Sustainability Report 2020 ”A Gene and Core Value“ In the Name of Allah, Most Gracious, Most Merciful “Verily, Allah is the All-Provider, Possessor of Power, the Mighty” Allah the Almighty speaks the truth

2 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 3 H.H. Sheikh H.H. Sheikh Nawaf Al-Ahmad Al-Jaber Al-Sabah Mishal Al-Ahmad Al-Jaber Al-Sabah Amir of the State of Kuwait Crown Prince

4 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 5 5 Managing our Human Capital 25 Employee Diversity and Inclusion 26 National Empowerment 27 CONTENTS Performance Management 28 Capacity Building 29 Retention and Turnover 30 1 Employee Rights 31 Employee Satisfaction and Engagement 32 About This Report 01 Health and Safety 33 Message from the Group CEO 02 Our Sustainability Highlights 03 Boubyan at a Glance 04 Profile 05 6 Direction 06 Subsidiaries 07 Engaging our Society 34 Memberships and Associations 08 Youth Empowerment 35 Small and Medium sized Enterprises (SME) Support 36 Women Empowerment 37 2 Health Initiatives 38 Environmental Initiatives 39 Sustainability Approach 09 Engagement Tools 40 Sustainability Assessment 10 Continuous Stakeholder Engagement 11 Sustainability / ESG Directions 12 7 Impacting through Innovation and Digitization 41 Innovation 42 3 Digitization and Technology 43 Sound Governance 13 Board of Directors 14 Sharia’a Supervisory Board 15 Executive Management 16 8 Organizational Chart 17 Assessing Our Environmental Impact 44 Risk Management and Business Resilience 18 Waste Management 45 Compliance 19 Water Management 46 Energy Efficiency 47 Greenhouse Gas (GHG) Emissions 4 and Intensity 48 Sustainable Marketplace Experience 20 Responsible Services and Solutions 21 Brand Power and Recognition 22 9 Customer Experience 23 Annex 49 Sustainable Procurement 24

6 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 7 Scope (102-1, 102-46, 102-52) This Sustainability Report 2020 About This Report was developed to report the Reporting Period (102-50) activities of Boubyan Group, Boubyan Group’s Sustainability Report 2020 covers the period providing key non-financial from January 1, 2020 to December 31, 2020. Global Reporting Initiative (GRI) Compliance (102-54) Boubyan Group’s Sustainability Report 2020 was developed in information and sustainability compliance with the core option of Global Reporting Initiative (GRI) reporting framework disclosure standards. This includes the development of a materiality assessment and matrix, and /Environmental, Social, and reporting against the core key performance indicators (KPIs) of GRI.

Governance (ESG) performance. Acknowledgement Boubyan Group’s Sustainability Report 2020 was developed by RSM Consulting W.L.L. Boubyan Group has provided the requested data, supported in the report development process, Boubyan Group comprises: Boubyan Bank, Boubyan and reviewed and signed-off the final report. Capital, Boubyan Takaful, Boubyan National Queries and Contact and the Bank of London and the Middle East (102-53) (BLME). Throughout this report, any mention of We welcome your feedback comments and queries concerning Boubyan Group and this report. Please contact us through the “Boubyan” refers to Boubyan Group, including the following channels: aforementioned subsidiaries. [email protected] bankboubyan.com | @bankboubyan

Boubyan Group | Sustainability Report | 2020 1 Message from the Group CEO By the Grace of Allah, the Almighty (102-14, 102-16) It is my pleasure to introduce the release of Boubyan’s first Sustainability Report for the year 2020, titled: “Sustainability – a Gene and Core Value.” Sustainability and Environmental, Social, and Governance (ESG) aspects are important to evaluate Boubyan’s performance, growth, positioning as leaders in digital banking, integration within our core values and business operational context, and impacts on varied stakeholders. Adel Abdul Wahab Al-Majed, Group CEO

2 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 3 Message from the Group CEO

In line with best practices in sustainability reporting, for sustainability reporting. In line with GRI, commitment, Boubyan has seen our customer the report followed stakeholder engagement complaints decreasing by 75.1%, a customer Boubyan focused on a range of topics that include: our best practices, ensuring that non-financial satisfaction index (CSI) rating of 98%, and a Net general sustainability approach, governance, marketplace / sustainability-related performance was Promoter Score (NPS) of 72%. addressed and communicated to Boubyan’s experience, innovation and digitization, the workplace, internal and external stakeholders. Engaging with Society Boubyan is committed to giving back to the our social engagement, our environmental impacts, Youth Empowerment society in which it operates, highlighting among other topics. Reporting in these areas has been Boubyan is committed to empowering our its role as a responsible corporate citizen. youth, working from a number of perspectives, Some relevant figures in this area include a developed into a baseline. The aim is to develop further which are explained more throughout our report number of investments into and support of the and particularly in our chapter: “Engaging Our community through a range of initiatives (ie. sustainability reports to compare our performance to this Society.” This includes, among other figures, financial, volunteering, engagement, guidance), a total 24 interns trained, 88 fresh university volunteering hours recorded at 520 total hours, baseline. graduates in our workforce, and 34% of our as well as the implementation of 12 health- customer base comprising youth customers. related initiatives, 11 youth / educational Furthermore, as 2020 was an exceptional year among others. Boubyan’s aim is to be initiatives, and 2 environmental initiatives. due to the onset of the COVID-19 pandemic, transparent as to Boubyan’s impacts on and SME Support connections to this situation have been impacts from our varied internal and external Boubyan is committed to especially supporting Sustainable Workplace displayed throughout the report. This allows stakeholders. I would like to reiterate the fact small and medium enterprises (SMEs), ensuring As our employees are valuable internal us to consider our performance throughout in that our sustainability / ESG performance has that we have an impact on developing Kuwait’s stakeholders, Boubyan exhibits our ways of this context, noting that our sustainability / ESG shown to be crucial in ensuring our business economy from its roots. This is shown through taking care of our employees through the elements serve as an indication of our resilience continuity and resilience, especially in the face our products and services catered to our integration of sustainability elements. Some against our risks and challenges. of the COVID-19 pandemic. SME clients, as Boubyan currently has 2,500 related achievements in our workforce include, SME clients. Boubyan has also conducted the among others, a 40.6% decrease in employee Boubyan recognizes that sustainability is a Sustainability Report Alignment Incubation Program, which is an initiative turnover, and hiring 173 additional employees. I valuable driver for us towards our vision of While Boubyan looks at best practices in setting that assists and incubates entrepreneurs by would like to stress this achievement of largely aspiring to be a top Islamic bank, and we aim the strategy and developing our report, Boubyan providing the knowledge, training, networking reducing our turnover and hiring additional to be on top with our sustainable performance strongly considers alignment with a number facilities, workshops, and access to mentors employees despite the challenges of COVID-19 as well. In addition, sustainability supports of national and international sustainability needed by SMEs to help them grow, innovate, and associated turnover seen among other our mission of achieving excellence, as the / ESG frameworks and drivers. Frameworks and become established. organizations. Furthermore, in line with our excellence areas Boubyan aims for include a emphasized throughout our report include: commitment to national empowerment, we number of sustainability and ESG elements. the Sustainable Development Goals (SDGs), Customer Experience through Digitization recorded a Kuwaitization rate attributable These sustainable directions have a direct link Kuwait National Development Plan (KNDP), As our customers are a valuable stakeholder to Boubyan Bank of 77% out of the total with our 5 core values as well, highlighting Kuwait Boursa sustainability disclosures, and for Boubyan, we put extensive efforts into workforce. In addition, Boubyan reports the various ways in which our report caters to a ESG indicators, among others. Notably, the assessing customer experience, and further representation of women in our workforce and range of stakeholders emphasized throughout report was developed in accordance with the improving it, especially through our digitization in 2020 female employees made up 17.2% our values—namely customers and employees, Global Reporting Initiative (GRI) standards and innovation developments. As a result of this of managers and above, and 7% of executive

4 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 5 Message from the Group CEO

managers and above. These indicators of In Closing female employee empowerment are considered Finally, we are proud of our commitment to as a baseline / direction for us towards further sustainability and, with the development of gender diversity in the future. Furthermore, in our baseline report, Boubyan looks forward to line with supporting our employees through continuing this practice by publishing additional training and development opportunities, sustainability disclosures in this future. Boubyan Boubyan has recorded 46,710 training hours aims to advance this practice in the future, provided through 224 courses. ensuring that we remain transparent with our valuable stakeholders, and remain competitive Environmental Impacts and comparable to our peers locally and As a result of a range of factors, including internationally. remote working and digital developments, We hope you enjoy reading through Boubyan’s Boubyan had a number of achievements in terms Sustainability Report 2020, and we look of our environmental impact. These include, forward to any feedback and engagement from among others, a decrease of 29% in our paper our stakeholders regarding any information consumption, a decrease of 38% in our plastic given in our report. usage, and calculation of our greenhouse gas (GHG) emissions across a number of scopes. Peace Be With You Thank You Firstly, on behalf of Boubyan, I would like to extend deep thanks to His Highness, the Amir Adel Abdul Wahab Al-Majed, of Kuwait, Sheikh Nawaf Al-Ahmad Al-Jaber Al- Group CEO Sabah, and to His Highness, the Crown Prince, Sheikh Mishal Al-Ahmad Al-Jaber Al-Sabah, may Allah protect them both. I would also like to thank all individuals involved for their valued efforts over the development of our report, as well as our range of internal and external stakeholders who contribute daily to our great success.

