable assurance engagement, and consequently the level of assurance obtained in a Management is responsible for the preparation and presentation of the Report for the Selected Information in limited assurance engagement is substantially lower than the assurance that would have been obtained had a accordance with the Reporting Guidance section of the Report, and the information and assertions contained reasonable assurance engagement been performed. within it; for determining İş Bankası’s objectives in respect of sustainable development performance and reporting, including the identification of stakeholders and material issues; and for establishing and maintaining Inherent limitations appropriate performance management and internal control systems from which the reported performance information is derived. Due to the inherent limitations of any internal control structure it is possible that errors or irregularities in
Financial the information presented in the Selected Information may occur and not be detected. Our engagement is Profitability Management is responsible for preventing and detecting fraud and for identifying and ensuring that İş Bankası
Performance andPerformance not designed to detect all weaknesses in the internal controls over the preparation and presentation of the complies with laws and regulations applicable to its activities. Selected Information, as the engagement has not been performed continuously throughout the period and the Management is also responsible for ensuring that staff involved with the preparation and presentation of the procedures performed were undertaken on a test basis. description and the Selected Information are properly trained, information systems are properly updated and that any changes in reporting encompass all significant business units. Conclusion
Approach Our conclusion has been formed on the basis of, and is subject to, the matters outlined in this report.
Management Our responsibilities We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our Our responsibility is to carry out a limited assurance engagement and to express a conclusion based on the work conclusions. performed. We conducted our engagement in accordance with International Standard on Assurance Engagements (ISAE) 3000 (Revised), Assurance Engagements other than Audits or Reviews of Historical Financial Information, Based on the procedures performed and the evidence obtained, as described above, nothing has come to our issued by the International Auditing and Assurance Standards Board. That Standard requires that we plan and attention that causes us to believe that the Selected Information of the Report of İş Bankası for the year ended perform the engagement to obtain limited assurance about whether the Selected Information is free from 31 December 2019 is not presented, in all material respects, in accordance with the Reporting Guidance of the Experience material misstatement. Report. Flawless CustomerFlawless We apply International Standard on Quality Control 1 and accordingly maintains a comprehensive system of In accordance with the terms of our engagement, this independent limited assurance report on the Selected quality control including documented policies and procedures regarding compliance with ethical requirements, Information has been prepared for İş Bank in connect with reporting to İş Bankası and for no other purpose or in professional standards and applicable legal and regulatory requirements. any other context. We have complied with the independence and other ethical requirements of the Code of Ethics for Professional Restriction of use of our report
Banking Accountants issued by the International Ethics Standards Board for Accountants, which is founded on Responsible Our report should not be regarded as suitable to be used or relied on by any party wishing to acquire rights fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and against us other than İş Bankası, for any purpose or in any other context. Any party other than İş Bankası who professional behavior. obtains access to our report or a copy thereof and chooses to rely on our report (or any part thereof) will do Procedures performed so at its own risk. To the fullest extent permitted by law, we accept or assume no responsibility and deny any liability to any party other than İş Bankası for our work, for this independent limited assurance report, or for the A limited assurance engagement on a Selected Information consists of making inquiries, primarily of persons conclusions we have reached. responsible for the preparation of information presented in the Selected Information, and applying analytical and Happy andHappy Productive Employees other evidence gathering procedures, as appropriate. These procedures included: • Interviews with relevant staff at the corporate and business unit level responsible for providing the information KPMG Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik Anonim Şirketi in the Selected Information. A member firm of KPMG International Cooperative • Using the Reporting Guidance of the Report to evaluate and measure the Selected Information; • Evaluating the design and implementation of key processes and controls over the Selected Information; Operations Responsible • Re-performing, on a sample basis, calculations used to prepare the Selected Information for the reporting period; • Evaluating the disclosure and presentation of the Selected Information in the Report to determine whether it is in line with our overall knowledge of, and experience with, the sustainability performance of İş Bankası. Şirin Soysal, • Comparing the information presented in the Selected Information to corresponding information in the relevant Partner underlying sources to determine whether all the relevant information contained in such underlying sources has İstanbul, 03 July 2020
Society been included in the Selected Information. • Reading the information presented in the Selected Information to determine whether it is in line with our overall Positive Value for Value Positive knowledge of, and experience with, the sustainability performance of İş Bankası.
