INSIDE THE REPORT

About UnionBank 04 Purpose Statement and DNA Business Profile ABOUT THE COVER Business Presence and Economic Contribution

10 About the Report

Sustainability Leadership 16 Joint Message of the Chairman and President & CEO The cover artwork portrays how sustainability in UnionBank is integrated with Sustainability Scorecard 2020 the digital transformation Policy and Framework strategy. The financial 22 Key Indicators technological breakthroughs and digital capability programs we have today People and Digital Transformation prove that we can make Approach and Metrics co-creation of innovations 28 Scorecard happen, driven by our mission Innovating for Social Good to “tech up” our customers, business partners, and other stakeholders. Planet and Sustainable Finance Approach and Metrics UnionBank believes that by 48 Scorecard empowering and enabling Unlocking Tomorrow’s ESG Opportunities its workforce and our fellow Filipinos with digital skills and capabilities, we can effectively Purpose and Inclusive Prosperity design products, services, and Approach programs that can help care 58 Scorecard for and sustain our planet. Designing the Digital Ecosystem for Entrepreneurs By championing innovation, we create a groundswell of communities that will have the Special Story: capability to hack solutions 66 Future-Proofing People in the Time of Pandemic that can address the wicked challenges of our world today. 76 GRI Index

84 Annexes 4 | UnionBank 2020 Sustainability Report

VISION EMPLOYER BRAND ABOUT To become one of the top three universal banks Own the future. Co-create innovations. in the Philippines by building a bank of enduring greatness. UNIONBANK CREDO PURPOSE We are a dynamic Bank committed to PURPOSE STATEMENT AND BANK DNA bringing the future of banking to the To co-create innovations for a better world. present by being forward thinking, innovative, open, and agile. VALUES We seek to provide our customers with the best solutions and experiences. We As we co-create the future, we remain rooted to are committed to driving our customers our three core values: to success by powering our systems with advanced technology and INTEGRITY platforms. We are accelerating their I do the right thing at all times. I am trustworthy, growth by connecting them to a whole transparent, and authentic. I treat everyone with new world of opportunities. respect. I am fair, honest, and accountable for all my actions. We are more than a bank. We seek to transform the lives of Filipinos and make MAGIS their dreams a reality. Our goal is to co- I am obsessed with the customer. I continuously create innovations for a better world. innovate. I learn fast to build capabilities. I achieve great results with an agile mindset. FOCUS UBUNTU I collaborate. I seek to understand through UnionBank is dedicated to becoming one courageous conversations. I give feedback, of the top three universal banks in the real-time, and on-demand. I communicate Philippines by the year 2020. In fulfilling clearly and openly. this mission, we commit ourselves to five key imperatives to help drive us forward:

CORPORATE BRAND IDEA • Financial Value • Operational Excellence Powering the future of banking. • Superior Innovation • Customer Franchise • UnionBank Brand/Experience DISTINGUISHING BELIEFS

Forward thinking. Innovative. Open. Agile.

TECH-UP | 5 TECH-UP | 7

BUSINESS PROFILE MASS MARKET AND PARTNERSHIPS FINANCIAL INCLUSION We pursue strategic partnerships with Union Bank of the Philippines organizations and institutions that align (UnionBank) is a publicly listed UnionBank leverages on its mass market with our advocacy on innovation and universal bank and a pioneer CONSUMER BANKING reach and technology to promote financial digital transformation for social good, of digital banking and financial inclusion. The bank has two major vehicles which is geared towards bringing to technology in the Philippines. This segment principally handles to achieve this. life the bank’s Purpose of “co-creating UnionBank’s clientele encompasses individual customers’ deposits and innovations for a better world.” retail, middle-market, and corporate provides consumer type loans, such as customers, as well as major automobiles and mortgage financing, government institutions. credit card facilities and funds transfer Lombard Odier partnership facilities. In 2016, UnionBank entered into a The bank, originally known as “Union cooperation agreement with Lombard Savings and Mortgage Bank”, was Odier, a Swiss global wealth and incorporated on August 16, 1968. City Savings Bank asset manager, to expand its wealth By 1982, it was given the license to CitySavings is our thrift bank subsidiary and asset management businesses. operate as a commercial bank and and the mass market arm of the banking UnionBank and Lombard Odier work a decade after, its common shares CORPORATE AND group. With its basic philosophy of to offer estate planning solutions, and were listed in the Philippine Stock COMMERCIAL BANKING “Simple is Good”, CitySavings offers a global and diversified multi-asset Exchange. On July 15, 1992 it was its clients simple and straightforward fund customized for high-net-worth granted the license to operate as This segment principally handles banking, coupled with warm and and ultra-high-net-worth clients. Both a universal bank. There were two loans and other credit facilities and helpful customer service reaching the of our organizations are collaborating mergers with the International deposit and current accounts for underserved markets in the rural areas on developing appropriate and timely Corporate Bank (Interbank) in 1994 corporate, institutional, small and of the Philippines. We have retained this sustainability metrics that will not and the International Exchange Bank medium enterprises, and middle market “small bank” personality while growing only comply with the regulatory (iBank) in 2006. customers. our network mainly through teachers, environment but also strengthen motorcycle, and microfinance loans. the role of sustainable finance in For the past 39 years, innovation has CitySavings is geared towards making facilitating endeavors that create been at the forefront of our thrust the financing experience for its niche social good, preserve the environment, to continually elevate customer customers easy and convenient, ensuring and make life better for many people. experience while committing high touch at any level of customer to enabling and empowering TREASURY interaction. Bancassurance partnership the underbanked and unbanked In 2017, UnionBank and CitySavings segments of the country. This segment is principally responsible entered into a bancassurance for managing the Bank’s liquidity and partnership with Insular Life Assurance UnionBank’s main operating funding requirements, and handling Company, Ltd. (Insular Life) for the businesses are organized and transactions in financial markets sale and distribution of Insular Life managed separately according covering foreign exchange, fixed income insurance products across the Bank’s to the nature of products and trading and investments and derivatives. and City Savings’ respective networks. services provided and the different markets served, with each segment UBX Blockchain partnership representing a strategic business With innovation and digital transformation In 2018, UnionBank entered into a unit. Our main business segments in mind, we launched UBX, our technology partnership with ConsenSys, a New are as follows: arm that houses initiatives, platforms, and York-based blockchain startup, HEADQUARTERS investments in fintech companies, with the to utilize Kaleido, an enterprise aim to make banking natural, open, and blockchain solution launched on top This includes corporate management, accessible through embedded banking of the Ethereum blockchain protocol support and administrative units not ecosystems. We want to positively that is used to process information specifically identified with Consumer impact financial inclusivity and business and transactions more securely and Banking, Corporate and Commercial growth through technology. We will build transparently. In connection with Banking or Treasury. platforms that bring businesses and this partnership, the Bank launched people together, provide access to needed “Project i2i” which aims to connect technology and services while creating rural banks and financial institutions marketplaces that aggregate supply and to the country’s main financial demand successfully. infrastructure and help bring unbanked Filipinos under the mainstream financial system.

6 | UnionBank 2020 Sustainability Report BUSINESS PRESENCE AND ECONOMIC CONTRIBUTION

PHP 33.71 PHP 3.50 PHP 774.46 Billion Billion Dividend per Share P TOTAL ASSETS Revenue Generated PHP 88.53 Billion Market Capitalization *as of March 2021

PHP 5.78 Billion PHP 7.81 Billion Payments to Government Salaries of Employees

PHP 8.50 Billion PHP 1.8 Billion Payment to Suppliers Innovation Expenses

PHP 126 Million CSR Fund

5,177 >100 388 1,950,013 Workforce Products and Branches Nationwide New Customers Served *including CitySavings Platforms Provided *including CitySavings 54,035 1,225 SMEs using GlobalLinker platform SME Linker Stores Opened

8 | UnionBank 2020 Sustainability Report TECH-UP | 9 10 | UnionBank 2020 Sustainability Report

hat role can UnionBank ABOUT W play in sustainable development? Our answer: Digital inclusion. Financial inclusion, THIS REPORT yes, but we are also at the forefront of the banking sector’s digital transformation here in the Philippines. We affirm that digital inclusion enables people to co-create innovations with us leading to better products, which ultimately lead to a better planet.

We present our third Lastly, this report sustainability report has been prepared in that captures the accordance with the latest development GRI Standards: Core in UnionBank’s option. sustainability journey. Additionally, it follows This report provides the the Sustainability most recent iteration to Reporting Guidelines our sustainability policy, of the Securities framework, and metrics. and Exchange We restated older Commission (SEC) and Reporting Framework Used: GRI Standards 2016 metrics as well as added refers to applicable Approach to GRI: In new ones to demonstrate guidance from the accordance ‘Core’ further alignment of World Economic Reporting Scope: Parent Bank and subsidiary our environmental, Forum’s Integrated City Savings Bank social, and governance Reporting Document Reporting Period: targets to our business and the United January to goals. We strengthened Nations Sustainable December 31, 2020 our governance Development Goals Reporting Cycle: Annual and structure and metrics. This report can Previous Report: formalized a technical also be downloaded at UnionBank’s 2019 working group that is www.unionbankph.com/ Sustainability Report, “Innovating Together,” established to rapidly sustainability/full-report published in May 2020 meet regulatory and stakeholder expectations.

TECH-UP | 11 SCOPE AND MATERIALITY STAKEHOLDER CONSULTATION

Sustainability reporting is an immersive Below is the summary of the universe of This report presents data the oversight on sustainability. experience requiring a review of significant stakeholders that we consult with on a regular primarily on UnionBank’s The CSR and Sustainability Unit concerns from our stakeholders—those who are basis, as well the modes of engagement. In sustainability performance, with under the Human Resources in a position of influence and those who are in 2020, we mostly conducted virtual ways to additional data on subsidiary, Group is the steward of the a position of vulnerability. We take note of their connect with them that allowed the lines of CitySavings. This report follows report, tasked to lead the feedback and determine how to address their communication to remain open despite the the GRI Reporting Principles bank-wide technical working concerns effectively. lockdowns. of stakeholder inclusiveness, group composed of members sustainability context, coming from units in risk Stakeholder Top Concerns Engagement Frequency of Unionbank Response materiality, completeness, management, compliance and Group in 2019 Channels Engagement accuracy, balance, clarity, corporate governance, treasury, comparability, reliability, and operations, private banking, Access to Online channels Daily UnionBank operates a 24-hour ISO- timeliness. information technology, facilities customer (Facebook, certified call center that handles management, and business service, e-mail, Twitter, customer relationship and care, The Board Corporate services. product- Instagram, including product queries. related LinkedIn, Governance Committee has inquiries Glassdoor, The Bank also maintains a 24/7 corporate pages) customer service chatbot dubbed Customers “Rafa,” accessible through Facebook Customer messenger. Reporting Prioritize Validate and Review service hotline Process Branches under UnionBank and its Consumer subsidiary CitySavings are evaluated We engage and consult Ranked the importance complaints are based on customer satisfaction. the key stakeholder of identified topics, reported at the Scores in 2019 reached above 4, with groups for the as informed by the Board level 5 being the highest possible score. materiality of topics to materiality process, be disclosed, including based on perceived Health and HR Helpdesk Daily (HR Health and medical assistance the revision of the scale of impact with the medical services), (outside of PhilHealth) are provided sustainability policy, reasonable interests of the benefits; health Bi-weekly to employees framework, and metrics Bank and our stakeholders & safety; (Employee on environmental, social, loans and Relations Safety audits, ERT training and governance. Reviewed the sustainability government- initiatives) How we framework, material mandated In-house clinics and accredited applied We comply with the topics, and KPIs by the benefits; hospitals the GRI mandate of Bangko Sustainability Advisory Employees inclusion (for process and Sentral ng Pilipipnas Council and Senior example, Tutok Kalusugan, health programs, principles on the development Management in relation to health and Annual Physical Exams, safety includes of sustainable finance the strategic interests of workers in health management policies roadmap, while beefing the Bank and its units UnionBank- (including flu, tuberculosis, hepatitis up our reports and controlled A and B, etc.) disclosures according to Gathered data and workplaces) industry best practices reported on topics Eight employees are members of the and some of the considered of interest to Health & Safety committee applicable standards stakeholders of global sustainability Relevant and Assigned Immediate Go Beyond Communities (GBC), raters. Internal review and continuing account feedback assessment community managers per (e.g., UB Xcellerator, UHack development area after a Go Kick-off meeting, Consultations (Chairman projects Beyond MS Ambassadors (Database for Crop Sustainability learning & CEO, members of the Website Diseases),SSS UMID, Pag-Ibig, i2i rural and working sessions Reputation Council, Unit bank, GlobalLinker Heads, and data owners) Stakeholder Regulators, Labor issues, ​Reportorial Annual, or Sustainability Report Activities engagement exercise Story conference One- LGUs, occupational submissions​ as needed conducted (primarily internal on-one interviews with Government health and Department of Labor and by the Bank stakeholders) business unit heads and Agencies safety Employment (DOLE) workplace subject matter experts inspections Stakeholder concerns review (utilizing external Risk Board and Annual Investor Relations briefs stakeholder engagement mitigation and Committee channels) effectiveness Meetings Sustainability Report of approach Financial results briefings

12 | UnionBank 2020 Sustainability Report TECH-UP | 13 MATERIALITY UN SDGS CONTRIBUTION

For this 2020 Sustainability Report, feedback, branch customer UnionBank’s Technical Working satisfaction, and UnionBank’s UnionBank supports the United Nations Group (TWG) revisited the previous transformation strategy and key Sustainable Development Goals (UN year’s materiality assessment. performance metrics. SDGs) through existing initiatives of the The process defined a long list of Bank, many of which are tied to broader sustainability topics from the Global Finally, the material topics were programs in the Aboitiz Group and in Reporting Initiative (GRI) Standards, defined and prioritized based on support of the national agenda of the and the Sustainability Reporting their impact to UnionBank and their government. Guidelines for Publicly Listed importance to stakeholders. The Companies from the Security and final list of topics includes those Ultimately, the Bank promotes long- Exchange Commission (SEC). that have significant impact to term economic growth by increasing the UnionBank and are of the highest capacity of individuals and organizations These topics were reviewed in light importance to our stakeholders. in wealth management, as well as by of the Bank’s previously published Employee and customer feedback empowering small-scale businesses and sustainability reports. The list of from 2020 were used to update and entrepreneurs. topics was validated and cross- prioritize the sustainability topics. referenced against customer As a responsible company, UnionBank strives to minimize its environmental footprint by adopting the principles of Leadership in Energy and Environmental MATERIAL TOPICS Design (LEED) design, among other environmental initiatives, to effectively manage the Bank’s facilities and resources.