6 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 7 OUR SUSTAINABILITY HIGHLIGHTS

Customer Satisfaction Customer complaints Index (CSI) 75.1% decrease 98%

Internships Training hours 24 interns 46,710 hours

Number of data leaks Local procurement 0 Zero 81% local suppliers

Kuwaitization rate (Boubyan Bank) Females in the workforce

77% 17.2% female managers and above 7% female executives and above Employee turnover New hires 40.6% decrease 173 employees

Employee complaints Number of SME clients 75% decrease 2,500 clients

8 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 9 OUR SUSTAINABILITY HIGHLIGHTS

Percentage of youth clients out of total clients Scope I GHG emissions

34% youth customers 1 75 MTCO2e

Number of community initiatives Scope II GHG emissions Education 11initiatives 2 6,984 MTCO2e Health 12 initiatives Environment 2 initiatives Scope III GHG emissions 3 133 MTCO2e Paper consumption 29% decrease

Total GHG emissions Greenhouse gas (GHG) savings from paper reduction 7,191 MTCO2e 129 MTCO2e

Volunteering hours Number of fresh graduates employed 520 hours 88 graduates

Plastic consumption Awards and recognitions 38% decrease 8 awards

10 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 11 Boubyan at a Glance

(102-1, 102-2, 102-3, 102-4, 102-5, 102-6, 102-7, 102-16)

Boubyan comprises a group of entities that include Boubyan Bank and four subsidiaries providing banking, investment and asset management, takaful insurance, and property management activities with the specific entities listed in Figure 1.1. Boubyan is renowned for its excellence and dedication to customer service and its market leadership in innovation.

Figure 1.1: Boubyan Entities

Boubyan Bank is a leading Islamic bank based in Kuwait, providing a variety of banking services to both individuals and corporate customers. Boubyan Bank provides retail banking, corporate banking and wealth management services in accordance with provisions of the Noble Islamic Sharia’a. Boubyan Bank was first established in 2004, with paid-up capital 100 million KD.

Boubyan is known for its provision of digital and innovative banking services and market-leading products in Kuwait. Boubyan is also ranked as an advanced private sector institution in Kuwait in the field of customer service. Creativity and innovation have always been cornerstones for Boubyan’s business model, as we are keen on reinforcing this value through our innovative digital and electronic banking services many of which were offered for the first time in Kuwait.

Boubyan Bank is listed on the Kuwait Stock Exchange (Kuwait Boursa), and is subject to both Central Bank of Kuwait (CBK) and Capital Markets Authority (CMA) regulations, including in terms of ownership / majority acquisition aspects. Accordingly, Boubyan discloses any ownerships that exceed 5%. As of November 24, 2020, the major shareholders of Boubyan owning or controlling more than 5% of capital include the National Bank of Kuwait S.A.K. and the Commercial Bank of Kuwait S.A.K.

12 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 13 Vision: Values: “We aspire to become one of the top 5 Islamic banks in the world.” 1) Always focusing on our customers and providing a safe banking experience. Mission: 2) Fostering creativity and innovation in the products and services “Achieving excellence in everything we do.” we offer and in the way we work with adequate risk appetite. 3) Working as a team to exceed our individual expectations. 4) Maintaining the highest standards of integrity and professionalism. 5) Focusing on our employees by creating a high-performance organization that nurtures, develops, and provides exceptional opportunities for our people.

1.2 Direction Throughout the execution of our strategy, we follow a set of 5 guiding principles, explained in (102-16) Figure 1.2b as follows:

Boubyan’s business direction is driven by the clear direction of our vision and mission Figure 1.2b: Guiding Principles of Strategy Execution statements, and 5 values. Note that our direction emphasizes elements related to excellence, 1. We are Champions of the Vision.. We actively participate in work that achieves the vision. innovation, and top performance, while catering for a range of stakeholders that include customers and employees. 2. We are the Customer.. Our customer is a very important stakeholder. We provide a safe banking experience. We treat the customer as we would like to be treated–with transparency In addition, Boubyan is guided by a set of 3 strategic directions identified for our future and sincerity. We earn customers’ loyalty through integrity. aspirations, which are listed in Figure 1.2a. Accordingly, the first strategic direction of digitization shows a focus on Kuwait with the aim of establishing a state of the art digital 3. We are Innovators.. We innovate efficiently, factoring risk with the long-term perspective platform in Kuwait. Furthermore, Boubyan aims to sustain growth, especially in retail and in mind. corporate banking businesses, and continue to offer digital and cost-conscious products. The remaining two strategic directions ( geographical diversification and value creation) will 4. We Take Ownership.. We are all accountable for delivering on our commitments, and we be achieved through Bank of London and The Middle East (BLME) and their focus on wealth own our outcomes. management value proposition for high-net-worth clients - while also acting as an International digital platform to offer offshore banking for the affluent and mass affluent segments. 5. We are One Boubyan.. We are all builders, and we teach by doing.

Figure 1.2a: Strategic Directions Boubyan ensures that the strategy is cascaded within our workforce and business units, while ensuring application of strategy elements. Accordingly, the 6-step process laid out in Figure 1.2c is followed to formulate and execute the strategy. Geographic Digitization diversification Value creation

14 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 15 Figure 1.2c: Process for Strategy Formulation and Integration 1.3 Subsidiaries (102-2, 102-3, 102-4, 102-6)

Boubyan comprises of Boubyan Bank and 4 These activities are all conducted while working subsidiaries, as listed and explained in the in accordance with Islamic Sharia’a, and following; applying Islamic teachings in the transactions. Top Management: Top management attends one Boubyan Capital Bank of London and the Middle East (BLME) offsite strategy meeting each year Boubyan Capital is a Sharia’a-compliant The Bank of London and The Middle East to present Boubyan’s strategic investment company based in Kuwait. It (BLME) is an award-winning, Sharia’a-compliant initiatives. provides services which include: bank, providing real estate-focused wealth • Asset management management solutions, as well as commercial Strategic Planning team: • Alternative investments real estate finance and savings products. Based The Strategic Planning team • Brokerage services to institutions and high- in London, with offices in the United Kingdom aligns and maps all of Boubyan’s net-worth individuals (UK) and the United Arab Emirates (UAE), BLME initiatives to reach an agreed- • Management of the property investments of became a subsidiary of Boubyan Bank following upon timeline and launch date. Boubyan Group a successful acquisition in 2020–consolidating Human Resources: Boubyan’s long-standing ownership in BLME The Human Resources (HR) business Boubyan Takaful since its foundation in 2007. unit conducts a comprehensive Boubyan Takaful is a Sharia’a-compliant bank-wide, top-down approach to insurance company based in Kuwait, offering a cascade the strategic initiatives into wide range of insurance products under various its KPIs and target dates. classes of business, including: • Motor Center of Excellence: • Fire and general accident The Boubyan Center of • Marine and aviation Excellence team begins the • Family takaful and medical analysis and execution phases. These insurance products are all provided on the basis of Takaful insurance in line with Signing Ceremony: Islamic principles under the supervision of our A signing ceremony for the Sharia’a Board. executive management is held to sign the performance contract. Boubyan National Boubyan National is a real estate services Strategic Planning team: company based in Kuwait, providing: Throughout the year, the • Land and real estate development Strategic Planning team • Rental and leasing participates in attending • Property maintenance meetings, while also monitoring • General contracting services the progress of each strategic • Managing the property interests of the initiative. Boubyan Group

16 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 17 2 | Sustainability Approach

Boubyan’s sustainability approach forms the basis of our sustainability report development. The sustainability approach ensures reflection of our performance throughout the 4 sustainability / ESG dimensions—namely Marketplace, Environment, Workplace, and Community (MEWC).