102 103 GRI Content Index İşbank 2019 Integrated Report
Disclosures Descriptions and Page Numbers
GRI Content Index Corporate Governance, Page: 38 ; 2019 Annual Report, Page: 104-105, 107-110 102-29 https://www.isbank.com.tr/en/about-us/financial-statements Disclosures Descriptions and Page Numbers Risk Management and Compliance, Page: 40-41 ; 2019 Annual Report, Page: 104- GRI 101: Foundation 2016 102-30 at İşbank 105, 107-110 https://www.isbank.com.tr/en/about-us/financial-statements Sustainability GRI 102: General Disclosures 2016 Sustainability Management at İşbank, Page: 12-14; Sustanability Priorities, Page: Corporate Profile 102-31 16,17; Sustainability Management , Page: 16; 2019 Annual Report, Page: 104-105, 102-1 About the Report, Page: 3 107-110 https://www.isbank.com.tr/en/about-us/financial-statements About İşbank, Page: 10-11 102-32 Sustainability Management, Page: 16 102-2 https://www.isbank.com.tr/en/about-us/who-we-are 102-33 Stakeholder Dialogue, Page: 42 102-3 https://www.isbank.com.tr 102-34 Stakeholder Dialogue, Page: 42
Financial 102-4 About İşbank, Page: 10-11 Remuneration Policy, Profitability About İşbank, Page: 10-11 https://www.isbank.com.tr/en/about-us/corporate-governance; Performance andPerformance 102-5 102-35 https://www.isbank.com.tr/en/about-us/ownership-structure 2019 Annual Report, Page: 97 102-6 https://www.isbank.com.tr/en/about-us/our-subsidiaries https://www.isbank.com.tr/en/about-us/financial-statements 102-7 About İşbank, Page: 10-11 Remuneration Policy, https://www.isbank.com.tr/en/about-us/corporate-governance 102-36 102-8 Equal Opportunities and Diversity, Page: 68; Human Resources Data, Page: 92 2019 Annual Report, Page: 97 Responsible Procurement,Page: 74-76; Supplier Management Principles, 102-9 https://www.isbank.com.tr/en/about-us/financial-statements Approach https://www.isbank.com.tr/en/about-us/our-policies
Management Remuneration Policy, GRI Content Index: There are no significant changes in İşbank’s size, structure and https://www.isbank.com.tr/en/about-us/corporate-governance; 102-10 102-37 ownership during reporting period. 2019 Annual Report, Page: 97 102-11 Risk Management and Compliance, Page: 40-41 https://www.isbank.com.tr/en/about-us/financial-statements 102-12 Corporate Memberships, Page: 88 Remuneration Policy, https://www.isbank.com.tr/en/about-us/corporate-governance 102-13 Corporate Memberships, Page: 88 102-38 2019 Annual Report, Page: 97 Strategy https://www.isbank.com.tr/en/about-us/financial-statements Experience 102-14 Chairperson’s Message, Page: 4-5; Message from the CEO, Page: 6-9 Remuneration Policy, Flawless CustomerFlawless 102-15 Risk Management and Compliance, Page: 40-41 ; Risks and Opportunities, Page: 26-27 https://www.isbank.com.tr/en/about-us/corporate-governance 102-39 Ethics and Integrity 2019 Annual Report, Page: 97 https://www.isbank.com.tr/en/about-us/financial-statements Business Ethics, Page: 38-39; Ethical Principles 102-16 https://www.isbank.com.tr/en/about-us/corporate-governance Stakeholder Engagement Business Ethics, Page: 38-39; Ethical Principles 102-40 Stakeholder Engagement, Page: 91 102-17
Banking https://www.isbank.com.tr/en/about-us/corporate-governance 102-41 Employee Rights and Satisfaction, Page: 66 Responsible Governance 102-42 Stakeholder Dialogue, Page: 42; Stakeholder Engagement, Page: 91 2019 Annual Report, Page: 80-84 102-18 102-43 Stakeholder Dialogue, Page: 42; Stakeholder Engagement, Page: 91 https://www.isbank.com.tr/en/about-us/financial-statements 102-44 Sustainability Priorities, Page: 16,17; Stakeholder Engagement Dialogue, Page: 91 102-19 Sustainability Management , Page: 16 Reporting Practices 102-20 Sustainability Management , Page: 16 About the Report, Page: 3 102-45 102-21 Sustainability Management at İşbank, Page: 12-14; Sustainability Priorities, Page: 16,17 https://www.isbank.com.tr/en/about-us/financial-statements Happy andHappy Productive Employees 2019 Annual Report, Page: 80-90 102-22 102-46 About the Report, Page: 3 https://www.isbank.com.tr/en/about-us/financial-statements 102-47 Sustanability Priorities, Page: 16,17 102-23 GRI Content İndex: The Chairperson İşbank has no executive duty. 102-48 GRI Content Index:There are no restatements of information. 