PEOPLE AND DIGITAL PLANET AND PURPOSE AND TRANSFORMATION SUSTAINABLE FINANCE INCLUSIVE PROSPERITY

Employment Environmental Inclusive Prosperity Compliance (including Training Financial Performance and Development, Climate Change Issues Compensation and Sustainable Finance Benefits) Risk Management for Sustainability Indirect Economic Employee Experience Management Performance

Labor Standards and Business Ethics Human Rights Anti-Corruption Practices Diversity and Inclusion Procurement Practices Customer Experience Risk Management Community Engagement Information Security (including Data Employee Volunteerism Privacy and Integrity, Cybersecurity and Socioeconomic Resilience) Compliance

14 | UnionBank 2020 Sustainability Report TECH-UP | 15 16 | UnionBank 2020 Sustainability Report

TECH UP PILIPINAS: OUR HIGHER PURPOSE

ON FULL THROTTLE “Our digital JOINT MESSAGE OF THE CHAIRMAN transformation journey established years AND PRESIDENT & CEO ago prepared us for this unprecedented disruption and allowed us to enter the crisis with robust fundamentals and clear business strategy.”

Dear Stakeholders,

While the start of a new Similar to the banking ago prepared us for this decade typically brings industry, your Bank was not unprecedented disruption hope, we quickly saw the spared from the adverse and allowed us to enter world come to a near effects of the pandemic. the crisis with robust standstill in 2020. The We had to deal with lower fundamentals and clear coronavirus pandemic was loan growth and rise in business strategy. Our the perfect storm that hit non-performing loans. assumptions and models us hard. The Philippine Nonetheless, UnionBank were stress-tested and yet, economy contracted and continued to post strong they were also validated slumped to historical low topline revenues and by the accelerated shift of of -9.5% in 2020, as a outperform the industry in consumer behavior towards result of many businesses, terms of profitability. digital. big and small, folding up, which led to a record rate Our digital transformation unemployment level. journey established years

TECH-UP | 17 Digital as For us at the UnionBank, to be able to retool themselves Baselining our will maintain our strong innovation-driven partnerships enabler of sustainability sustainability will be more and get back into the labor sustainability performance performance by demonstrating for the communities we serve. in times of crisis than just compliance – this market armed with relevant results on three focus areas, runs parallel with our digital capabilities and employable With these initiatives namely: digital transformation, We understand the inherent Indeed, the crisis has transformation strategy and skillsets. and more, your Bank sustainable finance, and responsibility of moving revealed the significance creates more opportunities to performed well on its maiden inclusive prosperity. capital, and so, we will take and necessity of ‘going achieve our Tech Up Pilipinas An offshoot of our People Tech participation in the global an active role in mitigating digital’ to future-proof one’s mission. program is the partnership corporate sustainability We will push for innovative environmental and social business. We saw this as with the HEROES2021 assessment of S&P. UnionBank thinking in designing products risks in our future financing both an opportunity and Multi-faceted Movement. Through our leads the pack among publicly and developing programs that activities. Most importantly, responsibility galvanized into Tech Up activation Microsoft-certified employee listed banks boosted by its result to a sustainable way of we will ensure that no our sustainability mission to education volunteers, we outstanding performance life. We will pursue initiatives one gets left behind in our Tech Up Pilipinas. Our aim We are approaching our “Tech developed digital modules in social sustainability and in digital capability building sustainability and digital is to leverage on the Bank’s Up” mission in a multi-faceted designed to help public school governance. And yet we through internal and external transformation journey. transformation to enable manner. teachers transition smoothly are just getting started. We trainings as well as through partners and customers into the Department of to take their own digital One is through our FinTech Education’s blended learning journey and co-create initiatives geared towards directive amid the pandemic. innovations for a better leveraging technology to help As of this writing, we have world. We also believe that promote financial inclusion. Our already trained 80,000 through our efforts in this tech and innovation company, teachers and we target to space, we can contribute UBX, is at the forefront of this accelerate the program to the rebuilding of our goal with its lineup of platforms to complete the 800,000 economy and push forth into which supports small and teachers nationwide. an era of renaissance where medium enterprises (SMEs) to "Sustainability digital innovation is elevating participate in the digital space To enable our Climate Tech is more than just people’s lives. and scale their businesses. program, we recently launched UnionBank’s sustainable compliance – our This thrust of ours coincided Moreover, we are able to “tech finance policy and framework. goal is to fully with the clarion call of the up” more and more retail It is anchored on the belief align our digital Bangko Sentral ng Pilipinas customers via our UnionBank that by supporting the (BSP) for the industry Online App and corporate development of innovative transformation to take an active role in customers via The Portal, capabilities of individuals strategy with the country’s sustainable enabling them to perform bank and sustainability missions development agenda transactions anytime, anywhere, of organizations, we can sustainable value by incorporating the in a safe and secure manner. collectively reduce the toll of creation. We will environmental, social and various products and services leverage on our governance (ESG) principles We also have People Tech on our planet. To this end, we into every bank’s strategy initiatives, which aim to help have in place a sustainable strength in people, and operations. employees, partners, and other finance mechanism that innovation, and stakeholders develop digital facilitates issuances of green We beefed up our literacy and build the skills to bonds, social bonds, and even digital technology governance to reflect our prepare them for the future. tech bonds. to put into full commitment to sustainability We are banking on our in- gear mode our to the highest level with house centers of excellence the Board of Directors’ in Data Science and Artificial sustainability Corporate Governance Intelligence, as well as our mission to Tech Up Committee taking up the Xcellerator program to equip oversight role on ESG internal and external talents with Pilipinas." matters across the Bank. We emerging capabilities. updated our sustainability policy, created the bank- While People Tech builds our wide sustainability technical own talent pipeline, we are also working group, and using this to advocate for more embedded culture building Filipinos to learn the skills of into our sustainability the future, which will provide program under the Human an opportunity for many of our Resources Group. countrymen who lost their jobs

18 | UnionBank 2020 Sustainability Report TECH-UP | 19 "Tech Up Pilipinas” efforts focused on promoting digital transformation across individuals and organizations to improve delivery of banking experiences, would allow all of us to create innovative solutions."

Full throttle efforts focused on promoting to achieving our mission digital transformation across individuals and organizations Your Bank is steadfast in to improve delivery of banking its vision to build a bank of experiences, would allow all of enduring greatness. Its edifice us to create innovative solutions. is made stronger not only by the crises that shook its We would like to thank you, our foundation, but also made stakeholders for the unwavering resilient by the passion support throughout the years. and purpose to ensure the To our Board of Directors, we technology we build benefits are grateful for your active role Time to accelerate will expand of its motorcycle timeframe between testing and everyone on the planet, in setting the Bank’s guiding towards renaissance and pension loan customers deployment of applications, including the planet itself. principles and direction. To all to further diversify its credit providing continuous delivery UnionBankers, thank you for With the pronounced shift of portfolio. We will continue without compromising quality, Amid this disruption, what’s your dedication in our purpose customer behavior towards to leverage data science and as we move towards addressing clear is that we have a once- and pushing through difficult digital, we will go full throttle artificial intelligence to churn customer needs at the exact in-a-generation opportunity circumstances. Finally, thank you on the Bank’s transformation out our next best offers and go moment of truth. to harness digital technology to our customers, partners, and journey. We will compress our full speed ahead on our retail to define the world we want shareholders for your continued pre-COVID five-year plan into and MSME lending initiatives. We are looking at increasing to live in. And for that, we loyalty to the Bank. two years, by accelerating the our participation in the trade are optimistic. It is in times onboarding of new customers To support these growth finance market via a blockchain like these that our ability We will weather this crisis and onto our digital channels. aspirations, we are further platform, being one of the to stay true to our mission emerge more resilient than beefing up our back-end processes that is most relevant and corporate purpose is of before. Together, as a nation, We shall ramp-up data capabilities. We accelerated our to be disrupted by blockchain. the utmost importance. We we will power the Future Erramon I. Aboitiz science-backed digital cloud transformation Program Apart from ramping up growth must always use technology of Banking, guided by the Chairman marketing initiatives to for the 100% migration of of its platform startups, UBX, to help address the world’s constancy of our purpose: To encourage digital account our systems and applications our technology and innovation challenges, not create new co-create innovations for a opening among prospects. to a hybrid public cloud firm, will also continue to test ones. better world. UBX will continue to grow infrastructure. Moreover, we will emerging business models MSME communities in i2i, be complementing Agile Ways via building its own startups We are confident that the Edwin R. Bautista Sentro, BUX, and SeekCap of Working with DevSecOps. or investment in fintechs or Bank’s “Tech Up Pilipinas” President & CEO platforms, while CitySavings This aims to shorten the strategic partners.

20 | UnionBank 2020 Sustainability Report TECH-UP | 21 22 | UnionBank 2020 Sustainability Report

In 2020, we refreshed our policy and its accompanying framework and metrics to fully align with the business strategy, to stay in tune with regulatory changes, and most importantly, to model a focused sustainability program that reflects who we are and what we do.

UNIONBANK SUSTAINABILITY POLICY

SUSTAINABILITY UnionBankers contribute to sustainability by pursuing digital transformation and investing in relevant social and environmental programs, he UnionBank which benefit our stakeholders. We power the future of banking by co- T Sustainability creating innovations for a better Policy outlines our world. In our day-to-day activities and throughout the banking group, we commitment to the commit to: collective effort towards sustainable • Uphold, protect, and respect the environment, human rights, and development. This labor standards. policy is aligned with • Contribute to enhancing positive the Bank’s Purpose to social & environmental impacts. co-create innovations for a better world • Provide products and services that contribute to the wellbeing and our sustainability of people, the environment, and mission is to tech up the economy; reduce or avoid unsustainable practices; and Filipinos by focusing on demonstrate positive impacts to digital transformation, the most important issues of the sustainable finance, and business. inclusive prosperity. • Implement inclusive business programs and initiatives.

• Engage internal and external stakeholders for continuous improvement and to promote cooperation.

• Foster the development of in-house learning, management capacity, and leadership on sustainability issues.

• Comply with all national laws and regulations.

• Communicate transparently about our sustainability performance.

TECH-UP | 23 UNIONBANK SUSTAINABILITY FRAMEWORK UNIONBANKUNIONBANK SUSTAINABILITY SUSTAINABILITY SCORECARD SCORECARD PEOPLE,PEOPLE, PLANET PLANET, AND PURPOSE PURPOSE METRICS METRICS

OUR FOCUS AREAS

Employee Count 4,769 5,174 5,177

Average Training 25.54 16.21 22.79 (UnionBank) (UnionBank) (UnionBank) (in Hours) 25.38 (CitySavings) (CitySavings) (CitySavings)

Employee 5,418 Volunteerism 35,873 44,386 (Note: The pandemic reduced community visits but sustained (in Hours) reach via digital CSR) 4.39 Employee 4.23 4.24 (UnionBank) Engagement Score 4.49 (CitySavings)

Energy (in GJ) 73,075 85,612 46,119 DIGITAL TRANSFORMATION SUSTAINABLE FINANCE INCLUSIVE PROSPERITY

GHG (in TCoe) 11,190 25,503 466.77

Water (in m3) 134,832 120,787 68,546

SUSTAINABILITY GOVERNANCE LEED-Certified Branches 20 20 22

Paper (in reams) 39,461 74,861 44,185 CORE VALUES: INTEGRITY, MAGIS, UBUNTU

Ink Toners (in cartridges) 8,887 11,103 5,131

UnionBank: 4.904 Customer Service (out of 5) Satisfaction Rating 4.28 4.61 CitySavings: 90.80% 100 scale as the highest

UnionBank: Number of 10.44 Million Customers Served 8.10 Million 8.50 Million CitySavings: (cumulative recorded deposits and loans accounts) 9,637

PEOPLE PLANET PURPOSE CSR Beneficiaries 1,982,475 2,050,373 2,330,703

GlobalLinker 35,000 40,000 54,035 MSME sign ups OUR THREE PILLARS OF SUSTAINABILITY

24 • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • UnionBank 2020 Sustainability Report TECH-UP | 25

28 | UnionBank 2020 Sustainability Report

PEOPLE hile we learn more about AND DIGITAL Wbuilding a virtual-first “ organization, UnionBankers TRANSFORMATION are prepared for a future that constantly and rapidly

evolves. The future of banking

will be driven by digital technologies and influenced by unprecedented shifts; but “ for the Bank, it will continue to be powered by a strong, technologically enabled workforce.

Michaela Sophia E. Rubio Chief Human Resource Officer

Our human capital development strategy focuses on nurturing the social capital that we have built over the years and using this to pivot our people’s skills, behavior, and mindset to achieve our digital transformation goal. In these pages, we report on our performance in building the skills of the future, which summarizes our overall approach to human capital development.