Our sustainability approach is also aligned with national and international directions, that include UN Sustainable Development Goals (SDGs) and the Kuwait National Development Plan (KNDP), among others. Ultimately, this section emphasizes how Sustainability is a “Gene and Core Value” for Boubyan. Defining this sustainability approach sets a foundation against which the quantitative and qualitative information was reported, based on prioritized areas of focus (material topics), derived from materiality assessment conducted via stakeholder engagement. Specifically, our sustainability approach is built around the set of 18 material topics assessed.

18 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 19 2.1 Sustainability Assessment 2.1.1 Qualitative Assessment Figure 2.1.1a: Material Topics and Description (102-21, 102-29, 102-40, 102-42, 102-44, 102-47, 103-1, 103-2) (102-21, 102-40, 102-44, 102-47, 103-1, 103-2, 103-3)

Material Topic Description Conducting the adequate sustainability The qualitative sustainability assessment for assessments as a foundation to sustainability Boubyan was conducted through a materiality reporting is a crucial step. These qualitative assessment. This assessment involved the 1 Digitization and technology Platforms, channels, mobile apps, automated processes, digital marketing and quantitative assessments ensure that identification, rating, and prioritization 2 Innovation Innovation methods applied within Boubyan operations and strategy, and externally our reporting practices are developed in line of topics that could be the most material while developing or enhancing customer services / products or experience, digital with national and international sustainability (significant) to stakeholders—accomplished transformation cycle, breakthrough banking solutions

frameworks, Boubyan’s strategic directions, through benchmarking and stakeholder 3 Responsible services and solutions Conscious services (i.e. in terms of environmental savings, impact on the community), and the significant areas and concerns for engagement methods. Then, the results were retail banking services, corporate banking services, accessible products Boubyan’s stakeholders. This is even more plotted on a matrix that prioritizes the topics’ 4 Customer experience Customer journey, customer satisfaction, customer feedback, complaints, customer crucial considering that this is Boubyan’s first significance. Next, it was ensured that the privacy and security, transparency sustainability report, and forms the baseline for topics throughout the report were in line 5 Dynamic Islamic services Providing competitive and innovative products and services within Sharia’a banking practices, customer experience influencer for Islamic and conventional market all future sustainability reports, starting with an with the materiality assessment results, in segment, role of Sharia’a banking in business development and profits, financial emphasis of how sustainability is a “Gene and order to make sure that the report covers the models

Core Value” for Boubyan. More information most important information / areas for the 6 Brand power and recognition Expansion, international and regional growth, awards, Service Hero, ratings, brand about the sustainability assessments conducted concerned stakeholders. value and their results are found in this section. 7 Sound governance Corporate values, corporate structure, shareholders, policies and standards, Internal and External Considerations compliance, code of conduct, committees, conflict of interest Throughout this report, Boubyan has taken (102-21, 102-40, 102-42, 102-43) 8 Risk management and business resiliency Risk controls, risk mitigation, stress testing, crisis management, COVID-19 impact, both qualitative and quantitative approaches stability against AML, fraud, corruption, business continuity to sustainability disclosures—qualitative in The materiality assessment took a two-pronged 9 SME support Contribution to Small and Medium sized Enterprises (SMEs), services offered terms of discussing our performance in certain approach: on one hand, the material topics areas, and quantitative in terms of measuring were rated by internal stakeholders; on the 10 Youth empowerment Community initiatives targeting youth, youth in managerial positions, internships and development programs and evaluating sustainability / ESG KPIs. The other hand, the same material topics were quantitative sustainability assessment is in benchmarked against a number of regional 11 Diverse community impact Events, engagement methods, social media, initiatives during COVID-19, campaigns, direct economic impact, supporting youth, women, education and health the form of KPIs evaluated and reported in and internal best-practice entities within their respective chapters; specifically, one KPI the industry. Accordingly, Figure 2.1.1a 12 National empowerment Attracting and maintaining Kuwaiti talents (Kuwaitization%) distributed across the report sections is the displays the 18 material topics identified for sustainability return on investment (SROI). Boubyan stakeholders. In addition, the specific 13 Capacity building Continuous learning and development assessment and implementation The qualitative assessment was conducted benchmarks used for analysis include 2 local, 3 14 Employee diversity and inclusion Gender diversity, age diversity, female representation and empowerment, religion in the form of a materiality assessment, in regional, and 3 international entities. diversity, special needs compliance with the Global Reporting Initiative 15 Employee rights and engagement Performance management, retention, labor standards, events, employee (GRI) reporting standards framework. satisfaction, compensation

16 Health and safety Organizational health index (OHI), COVID-19 initiatives, stakeholders’ safety

Local vs. foreign suppliers, transparency, environmental impact, code of conduct, 17 Sustainable procurement due diligence

Waste management, water management, energy efficiency, compliance to 18 Environmental Impact regulations, GHG emissions and intensity

20 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 21 Materiality Matrix Figure 2.1.1c: Materiality Levels (102-21, 102-44, 102-47, 103-1)

Based on the previously conveyed materiality Importance materiality based on matrix results. Material Topic Materiality Level results, a materiality matrix was developed Further emphasizing the integration of these

to consolidate the results from both the material topics into our sustainability report 1 Digitization and technology High impact, High importance benchmarking analysis and the stakeholders’ development, the beginning of each chapter 2 Innovation High impact, High importance ratings. Figure 2.1.1b displays the materiality displays the material topics (aligned with their matrix, while Figure 2.1.1c shows how ESG areas) that are relevant to the topics within 3 Responsible services and solutions High impact, High importance the material topics are categorized into the associated report chapter. 4 Customer experience High impact, High importance

4 combinations of High or Low Impact or 5 Dynamic Islamic services High impact, Low importance

Figure 2.1.1b: Materiality Matrix 6 Brand power and recognition High impact, Low importance

7 Sound governance High impact, High importance

8 Risk management and business resiliency High impact, High importance

9 SME support Low importance, Low impact

10 Youth empowerment High impact, Low importance

11 Diverse community impact High impact, High importance

12 National empowerment High impact, Low importance

13 Capacity building High impact, High importance

14 Employee diversity and inclusion High impact, High importance

15 Employee rights and engagement High impact, Low importance

16 Health and safety High impact, Low importance

17 Sustainable procurement High impact, Low importance

18 Environmental Impact High impact, High importance

2.1.2 Quantitative Assessment (102-15, 102-29, 102-44)

Supplementing the qualitative approach of Because outcomes are often intangible or materiality assessment, other sustainability immeasurable through traditional means, / ESG aspects were measured and assessed calculations were done to convert them through related material topics and KPIs. One to measurable numbers and retrieve SROI important sustainability / ESG KPI we used here percentage results. As a result, 15 SROI and throughout the report was the sustainability calculations were conducted and these are return on investment (SROI). SROI is used to reported throughout this report. On top of assess what is most impactful for initiatives communicating evaluation results, this SROI and projects, setting up criteria for evaluating approach will support Boubyan in decision- projects and initiatives, especially those related making for future sustainability-related projects to the community, environment, business, and and initiatives. workplace.