2019 Annual Report, Page: 94-103, 102-24 102-49 GRI Content Index: There are no significant changes. https://www.isbank.com.tr/en/about-us/financial-statements 102-50 About the Report, Page: 3 Corporate Governance, Page: 38 ; 2019 Annual Report, Page: 94-98 102-25 GRI Content Index: This is the second Integrated Report of İşbank. The previous report https://www.isbank.com.tr/en/about-us/financial-statements 102-51 was published as first Integrated Report of İşbank 2018. Operations
Responsible Corporate Governance, Page: 38 ; 2019 Annual Report, Page: 94-98 102-26 https://www.isbank.com.tr/en/about-us/financial-statements 102-52 About the Report, Page: 3 Corporate Governance, Page: 38 ; 2019 Annual Report, Page: 94-98 102-53 [email protected] 102-27 https://www.isbank.com.tr/en/about-us/financial-statements 102-54 About the Report, Page: 3 Corporate Governance, Page: 38 ; 2019 Annual Report, Page: 94-98 102-28 102-55 GRI Content Index, Page: 104-110 https://www.isbank.com.tr/en/about-us/financial-statements 102-56 Independent (Limited) Assurance Report, Page: : 100 - 103 Society
Positive Value for Value Positive For the Materiality Disclosures Service, GRI Services reviewed that the GRI content index is clearly presented and the references for Disclosures 102-40 to 102-49 align with appropriate sections in the body of the report.GRI STATEMENT: The service was performed on the Turkish language version of the report.
104 105 GRI Content Index İşbank 2019 Integrated Report
Priority Issues Priority Issues
Standard Disclosures Descriptions and Page Numbers Standard Disclosures Descriptions and Page Numbers Financial Performance and Profitability GRI 206: ANTI-COMPETITIVE GRI Content Index:There are no cases of anti-trust and anti-competitive behavior in 206-1 103-1 Explanation of BEHAVIOR 2016 the reporting period. Sustanability Priorities, Page: 16, 17; at İşbank the Material Topic and GRI 307: ENVIRONMENTAL Sustainability Financial Performance and Profitability, Page: 32-34 307-1 GRI Content Index:There are no significant fines or sanctions in the reporting period. its Boundary COMPLIANCE 2016 GRI 103: MANAGEMENT 103-2 The Management Sustanability Priorities, Page: 16, 17; GRI 419: SOCIOECONOMIC GRI Content Index: There is no lawsuit regarding corruption and bribery brought APPROACH 2016 Approach and its 419-1 Financial Performance and Profitability, Page: 32-34 COMPLIANCE 2016 against the Bank during the reporting period. Components Stakeholder Dialogue 103-3 Evaluation of the Sustanability Priorities, Page: 16, 17; Management Approach Financial Performance and Profitability, Page: 32-34 103-1 Explanation of the Material Topic and Sustanability Priorities, Page: 16, 17; Stakeholder Dialogue, Page: 42 201-1 Value Creation Model,Page: 18; Financial Performance and Profitability, Page: 32-34 its Boundary Financial
Profitability In the scope of the reduction in order-based R&D, innovation and design activities GRI 103: MANAGEMENT 103-2 The Management
Performance andPerformance GRI 201: ECONOMIC introduced by the Regulation on Implementation and Supervision of Support for APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Stakeholder Dialogue, Page: 42 PERFORMANCE 2016 201-4 Research, Development and Design Activities published in the Official Gazette dated Components 10.8.2016 and numbered 29797, an R&D discount of TL 27,565 thousand has been 103-3 Evaluation of the achieved. Sustanability Priorities, Page: 16, 17; Stakeholder Dialogue, Page: 42 Management Approach Business Ethics Transparency and Reporting 103-1 Explanation of Sustanability Priorities, Page: 16, 17; Management Approach,Page: Management 103-1 Explanation of