TECH-UP | 29 OUR WORKFORCE WORKFORCE TOTAL AT-A-GLANCE

UnionBankers from across the 1,671 group are the building blocks CITYSAVINGS of our digital transformation strategy, harnessing their 5,177 talent to power the machinery TOTAL WORKFORCE of our growth. Our setup is a workplace that is agile, collaborative, empowering, 3,506 and inclusive in nature. We UNIONBANK have policies and programs in place for talent attraction and retention, total wellbeing, ATTRITION RATE productivity, recognition, and the potential for innovation. 8.13% 7.6%

WORKFORCE BREAKDOWN BY GENDER AND AGE

Male Female WORKFORCE BREAKDOWN BY TENURE AND RANK

148 154 Over 33 50 years old 7 UNIONBANK <1 1-5 6-10 11-15 16-20 21-25 >25

797 30 to 50 1,216 674 years old 332 Staff 46 382 69 89 22 49 43

398 793 UnionBank Under Supervisor 72 536 215 207 34 40 19 265 30 years old 360 CitySavings Managers 81 534 205 247 136 154 94

AVP and Up 12 100 33 27 22 19 19 WORKFORCE BREAKDOWN BY GENDER AND RANK TOTAL 211 1,552 522 570 214 262 175 Male Female

CITYSAVINGS <1 1-5 6-10 11-15 16-20 21-25 >25

120 112 Staff 110 557 184 61 5 5 2 AVP and Up 27 14 Supervisor 14 136 195 108 15 2 2 566 885 Manager 146 88 Managers 4 73 88 32 27 7 3

399 724 Supervisor 262 210 AVP and Up 8 20 5 1 3 1 3

UnionBank 258 442 TOTAL 136 786 472 202 50 15 10 537 387 CitySavings

30 | UnionBank 2020 Sustainability Report TECH-UP | 31 WORKFORCE BREAKDOWN BY LOCATION AND RANK WORKFORCE BREAKDOWN BY EMPLOYMENT TYPE

UNIONBANK CITYSAVINGS Young Majority Region Luzon Visayas Mindanao Luzon Visayas Mindanao Most of our bank employees belong to the 30-50 age range, followed by those below 30 years old. Staff 560 92 48 584 211 129

Supervisor 960 108 53 308 116 48

Managers 1297 102 52 143 66 25 UNIONBANK CITYSAVINGS BANK AVP and Up 223 6 3 30 11 0 1,229 2,017 302 625 1,006 40 TOTAL 3,042 308 156 1,065 404 202 <30 years old 30-50 years old >50 years old <30 years old 30-50 years old >50 years old

Talent Management By the end of 2020, very few of our employees were on Contractual status; the majority had already been on-boarded as regular employees.

UNIONBANK CITYSAVINGS BANK 98.8% 1.2% 98.1% 1.9% Regular/ Contractual Regular/ Contractual Probationary Probationary

WORKFORCE COVERED BY COLLECTIVE BARGAINING AGREEMENT

700 731 or 20% or 44%

Note: All rank-and-file employees are automatically covered by a CBA as part of their employee union membership

AVP and Up Staff Supervisors Managers

32 | UnionBank 2020 Sustainability Report TECH-UP | 33 ACHIEVING DIGITAL TO THE CORE THE 23 DIGITAL DNA TRAITS

Exploring Doing Becoming Being Throughout our digital building a bank of enduring embedding the digital 2018 Results 2019 Results 2020 Results Digital Digital Digital Digital transformation journey, we greatness. DNA traits in everything have been bringing our that we do. These digital Flattening & Changing Hierachy employees, customers, We do this by facilitating DNA traits enable every Fail Early, Fail Fast, Learn Faster and other stakeholders to super learning in a virtual employee – not just the IT Continuously Innovating the same level of mindset, first workplace. UnionBank’s group, fintech, or product attitude, and capability, capability framework is developers – to be truly Fluidity so that all of us move with instrumental in making digital. Agility the same speed towards this happen, starting with Iterative Continuous Ecosystem Disruption Multi-Modal Operations Uneven Velocity between Digital & Legacy Dynamic Skill Requirements Chainging Nature & Typology of Work Real Time & On-Demand Move from becoming Superlearning Cross-functional, agile, digital to being is the way forward iterative development by Democratizing Information digital squads and teams Ongoing Shifts in Decision Rights & Power Morphing Team Structures Changing Mix of Traditional & Non-Traditional Stakeholders Increased Customer Involvement Intentionally Collaborative Geography Agnostic Virtual-first employee High value on health and experience wellness for business Productive Mobility performance and continuity Constant Disruption Constantly Changing Decision Criteria Modulating Risk & Security Boundaries

1 < 2.52 2.52 < 3.68 3.68 < 4.52 4.52 >

All UnionBankers, including practitioner who can apply apps and platforms, it is also those not directly working skills to complete problems using digital technology to on digital products, are that may require a new make backend operations expected to be at least at process or approach. After and customer service more the effective level where all, digital transformation is efficient and automated. 24% each one is a skilled not just about developing Tech Talents Bought 527 UNIONBANKERS IN NEW FROM AGILE TO ‘DEVSECOPS’ TECH JOBS

Our rich experience in design, operations, and risk development processes 76% digital transformation management through the within an agile framework. now allows us to embark ‘DevSecOps’ way of working. By embedding IT security Tech Talents Built onto the next phase of our early in the process, we will journey. We are evolving the DevSecOps will enable us increase shared responsibility agile way of working to a to create new solutions in the entirety of the project more seamless interplay of for complex product cycle.

34 | UnionBank 2020 Sustainability Report TECH-UP | 35 DIVERSITY AND EQUAL OPPORTUNITY

Throughout this natural enhancing diversity in our progression, we continue workforce as these values With prime focus given to to provide a fair and non- are embedded in the bank’s WATERFALL/LEGACY AGILE DEVSECOPS skill sets, UnionBank ensures discriminatory workspace DNA, and thus has zero Digital Delivery Operations DevOps Engineer equal opportunities for all. for a future-ready, tolerance to discrimination Automation Architect interdisciplinary workforce. of any kind. Utility Technology Player We are committed to Software Developer and Tester

Security Engineer Release Manager

Testing Center of Excellence Software Developer and Tester

Customer Experience Experience Assurance Professional

InfoSec Security Engineer

In other words, technology together as a team—without change and needs rapidly, security protocols that are short circuiting the goal of better collaboration and baked into the development creating secure code. communication among teams, process rather than added more opportunities to unlock as a “layer on top” allows our The benefits of moving into automated builds, and our squads to harness the power DevSecOps primarily include people assets are freed to of agile methodologies— the ability to respond to perform more high-value work.

2020 2019

*Rank from the Executive Vice President Note: This data covers the Parent Bank only.

36 | UnionBank 2020 Sustainability Report TECH-UP | 37 NO ONE GETS LEFT BEHIND

Our human capital developing systems to our promise not to leave any development program share knowledge across the one behind. We aim to bring follows a comprehensive company, in a manner that everyone to the same level of approach to identifying skill is timely to keep up with the productivity, performance, and gaps, measuring human fast changes in the industry. competitiveness. capital management, and This approach keeps us within

BOOSTING CAPABILITIES

Average training hours per employee

Part of our learning delivery of training can now be our UnionBank University approach is the shift to done efficiently to 2 to 4 portal, eliminating the use a more prevalent use of hours. When the pandemic of physical classrooms and digital platforms to train resulted to lockdowns, allowing for an on-demand, our employees. What used we relied heavily on our paced learning approach. to take around 8 hours virtual trainings through

UNIONBANK 2017 2018 2019 2020 Training Hours Overall - UnionBank Average 31.47 25.54 16.21 22.79 by Gender:

By Gender CENTERS OF BUY BUILD EXCELLENCE 82,559.10 Male 29.08 21.48 14.25 17.17 HOURS Total training hours Expand our network to find Partner with internal and In-depth research and the right talents and build our external experts to increase development to provide Female 32.94 28.02 17.40 26.28 talent pool capabilities within leadership and direction for leading-edge capabilities By Employment Category Ally with local and international Invest in certifications for deep professional organizations skills Focus on building expertise 58,730.60 and enablement of Tribes Senior Management 22.89 25.55 13.34 10.79 HOURS Engage global talents and Squads through Female employees experimentation

Transfer knowledge of Middle Management 39.54 30.53 16.48 16.95 leading-edge capabilities through its academics Supervisor 19.73 23.72 19.09 28.16 23,828.50 HOURS Rank-and-File 31.73 19.56 11.90 30.55 Male employees

*Restated 2017 data to standardize formula for all indicated years: Ave. Training Hours = Total training hours / No. of distinct trained employees

38 | UnionBank 2020 Sustainability Report TECH-UP | 39 Training Hours HEALTH, SAFETY, AND WELLBEING CITYSAVINGS 2019 2020 by Gender: Beyond our focus and to high productivity and This office continually Overall - CitySavings Average 25.47 25.73 orientation on occupational performance. monitors and coordinates 42,995 safety and health, we with the various branches By Gender HOURS also implement wellness The bank has a dedicated regarding their status and programs, welfare policies Occupational Health and concerns through the bank- 2020 Total training hours and well-being initiatives, with Safety (OHS) Office, tasked wide committee on safety Male 22.93 24.08 provided to employees, active participation of our with ensuring regulatory and occupational health by gender employees across all levels. compliance including with members including We believe that by taking a environmental standards, the employee union. To Female 28 28.02 proactive approach, we can Philippine Central Bank streamline this process, we enhance our preparedness requirements, and local launched a digital tracking to manage various issues laws applicable to our and monitoring system that By Employment Category and concerns in relation to branches whose host local allows the branches access to 19,589 health and safety. Our goal governments implement their their pending OHS concerns. is to positively contribute own ordinances. Senior Management 11.16 21.21 HOURS Female employees Work Safety

INJURY PYRAMID UNIONBANK CITYSAVINGS1 Middle Management 26.92 39.45

Fatality 0 0 Supervisor N/A 26.55 23,406 HOURS Rank-and-File 25.04 22.04 Male employees Lost Time Incidents (LTI) 2 0

Training and development inputs Percentage of employees receiving Restricted Work Case (RWC)* 33 0 regular performance and career development reviews

UNIONBANK 2019 2020 UNIONBANK & 2019 2020 Medical Treatment Case (MTC)* 0 27 CITYSAVINGS

By Gender First Aid Case 22 0

Average hours Male 100% 100% per FTE of OTHER STATISTICS UNIONBANK CITYSAVINGS1 16.21 22.79 training and development Female 100% 100% Total number of employees 3,506 1,671

By Employment Category Number of employees who are Senior members of the Health & Safety 22 12 100% 100% Management Committee

Percentage of Employees under Average Middle 0.63% 0.7% 100% 100% Health & Safety Committee amount spent Management per FTE on 10,894.08 4,110.47 training and Total work hours 7,012,000 3,163,360 development Supervisor 100% 100% (in PHP)

XXXX 3 Rank-and-file 100% 100% Total lost days* 42 0

*Includes COVID-19 cases 40 | UnionBank 2020 Sustainability Report TECH-UP | 41 Safety performance

Employee tardiness No. of LTI 0

ABSENTEE RATE 2020 Total Hours Worked 2,955,106

LTIFR (Employees) Employees 0.0052%

Number of Employees (in this 1,576 report) Workplace conditions, labor standards, and human rights Number of Employees (expected) 1,576 DISCLOSURE UNIONBANK CITYSAVINGS1 Data Coverage (as % employees) 100%

Safe Man-Hours 3,506,000 3,163,360

We have in place a continue the sense of wellbeing program that belongingness among No. of work related injuries 2 0 caters to developing our employees and their the employees’ physical, families. mental, and financial wellness. We actively We offer financial No. of work related fatalities 0 0 promote living a healthy wellness program to and active lifestyle educate employees on through proper exercise financial literacy, which To be reported No. of work related ill health 13 and nutrition, regular covers retirement and in next cycle health risk assessment, savings plans, and health education, and pension funds. To ensure Performed by preventive measures that our employees are all 149 branches online Number of safety drills 4* such as immunization. well-equipped to achieve (1 representative their short-term and per branch) We maintain the long-term financial goals, implementation of our the Bank also organizes *-2 call tree exercises, 2 evacuation drills mental health activities forums and retirement as part of our mental fairs. health policy. To help with the anxiety brought Our wellbeing activities about by the pandemic, are good jumping we intensified our boards to further programs on counseling design activities where and providing avenues the families of our to destress like stress employees can take management campaign, part. Our family welfare mindfulness exercises, policy outlines how we employee assistance can align engagement programs, and support and wellness programs groups. into the family welfare program. Our goal is to Recreational activities help build an enriching such as team day, family organizational culture day, halloween, and where our people are special events have highly engaged and been designed and ran thrives in an intrinsically on virtual platforms to rewarding workplace.

42 | UnionBank 2020 Sustainability Report TECH-UP | 43 SUSTAINING ENGAGEMENT IN THE TIME OF DISRUPTION SPURRING INNOVATION TO HELP COMMUNITIES

In a world of paradoxes, We are cognizant of this and is when workers and teams speed, complexity, and therefore, we embedded this can solve new problems and machines, we need to lead mindset too in our employee create new value, services, by doing uniquely human engagement programs. This and relationships. Our corporate social responsibility program GoBeyond Communities continues to things. People imagine the was challenged in many provide opportunities for our employees to fulfill personal advocacies and reach future; people compose ways then the pandemic hit As a result, we sustained out to communities in the spirit of volunteerism. We empower UnionBankers music, work, businesses; and us. Just like our squads, we our engagement scores and to take an active role in these community projects centered on education, people activate curiosity, sprinted those challenges always focused on this as a environment, livelihood and inclusion. passion, connectedness, and and come up with solutions priority. In the 2020 survey, belonging. We sometimes as a team. Doing more we scored 4.39, which need to be reminded that of the same, and doing allowed us to move closer we invented all of this it faster, is not where the to Gallup’s global best technology. magic happens—the magic business practice of 4.41.