SROI Level Scale Legend • 0-99%: medium • 100 - 299%: high • 300%+: very high

22 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 23 legend for stakeholder engagement frequency: • High: daily basis • Medium-High: weekly to monthly basis • Medium: Monthly basis • Low: yearly basis 2.2 Stakeholder Engagement Figure 2.2: Stakeholder Engagement (102-21, 102-33, 102-40, 102-42, 102-43, 102-44)

Engagement with our stakeholders is key depending on the type of stakeholder engaged to ensuring a harmonious sustainability / with: 1 2 3 4 5 ESG journey for Boubyan. The results of our • Emails engagement with stakeholders are provided in • Telephone Stakeholder Stakeholder Frequency of Value added Value added from this section. • Virtual meetings Type Engagement from Boubyan to Stakeholder to • Physical meetings Stakeholder Boubyan Specifically, stakeholder engagement involves • Conferences Employees Internal High • Compensation, • Skills, experience, being aware of Boubyan’s relationship with and • Reports remuneration, and capabilities benefits • Business impacts from and on stakeholders, transparently • Social media • Employee rights representation communicating with these stakeholders, • Websites • Empowerment • Loyalty and • career path satisfaction and appropriately monitoring, assessing, development and improving stakeholder impacts and Moreover, Figure 2.2 provides more details engagements. In order to engage with external concerning the frequency of engagement with Shareholders Internal Medium-High • Dividends, financial • Accountability and internal stakeholders, Boubyan utilizes a each stakeholder, as well as the value added outcomes • Voice of decision • Long-term values making number of tools / mechanisms; a selection of to Boubyan and to the stakeholder from the • Supporting growth these is listed as follows. Their relevance varies engagement. Customers External High • Quality products • Sales revenue and services • Demand for • Sustainable innovative products engagement and services • Reputational and brand outcomes • Areas of improvement

Government External High • Lead by example • Frameworks and / Regulatory • Compliance guidelines Bodies • Market stability • Performance monitoring • Stakeholder confidence

Suppliers External low • Procurement • Procured quality expenditures products and • Developments services through innovative • Sustainable supply projects chain

Community External Medium-High • Tangible and • Enhance brand intangible impact value • Sustainable • Support in community allocating impacts development through budgets • Employment opportunities • Local empowerment • Constructive partnerships

24 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 25 Material Topic SDGs KNDP 2.3 Sustainability / ESG Directions (102-12, 102-16, 102-29, 102-44) • Kuwait 2035 Vision / Kuwait National Development Plan (KNDP) 7 Sound governance 8: Decent Work and Economic Growth • Global Positioning It is important for Boubyan to have solid • Kuwait Boursa voluntary sustainability 9: Industry, Innovation and Infrastructure 16: Peace, Justice, and Strong Institutions sustainability / ESG directions, in alignment disclosures 17: Partnerships for the Goals with other frameworks, and either directly or • Various Environmental, Social, Governance indirectly embedded in their strategic directions. (ESG) criteria 8 Risk management and business resiliency 8: Decent Work and Economic Growth • Global Positioning In this regard, Boubyan’s sustainability / ESG 16: Peace, Justice, and Strong Institutions directions are presented in this section. This strong alignment has especially been 9 SME support 8: Decent Work and Economic Growth • Global Positioning In recognition of Sustainability – “Gene and ensured through the KPIs and data points against 9: Industry, Innovation and Infrastructure • Diversified Economy Core Value,” the sustainability / ESG directions which Boubyan collected, measured, evaluated, 11: Sustainable Cities and Communities 16: Peace, Justice and Strong Institutions embedded throughout Boubyan Sustainability and reported its performance throughout this 17: Partnerships for the Goals Report 2020 are derived from well-known report. More directly, Figure 2.3a displays international and national sustainability / ESG an alignment of the report’s material topics 10 Youth empowerment 4: Good Education • Global Positioning 8: Decent Work and Economic Growth • Diversified Economy frameworks and drivers, which include: to the aforementioned sustainability/ ESG 9: Industry, Innovation and Infrastructure • Creative Human Capital • UN Sustainable Development Goals (SDGs) frameworks, specifically the SDGs and KNDP. 11: Sustainable Cities and Communities

11 Diverse community impact 1: No Poverty • Global Positioning 2: Zero Hunger • High Quality Healthcare 3: Good Health and Well-being Figure 2.3a: Material Topics Alignment 4: Quality Education 10: Reduced Inequalities 11: Sustainable Cities and Communities 16: Peace, Justice, and Strong Institutions Material Topic SDGs KNDP 17: Partnerships for the Goals

1 Digitization and technology 8: Decent Work and Economic Growth • Global Positioning 12 National empowerment 8: Decent Work and Economic Growth • Creative Human Capital 9: Industry, Innovation and Infrastructure • Diversified Economy 10: Reduced Inequalities 11: Sustainable Cities and Communities • Developed Infrastructure • Sustainable Living Environment 13 Capacity building 4: Quality and Education • Global Positioning 8: Decent Work and Economic Growth • Creative Human Capital 2 Integrated innovation 8: Decent Work and Economic Growth • Global Positioning 10: Reduced Inequalities 9: Industry, Innovation and Infrastructure • Diversified Economy 17: Partnerships for the Goals 11: Sustainable Cities and Communities • Developed Infrastructure

14 Employee diversity and inclusion 5: Gender Equality • Creative Human Capital 3 Responsible services and solutions 8: Decent Work and Economic Growth • Global Positioning 8: Decent Work and Economic Growth 11: Sustainable Cities and Communities • Diversified Economy 10: Reduced Inequalities • Sustainable Living Environment 15 Employee rights and engagement 8: Decent Work and Economic Growth • Creative Human Capital 4 Customer experience 8: Decent Work and Economic Growth • Global Positioning 10: Reduced Inequalities 9: Industry, Innovation and Infrastructure • Diversified Economy 10: Reduced Inequalities 16 Health and safety 3: Good Health and Well-being • High Quality Healthcare 11: Sustainable Cities and Communities 8: Decent Work and Economic Growth 12: Responsible Consumption and Production 17 Sustainable procurement 8: Decent Work and Economic Growth • Sustainable Living Environment 11: Sustainable Cities and Communities • Diversified Economy 12: Responsible Consumption and 5 Dynamic Islamic services 8: Decent Work and Economic Growth • Global Positioning Production 9: Industry, Innovation and Infrastructure • Diversified Economy 17: Partnerships for the Goals 10: Reduced Inequalities 16: Peace, Justice and Strong Institution 18 Environmental Impact 6: Clean Water and Sanitation • Global Positioning 17: Partnerships for the Goals 7: Renewable Energy • Sustainable Living Environment 11: Sustainable Cities and Communities 12: Responsible Consumption 6 Brand power and recognition 8: Decent Work and Economic Growth • Global Positioning 13: Climate Action 9: Industry, Innovation and Infrastructure • Diversified Economy 14: Life below Water 16: Peace, Justice and Strong Institution 15: Life on Land 17: Partnerships for the Goals

26 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 27 Kuwait 2035 Vision Alignment Figure 2.3c: SDG Report Alignment Boubyan’s strategy is aligned to the Kuwait agendas. Accordingly, Figure 2.3b shows the 2035 Vision / Kuwait National Development alignment of KNDP pillars to their respective SDG Goal Sustainability Report Chapter Explanation Plan (KNDP), which ensures that we are sections of the sustainability report. contributing to furthering local sustainability SDG 1: no poverty • Chapter 5: Managing our Human Capital • Boubyan contributes to alleviating poverty through • Chapter 6: Engaging with our Society both community engagement and the direct Figure 2.3b: KNDP Report Alignment economic impact on employees. SDG 2: zero hunger • Chapter 6: Engaging with our Society • Boubyan contributes to alleviating hunger through social engagement, such as food bank donations. KNDP Pillar Sustainability Report Chapter Explanation SDG 3: good health and well-being • Chapter 4: Sustainable Marketplace • Boubyan aims to promote a healthy lifestyle Experience initiative through numerous events and bulletins • Chapter 7 : Impacting through broadcasted to all employees. Global Position • Throughout the report (Chapters 1 - 8) Global positioning elements are displayed Innovation and Digitization • Various health outcomes are also included within throughout the report, as the report KPIs • Chapter 5: Managing our Human Capital our products and services, technology outcomes, to assessing and reporting sustainability / • Chapter 6: Engaging with our Society and social engagement. ESG information is derived from a range of international frameworks and best SDG 4: quality education • Chapter 6: Engaging with our Society • Education outcomes are shown throughout our social engagement, especially in empowering practices. youth.