Approach the Material Topic and
Management Approach, Sayfa: 36-39 the Material Topic and Sustanability Priorities, Page: 16, 17; Transperency and Reporting, Page: 42 its Boundary its Boundary GRI 103: MANAGEMENT 103-2 The Management Sustanability Priorities, Page: 16, 17; Management Approach,Page: Management GRI 103: MANAGEMENT 103-2 The Management APPROACH 2016 Approach and its Approach, Sayfa: 36-39 APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Transperency and Reporting, Page: 42 Components Components 103-3 Evaluation of the Sustanability Priorities, Page: 16, 17; Management Approach,Page: Management 103-3 Evaluation of the Management Approach Approach, Sayfa: 36-39 Sustanability Priorities, Page: 16, 17; Transperency and Reporting, Page: 42 Management Approach 205-1 Business Ethics, Page: 38-39
Experience GRI 205: ANTI-CORRUPTION Digital Banking 205-2 Business Ethics, Page: 38-39 2016
Flawless CustomerFlawless 103-1 Explanation of 205-3 Business Ethics, Page: 38-39 the Material Topic and Sustanability Priorities, Page: 16, 17; Digital Banking, Page: 44 GRI Content Index:During the reporting period, no risk of child labor was observed in GRI 408: CHILD LABOR 2016 408-1 its Boundary İşbank’s operations. GRI 103: MANAGEMENT 103-2 The Management GRI 409: FORCED and GRI Content Index: During the reporting period, no risk of forced or compulsory labor 409-1 APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Digital Banking, Page: 44 COMPULSORY LABOR 2016 was observed in İşbank’s operations. Components GRI 410: SECURITY Banking 410-1 GRI Content Index: 25% of security personnel attended the renovation training in 2019. 103-3 Evaluation of the
Responsible PRACTICES 2016 Sustanability Priorities, Page: 16, 17; Digital Banking, Page: 44 Management Approach GRI 412:HUMAN RIGHTS 412-2 Business Ethics, Page: 38-39 Customer Orientation ASSESSMENT 2016 GRI 415: PUBLIC POLICY 103-1 Explanation of 415-1 GRI Content Index: İşbank does not provide aids to political parties. 2016 the Material Topic and Sustanability Priorities, Page: 16, 17; Customer Focus, Page: 49-50 its Boundary Risk Management GRI 103: MANAGEMENT 103-2 The Management 103-1 Explanation of APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Customer Focus, Page: 49-50 Happy andHappy Productive
Employees the Material Topic and Sustanability Priorities, Page: 16, 17; Risk Management and Compliance, Page: 40-41 Components its Boundary 103-3 Evaluation of the GRI 103: MANAGEMENT 103-2 The Management Sustanability Priorities, Page: 16, 17; Customer Focus, Page: 49-50 Management Approach APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Risk Management and Compliance, Page: 40-41 Components 417-1 İşbank Banking, Page: 12-14; Responsible Banking,Page: 57-60 GRI 417: MARKETING and 103-3 Evaluation of the 417-2 GRI Content Index: No such case occurred during the reporting period. Sustanability Priorities, Page: 16, 17; Risk Management and Compliance, Page: 40-41 LABELING 2016 Management Approach 417-3 GRI Content Index: No such case occurred during the reporting period. GRI 201: ECONOMIC Data Safety