Being trained to be equipment (PPEs) to respectively, developed innovative, open, agile, donate to frontliners, the by the Bank’s fintech and forward-thinking, UnionBankers hired the company UBX. They 2020 YEAR-END UnionBankers were sewers to make them. The invited MSMEs, including ENGAGEMENT challenged to think – and sewers earned income, the some UnionBankers, to GRAND MEAN SCORE help – outside the box PPEs were given to a nearby sell products online and during the lockdown when hospital, and the employees donate a portion of their the coronavirus pandemic were able to help their sales to jeepney drivers, An incremental increase from the midyear struck. community without them who were their target GBC bankwide mean score of 4.38 and close to physically spending time beneficiaries. global best practice of 4.41. While government with the beneficiaries. restrictions may have Another project was A meaningful growth of 0.15 from last year’s mean score of 4.24​ inevitably led to fewer And that is how the idea in partnership with projects and reduced of virtual sweat equity – Local Goodness PH a 4.39 This exceeds the 2020 Bankwide Balanced volunteer hours, that did volunteerism with little or social enterprise spun Scorecard target of​ of 4.27. not necessarily mean lesser no physical presence – was off from Meaningful 0.00 5.00 impact to community born. From there, GBC Travel, which was stakeholders. Actually, evolved to become an focused on sustainable UnionBank’s CSR impact incubator for ideas – pilot- tourism. Having been scorecard showed that tested in local communities hit by the pandemic, the there were significantly – that could turn into bigger organization had to pivot more communities and and wider strategic CSR to promoting community beneficiaries served in programs and sustainability products from local 2020 with a minimal programs for the Bank. artisans, small businesses, increase in volunteers and and farming cooperatives. volunteer hours. ENTER THE INTERNS The SMP interns created SURVEY 4.51 marketing campaigns PARTICIPATION STARTING SMALL Some of the most and sold products to OVERALL promising ideas came from UnionBankers, with the SATIFACTION One of the earliest UnionBank’s interns under proceeds going to the eligible UnionBankers examples was at one its Student Mentorship farmers who are now who are regular and 96% branch, where the Program (SMP). These probationary employees hired 4.57 enjoying the benefits of on or before August 23, 2020 employees found sewers college students rolled out doing their small trade GREAT PLACE responded to the survey.​ in their barangay who creative projects such as using digital banking TO WORK FOR lost their jobs when the UB Pasahero. They made services. economy slowed down. use of Sentro and Bux,

Talents Bought Talents Built Instead of buying imported an online shop builder personal protective and payment platform,

44 | UnionBank 2020 Sustainability Report TECH-UP | 45 ambassadors who created 18 training modules and conducted “ live sessions to public school Truly, we got a taste of the UnionBank DNA, culture and core values. I learned so many teachers in the Bicol region and things and not just the technical aspects of CALABARZON. In addition, our on-the-job training. Being able to leave a the Bank contributed cash

positive impact on the lives of fellow students sponsorship to the project.

is a fulfilling experience, one that made me feel good about myself and one that I will Another ingenious GBC project remember even after my intership. “ was the sale of retail treasury bonds (RTBs) called Premyo bonds, sold by the government for its COVID relief projects. Nico Lozano Using the new Bonds.PH app, SMP Student Intern and GBC Volunteer volunteers promoted the RTBs and the app to fellow UnionBank employees and their families. Not only did the campaign encouraged personal savings, CSR AT-A-GLANCE DIGITAL’S MULTIPLIER EFFECT it also contributed to nation building. UNIONBANK & CITYSAVINGS 20195 20206 Another project was Add to Cart, Fill a Heart, a branch- This new kind of CSR shows that initiated online fundraising UnionBank and UnionBankers Number of bazaar where they sold food can create more, reach more, Direct and Group 43,542 280,330 and home products on social and make a bigger impact Beneficiaries media. The group raised by doing what they do best – Php 100,000, double their innovate and accelerate. target, with proceeds used to buy headsets and hard drives to With the same spirit of Ubuntu Amount of P54 M P142 M CSR allocation help teachers of a public school – that sense of being part of a transition to online teaching. community – and a compassion for others in need, UnionBankers On an even bigger scale, can leverage its DNA of innovation and digital tools to Number of 149 911 UnionBank also partnered with CSR Projects HEROES2021.org, an intensive make a difference. As shown by online training program our experience, technology can aimed to rapidly build the be used to overcome physical capability of 800,000 DepEd limitations, elevate traditional 54,186 public school teachers across approaches, and power the Total 5,437 Volunteer Hours (restated) the Philippines who had to future of CSR. shift to e-learning. This is a collaboration among Thames International, an international 2,150 college; EduRescue, a provider (Note: of Massive Open Online Courses Community (MOOCs) for teachers; and Total 9,337 outreach Volunteers (restated) activities Akadasia, a Singaporean edtech decreased to company. ensure employee safety amid the pandemic) UnionBank tapped its 25 Microsoft-certified education

46 | UnionBank 2020 Sustainability Report TECH-UP | 47 48 | UnionBank 2020 Sustainability Report

PLANET AND e will utilize Sustainability “ Wto enhance the traditional notion of environmental SUSTAINABLE FINANCE preservation and protection; we will create a social sustainability model that leverages on UnionBank’s strengths in digital

technology and innovation. With

these in mind, we will pursue sustainable finance efforts that are based on cooperation and co- “ creation of innovative solutions for our society.

Jose Emmanuel Hilado Chief Financial Officer

The banking sector holds a unique position in advancing the sustainability agenda. We can no longer afford to ignore climate change or sustainability issues as a governance priority. By deciding to finance sustainable projects, we can create more value for our shareholders. We can address the broader environmental, social, and governance issues that could test the resilience of banks and overall financial system. What we envision for UnionBank’s sustainable finance thrust is to enable stakeholders to design solutions that not only elevate customer experience but also lessen the impact on our planet.

TECH-UP | 49 OUR APPROACH TO ENVIRONMENTAL MANAGEMENT RESOURCE EFFICIENCY IN OUR OPERATIONS

finance program, which monthly meetings with the Sustainability is also about We are fully committed through a renewable energy will lay down a holistic Environmental, Occupational the efficient management to minimizing our carbon source in 2017. In 2020, UnionBank is fully approach to how the bank Safety and Health Committee, of finite resources, allowing footprint by greening our we used 3.4 MW of energy committed to achieve can facilitate the movement and monitor GHG emissions us to create more with less workspaces and the network sourced from renewable our energy efficiency of financial capital so that and waste management. wastage. Resource efficiency of branches where we power. goal, which is ultimately our stakeholders can utilize is often a practical, cheap engage with our customers. to mitigate the them for better environmental For the former, we are and faster way to address UnionBank Plaza, our environmental impact of practices in the conduct of working with our parent the intermittent uses of our headquarters, was the first their businesses. company, the Aboitiz Equity water, electricity and paper high-rise financial center in our operations. This is Ventures, for the standard resources in the office. the Philippines to operate fully translated through our As mover of capital, formula that we will apply in digital transformation. UnionBank directly affects our GHG tracking program Processes and services economic development, and moving forward. For the OUR RESOURCE CONSUMPTION are updated to we are therefore in a position latter, the volume of waste continually improve wherein we can promote generated are reflected in resource management and inspire the adoption of the quarterly self-monitoring and carbon footprint. sustainable business practices, report that we submit to the protection of ecosystems, and environmental management diversity for our clients. While department of the Philippine other environmental topics government. Guidelines and like ecosystem, biodiversity, procedures for proper waste air pollutants, and effluents management and trainings in are considered not material collaboration with concerned Our aim is to adopt the LEED to the bank, we are studying units were established to design wherever applicable how we can take them provide rules and guidelines to promote the reduction of into consideration as part for decision-making carbon emissions. We also of our risk assessment for and consistency across join the Race to Reduce prospective clients. organizational operations. program of one of our principals, the Aboitiz Group. In a dedicated section of These initiatives encourage this report, we outline our UnionBank branches all sustainable finance framework over the country to reduce and the ongoing work on consumption of water, developing our very own electricity, and paper. We are environmental and social risk engaged in digital and tech- monitoring system which driven business and banking will cover these indirect services. As such, we do not environmental impacts. generate air pollutants in our operations. We have an Occupational Safety and Health Division Our emerging climate that monitors, enforces, technology program is and ensures compliance founded on our desire of national regulations and to enable people to co- policies as issued by the create with us solutions and Department of Environment innovations that address the and Natural Resources, and wicked problems including other relevant government those that affect our agencies. We conduct the environment. The backbone following initiatives as part of climate technology is an of our environmental risk extension of our sustainable management: conduct Note on water: The Bank mostly sources its water from a local water utility. The Bank does not recycle or reuse wastewater.

50 | UnionBank 2020 Sustainability Report TECH-UP | 51 OUR RESOURCE CONSUMPTION We convey to our customers that Leadership in Energy and a 7.5-kW solar thin film flexi digital is another way they can Environmental Design (LEED). system installed on the roof, help reduce carbon footprint. In This thrust complemented our which harnesses the sun’s 2020 when we fully rolled our move to convert traditionally rays and converts it to direct digital transaction portal, we structured branches into ARK and electricity (DC). A typical were able to switch 58% of our ARK Lite centers that are even CitySavings branch consumes total transactions to paperless more resource-efficient while an average of 1,900 kilowatt- or online processing. This alone incorporating paperless, digital hours of electricity per month. helped offset almost 160,000 features. The newly installed solar power kwH in energy consumption and generator can produce an save 637 trees. Even our thrift bank branches estimated 1,125 kilowatt-hours of outside of the national capital has AC power per month, effectively We have turned our bank adopted this resource-efficient providing almost 60% of their branches and workspaces into way of operating. Some of our power needs. sustainably designed structures CitySavings branches generate following the principles of their own electricity using

In 2020, we were able to offset almost 160,000 kwH in energy consumption and CARBON FOOTPRINT save 637 trees. 159,330 KWh 637 trees

E-WASTE DISPOSAL PARTNERSHIP WITH GLOBE

We renewed our Race to Zero out-of-use electronic and accredited treatment, storage, partnership with Globe telecoms electrical devices. Raw materials and disposal (TSD) centers where to encourage our customers and from these e-wastes are then they are segregated to recover stakeholders to recycle electronic recycled, thereby conserving plastic materials, electronic waste. As we encourage them to natural resources, preventing components, and precious metals do digital transactions, we are air and water pollution caused in the country. Proceeds from also cognizant that the gadgets by hazardous waste disposal, e-waste processing are used they use tend to be replaced as and avoiding the production of to provide connectivity and soon as new models are out in the new materials that contribute communication needs of public market. We advocate to extend to energy consumption and school teachers and students. the usage of existing electronic greenhouse gas emissions. This e-waste recycling program gadgets and responsibly recycle is very timely especially now that those that are end of life so they As in the past, we will redesign the country has adopted the the toxic materials don’t go to how we collect e-wastes and blended learning for all education landfills. most importantly, influence the levels. behavior of our customers to be The program, formerly known responsible in disposing these as Project 1 Phone provides gadgets. Note: Realigned computation for diesel under Scope 1, separated a platform for businesses, computation for Luzon/Visayas sites from Mindanao Sites for organizations, and the general After we collect them, Globe Scope 2. Recent coverage includes 47 sites for UnionBank and 150 sites for CitySavings. public to donate their old, picks them up and delivers to

52 | UnionBank 2020 Sustainability Report TECH-UP | 53 SUSTAINABLE FINANCE: OPPORTUNITIES UNLOCKING TOMORROW’S ESG

We join the Bangko Sentral • ICMA Sustainability • Reporting Below is the overview of possible ng Pilipinas on its clarion Bond Guidelines (“ICMA • External Review endeavors of our sustainable financing: call for local banks to SBG”, and together adopt sustainable finance with the ICMA GBP and A Sustainable Finance mechanism, which is one of ICMA SBP, the “ICMA Taskforce has been set up and the key enablers as we rebuild Principles”) will be the designated body to the economy in the aftermath • ASEAN Green Bond evaluate and select projects of the pandemic. For us in Standards (“ASEAN that will be funded by our UnionBank, sustainability will GBS”) sustainable finance program. be more than just compliance • ASEAN Social Bond The Taskforce is chaired by - our goal is to fully align Standards (“ASEAN UnionBank’s Chief Financial our digital transformation SBS”) Officer and includes senior- strategy with sustainable • ASEAN Sustainability level individuals from the value creation. Bond Standards bank’ specialist teams such as (“ASEAN SUS”, and Treasury, Corporate Banking, We will leverage on our digital together with the and Sustainability Group, and innovation strengths to ASEAN GBS and ASEAN which are tasked to do the model a sustainability path SBS, the “ASEAN following: that is driven by investments Standards”) in people, technology, and • LMA, APLMA, and LSTA • Review and validation digitalization. This is an Green Loan Principles of selected Eligible opportunity for us to fulfill Assets based on the the Bank’s purpose statement From now on, this eligibility criteria of co-creating innovative framework enables us and described more fully solutions for a better world. our subsidiaries to raise the under ‘Use of Proceeds’. following types of financing • Monitor all Eligible We are happy to announce for specific assets and Assets for required that we have launched our projects that catalyze positive exclusion or sustainable finance policy and environmental and social replacement. framework. Said framework is benefits. • Manage any future in parallel with relevant global updates of the sustainability principles and • Green Bonds, in Framework and Second standards while fully aligning accordance with ICMA Party Opinion (or with our Focus 2030 digital GBP and ASEAN GBS. successor external transformation strategy. • Social Bonds, in review or certification). accordance with ICMA The framework reinforces our SBP and ASEAN SBS. Once screened and eligibility commitment to sustainable • Sustainability Bonds, in is confirmed, projects or development, focusing on accordance with ICMA the eligible assets will be people, planet and purpose, SBG and ASEAN SUS classified under either one while managing risks and • Green Loans, in of the green or social asset opportunities of a changing accordance with GLP portfolios. The Taskforce will world. meet periodically to ensure Furthermore, the Framework the aggregate amount in The UnionBank Sustainable details the following both portfolios is equal to or Finance Framework fulfils the components in compliance greater than the aggregate requirements of the following with the ICMA Principles, amount of net proceeds guidelines. It is our intention ASEAN Standards, and the from Sustainable Finance to follow the best market GLP. Use of Proceeds Instruments. practice as standards develop. ICMA Green Bond Principles • Process for Project (“ICMA GBP”) Evaluation and Selection • ICMA Social Bond • Management of Principles (“ICMA SBP”) Proceeds