SDG 5: gender equality • Chapter 5: Managing our Human Capital • Boubyan aims to increase female representation Creative Human Capital • Chapter 5: Managing our Human Reported varied information related to • Chapter 6: Engaging with Society in the workforce and especially in upper Capital Boubyan’s workforce, Kuwaitization, management. training, supporting the youth in their • There are also female empowerment elements career development, among others. within our social engagement. SDG 6: clean water and sanitation • Chapter 8: Assessing Our Environmental • Water consumption aspects are reported. Impact High Quality Healthcare • Chapter 4: Sustainable Marketplace Health and safety elements are reported Experience throughout our products and services SDG 7: affordable and clean energy • Chapter 8: Assessing Our Environmental • Energy consumption aspects are reported. • Chapter 5: Managing our Human (ie. health insurance and financing), Impact Capital customer health and safety, employee • Chapter 6: Engaging our Society health and safety, technologies that SDG 8: decent work and economic • Chapter 3: Sound Governance • Workplace and economic aspects are reported. • Chapter 7: Impacting through safeguard stakeholders’ health, and social growth • Chapter 4: Sustainable Marketplace Experience Innovation & Digitization engagement related to health initiatives. • Chapter 5: Managing our Human Capital

SDG 9: industry, innovation and • Chapter 4: Sustainable Marketplace • These elements are reported throughout our Sustainable Living Environment Various elements and KPIs related to our infrastructure Experience products and services, as well as our digitization • Chapter 7: Impacting through environmental impact are measured and • Chapter 7: Impacting through Innovation and innovation developments. Innovation & Digitization reported, especially those arising through & Digitization • Chapter 8: Assessing Our our use of technology. SDG 10: reduced inequalities • Chapter 5: Managing our Human Capital • We report on diversity aspects, especially related Environmental Impact to equal opportunity and non-discrimination for age and gender. Developed Infrastructure Infrastructure aspects are related to • Chapter 4: Sustainable Marketplace our products and services related to SDG 11: sustainable cities and • Chapter 6: Engaging our Society • We report on various social engagements aimed at Experience financing. communities sustainability in the community.

SDG 12: responsible consumption • Chapter 4: Sustainable Marketplace • We report on efficiency and resource management aspects in general, as well as specifically related to Sustainable Diversified Economy Reported information about Boubyan’s and production Experience • Chapter 7: Impacting through Innovation our digitization initiatives. • Chapter 4: Sustainable Marketplace economic performance, direct economic & Digitization • Boubyan aims to inform the client on responsible Experience impacts on stakeholders, community • Chapter 8: Setting our Environmental lending through specific initiatives and aims to • Chapter 6: Engaging our Society investment, support of and contribution Impact introduce a Plastic-Free Kuwait initiative for the to small and medium sized enterprises betterment of the environment. (SMEs), among others. SDG 13: climate action • Chapter 7: Impacting through Innovation • Climate-related aspects are reported in relation to & Digitization our operations, as well as specifically in relation to • Chapter 8: Assessing Our Environmental our technology element. Effective Public Administration Reported various compliance matters and Impact • Chapter 3: Sound Governance our transparency to regulatory standards and requirements. SDG 16: peace, justice, and strong • Chapter 3: Sound Governance • These elements are conveyed through our institutions compliance with regulatory authorities and standards, as well as internally through our various UN Sustainable Development Goals (SDGs) report. In addition, further alignment between governance aspects.

Alignment Boubyan and the SDGs is displayed for each SDG 17: partnerships for the goals • Chapter 6: Engaging our Society • Various information about our partnerships is chapter throughout the report, emphasizing • Chapter 7: Impacting through Innovation disclosed, specifically for innovative projects or for Boubyan is aware that its sustainability / ESG & Digitization social engagement. directions, evaluation, and reporting are in line the ways in which we contribute to (and have with specific goals from the UN Sustainable a connection with) global sustainability / ESG Development Goals (SDGs) framework. directions throughout our own sustainability / Accordingly, Figure 2.3c shows the alignment ESG performance. of specific SDGs to the specific sections of the

28 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 29 Environmental, Social, and Governance Boubyan’s measurement, evaluation, and Sustainability / ESG Elements in Boubyan strategy cover the 4 key sustainability / ESG (ESG) Factors reporting of these respective KPIs are displayed Strategy dimensions—namely environment, community, The report and its content are aligned to throughout the report, but Figure 2.3d provides a Boubyan has articulated a set of sustainability workplace, and marketplace. Even though various criteria and KPIs derived from a number sense of alignment between the report sections / ESG elements that are related to Boubyan’s this is the first baseline sustainability / ESG of ESG factors. Namely, the report sequence, and the ESG areas that overarch different ESG overall strategy, noting that no specifically report, elements are already integrated within content, integration, focus areas, and other criteria. In addition, further emphasis on the written sustainability / ESG strategy for Boubyan’s strategy at many levels and areas, qualitative and quantitative indicators assessed connection between ESG elements is provided Boubyan currently exists. The sustainability and these are listed in Figure 2.3e. are strongly linked to existing criteria and KPIs throughout the report, as each chapter / ESG elements embedded within Boubyan’s used by ESG factors to assess organizations’ displays the relevant material topics with their sustainability / ESG performance. associated ESG areas. Figure 2.3e: Sustainability / ESG Elements Integration

Figure 2.3d: ESG Area Report Alignment

ESG Area Sustainability Report Chapter

Environmental (E) • Enhancing digitization of multiple services, which would also result in a reduction in CO2 emissions. ESG Area Sustainability Explanation • Implementing responsible lending initiatives for society, especially considering environmental aspects. Report Chapter Social (S) • Attracting and retaining Kuwaiti talent. The Bank is committed to Environment (E) • Chapter 7: Impacting • Environmental aspects are reported Kuwaitization and attracting the “right” talent. through Innovation and generally for our operations, as • Assessing performance through the Organizational Health Index (OHI) Digitization well as specifically as a result of as a predictor of future capacity to perform. • Chapter 8: Assessing Our our technological advancements. • Implementing training and development schemes. Environmental Impact • Promoting services and products to assist underbanked and SMEs in their growth and development. • Chapter 4: Sustainable • Social aspects are reported by • Promoting a healthy lifestyle within the workforce with various Society (S) Marketplace Experience showing the various community messages, events and bulletins sent throughout the year. • Chapter 5: Managing our initiatives conducted. • To measure the effects on clients via the Customer Satisfaction Index Human Capital • Social aspects are also related (CSI) and Net Promoter Score (NPS). • Chapter 6: Engaging Society to our disclosure of workplace • Organizing a number of health and safety initiatives, especially focused • Chapter 7: Impacting management, as well the various on COVID-19. through Innovation and customer outcomes of our product • Improving female representation in the workforce. Digitization and service offerings. Governance (G) • To innovate and offer unique products and cost-conscious services through secure modern channels (digitization) resulting in value Governance (G) • Chapter 3: Sound • Various governance aspects addition to the clients. Governance are reported, including the Board, executive management, committees, policies, amd compliance, among others. Boubyan’s Visionary Approach Towards is articulated in alignment with our current Sustainability / ESG strategy and vision, to enable the plan to reach Boubyan has set out a visionary approach that a good level of integration of these elements in aims at following and improving on a range the future. of sustainability / ESG areas. This approach and the areas aiming to be achieved are listed in Figure 2.3f below. This visionary approach

30 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 31 Figure 2.3f: Boubyan’s Visionary Approach

Integrating into Integrating into risk Integrating into Integrating into Developing a sustainability / ESG strategy Enhancing the Board’s corporate governance management financing investment that is guided by an overarching vision and responsibility for overseeing decision-making mission of Boubyan, and incorporate ESG sustainability / ESG issues processes into strategic planning

Strengthening the Determining KPIs Concerning Board Adopting a Disclosing Boubyan Becoming a signatory Becoming a Board/senior executives’ and targets to ESG management systematic sustainability / ESG of the Principles signatory of oversight, proactive measure and evaluate approach and approach to vision, strategy and of Responsible Equator Principles management and sustainability / ESG strategy, including identify, assess performance in different Investment (PRI) or (EP) or other ongoing dialogue on performance, with an the process used and respond communications other frameworks ESG-related risk sustainability / ESG aim of improving ESG to evaluate, or to ESG-related channels–eg. annual for responsible and investment topics performance in the prioritize and risks in business sustainability / ESG investment, noting frameworks, short, medium and manage material operations reporting, website, that Boubyan is noting that long term sustainability / engagement with a not currently a PRI Boubyan is not ESG-related issues third party to perform signatory. currently an and risks independent assurance Equator Principles on sustainability / ESG Financial reports, or ESG data, Institution (EPFI). giving confidence to stakeholders on the credibility of the report and data,

32 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 33 Case Study The Adaptation of Strategy During COVID-19 Crisis

Overview: A. Prioritizing initiatives that have a time-frame As economies suffer and markets crash as a of impact between 12-18 months. result of the unexpected pandemic that has B. Focus on using existing internal resources raged across the whole world, it would be when possible, and adopting an efficient understandable if set strategies and plans that working methodology. were predetermined at the beginning of the C. Decrease risk profile by increasing budgetary year were disrupted. The COVID-19 crisis has responsibility and awareness, while introduced numerous complications in our minimizing short-term cost. everyday lives, let alone in business cycles and D. Focus on initiatives that have key strategic corporate regimes, which are some of the most relevance, like market share growth, or affected by the global pandemic. acceleration of alternative profit sources.