Operations 201-2 Environmental Impact, Page: 77-78; Risks and Opportunities, Page: 26-27 Responsible PERFORMANCE 2016 103-1 Explanation of Compliance with Regulation the Material Topic and Sustanability Priorities, Page: 16, 17; Data Security, Page: 50 103-1 Explanation of its Boundary the Material Topic and Sustanability Priorities, Page: 16, 17; Risk Management and Complıance, Page: 40-41 GRI 103: MANAGEMENT 103-2 The Management its Boundary APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Data Security, Page: 50 GRI 103: MANAGEMENT 103-2 The Management Components APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Risk Management and Complıance, Page: 40-41 103-3 Evaluation of the Society Sustanability Priorities, Page: 16, 18; Data Security, Page: 50 Components Management Approach
Positive Value for Value Positive 103-3 Evaluation of the GRI 418: CUSTOMER Sustanability Priorities, Page: 16, 17; Risk Management and Complıance, Page: 40-41 418-1 GRI Content Index: Number of complaints is not disclosed due to data privacy. Management Approach PRIVACY 2016
106 107 GRI Content Index İşbank 2019 Integrated Report
Priority Issues Priority Issues
Standard Disclosures Descriptions and Page Numbers Standard Disclosures Descriptions and Page Numbers Finance Integrating ESG Criteria GRI 402: LABOR/ GRI Content Index: In case of significant operational changes, legal notice periods are 103-1 Explanation of MANAGEMENT RELATIONS 402-1 Sustanability Priorities, Page: 16, 17; Environmental and Social Risk Management in followed. at İşbank the Material Topic and 2016
Sustainability Lending, Page: 55-56 its Boundary 403-1 Occupational Health and Safety, Page: 67 Human Resources Data, Page: 94 GRI 103: MANAGEMENT 103-2 The Management GRI 403: OCCUPATIONAL 403-2 Human Resources Data, Page: 94 Sustanability Priorities, Page: 16, 17; Environmental and Social Risk Management in APPROACH 2016 Approach and its HEALTH 2016 Lending, Page: 55-56 403-3 Human Resources Data, Page: 94 Components 403-4 Occupational Health and Safety,Page: 67 103-3 Evaluation of the Sustanability Priorities, Page: 16, 17; Environmental and Social Risk Management in GRI 407: FREEDOM Management Approach Lending, Page: 55-56 of ASSOCIATION and 407-1 Rights Provided to Employees, Page: 66 GRI 304: BIODIVERSITY 2016 304-2 Environmental and Social Risk Management in Lending, Page: 55-56 COLLECTIVE BARGAINING Financial
Profitability GRI 412:HUMAN RIGHTS 2016 412-3 Environmental and Social Risk Management in Lending, Page: 55-56 Performance andPerformance ASSESSMENT 2016 Equal Opportunity and Diversity GRI 413: LOCAL 103-1 Explanation of 413-2 Environmental and Social Risk Management in Lending, Page: 55-56 Sustanability Priorities, Page: 16, 17; Equal Opportunities and COMMUNITIES 2016 the Material Topic and Diversity, Page: 68-69 Responsible Products and Services Portfolio its Boundary 103-1 Explanation of GRI 103: MANAGEMENT 103-2 The Management Sustanability Priorities, Page: 16, 17; Equal Opportunities and the Material Topic and Sustanability Priorities, Page: 16, 17; Responsible Products and Services Page: 57-60 APPROACH 2016 Approach and its Diversity, Page: 68-69
Approach its Boundary Components Management GRI 103: MANAGEMENT 103-2 The Management 103-3 Evaluation of the Sustanability Priorities, Page: 16, 17; Equal Opportunities and APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Responsible Products and Services Page: 57-60 Management Approach Diversity, Page: 68-69 Components Equal Opportunities and GRI 202: MARKET 103-3 Evaluation of the 202-1 Diversity, Page: 68-69; Rights Provided to Employees, Page: 66; Remuneration Policy, Sustanability Priorities, Page: 16, 17; Responsible Products and Services Page: 57-60 PRESENCE 2016 Management Approach https://www.isbank.com.tr/en/about-us/corporate-governance Responsible Marketing 405-1 Human Resources Data, Page: 92 GRI 405: DIVERSITY and 103-1 Explanation of GRI Content Index: This ratio is one since there is no gender-based wage
Experience EQUAL OPPORTUNITY 2016 405-2 the Material Topic and Sustanability Priorities, Page: 16, 17; Responsible Marketing,Page: 63 discrimination in İşbank.