54 | UnionBank 2020 Sustainability Report TECH-UP | 55 SUSTAINABILITY SPOTLIGHT: Many organizations Institute of Innovation HACKATHONS THAT SPARK undertake efforts thinking and Technology, Future UnionBank hackathons: designing, of the kind of planet Proof PH, and Scale prototyping and pitching solutions to ENVIRONMENTAL JOY they will leave behind Solutions in staging a solve wicked problems for their children. But we hackathon event that ask the opposite: what pushes for a zero-carbon, kind of children are we climate resilient society. leaving behind for our planet? The only legacy The Climathon is an we all leave behind is the annual gathering of effect we have on others, change-makers, brought 10 HACKS ACROSS THE COUNTRY the changes we create together by a globally in them by interacting interconnected event with them, and thus the where participants world. It is incumbent tackle climate-related upon us to teach these issues within their values of caring for the respective locales. This environment to those year, the Climathon 390 437 who will succeed us in saw the participation of the business, and to those 6,000 problem solvers, IDEAS TEAMS who will live tomorrow in students, and citizens the communities that our from 110 key cities all businesses are serving over the world. In the today. Philippines, Pasig City is the first to host the We strive to instill in them climathon event in an immutable lesson—the 2019, inspiring other rules of business must municipalities to co-host 293 29 align with the laws of this year’s event. PITCHES WINNERS nature. And so, we turn to the core of human values Concluded at the height to establish a living guide of Typhoon Ulysses for the care of our planet; and in the middle of a this as we build a bank of pandemic, the Climathon enduring greatness that pushed through future UnionBankers can virtually, conveying the continue to be proud of. importance of building 1,662 440 the capability of cities HACKATHON CODING By supporting collective and their people to PARTICIPANTS HOURS efforts, we ultimately collectively create set up the ground for innovative solutions innovation in climate that address climate technology to happen. change. This year’s In 2020, we focused theme centered on the our environmental challenge to sustainably sponsorships to innovation grow nutritious and challenges organized by affordable food at the We are supporters of the Philippine Innovation Challenge that is being ran by the the academe and young community level. University of the Philippines’ Business Administration Council, and the UN sustainable entrepreneurs. Once such development goals-centered hackathon of AIESEC Philippines. We are equipping our collaboration was the Mayor Vico Sotto in his young innovators with ample capabilities from ideation to project implementation, staging of the Climathon in message at the event said which makes a complete learning experience for them. the Philippines. that Pasig City is leading the way in inspiring other UnionBank partnered with cities to take climate Pasig City, the European action seriously.

56 | UnionBank 2020 Sustainability Report TECH-UP | 57 58 | UnionBank 2020 Sustainability Report

he bank’s passion to innovate, PURPOSE AND “ Treinvent itself, and work for a purpose greater than profit is the reason why it has endured INCLUSIVE PROSPERITY for almost 40 years. The bank’s purpose fuels our promise of ‘no one gets left behind’. That is the reason why our digital transformation journey has always aspired for inclusivity for people

especially the underbanked

segments of our stakeholder universe. With the right support they have the potential to do “ more, do better, and become great!

Henry Rhoel Aguda Chief Technology and Operations Officer and Chief Transformation Officer

Many people ask about digital transformation. We say it’s not about digital. It’s about people, it’s about the mind-set, it’s about culture. It’s about values. And when you get that right, the technology becomes a true enabler, because most of what needs to be done using technologies is not just about the knowledge of technology but how the technology can add value to society and how that technology can be a real business case.

TECH-UP | 59 OUR APPROACH TO FINANCIAL INCLUSION PLOWING BACK THE ECONOMIC VALUE GENERATED

Technology and purpose become our creates new opportunities, and reduces social We believe that wealth generation should not be the only focus; wealth distribution should greatest anchors in a time when the world inequalities. With sustainable banking practices, also be a priority, in our bid for inclusive prosperity. is going through a drastic change. We we operate to achieve growth that is meaningful recognize that long-established assumptions for everyone who shares our mission to tech up about wealth creation have changed. Our our fellow Filipinos. opportunity is to help our customers achieve Direct Economic Value Generated a sustainable financial future in this changed We dedicate ourselves to providing the most and Distributed environment. This means new paths of innovative services in banking so that we may wealth creation that are less dependent on continue to be a bank of enduring greatness debt, supported by new models of education and to uplift the lives of our patrons and and advice. communities. We intend to take the country to the next level by moving forward with purpose: Our core business of banking aspires to fulfil Tech up the Philippines and foster inclusive the promise of a better future, where economic financial prosperity. growth empowers people and businesses,

Our goals are clear-cut:

• Bring financial services to the rural areas.

Financial inclusiveness means finding ways to elevate the lives of fellow men through banking and financial services. Since the country is still predominantly unbanked, this remains as one of the causes of poverty. Remote locations in the country should be targeted for financial inclusivity, as access to technology remains limited within these areas.

• Make financial products accessible to more people.

In an emerging country like the Philippines, a financial product or service becomes “inclusive” when it can be accessed with the least cost. We invest in the technological infrastructure upon which our services and products are built, and our offerings are meant to be readily usable by all kinds of end-users. These products and services are made available not only in the metropolitan areas, but in the rural provinces—so they don’t need to play catch-up anymore.

• Reach out to the unbanked and underbanked.

UnionBank serves as a channel through which the unbanked/underbanked can suggest how to build on the current products and services of the Company, even as subsidiaries such as UBX and CitySavings provide the financial inclusion delivery of the Bank.

60 | UnionBank 2020 Sustainability Report TECH-UP | 61 DIGITAL TRANSFORMATION Bonds PH paves the way is very much a fund-raising access to the Philippine for all Filipinos, particularly exercise for the government Clearing House to speed up PREPARED US FOR THE DISRUPTION the unbanked, to easily with an issue of PHP192.7 interbank payments using and affordably invest in the billion. blockchain through the i2i BTr’s newest retail treasury platform of our subsidiary, We are one of the banks bond, RTB-24. While the This is by no means our UBX. By the end of 2020, that did not redundiate or target may be the unbanked first blockchain initiative. UBX i2i platform has signed let go of employees. We with a minimum investment Two years ago, we helped up 172 rural banks and took care of our 5,000 equivalent to PHP5,000, this rural banks that don’t have onboarded 89. strong Unionbankers including employees of our subsidiaries. We retained the services of our outsourced personnel which totaled 1,576. We allocated 81 percent of our procurement budget for local suppliers to support them during the lockdown.

As we took care of our own, we saw this translated into a determination to provide uninterrupted services for our customers. This helpfulness was evident in our commitment to SME BANKING TO TAKE IN ONE MILLION ensuring that essential FILIPINO ENTREPRENEURS banking services remained accessible and reliable 24/7 during the With the launch of our This shift came at the right When done properly, they enhanced community SME banking platform, time with local businesses would be the engine that we envision helping one relying heavily on digital will sustain the continued quarantine period, a time Another sector of society distribution of cash million small and medium channels to continue growth of the country. when uncertainties ran that we were able to or loan proceeds to enterprises. Currently, we commerce in the time of rampant, and the needs of assist especially at the constituents. have 175,000 businesses— pandemic. We observed We already have a digital customers could change height of the pandemic with asset size of less than that around 99 percent of platform for corporates, at any time. were teachers, through Responding to the PHP10 million—that have all the businesses in the but we also recognize that our thrift bank subsidiary call for innovative shifted to the UnionBank’s country were able to adapt SMEs have different banking We enhanced the financial CitySavings Bank. collaboration, digital channels and we are to the so-called new normal, needs compared to bigger services of our mobile CitySavings has extended UnionBank developed optimistic that we can bring transitioning to e-commerce companies. This prompted app to allow customers a total of PHP26.1 billion the Bonds PH mobile in more to reach our one- during the lockdowns. us to develop a new digital to bank from home: in teachers’ loans, PHP3.2 app that leverages million target in the near With this, we reiterate that financial platform that has digital account opening, billion in motorcycle loans, blockchain and enables term. SMEs should be given help full digital capabilities such online check deposit, and PHP2.9 billion in consumers to buy to further bounce back. as real end-to-end online sending money to money MSME loans. retail treasury bonds account opening process. remittance centers, (RTBs) issued by the removal of fees on fund We helped the Philippines Bureau of The mobile application transfers, and cash in and government in the the Treasury (BTr). specifically allows SMEs out via EC Pay partners. disbursement of the to open online stores and For customers who cannot Department of Social track inventory. At the do away with actual Welfare and Development same time, it offers basic banking transactions, we (DSWD)’s Social banking transactions, provided bank on wheels, Amelioration Program including balance checking, a mobile ATM that goes to (SAP) cash assistance to fund transfers and check areas with high demand. 700,000 beneficiaries deposits. The SME banking This allows us to decrease amounting to PHP4.9 platform is also designed to queues in the branches billion. We also assisted manage multiple businesses and to reinforce social partner Local Government even by just submitting a distancing. Units (LGUs) in the single set of credentials.

62 | UnionBank 2020 Sustainability Report TECH-UP | 63 TECH-UP | 65

SUSTAINABILITY SPOTLIGHT: Mitzi, who started her social enterprise at 23, was able to COMPLETE DIGITAL ECOSYSTEM FOR ENTREPRENEURS bounce back during the pandemic by maximizing sales on her online store and creating new products that are relevant to the new normal.

Pandemic or not, we have always “We created face masks and dual envisioned a bank that will allow more zip sling bags that (are handy Filipinos, especially the unbanked and accessories) for the new normal,” marginalized, to adopt digital banking she shares. services and enable them to become active partners of our Tech Up Pilipinas Mitzi’s pivot has yielded good mission. results for her business. “It went really well online to the point that We are gearing up towards fulfilling we were able to gain new sales our promise of financial inclusion advocates. These sales advocates and social empowerment. Our SME were able to sell our items online,” business banking unit has intensified Mitzi explains. With the help of the the campaign to onboard more Filipino new sales advocates who highly entrepreneurs into the GlobalLinker. believe in the mission of Mori This is a digital platform designed for For a business owner who mostly relied Notes, they were able to sell all the the 250,000 members across the Asia on offline retail channels to drive sales, items that were supposed to be Pacific region, so they are connected Mitzi Uy, founder of Mori Notes, was distributed via their offline retail and provided with the right knowledge forced to take a 180-degree turn due to channels. and tools to accelerate the growth of the pandemic. Mori Notes specialises their businesses. in creating multifunctional journals and “Before, less than 20% of our sales organizers, while providing homebased came from online, but now, almost One of our GlobalLinker members livelihood to women in Quezon City 80% of our sales are through shared how these digital tools enabled online channels,” she remarks. her not just to survive, but thrive, in the “Prior to the onset of the pandemic, we pandemic. actually created a lot of products to be Mitzi recognizes the convenience delivered to brick-and-mortar outlets like and accessibility of setting up department stores and bookstores,” the her online store with UnionBank female founder recalls. “At least 80% of GlobalLinker’s eCommerce our sales was contributed by these retail platform. “Setting up the store channels.” has been very easy. The platform provides online store templates (that you can use). When you With change in buying behaviors due To help MSMEs convert to the online platform, add photos, description and add to the pandemic, Mitzi has had to adapt details, you end up having a nice we link the app to an entire digital commercial and shift from offline to online modes and professionally designed online ecosystem including a payment gateway and of selling. Although she admits that her store.” digital shop builder BUX can be integrated into business is not yet as active online, she an online seller’s platform while Sentro helps made a way to pivot as she believes that She is just one of the thousands of entrepreneurs set their online shops. the next big opportunity is online. Fiipino entrepreneurs that we want to lead the pack in rebuilding our Today, there are more than 95,000 users of commerce. That’s why introduced BUX and close to 30,000 sign-ups for Sentro. the SME Business Banking App “I’m very thankful to specifically catering to their Meanwhile, SeekCap, the Philippines’ first banking needs. Through this app, same-day approval lending marketplace, UnionBank GlobalLinker we will focus on providing online supports MSMEs by providing them with because they helped us banking services and custom sources of credit without having to fill in create our very first online marketplace solutions with speed, lengthy loan applications. To date, we have ease and trustworthiness as our recorded more than 23,000 sign-ups and store during the pandemic.” key competitive advantage. disbursed loans over PHP100 million. - with portions written by Airamae Guerrero, - Mitzi Uy GlobalLinker content manager Entrepreneur

64 | UnionBank 2020 Sustainability Report 66 | UnionBank 2020 Sustainability Report

SPECIAL STORY: FUTURE-PROOFING emaining true to our promise Rof “no one gets left behind,” OUR PEOPLE UnionBank established measures and strengthened existing employee wellbeing programs to protect people from the coronavirus. Our ability to remain safely operational became direly important for us and for our communities, and our people which became economic front liners in the time of pandemic. workforce.

UnionBank like all the other banks in the country, was tasked to remain operational under new restrictive requirements. We understood clearly the importance of our role in this crucial time. We are providers of essential financial and banking services to practically all the other sectors of the country as well as individuals and communities that needed financial resources to tide them over during the pandemic.