Despite these challenges, Boubyan has reacted Outcomes: in a different way, as Boubyan has sought to At the present time, the Acceleration Program face these challenges with determination and has had a few months of implementation vigor. With allocated resources, leeway was (August to December 2020). However, the created in terms of pursuing our aspirations and program has energized Boubyan and our set strategies. Thus, upper management created employees to not rest on our laurels and accept a program to initiate this movement towards the effects the pandemic has had on our jobs growth, in what was called the “Acceleration and everyday lives. Instead, the Program Program. made sure that the goals that were set for the year have not changed, and are expected to The Program contains 15 chosen strategic be completed in time. The Program has also initiatives, all with set timelines of impact shifted the allocation of the budget to the most and strategic relevance. Accordingly, Boubyan important and selected programs under this initiated its implementation after the Board’s initiative. approval in August 2020. Boubyan was proactive in its approach, and Objective: sought for growth and continued success The “Acceleration Program” focuses on being to ensure that its clients were provided proactive to achieve Boubyan’s aspirations, with services that exhibited excellence and as the plan was set in accordance with the professionalism, whatever the circumstances. following objectives and principles:

34 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 35 3 | Sound Governance

Governance is a cornerstone of sustainability reporting, being attributable to many aspects of ESG, and touching on all 4 of the sustainability / ESG dimensions (MEWC)—notably through the way that organizations govern their performance in these dimensions. Governance elements are also found in national and international sustainability / ESG frameworks and drivers. In this regard, Boubyan recognizes that governance plays a major role in sustainability, which is a “Gene and Core Value” for us.

We are consistently assessing, improving, and communicating our governance aspects with stakeholders, as the main governance areas reported include: our Board of Directors, Sharia’a Supervisory Board, executive management, organizational chart, risk management and business resilience, and our compliance. Specifically, through engagement with our stakeholders, we have derived 2 material topics related to governance. Decent Work and Economic Growth

Peace, Justice, and Strong Institutions

36 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 37 3.1 Board of Directors (102-18, 102-20, 102-22, 102-23, 102-24, 102-25, 102-26, 102-27, 102-28, 102-32)

Information about our Board of Directors is provided pertaining to the period of January 1, Adnan Abdullah Al-Othman Other current posts: important to be disclosed in the sustainability 2020 to December 31, 2020. Director (Non-Executive) • Board Director – Warba Insurance Company, / ESG domain, especially as the Board is a vital Year of joining: 2016 KPSC (Kuwait) part of any organization’s governance function. Boubyan Bank BoD Attendance Rate 2020: 95% • Board Director – Idafa Holding Company, Therefore, transparency in this area is beneficial, Abdulaziz Abdullah Dakheel Al-Shaya KSCC (Kuwait) namely for details regarding board members Chairman Skills and Experience: and a range of other disclosures of indicators Year of joining: 2009 Mr. Al-Othman is a well-known businessman Mohamed Yousef Al-Saqer related to the Board. More information about Attendance Rate 2020: 100% with more than 42 years of experience in Director (Non-Executive) our Board of Directors is given in this section. banking and real estate sectors; he owns a Year of joining: 2019 Skills and Experience: real estate company. Mr. Al-Othman holds a Attendance Rate 2020: 100% Board Members Mr. Al-Shaya is a well-known businessman with bachelor’s degree in Industrial Engineering from Overarching our corporate governance is more than 42 years of experience in trading Syracuse University - USA. Skills and Experience: our Board of Directors, which is tasked with and real estate sectors; he manages a trading Mr. Al-Saqer is a well-known businessman with the top-management of Boubyan to lead it company in Kuwait. Mr. Al-Shaya holds a Other current posts: more than 32 years of experience in business; strategically. The Board, along with the support bachelor’s degree in Economics from • Member of the Trustees of the Estate of the he is the managing partner of two trading of its committees, reviews and approves all Kuwait University. Late Abdullah Abdulatif Al-Othman (Kuwait). companies in Kuwait. Mr. Al-Saqer holds a of Boubyan’s policies, authority matrices, and • Member of the Executive Committee for the bachelor’s degree in Public Administration from frameworks. The Directors are under a mandate Other current posts: Implementation of the Charity Projects of the Point Park University - USA. to deliver sustainable value to all stakeholders, • Vice Chairman – Awtad Real Estate Company, Late Abdullah Abdulatif Al-Othman (Kuwait) including depositors, customers, shareholders, KSCC (Kuwait) Waleed Mishari Al-Hamad employees, society, and others. The Board • Vice Chairman – Orient Education Services Fahad Ahmad Al-Fouzan Director (Non-Executive) conducts these matters from a strategic Company, KSCC (Kuwait) Director (Non-Executive) Year of joining: 2010 level, while other detailed documentations • Vice Chairman of Trustees – Algonquin Year of joining: 2020 Attendance Rate 2020: 96% and procedures are delegated to Boubyan’s College (Kuwait) Attendance Rate 2020: 100% executive management. The Board is granted Skills and Experience: the highest authority and overall responsibility Adel Abdul Wahab Al-Majed Skills and Experience: Mr. Al-Hamad has more than 30 years of by the shareholders to manage Boubyan, and Vice-Chairman & Group Chief Executive Officer Mr. Al-Fouzan is a businessman with more than experience, including 11 years in banking and the Board operates in line with the by-laws of (Executive) 36 years of experience, including 30 years of the remaining in the investment sector; he is Boubyan and its charter, where its scope of Year of joining: 2010 experience in banking sector, where he worked the Managing Director of a holding company work includes, but is not limited to: Attendance Rate 2020: 96% in various leadership positions. He manages a in Kuwait. Mr. Al-Hamad possesses a bachelor’s • Setting the strategies and risk appetite for contracting company in Kuwait. Mr. Al-Fouzan degree in Economics, and a master’s degree in Boubyan Skills and Experience: holds a bachelor’s degree in Accounting from Finance from the United States of America. • Approving capital and operating plans Mr. Al-Majed joined Boubyan Bank in August Kuwait University. presented by management for the 2009, and has around 40 years of banking Other current posts: achievement of Boubyan’s strategic experience. He worked previously at the Hazim Ali Al-Mutairi • Board Director and CEO – Helvetia Arab objectives National Bank of Kuwait (NBK) for more than Director (Non-Executive) Holding Company, KSCC (Kuwait) • Ensuring efficient application of the 25 years, where he held leadership positions, Year of joining: 2010 resources for the achievement of the including Deputy Chief Executive Officer and Attendance Rate 2020: 78% objectives General Manager - Consumer Banking Group. • Monitoring the performance of executive Mr. Al-Majed graduated from the University Skills and Experience: management of Alexandria with a bachelor’s degree in Mr. Al-Mutairi has a well-diversified experience accounting, and attended various executive for more than 28 years in the fields of financing, Transparency concerning any entity’s Board of management development programs at various investment, and banking. He is currently the Directors is key in ESG disclosures; accordingly, universities, including Harvard, Wharton, CEO of Holding Company. He graduated from the following illustrates details concerning Stanford, and other reputable institutions. the United States of America with a bachelor’s Boubyan Bank’s Board, including Board member degree in Finance. names, position, year of joining, skills and Other current posts: experience, other current posts, gender, and • Chairman - Bank London & Middle East (UK) attendance rate. Note that attendance rate is