Flawless CustomerFlawless its Boundary GRI Content Index: İşbank takes all decisions about its employees independent of GRI 103: MANAGEMENT 103-2 The Management GRI 406: NON- race,religion, language, sect or any belief, gender, mental or physical disability, age, 406-1 APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Responsible Marketing,Page: 63 DISCRIMINATION 2016 cultural or social class differences; it refuses any discrimination against or among the Components employees and managers. 103-3 Evaluation of the Talent Management Sustanability Priorities, Page: 16, 17; Responsible Marketing,Page: 63 Management Approach 103-1 Explanation of Banking Financial Inclusion the Material Topic and Sustanability Priorities, Page: 16, 17; Talent Management, Page: 69-72 Responsible 103-1 Explanation of its Boundary the Material Topic and Sustanability Priorities, Page: 16, 17; Financial Inclusion,Page: 61-62 GRI 103: MANAGEMENT 103-2 The Management its Boundary APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Talent Management, Page: 69-72 GRI 103: MANAGEMENT 103-2 The Management Components APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Financial Inclusion,Page: 61-62 103-3 Evaluation of the Sustanability Priorities, Page: 16, 17; Talent Management, Page: 69-72 Components Management Approach 103-3 Evaluation of the 404-1 Human Resources Data, Page: 93 Happy andHappy Productive Employees Sustanability Priorities, Page: 16, 17; Financial Inclusion,Page: 61-62 GRI 404: TRAINING AND Management Approach 404-2 Talent Management, Page: 69-72 EDUCATION 2016 Employee Rights and Satisfaction 404-3 Human Resources Data, Page: 93 103-1 Explanation of Sustanability Priorities, Page: 16, 17; Employee Rights and Supply Chain Management the Material Topic and Satisfaction,Page: 64-68 103-1 Explanation of GRI 103: MANAGEMENT its Boundary the Material Topic and Sustanability Priorities, Page: 16, 17; Responsible Procurement,Page: 74-76 APPROACH 2016 103-2 The Management Sustanability Priorities, Page: 16, 17; Employee Rights and its Boundary Approach and its Satisfaction,Page: 64-68 GRI 103: MANAGEMENT 103-2 The Management Operations Responsible Components APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Responsible Procurement,Page: 74-76 103-3 Evaluation of the Sustanability Priorities, Page: 16, 17; Employee Rights and Components Management Approach Satisfaction,Page: 64-68 103-3 Evaluation of the GRI 201: ECONOMIC 2019 Annual Report, Page: 201-203 Sustanability Priorities, Page: 16, 17; Responsible Procurement,Page: 74-76 201-3 Management Approach PERFORMANCE 2016 https://www.isbank.com.tr/en/about-us/financial-statements GRI 204: PROCUREMENT Equal Opportunities and Diversity, Page: 68-69; Rights Provided to Employees, Page: 204-1 Responsible Procurement,Page: 74-76 GRI 202: MARKET PRACTICES 2016 202-1 66; Remuneration Policy PRESENCE 2016 GRI 308: SUPPLIER 308-1 Responsible Procurement,Page: 74-76 Society https://www.isbank.com.tr/en/about-us/corporate-governance ENVIRONMENTAL 401-1 Human Resources Data, Page: 93 ASSESSMENT 2016 308-2 Responsible Procurement,Page: 74-76 Positive Value for Value Positive GRI 401: EMPLOYMENT 401-2 Human Resources Data, Page: 93 2016 GRI 414: SUPPLIER SOCIAL 414-1 Responsible Procurement,Page: 74-76 401-3 Human Resources Data, Page: 93 ASSESSMENT 2016 414-2 GRI Content Index: No negative social impacts were observed in the supply chain.