TECH-UP | 67 As a result, we were able to transition 90% of our workforce to a remote setup and the remaining continued to work in branches VIRTUAL FIRST provided with personal protective WORKPLACE equipment, dedicated transportation service, and food allowance. Work remained at its peak and services While some changes have were sustained. We were one of the forced organizations to banks that had less down time and rapidly reinvent the way they minimal disruption, if there were any work by shifting remotely, at all. UnionBank welcomed the change with open arms. The UnionBank Work from Prior to the pandemic, we Home (WFH) playbook were already experimenting guided everyone. It provides on telecommuting, thanks guidelines for employees to to our agile way of working, simulating a remote work set work from home effectively, up. including FAQs for line managers to lead remote To ensure its effective working successfully. It implementation, the Bank is not just a manual; it is invested in infrastructure that allows employees to work a manifesto on how we from home and operate the operationalize key principles bank from home. Around on productive mobility and the same time, the Bank sustaining engagement began automating most of especially during periods of its processes and putting them in the cloud, which were disruption. critical for the Bank’s remote operations. Later, when the lockdown was lifted, we developed the Return to Workplace Playbook, adopting the Department of Health standards and Department of Labor and Employment’s Occupational Health Standards framework to guide us in our phased approach to returning to the workplace.

68 | UnionBank 2020 Sustainability Report TECH-UP | 69 TAKING CARE OF OUR PEOPLE IN A VIRTUAL FIRST SETUP

While we activated our business continuity plan, we also beefed up our safety, health, and employee engagement programs. We executed several health and safety control measures to prevent transmission of the virus in the workplace and complemented these with a suite of engagement, learning and development, and family welfare activities.

Below are some of the health and safety initiatives that we did:

• Provided free regular rapid and antigen testing for all employees. On the engagement and demonstrate the core mental and emotional culture-building aspect, values of Integrity, Magis wellness. We provide • Introduced Telemedicine these are the initiatives we and Ubuntu in times of 24x7 phone hotline and for employees’ COVID-19 implemented to balance human crisis. 16x5 chatline services to related issues, handling interaction and virtual style of connect our employees and monitoring of health working: • Launched the online brown with mental health for those who tested bag sessions that covers professionals. positive. • Conducted regular virtual a variety of topics related check-ins, which we call to wellness, health and • Amplified our employee • Enhanced the “Kamustahan” in our native safety, family relationships, volunteerism program health insurance to Filipino language. life skills, and work-life to embed virtual sweat accommodate the balance. equity, allowing oour COVID-19 screening • Provided the ‘Ubuntu’ • Shared through our employees to help test reimbursements for special subsidy for eligible intranet non-work-related communities from the the employee and his employees and outsourced stories and wellness safety of their homes. dependents. • Ran an intensive internal remained opened for personnel as additional and hobbies tips during communication campaign customers. assistance on top of the weekends. • Provided medical and to update employees regular amenities provided hospitalization support about the coronavirus, • Implemented virtual modes by the Bank. • Staged virtual events- for employees who got and tips on how to of meetings as first choice. cum-fundraisers which we sick of the virus. avoid infection including • Offered free webinars, called Social DistanSING, wearing of face masks, • Activated the buddy system virtual classes, and self- where our employees • Implemented the face shields, and washing in branches and designed a paced courses including perform in an online modified physical of hands. work rotation shift. podcasts for the concert during special workspace safety plan continuous learning of our occasions such as and building entry point • Developed our own • Provided food or employees. Mother’s Day, Father’s Day, protocols. UnionBank mobile app meal allowance and Christmas Festival, and for contact tracing. transportation service for • Staged a crowd-sourced Valentine’s Day. • Converted the office our branch employees and storytelling campaign clinic into a virtual • Deep cleaning of essential personnel in the called “Kwentong Bank • Created the CHAT Room medical consultation workspaces especially command centers. Hero” where employees as part of our employee center. in the branches that share their stories on assistance program how they were able to dedicated for topics on

70 | UnionBank 2020 Sustainability Report TECH-UP | 71 UNIONBANKERS AS ECONOMIC FRONTLINERS #UNIONBANKHEROES

On Day 1 of the enhanced The ARK’s modular design registered users worldwide In the process of providing our subsidiary CitySavings, All these initiatives and community quarantine, all allows easy reconfiguration and raised more than the basic needs of our sacrificed time with their more led to UnionBank critical functions remained of the branch to comply Php100 million across three employees, the DNA and families and stayed at the being voted as the 2nd operational despite having with social distancing issuances. culture of UnionBank Cebu head office for one Most Helpful Bank in 80% of head office employees requirements with floor was seen shining month when the lockdown Asia Pacific and the only working from home. Our stickers, digital health Sign-ups of financial through. Stories abound was announced, realizing Philippine bank in the Top teams, equipped with the checklist posters with QR institutions in the i2i financial of UnionBankers going the importance of finishing 20 list by BankQuality.com, necessary digital tools, have code for contact tracing platform doubled to 181 beyond what was required the project implementation during this public health on-demand access to the in all branches. Branch as of February 2021 with of them to leave no of CitySaving’s core crisis. bank’s cloud-based systems safety videos are played transactions growing by customer behind. banking system. Moreover, and applications. in these transformed 29 times to PHP2.8 billion. despite hospitals being Indeed, there are more branches featuring the safety BUX payment gateway also We have Jhoie, a Sales warzone-like, employees stories to tell. But there’s Majority of UnionBank’s protocol observed for all signed up more than 95,000 and Service Assistant from from our hospital-based only one string that branches remained open with employees and customers. E-Commerce merchants, our Makati branch, who branches (e.g., Makati pulls them together – full banking services and Retail customers can also while Sentro online shop found ways to report to Medical, The Medical City, UnionBankers’ commitment ATMs were constantly loaded schedule their visits through builder grew its MSME work and rode her scooter Center, St. Luke’s, Cardinal to support one another and to support our customers’ UnionBank Online while community close to 30,000 in in the absence of public Santos, and many more) respond to the needs of liquidity needs. Our corporate customers through less than a year of operations. transportation during the set aside their fears to our customers regardless 5G-enabled Bank on Wheels The Portal for less waiting community quarantine. respond to the call of duty. of the situation – a mindset banking kiosk served distant time. Moreover, SeekCap online She passed through 4 In full medical gears, they embedded across the Bank. areas with large transaction lending marketplace with cities and 3 checkpoints diligently and selflessly requirements while our Several partners and eight partner lenders, has to continue serving our assisted, recognizing that call center also continued organizations partnered with more than 23,000 signups customers in the branch. clients need their service to provide 24/7 customer us to enable them to fulfill and continues to provide A team of 15 Manila and the most in times like assistance. their respective missions business loans tailor-fitted Cebu-based employees of these. during the pandemic. The to MSMEs’ needs since Department of Social Welfare 2019. Given its impressive and Development (DSWD), performance in the past year, for instance, tapped select UBX was recognized as ‘2020 financial institutions to Fastest Growing Fintech conduct digital payments of Company in Southeast Asia’ “We hope to their cash subsidy. Given our by UK-based Global Brands digital readiness and the wide Magazine. continuously reach of UBX’ i2i network, provide meaningful we were assigned the third CitySavings, on the other highest allocation of more hand, continues to innovate experiences than 1.3 million beneficiaries, for customers with the pilot through pandemic- which was the highest launch of its “Loan Ranger” proof banking allocation given to a single Mobile App, enabling teacher bank. borrowers to digitally to more monitor their accounts, and customers.” We were also the chosen soon re-avail of salary loans trusted partner of the Bureau without going to the branch. of the Treasury (BTr) for Its salesforce Loan Ranger Ana Delgado the pioneer launch of the platform also allowed the Chief Customer first app-based, blockchain- Bank to fulfill funding needs Experience Officer enabled distribution of retail of teachers, motorcycle loan sovereign treasury bonds borrowers, and pension loan called Bonds.ph. To-date, customers amid the COVID Bonds.ph has close to 50,000 crisis.

72 | UnionBank 2020 Sustainability Report TECH-UP | 73 Carlos April 1, 2020

Most of us probably have the same problem on how to get to Angel our office everyday inspite of the lockdown brought by this April 2, 2020 covid19. Enabling people to work remotely by giving tools needed is what we It’s not having excuses to go to office but rather finding and have been doing even before ecq started. Dedication from the start looking a means to serve our client. My “pedal “ serves as my until the end have become our foundation and as your enterprise inspiration to continously cater the needs of our client. communication and collaboration support, we will always stand by U and give U the best of what we can do to ensure uptime and As frontliner of the bank, it’s valuing my job thru magis availability of your tools specially in this times of crisis. and my commitment with my work amidst the threat and uncertainty of the unforeseen force. We share the same passion — to help and provide excellent service #UNIONBANK to our customers, internal or external. #KwentongBankHero # OwntheFuture #Magis #Ubuntu #Integrity HEROES In this photo, 100+ laptops deployed, mobility kits, vpn readiness #TeamElyu and network preparation for wfh tools by our frontliners to enable users to work remotely and come home safely to our families.

Ubuntugether!

#KwentongBankHero #Ubuntu

Gerald Dwight April 2, 2020

#Magis #Kwentong BankHero Own the Future.

Senior citizen na may kapansanan di makalabas dahil sa COVID 19, pinuntahan at witness ang pagpirma bago pupunta ang representative sa branch. #happyclient.

74 | UnionBank 2020 Sustainability Report TECH-UP | 75 76 | UnionBank 2020 Sustainability Report

Disclosure Page Direct Answer/ GRI Standard Disclosure Title Number Number Statement of Omission

102-1 Name of the 4 organization

102-2 Activities, brands, 6-7, products, and 85-86 services

102-3 Location of 95 headquarters

102-4 ​Location of 6-7 operations GRI INDEX 102-55 102-5 Ownership and 85 legal form

102-6 Markets served 6-7, 85-86

102-7 Scale of the 6-7, organization 85-86

102-8 Information on 28-47 employees and other workers

102-9 Supply chain UnionBank supports local enterprises ORGANIZATIONAL and local populations to honor the PROFILE mutually beneficial relationship we have with our host community. Our branch network is designed to encourage banking locally. We also do our part by investing in the local market, through our suppliers, and through our championship of small and medium enterprises (SMEs).

102-10 Significant changes There were no significant changes to the organization to the organization for the reporting period.

102-11 Precautionary UnionBank distinguishes itself principle or through technology and innovation, approach unique branch sales and service culture, and centralized backroom operations. The Bank’s technology allows for the delivery of online, real-time business solutions to meet the customers’ changing and diverse needs through innovative and customized cash management products and service offerings. We ensue that we are compliant with the relevant laws and take the necessary precautions prior to launching our product and service offerings to prevent any harm to our stakeholders.

102-12 External initiatives 53-56

TECH-UP | 77 Disclosure Direct Answer/ Disclosure Direct Answer/ GRI Standard Disclosure Title Page Number GRI Standard Disclosure Title Page Number Number Statement of Omission Number Statement of Omission

102-13 Membership of See page 6 of the 2019 UnionBank 102-32 Highest 18 associations Sustainability Report governance (2nd - 3rd GOVERNANCE body’s role in paragraphs) 102-14 Statement from 16-21 sustainability senior decision- reporting maker 102-40 List of 13-14 102-16 Values, 5 stakeholder principles, groups standards, and norms of 102-41 Collective Both UnionBank and its subsidiary behavior bargaining CitySavings have recognized employees agreements association, which have combined membership of 1,431 embers. The Bank 102-18 Governance The membership of the Board is has collective bargaining agreement structure made up of a combination of varying with UnionBank Employees Association core competencies. As a whole, the (UBEA)and is subject for renewal every Board demonstrates integrity and 5 years (economic and political) and adherence with the principles of good STAKEHOLDER every 3 years (economic). governance and accountability to ENGAGEMENT ensure a high standard of governance and oversight. Individually, members 102-42 Identifying 13-14 have a spread of skills and experiences and selecting that work correspondingly with each stakeholders other. With the Bank’s on-going digital transformation, the Board ensures the security and privacy of the stakeholders’ 102-43 Approach to 13 information through laws and adhering stakeholder to good governance principles. The engagement Bank has established strict laws and policies within the organization to ensure ethical business operations. All 102-44 Key topics and 14 employees, management, suppliers, and concerns raised representatives of the Bank are guided by our principles and norms of behavior. The Bank also undergoes regular self- 102-45 Entities 11 assessment based on the ASEAN included in the Corporate Governance Scorecard and consolidated submits an Integrated Annual Corporate financial Governance Report (I-ACGR). statements

GOVERNANCE For more details: https://www. 102-46 Defining report 11 unionbankph.com/about-us/corporate- content and governance topic Boundaries

102-47 List of material 14 102-30 Effectiveness UnionBank operates according to its topics of risk established risk philosophy, where the management Board is responsible for approving, 102-48 Restatements of Statistical employee and other corporate processes reviewing, supervising, and overseeing REPORTING information data previously reported in the 2018 and the Bank’s risk strategy, risk policies, PRACTICE 2019 sustainability reports have been risk appetite and risk limits. Following recomputed to include CitySavings data the Board’s instruction, the Bank’s (both Head office and branch network Senior Management and various risk figures), for a more complete picture of management committees set up our impacts. independent risk management functions to ensure that risks are properly understood, controlled, and managed, 102-49 Changes in This 2020, alongside the GRI Standards, in addition to the risk processes which reporting we continue to adopt the Sustainability must be clearly aligned with the Bank’s Reporting Guidelines for Publicly business strategies. The Board will tackle the new mandate of Bangko Listed Companies as mandated by the Sentral ng Pilipinas, whereby it seeks Philippines Securitues and Exchange to integrate the Sustainable Finance Commission (SEC). Policy from Board agenda to the bank’s performance appraisal. UnionBank will provide more details in the next report. 102-50 Reporting January 2020 to December 2020 period