38 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 39 Waleed Ibrahim Al-Asfour Boubyan Capital’s BoD consists of: Board Committees 5 Board committees in charge of governing Director (Non-Executive) • Chairman: Concerning the Board committees, these are different areas of business, which are listed in Year of joining: 2019 Abdulsalam Mohammed Al-Saleh provided below, noting that they pertain to as follows along with the explained role of each Attendance Rate 2020: 100% • Vice-Chairman: Boubyan Bank and its BoD. These consist of one. Abdullah Abdulkareem Al-Tuwaijri Skills and Experience: • Directors: Mr. Al-Asfour possesses more than 36 years of Abdullah Ahmed Al-Mehri experience in real estate and financial sectors. Mohamed Ibrahim Ismail Key Board He manages a real estate company and an Ghazi Saleh Al-Babtain Committees investment company in Kuwait. Mr. Al-Asfour graduated from Kuwait University with a Boubyan Takaful’s BoD consists of: bachelor’s degree in Business Administration - • Chairman: Finance. Abdullah Al-Najran Al-Tuwaijri Board Governance Board Nomination and Committee (BGC) Board Risk Management • Vice-Chairman: Board Executive Board Audit Committee (BEC) Remuneration Committee (BAC) and Compliance Other current posts: Waleed Khalid Al-Yaqout Committee (BNRC) Committee (BRCC) • Vice Chairman – Al-Wodouh Capital Holding • Board Member: Company, KSCC (Kuwait) Khalil Al Shami • Board Director – Shorooq for Medical Abdul-Salam Mohammed Al-Saleh Services Company, KSCC (Kuwait) Ahmed Bouresli Board Executive Committee (BEC) financing, business, and real estate. As per the • Managing Partner - Market Plus Real Estate Mohamad Ibrahim Ismail The BEC comprises 4 Board Directors, and charter of the BEC, the Committee should meet (Kuwait) Jabra Raja Ghandour is headed by the Vice-Chairman & CEO. The at least 6 times a year. The main role of the BEC members of the BEC are not members of the is to review and approve limits and transactions Waleed Abdullah Al-Houti BLME’s BoD consists of: Board Audit Committee or Board Risk and related to financing and investment activities as Director (Non-Executive) • Chairman: Compliance Committee; and they possess set within the authority matrices of Boubyan. Year of joining: 2019 Adel Abdul Wahab Al-Majed collective experience in banking, credit The BEC also reviews related policies such as Attendance Rate 2020: 100% • Deputy Chairman and Senior Independent financing policies. Director: Skills and Experience: Michael Williams Mr. Al-Houti possesses around than 40 years of • Chair of the Nominations and Remuneration experience in financial and oil sectors. He is Committee: currently a Chairman of Kuwaiti shareholding Joanne Hindle company, which invests in petroleum • Chairman of the Audit Committee services. Mr. Al-Houti graduated from Kuwait Calum Thomson University with a bachelor’s degree in Business • Chairman of the Risk Committee Administration - Finance. David Williams • Non-Executive Directors: Other current posts: Jabra Raja Ghandour • Chairman – Al-Dorra for Petroleum Services Bader Abdullah Al Kandari Company, KSCC (Kuwait) Maged Fanous • Vice -Chairman – Makamen for Oil and Gas Abdul-Salam Mohammed Al-Saleh Services Company (Saudi Arabia) • Chief Executive Officer: Andrew Ball While the aforementioned Board of Directors • Chief Financial Officer (CFO) and Chief (BoD) details pertain to Boubyan Bank, each of Operating Officer (COO): the other entities within Boubyan have their Chris Power own BoD members and structures. These are as follows:

40 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 41 Figure 3.1a: Boubyan Board of Director Disclosures Board / Governance KPIs Boubyan Performance Disclosures BLME Performance Disclosures

1 Female members percentage of the 0% female percentage 9% female percentage Board of Directors

Board Nomination and Remuneration the status of corrective actions 2 Existence of a policy addressing Board There is a policy addressing Board size, There is a policy addressing Board size, though size as approved by the shareholder general it is a maximum of 11 members, as stipulated Committee (BNRC) • Providing support to the Internal Audit assembly. by BLME’s Articles of Association. The BNRC comprises 4 Board Directors; Group to ensure it fulfills its scope of work 3 The maximum number of years a Board There are no specific number of years There are also no maximum number of the members of the BNRC have collective effectively and independently member can be on the Board for executive and non-executive Board years specified, but there is a rebuttable directors. However, as per Central Bank of presumption of 9 years for independent Board experience in banking, business, and Islamic • Approving the appointment and/or Kuwait (CBK) requirements, an independent directors. Note that an independent non- Board member cannot be appointed for executive director (INED) can have a tenure Sharia’a. As per the charter of the BNRC, resignation of the Chief Audit Executive – more than 2 periods (normally 3 years per extended beyond 9 years if his/her continued the Committee should meet at least 4 times Internal Audit Group, and assessing his/her period). independence can be demonstrated and is accepted by the Board of Directors. a year. The main role of the BNRC includes annual performance 4 Number of times the Board of Directors The Board meets an average of 10 times per The Board meets an average of 6 to 10 times assessing the nominees for the Board based meets per year annum. As per the laws and Boubyan’s by- per annum. laws, the Board should meet at least 6 times on set criteria, administering the assessment Board Risk Management and Compliance per year, including quarterly meetings. of the Board, revising the Remuneration Policy Committee (BRCC) 5 Attendance percentage of Board Attendance is disclosed per Board Board committee attendance for 2020 are as and the assessment of executive management The BRCC comprises 3 Board Directors, and Committee meetings member, as earlier mentioned. However, follows: attendance percentage is not reported per • Nominations and Remuneration performance, and ensuring the presence of a none of its members is a member of the Board Board committee as it is not a mandatory Committee: 98% requirement. • Audit Committee: 100% proper employee succession plan. Executive Committee. As per its charter, the • Risk Committee: 98% BRCC meets at least 4 times a year, and reports Board Governance Committee (BGC) on its activities to the Board on a periodic basis. 6 Criteria used for nominating or selecting There are criteria used in Boubyan. These There are criteria used by BLME’s Board the Chairman and Board members criteria have been discussed by the Board Nominations and Remuneration Committee The BGC comprises 4 Board Directors; the The role of the BRCC includes: Nominations and Remuneration Committee (BNRC), where the committee makes (BNRC), and approved by the Board. recommendations to the Board on the Chairman is the chairperson of the BGC, • Assessing the Risk Appetite measures, Risk appointment of any new Directors to the Strategy, and other risk related measures, and Board. The BNRC oversees the appointment whose members have collective experience process, prepares a description of the role and in banking, business, and governance. The proposing recommendations to the Board capabilities required for the appointment, and considers the overall balance of the Board. Committee should meet at least twice a year. • Reviewing and discussing the reports of The BNRC has the duty to ensure that any person nominated for election to the Board is The main role of the BGC includes developing the Risk Management Group, including the fit and proper with the appropriate skills and experience for the post in accordance with the and updating the Governance Manual, ensuring Capital Adequacy Ratio, Internal Capital regulatory requirements and the principles of that the Governance Manual is adequately Adequacy Assessment Process (ICAAP), Stress good corporate governance. followed, reviewing the annual governance Testing, and other risk assessment reports 7 Evaluation of the Chairman and the There is an assessment mechanism The Chairman and the Board of the Directors Board of Directors conducted to evaluate the Chairman and are evaluated once every 3 years, where BLME report, and following-up on governance-related • Providing support to the Risk Management the Board of Directors, and the mechanism uses an external consultant to independently is approved by the BNRC. evaluate Board performance. Additionally, recommendations/actions. Group to ensure it fulfills its scope of work BLME conducts annual self-evaluations of the effectively and independently Board committees through a combination of surveys and desk-based analyses of the Board Audit Committee (BAC) • Approving the appointment and/or annual work agenda achieved against each Committee’s responsibilities. The BAC comprises 3 Board Directors, whose resignation of the Chief Risk Officer – Risk Furthermore, BLME’s Compliance Department conducts an annual fit-and-proper assessment members have collective experience in Management Group, and assessing his/her process of all senior BLME employees covered banking, business, governance, and audit. None annual performance by the Senior Manager and Certification Regime (SMCR) of the UK Prudential of the BAC members is a member of the Board Regulation Authority (PRA). This covers senior management functions (SMF) holders, certified Executive Committee. The BAC should meet persons, material risk takers, and all Board at least on a quarterly basis, and its main role directors, including the Chairman. includes: 8 Tax transparency compliance Boubyan receives an annual anti-money Board oversight of tax matters are discussed laundering (AML) report, which addresses the at the Board Audit Committee (BAC) level. • Reviewing internal audit charter and manual, Board Disclosures tax reporting aspects, especially related to the Also, BLME has adopted the Code of Practice Foreign Accounts Tax Compliance Act (FATCA) on Taxation for Banks by the UK Her Majesty’s and accounting policies As part of ESG disclosures, there are various and the Common Reporting Standards Revenue and Customers (HMRC). (CRS). Also, the Board Risk and Compliance • Assessing and recommending appointment Board-related KPIs that are often reported Committee (BRCC) reviews respective activity of external auditors transparently. Accordingly, Figure 3.1a reports reports on a quarterly basis. • Reviewing quarterly financial statements how Boubyan fares against each of the selected On an annual basis, the BNRC receives BLME’s BNRC reviews Board succession 9 Board succession planning and discusses a succession plan update. In planning on a regular basis • Discussing the internal Sharia’a audit reports Board KPIs. 2020, the succession plan was presented on • Approving internal audit plan, discussing November 25. Boubyan does not publicly disclose auditor BLME publicly discloses all fees paid to the internal audit reports, and following-up on 10 Disclosure of auditor fees fees. external auditor within its Annual Report and Financial Statements