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Priority Issues
Standard Disclosures Descriptions and Page Numbers Environmental Footprint of the Bank 103-1 Explanation of Sustanability Priorities, Page: 16, 17; Environmental Impact, Page: 77-78; at İşbank the Material Topic and Environmental and Social Impact Policy https://www.isbank.com.tr/en/about-us/ Sustainability its Boundary Documents/sustainability/environment-and-social-impact-policy.pdf 103-2 The Management Sustanability Priorities, Page: 16, 17; Environmental Impact, Page: 77-78; GRI 103: MANAGEMENT Approach and its Environmental and Social Impact Policy https://www.isbank.com.tr/en/about-us/ APPROACH 2016 Components Documents/sustainability/environment-and-social-impact-policy.pdf Sustanability Priorities, Page: 16, 17; Environmental Impact, Page: 77-78; 103-3 Evaluation of the Environmental and Social Impact Policy https://www.isbank.com.tr/en/about-us/ Management Approach Documents/sustainability/environment-and-social-impact-policy.pdf Financial
Profitability 302-1 Environmental Impact/ Performance Data,Page: 79
Performance andPerformance 302-2 Environmental Impact/ Performance Data,Page: 79 GRI 302:ENERGY 2016 302-3 Environmental Impact/ Performance Data,Page: 79 302-4 Environmental Impact/ Performance Data,Page: 79 302-5 Environmental Impact/ Performance Data,Page: 79 303-1 Environmental Impact/ Performance Data,Page: 79 GRI Content Index:There are no water sources significantly affected by the operations
Approach GRI 303: WATER 2016 303-2 of İşbank. Management 303-3 Environmental Impact/ Performance Data,Page: 79 305-1 Environmental Impact/ Performance Data,Page: 79 305-2 Environmental Impact/ Performance Data,Page: 79 GRI 305: EMISSIONS 2016 305-3 Environmental Impact/ Performance Data,Page: 79 305-4 Environmental Impact/ Performance Data,Page: 79 305-5 Environmental Impact/ Performance Data,Page: 79 Experience GRI 306: ATIKSULAR 306-1 Environmental Impact/ Performance Data,Page: 79
Flawless CustomerFlawless VE ATIKLAR 2016 306-2 Environmental Impact/ Performance Data,Page: 79 Social Investment Programs 103-1 Explanation of
the Material Topic and Sustanability Priorities, Page: 16, 17; Positive Value for the Society, Page: 80 its Boundary GRI 103: MANAGEMENT 103-2 The Management Banking APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Positive Value for the Society, Page: 80 Responsible Components 103-3 Evaluation of the Sustanability Priorities, Page: 16, 17; Positive Value for the Society, Page: 80 Management Approach GRI 203: INDIRECT 203-1 Financial Performance and Profitability, Page: 32-35 ECONOMIC IMPACTS 2016 203-2 Financial Performance and Profitability, Page: 32-35 GRI 413: LOCAL 413-1 Environmental and Social Risk Management in Lending, Page: 55-56 COMMUNITIES 2016 Happy andHappy Productive Employees Financial Literacy 103-1 Explanation of the Material Topic and Sustanability Priorities, Page: 16, 17; Positive Value for the Society, Page: 80 its Boundary GRI 103: MANAGEMENT 103-2 The Management APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Positive Value for the Society, Page: 80 Components Operations Responsible 103-3 Evaluation of the Sustanability Priorities, Page: 16, 17; Positive Value for the Society, Page: 80 Management Approach Combating Climate Change 103-1 Explanation of the Material Topic and Sustanability Priorities, Page: 16, 17; Combating Climate Change, Page: 52,54 its Boundary GRI 103: MANAGEMENT 103-2 The Management Society APPROACH 2016 Approach and its Sustanability Priorities, Page: 16, 17; Combating Climate Change, Page: 52-54 Components Positive Value for Value Positive Reporting Constultant & Design 103-3 Evaluation of the Sustanability Priorities, Page: 16, 17; Combating Climate Change, Page: 52-54 Kıymet-i Harbiye Yönetim Danışmanlık Management Approach
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