78 | UnionBank 2020 Sustainability Report TECH-UP | 79 Disclosure Page Direct Answer/ Disclosure Page Direct Answer/ GRI Standard Disclosure Title GRI Standard Disclosure Title Number Number Statement of Omission Number Number Statement of Omission GRI 300: ENVIRONMENTAL STANDARDS SERIES 2016 102-51 Date of most recent 2019 Sustainability Report published report in May 2020 103-1 Explanation of the 50 material topic and 102-52 Reporting cycle Annual its boundary

102-53 Contact point for [email protected] GRI 103: 103-2 The management 50 questions regarding Management approach and its the report Approach 2016 REPORTING components PRACTICE 102-54 Claims of reporting GRI Core 103-3 Evaluation of the 50 in accordance with management the GRI Standards approach

102-55 GRI content index This entire section GRI 301: 301-1 Materials used by 51-52 Materials 2016 weight or volume 102-56 External assurance This report did not undergo external assurance. 302-1 Energy 51-52 GRI 302: GRI 200: ECONOMIC STANDARDS SERIES 2016 consumption Energy 2016 within the 103-1 Explanation of the 13-14, 84-86 organization material topic and its boundary 305-1 Direct (Scope 1) 52 GHG emissions 103-2 The management Management approaches are approach and its stated at the beginning of every 305-2 Energy indirect 52 GRI 103: components section devoted to People (social), GRI 305: (Scope 2) GHG Management Planet (environment) and Purpose Emissions 2016 emissions Approach 2016 (Governance). 305-4 GHG emissions Not yet reported. This will be aligned 103-3 Evaluation of the Sustainability strategy and intensity with the groupwide GHG reporting management management approach are vetted at initiative of the parent company approach the Board’s Corporate Governance Aboitiz Equity Ventures. Committee, duly noted by the Board en banc. GRI 307: 307-1 Non-compliance There is one (1) non-monetary Environmental with environment sanction for non-compliance GRI 201: Economic 201-1 Direct economic 61 Compliance 2016 laws and with environmental laws and/or Performance 2016 value generated and regulations regulations distributed GRI 300: ENVIRONMENTAL STANDARDS SERIES 2018

203-1 Infrastructure 26-27 GRI 303: 303-5 Water 51 investments and Water 2016 consumption GRI 203: Indirect services supported Economic Impacts GRI 400: SOCIAL STANDARDS SERIES 2018 203-2 Significant indirect 26-27 103-1 Explanation of the 29-38 economic impacts material topic and its boundary GRI 204: 204-1 Proportion of PHP8.5 Billion Procurement spending on local GRI 103: 103-2 The management 29 Practices 2016 suppliers Management approach and its Approach 2016 components 205-2 Communication and 88 GRI 205: training about anti- 103-3 Evaluation of the 29-30 Anti-Corruption corruption policies management 2016 and procedures approach

80 | UnionBank 2020 Sustainability Report TECH-UP | 81 Disclosure Page Direct Answer/ Disclosure Page Direct Answer/ GRI Standard Disclosure Title GRI Standard Disclosure Title Number Number Statement of Omission Number Number Statement of Omission GRI 400: SOCIAL STANDARDS SERIES 2018 418-1 Substantiated There were no substantiated 401-1 New employee 30 complaints complaints concerning breaches hires and GRI 418: Customer concerning of customer privacy and loss of employee Privacy 2016 breaches of customer data in 2020. turnover customer privacy and loss of customer data GRI 401: 401-2 Benefits provided In the 2020 benchmarking of the Employment 2016 to full-time bank, the result showed that our 419-1 Non-compliance There were no incidents of non- employees that entry-level employees have higher GRI 419: with laws and compliance with laws and regulations are not provided starting basic pay compared to other Socioeconomic regulations in in the social and economic arena. to temporary banks of similar size. Compliance 2016 the social and or part-time economic arena employees See also, page 27 of the 2019 UnionBank Sustainability Report

403-2 Types of injury 41-43 and rates of injury, GRI 403: occupational Occupational diseases, Health and Safety lost days, an 2016 absenteeism, and number of work- related fatalities

GRI 404: Training 404-1 Average training 39 and Education 2016 hours

405-1 Diversity of 37 GRI 405: Diversity governance and Equal bodies and Opportunity 2016 employees

413-1 Operations with 45-47 local community engagement, GRI 413: Local impact Communities 2016 assessments and development programs

416-2 Incidents of There were no incidents on non- non-compliance compliance concerning the health GRI 416: concerning and safety impacts of products and Customer Health the health and services. and Safety 2016 safety impacts of products and services

417-3 Incidents of There were no incidents on non- non-compliance compliance concerning marketing GRI: 417: Marketing concerning communications. and Labeling 2016 marketing communication

82 | UnionBank 2020 Sustainability Report TECH-UP | 83 Ownership Products and Services and Legal Form • Cash Management • Investment Services and Trading Platforms As of February 28, 2021, » The Portal by » Bonds.Ph: A fully UnionBank’s major UnionBank (Business digital bond Ownership shareholders are: Banking) - The distribution platform and legal form Portal by UnionBank that allows clients to is an online cash create an account, management platform cash in from any Products and services 49. 27% for corporate and bank, debit card or Aboitiz Equity business users to electronic wallets like Board diversity Ventures, Inc. facilitate all their GCash or Paymaya. banking activities: Bonds.PH allows Codes of Conduct initiate fund transfers, clients to invest in pay bills, monitor various bonds issued 16.28% balances, approve The Insular Life by the Bureau of the Anti-corruption policy transactions with a Assurance Co., Ltd Treasury or BTr during single sign-on and the public offer period, Customer satisfaction many more. Accessible without the need for via web or the mobile a bank account. The 9.91%* app (iOS and Android). Bonds.PH mobile Customer PCD Nominee Corporation » Disbursements app is available 24/7, health and safety and allows investors » Collections residing abroad Marketing 15.29% » Payroll to participate in a and labeling Social Security System » Government Payments featured BTr issuance. As allowed by the » Cards terms and conditions Customer privacy *Social Security System (SSS) » Financial Supply Chain of certain issuances, holds 44,045,313 shares or 3.61% of the company’s outstanding capital shares under the clients can also sell PCD Nominee Corporation. » Liquidity Management ANNEX TOPICS Data security their investments • UnionBank Online - purchased from Bonds. Easily transfer funds PH. and pay bills, including » U.FX: U.FX: A web- sending money to partner based foreign remittance centers: exchange (FX) dealing Palawan Express, Cebuana platform with live Lhuillier, LBC and PeraHub executable rates for • Loan products the branches and • SME Banking Solutions mobile app. The platform allows for • Trade Services and straight through Products processing of FX • Credit Cards transactions with • Debit Cards competitive and live rates not only for US • Visa Prepaid Cards Dollar to Philippines • Private Banking Peso, but also for most major currencies. The • Investment Banking U.FX on the mobile Services application allows our • Deposit Products clients to transact - Savings Account, their FX needs Checking Account, anytime, anywhere. Investment Accounts » Trust Services

TECH-UP | 85 Corporate Governance GOVERNANCE UNIONBANK • Fintech Business Group with OneConnect • Electronic Banking GOVERNMENT CODES EVALUATION MANUALS (UnionBank API Financial Technology Services MECHANISMS Good Governance Principles Developer Portal) Co. Ltd., a leading • Priority Banking - It is a channel that technology-as-a-service • Pre-Need First Union Revised Philippine Financial Internal Audit – enables fintechs and platform for financial Manual Reporting Standards 9 investigates in aid Plans The Bank has established corporate clients to tap institutions. strict laws and policies on Good (FPRS 9) by the Banko of administrative into UnionBank’s banking • Real Property within the organization Corporate Sentral ng Pilipinas or criminal services and other • I2i - i2i connects Management (UnionBank to ensure ethical business Governance proceedings functionalities. Available financial institutions of Investments Corp) operations. All employees, since 2017, the portal all sizes and community- management, suppliers, and External Audit – acts as the interface based non-banking representatives of the Bank checks on whether between the Bank’s full financial service are guided by our principles financial statements and norms of behavior. are fairly presented suite of APIs and its providers to each other The Bank also undergoes in accordance with developers community. and the national retail regular self-assessment financial reporting It allows external payment system. Digital based on the ASEAN standards entities to easily sign services provisioned Corporate Governance up on it, choose from a through the platform Scorecard and submits an Code of Sustainability Privacy Impact catalogue of services, help digitally transform Integrated Annual Corporate Conduct Reporting Guidelines Assessment and integrate them to these financial service Governance Report for Publicly Listed - manages their own platforms. It providers. A full suite of (I-ACGR). Companies by confidentiality of permits a system-to- ready-to-use tools are the Securities and client information system communication available - from core Exchange Commission UnionBank also aligns between the core client’s banking, agency banking, itself with the local and platform and the Bank’s mobile ATM, alternative international standards Ethical Information core systems, enabling credit scoring, money for best practices. These Standards Security, Risk, and customers to reach a transfers, bills payments, include the guidelines and Legal Assessments wider audience and and more. provided by the Code of Governance – safeguards and growth. Corporate Governance Policies secures customer • Qlabs - Qlabs provides issued by the Securities transactions • Bux - An end-to-end capabilities to help and Exchange Commission, payment platform customers of the the Bangko Sentral ng catering to businesses of UnionBank group Pilipinas Circular No. 969 or the Enhanced Corporate all sizes, from individual digitally transform Board Diversity Policy Governance Guidelines and casual sellers to their businesses. QLabs for BSP-Supervised sole proprietors and delivers secure and Financial Institutions, large organizations. reliable systems powered The Bank recognizes the of skills and experiences and the internationally value of board diversity that work correspondingly Bux accepts all forms of by modern technologies recognized Organization and as such strives to with each other. With the payment whether it be through software for Economic Cooperation promote the same by non- Bank’s on-going digital over the counter, credit development services and Development (OECD) discrimination on age, transformation, the Board and debit card payments, and dedicated teams principles. gender, religion, socio- ensures the security and e-wallet, online banking, to support our clients’ political affiliation and status. privacy of the stakeholders’ and pay later options. digital transformation Diversity in the composition UnionBank Manuals, information through laws and of the members of the board Government Codes, adhering to good governance are upheld on a year-on-year • SeekCap - SeekCap is • Sentro - Sentro is a Governance Evaluation principles. basis in alignment with the the Philippines’ first Retail Operating System Mechanisms same-day approval complete with everything fit and proper rule of the Our diversity statement lending marketplace for Bangko Sentral ng Pilipinas. an SME needs to alludes to variety in field of Revised Manual on Good Filipino entrepreneurs. jumpstart, run and grow expertise and background. Corporate Governance, It allows businesses to their business. The membership of the It is non-discriminatory in Philippine Financial get access to financing Board is made up of a a way that it does not limit Reporting Standards 9 through an end-to-end Sentro includes an end- combination of varying core diversity to gender, race nor (FPRS 9) by the Banko digital experience. Online competencies. The Board nationality. to-end ecommerce Sentral ng Pilipinas. Internal demonstrates integrity and platforms can also easily platform that comes Audit investigates in aid of adherence with the principles plug into the platform built-in with an easy-to- administrative or criminal of good governance and Board Gender Diversity to offer loans to their use online store builder, proceedings, and External accountability to ensure a customers and provide inventory management Audit checks on whether Number of Female Directors high standard of governance a seamless, embedded system, and pre- financial statements as of December 31, 2020: 2 and oversight. Individually, are fairly presented in experience. . This was integrated payments and members have a spread developed in partnership logistics. accordance with financial reporting standards.

86 | UnionBank 2020 Sustainability Report TECH-UP | 87 assistance policies and Moreover, our Public Relations Codes of Conduct Anti-Corruption Customer Relationship procedures as well as the unit monitors feedback from Management corporate structure for traditional and social media to The following aspects are handling complaints. identify customer concerns; Which stakeholders are The Board of Directors is Customer Satisfaction covered by UnionBank’s customer research; alignment affected? ultimately responsible for codes of conduct at a The Consumer Affairs Group with Consumer Protection; the Bank’s Anti-Bribery Which stakeholders are group level: Employees, customers, (CAG) is the unit responsible assessment for reputational risk and Corruption Compliance affected? business partners, suppliers, with the compliance of BSP and where it is being regularly • Corruption and Bribery Program, which covers Circulars 857 and 1048 on reported to. stockholders, board of directors prohibition of receipt of Customers (customer • Confidentiality of protection, satisfaction level, Financial Consumer Protection. gifts, entertainment and CAG monitors Customer Customer Satisfaction Score Information What are the risks identified? benefits, vendor management, complaints that have been addressed, maintaining the Experience and liaises with UnionBank puts importance • Conflicts of Interest Operational and Reputational whistleblowing and BSP Consumer Empowerment other related activities. trust given to the bank), in upholding the rights of • Anti-Money Laundering Group - Center for Learning The Bank is committed to UnionBank requires compliance investors (reputational its customers throughout its • Sustainability impact due to customer and Inclusion Advocacy (CEG- business operations and the conducting its business with applicable Anti-Bribery CLIA). (Environment, Health, and activities in a fair, honest and and Corruption laws in the relationship management and entire organization. This has Safety) ethical manner. UnionBank country. satisfaction can be a factor resulted to positive customer for investment/divestment), They shall be responsible for satisfactions ratings. In our • Whistleblowing has zero tolerance for bribery ensuring that the consumer Training on Anti-Corruption regulators (regulations can 2020 customer satisfaction and corruption and strives to assistance management Policies and Procedures be created and/or revised to survey, respondents provided apply the highest standards process is necessary, updated, Coverage of corporate ethics and protect and uphold the rights the following: of customers), general public and conforming to the internal professionalism in the conduct control framework of the • Contractors/Suppliers/ DISCLOSURE and media (these two have • Overall Rating - Branch Service Providers: Only of its business. This zero Bank and complied with by tolerance approach also means reputational impact) customers’ rating on their whistleblowing policy for all affected units. They are level of satisfaction with the the Bank is committed to the Percentage of 100% contractors/suppliers/ What are the risks identified? responsible for performing overall service they have mitigation, deterrence and employees to whom etc 100% coverage, 100% monitoring and oversight received from UnionBank, as detection of bribery, corruption the organization’s Reputation Risks: Unsatisfied written acknowledgement, over the Bank’s Consumer a whole part of bid process and other unethical practices. anti-corruption customers whose issues Assistance. policies and have not been resolved can • Branch Service Rating - • Subsidiaries: 100% What are the opportunities procedures have provide negative feedback The group keeps track, Branch customers’ rating coverage for seconded identified? been communicated and public opinion. These can identifies and analyzes on their level of satisfaction employees, written be shared over social media trends about the nature with the overall service acknowledgement, annual Conduct strong and consistent and circulated by the general of the complaints and, they have received from refresher course on Code awareness campaign. Regularly Percentage of 100% public. when needed, recommends their “most-often visited” of Conduct. For those update new employees, directors and solutions to avoid recurrence UnionBank branch, given regular employees of suppliers, and contractors. As a management that What are the opportunities or improve processes to their experience for the last Subs, they are covered result, all employees, directors, have received anti- identified? deliver standout Customer 3 months by their respective vendors, related third parties, corruption training Experience. CAG reports and companies’ Code of business partners and other Higher customer satisfaction • Customer Engagement escalates issues and concerns Conduct. stakeholders must comply with translates to trust and can Questions - Branch Percentage of 100% to Senior Management or the provisions of the Bank’s employees that ensure customer loyalty. It customers’ average rating Anti-Bribery and Corruption also attracts potential new to the Operational Risk on the Gallup Customer have received anti- Management Committee on a Systems and Procedures Policy corruption training customers and therefore, more Engagement Perception sales and revenue for the Bank. monthly basis about persistent Questions The following mechanisms Management Approach “complaints against the Bank are in place to assure The Bank aims to continuously or UnionBankers” that have Note: The scale used in this survey effective implementation of UnionBank requires compliance improve its products and been received. is 1 to 5 (with 5 being the highest) these codes of conduct: with applicable Anti-Bribery Incidents of Corruption and Corruption laws in the services by taking into country. consideration past complaints, TOTAL NUMBER OF CUSTOMER suggestions and feedback from • Responsibilities, Number of incidents in 0 CUSTOMERS SERVED SATISFACTION RATING accountabilities and UnionBank has bank-wide which directors were its clients. Digital platforms are also constantly being enhanced reporting lines are policies on anti-corruption such removed or disciplined UnionBank 1.94 M deposit accounts 4.904 (out of 5) for corruption and updated to fit the current systemically defined in as its Whistle Blowing Policy, and loans opened in 2020 all divisions and group and Fair Securities Dealing and immediate needs of UnionBank customers. companies Policy. Number of incidents in 0 6.5 M current and existing which employees were • Dedicated help desks, Management Approach deposit accounts and focal points, ombudsman, This is part of the Bank’s dismissed or disciplined loans as of 12/31/2020 hotlines effort to achieve disclosure for corruption The Bank conducts operations and transparency. The policy and provides quality customer • Employee performance on Anti-Money Laundering service following our culture CitySavings Luzon: 5,766 90.78% appraisal systems is also intended as a way Number of incidents 0 and DNA of integrity, magis Visayas: 2,804 integrates compliance/ to reduce the risk of entering when contracts with and ubuntu. Mindanao: 1,067 Coverage is from May codes of conduct into transactions that may be business partners were Total: 9,637 customers to December 2020 terminated due to using new Customer • Disciplinary actions in exploited and may then result The consumer assistance incidents of corruption Satisfaction (CSAT) case of breach in incidences of bribery or management system of the fraud among others. bank includes consumer methodology

88 | UnionBank 2020 Sustainability Report TECH-UP | 89 Customer Health and Safety considerations. This will guide reference for our contributions Marketing and Labelling products and services, What are the risks identified? the Bank in its risk assessment to sustainable development, including any economic, Breaches in customer privacy Which stakeholders are process to evaluate the while managing risks and environmental or social and loss of customer data can Which stakeholders are affected? negative and positive effects of opportunities of a changing impact. This is incorporated lead to regulatory penalties affected? in its labelling and Customers, (customer a project that the Bank could world. and reputational risks. finance. Customers, (customer marketing communication protection and satisfaction aspects. level and complaints and This table summarizes the protection and satisfaction UnionBank ensures that it concern resolution), investors The Bank’s Sustainability Policy number of overall customer level and complaints and informs all data processors (reputational impact due guides decision-making at all concerns in 2020: concern resolution), investors Topic Number how the bank protects to customer relationship levels, providing a frame of (reputational impact due personal information of clients management and satisfaction to customer relationship Number of None following the privacy-by-design management and satisfaction principles. All customers would can be a factor for investment/ SUMMARY OF CUSTOMER CONCERNS substantiated divestment), and regulators can be a factor for investment/ complaints also be notified as to how (regulations can be created divestment), and regulators on marketing their personal data is being and/or revised to protect (regulations can be created and labelling? processed. and uphold the rights of E-MoneyE-Money 45% and/or revised to protect customers). and uphold the rights of What are the opportunities customers). Number of None identified? complaints What are the risks identified? Improvement to the Bank’s DepositDeposit 22% What are the risks identified? addressed UnionBank’s financial products customer privacy processes and services do not directly UnionBank adheres to national and measures can ensure cause risks to the health regulations on labelling and Customer Privacy customer satisfaction. This will Other Products/Other Products/Services 18% providing information about its allow customers to trust the and safety of its customers. Services Our customers’ products financial products and services. Bank and continue to drive and services can, however, Non-compliance can be Which stakeholders are revenues and new clients along subject to regulatory penalties. the way. indirectly cause health and Credit CardCredit Card 14% affected? safety risks to their own clients. Transparent and responsible approach to various means and Customers, (customer Conduct trainings for 0% 10% 20% 30% 40% protection and satisfaction What are the opportunities channels of communications, employees, management, and level and complaints identified? especially on any risks subcontractors to continuously associated to the use of such and concern resolution), update everyone on customer As lenders of capital and These concerns went email in acknowledgement of products and services. investors (reputational privacy regulations, market intermediaries in financial through the Bank’s formal concern and upon resolution of impact due to customer changes, and risks. transactions, the Bank can communication channels. the case. relationship management promote sustainable business What are the opportunities and satisfaction can be A Consumer Assistance identified? Compliance courses on practices (including health Officer (CAO) receives and The Quality Assurance Officer a factor for investment/ customer privacy for and safety) to its clients and acknowledges customer’s (QAO) monitors the progress Innovative updates and divestment), and regulators employees and awareness customers. complaint/request/inquiry of investigation to ensure approaches on marketing and (regulations can be created campaigns remind everyone through any but not limited compliance with the prescribed labelling can result to better and/or revised to protect in the organization to remain Management Approach to the following channels: turnaround time and conducts customer satisfaction ratings. and uphold the rights of vigilant to changes and can UnionBank’s Sustainability web-portal, walk-in or follow-up as deemed necessary. The Bank strives to carefully customers). therefore improve processes Policy is aligned with its personal branch visit, letter, The Resolving Consumer assess and review all marketing and mitigate risks better. vision and brand promise e-mail and telephone / Assistance Officer assesses campaigns, materials, and and describes its ambition to facsimile. The CAO performs and investigates the request/ digital platforms (including the neither cause nor contribute initial investigation to identify complaint then completes mobile app and website). Topic Number to adverse social and concerned unit/s in charge the investigation within the environmental impacts. By of resolving the complaint/ required turnaround time based Number of substantiated None Management Approach way of commitments, the request/inquiry and logs the on the type of complaint and complaints on customer Bank’s statement addresses same into the Bank’s central communicates the resolution The Bank is able to provide privacy the (potential) direct impacts repository system. The client to the customer in simple and consumer protection and which it could create because will receive notifications via clear language. satisfaction by being able Number of complaints None of its operations and the to uphold the rights of its addressed products and services which it customers to the security of offers to the market. Customer Affairs Group (CAG) its products and services. This is part of the organization’s No. of customers, users, 100% As part of its ESG strategy, primary business. and account holders the Bank is preparing to Quality We monitor the percentage of Quality Quality whose information is used develop its Environmental Assurance Officer users whose customer data is used Assurance Officer Assurance Officer The Bank also strives to be for secondary purposes and Social Risk Management (Customer transparent and accurate in for secondary purposes. 100% of (Branches) (HO Units) System (ESRMS), which will Engagement Group) providing its customers access customers’ data is used for secondary require that all environmental to information. The Bank purposes. These are processed for and social risks inherent or provides information on the secondary purposes other than through its relationships, Customer Customer Customer effects of subscribing to its banking product and services, subject products, and services are Assistance Officers Assistance Officers Assistance Officers to the Bank’s privacy policy. reviewed and vetted with these

90 | UnionBank 2020 Sustainability Report TECH-UP | 91 Management Approach Data Security 3. Right to dispute – you may Conduct trainings for dispute inaccuracy or error UnionBank respects and values employees, management, and in your personal information our clients’ right to privacy with UnionBank manages and subcontractors to continuously in the Bank systems utmost importance. We would protects data to ensure update everyone on data through our contact center like to inform you that we are its integrity, reliability, and information security representatives. taking the necessary steps for the and security across the regulations, market changes, protection and security of your organization. and risks. Compliance courses 4. Right to object – you may personal information and of your on data privacy for employees suspend, withdraw, and use of our services. Which stakeholders are and awareness campaigns remove your personal affected? remind everyone in the information in certain further processing, upon As provided by the Data Customers, (customer organization to remain vigilant demand, which include protection and satisfaction to changes and can therefore Privacy Act of 2012 (“DPA”), your right to opt-out to any level and complaints and improve processes and mitigate its Implementing Rules and commercial communication concern resolution), investors risks better. Regulations (“IRR”), and or advertising purposes (reputational impact due issuances by the National Privacy from the Bank. Commission, the Bank guarantees to customer relationship management and satisfaction Topic Number that we are compliant with all 5. Right to data erasure can be a factor for investment/ – based on reasonable the requirements mandated by divestment), and regulators law, as well as with the generally Number of None grounds, you have the right (regulations can be created to suspend, withdraw or accepted global data protection data breaches, and/or revised to protect including leaks, order blocking, removal or standards and regulations. and uphold the rights of thefts and losses destruction of your personal customers). of data data from the Bank’s filing The Bank ensures continued system, without prejudice protection of your personal What are the risks identified? to the Bank continuous information with our Data and information security Management Approach processing for commercial, organizational, physical, and breaches, including leaks operational, legal, and technical measures for data and theft may occur in the The Bank ensures continued regulatory purposes. protection of customer’s protection, including policies for organization. personal information. We 6. Right to secure data evaluation, monitoring, and review • An information security/ continually inform customers portability – you have of operations and security risks. on updates in our corporate the right to obtain from This Privacy Policy informs you of cybersecurity policy is internally available to all policies regarding the the Bank your personal updates in our corporate policies employees collection, use, storage, information in an electronic regarding the collection, use, disclosure, and disposal of or structured format that is storage, disclosure, and disposal • Information security/ personal information. commonly used and allows of personal information we cybersecurity awareness for further use. receive and collect from the Bank training Under the Data Privacy Act of customers, payees, users, and • UnionBank adopts a clear 2012, our customers have the 7. Right to be indemnified for damages – as data subject, any individual who communicate, escalation process, which following rights: you have every right to raise inquiries and concerns, as employees can follow in the 1. Right to be informed – you be indemnified for any well as transact with us through event an employee notices something suspicious is in may demand the details damages sustained due our authorized representatives, place. as to how your personal to such violation of your bank branches, official websites information is being right to privacy through and platforms, and web-based • The Bank has continuity/ processed or have been inaccurate, false, unlawfully applications and channels. contingency plans processed by the Bank, obtained or unauthorized and incident response including the existence of use of your information. procedures in place This Privacy Policy shall be automated decision-making to prevent IT system 8. Right to file a complaint – subject to changes in our policies and profiling systems. interruptions and you may file your complaint and the law. We shall notify you cyberattacks. These plans 2. Right to access – upon or any concerns with our of the changes by posting in are tested at least annually. written request, you Data Protection Office at our website and other means may demand reasonable 44/F UnionBank Plaza, of communication for your What are the opportunities access to your personal Meralco Avenue corner information and reference. identified? information, which may Onyx Road, Pasig City, 1600, include the contents of Metro Manila, Philippines UnionBank can strengthen your processed personal or [email protected] and continue improving any information, the manner and/or with the National data and information security of processing, sources Privacy Commission through measures and processes. This where they were obtained, www.privacy.gov.ph can lead to better customer recipients and reason of satisfaction ratings and disclosure. ultimately, better revenues for the Bank.

92 | UnionBank 2020 Sustainability Report TECH-UP | 93 THE TEAM BEHIND THE REPORT Treasury Risk Resiliency Procurement Private Banking Operations Group Legal Division Information SecurityOffice Human Resource Group and Accounting Standards Financial Reporting Facilities Management Customer SegmentManagement Customer Experience Corporate Product Management Corporate Planning and Reputation Management Corporate Media and Corporate Governance Office Compliance Branch ChannelManagement Artificial Intelligence andData Policy AND SUSTAINABILITY DATA STEWARDS TECHNICAL WORKING GROUP SUSTAINABILITY Jaries S.Villavicencio Patricia AnneA.Montecillo Louis JohnS.Ramos Angelika MaeI.Mozo Genielyn M.Soriano Andy Francis G.Bongon Kevin Lawrence JamesN.Villacrucis May G.Buencamino LAYOUT ANDCREATIVES Angelica MarieS.Justo Dave JesusT. Devilles Michaela SophiaE.Rubio EDITORIAL

Meralco Avenue, OrtigasCenter, Pasig City For your inquiries, you may reach usat: [email protected] 14F, UnionBank Plaza