11 Regular rotation of auditors / audit Boubyan regularly rotates its auditors / audit BLME’s Audit Committee reviews partners partners. recommendation to the Board for the appointment or re-appointment of the external auditors. The audit partner is rotated at least every five years

42 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 43 3.2 Sharia’a Supervisory Board 3.4 Organizational Chart (102-16, 102-20, 102-24, 102-26, 102-27) (102-7, 102-18)

Boubyan reports on its Sharia’a Supervisory As Boubyan’s practices are in line with Islamic Reporting on the organizational chart is an organization chart is provided in this section. Board, which highlights its adherence to Islamic Sharia’a, there is a Sharia’a Supervisory Board important part of sustainability, since it shows We disclose both our organizational chart and principles throughout its business, products, and developed to ensure that the Sharia’a practices how an organization’s governance is structured, the governance framework in this section. services. This principled approach to business are adhered to. This Board is composed of 4 with coordination among the different members Boubyan’s organizational chart is illustrated in is connected to sustainability / ESG, especially members, listed in Figure 3.2 as follows. Note and bodies. More information about our Figure 3.4. regarding the integration of ethics in economic that all members of the Sharia’a Supervisory / business aspects. More information about Board are independent (100%). In addition, Figure 3.4: Boubyan’s Organizational Chart * our Sharia’a governance through the Sharia’a each of the other Boubyan subsidiaries have Supervisory Board is presented in this section. their own Sharia’a Committees, consisting of 3 members in each Sharia’a Committee.

General Assembly Figure 3.2: Boubyan Sharia’a Supervisory Board Members

Member Position Independence Status Board of Directors Sheikh Dr. Abdulaziz Al-Qasar Chairman Independent

Board Board Nomination Board Board Risk Board Executive Governance & Compliance Audit Sharia’a Sheikh Dr. Esame Al-Enezi Reporter Independent & Remuneration Committee Committee Committee Chairman Committee Committee Committee Sheikh Dr. Mohammed Al-Fuzaie Member Independent Sheikh Dr. Ali Al-Rashid Member Independent

Secretary to Strategic Board Planning Vice Chairman & GCEO

3.3 Executive Management CEO CEO Corporate Banking & Consumer Banking & (102-20) Treasury Digital

Reporting on our executive management is managing Boubyan’s business units compared Administration Human Legal Affairs Treasury Corporate Financial Consumer Sales & Chief Corporate Risk Anti Money Group Resources Group Banking Control Banking Group Distribution Operating Officer Governance Compliance Management Laundering Internal Audit Sharia’a Internal another facet of sustainability, due to the to the Board of Directors. Figure 3.3 lists the Group Group Group Channels Support Group Audit

executive management’s various roles in executive management members, displaying Enterprise Data Digital Group Banking Information Management Operations Technology Boubyan’s governance. More information the name, position, and biography–with a total Group Group Group Private Banking Corporate Consumer Change Communication Finance Management about our executive management is presented of 14 executive managers. Concerning the Operations Office

in this section. Through executive managers gender allocation, this is allocated among 1 Social Media Customer Experience and management committees, the executive female and 13 males, resulting in 7% female Management

Complaint Unit Center of Innovation and management has a more operational role in executive management rate. Excellence Partnership

Boubyan Boubyan Boubyan BLME Takaful Capital National Figure 3.3: Boubyan Executive Management Marketing Insurance

Member Position

Adel Abdul Wahab Al-Majed Vice-Chairman & Group Chief Executive Officer *Note: Boubyan Bank Group lost its Chairman – Mr. Mahmoud Yousef Al-Fulaij (may Allah have mercy on him), who was Abdullah Abdulkareem Al-Tuwaijri Position to CEO – Private, Consumer & Digital Banking among the leading supporters for the remarkable turnaround of Boubyan since the preparation of the first five year plan in year 2010. Abdul-Salam Mohammed Al-Saleh Position to CEO – Corporate Banking & Treasury Waleed Khalid Al-Yaquot Group General Manager Administration Group Adel Abdullah Al Hammad Group General Manager – Human Resources Group Abdullah Ahmed Al-Mehri Chief Operating Officer Ashraf Abdullah Sewilam Group General Manager – Corporate Banking Group Abdul Rahman Hamza Mansour Chief Internal Auditor – Internal Audit Group Mohamed Ibrahim Ismail Group General Manager – Financial Control Group Maged Fanous Chief Risk Officer – Risk Management Group Noora Sulaiman Al-Fassam Chief Strategy Officer Adel Rashed Al-Mutairi Treasurer – Treasury Group Jabra Raja Ghandour Chief Executive Officer – Boubyan Capital

44 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 45 Boubyan Governance Framework

Figure 3.5a: Boubyan Risk Management Bodies

Board of Directors

Board Risk and Compliance Committee (BRCC)

Compliance Department Risk Management Group Anti-Money Laundering

In addition, various sustainability issues are 1. Business Continuity Management (BCM) considered throughout business continuity Boubyan has developed an overall BCM Strategy. management. The clearest aspects of this can This strategy ensures resilience, continuity, be found in the approach towards COVID-19, and availability of its mission-critical and where matters of health, safety, stakeholder essential products, services and operations. In care, workplace enhancement, transparency, addition, the BCM Strategy supports efficiency and others were especially embraced. Moreover, in recovery efforts to achieve overall recovery environmental hazards are considered as part objectives—ie. through disaster recovery (DR) of the business continuity planning and disaster and alternative sites. Boubyan’s BCM strategy’s recovery plans. main objective is to ensure appropriate business continuity plans are in place, which Three Lines of Defense Model contain specific actions and steps that need to Boubyan is utilizing the Three Lines of Defense be executed by nominated teams or individuals Model for effective management of risks and upon the occurrence of any disruption event. 3.5 Risk Management and controls. This model is distinguished among The scope of the BCM Strategy includes, Business Resilience three groups as illustrated below: among others, buildings, facilities, Information • First line of defense – Boubyan IT & Business (102-11, 102-15, 102-29, 102-30, 103-1, 103-2, 207-2, 308-1) Communication Technology (ICT), information functions that own and manage risks daily. security, vital records, manpower, vendors, • Second line of defense – Boubyan Risk Boubyan recognizes that proper and proactive At Boubyan, the highest authority for reviewing suppliers, third-parties , utilities, health and Management function that oversees and risk management practices are essential to the effectiveness of risk management is safety and security of people. BCM especially monitors risks. ensuring a sustainable and resilient business the Board of Directors. The Board Risk and considers the case of any outages or shortages. • Third line of defense – Boubyan Internal operating model. This has especially proven Compliance Committee (BRCC) then handles Boubyan’s BCM strategy determines the set of Audit function for independent assurance. to hold true this year, as Boubyan was able the detailed follow-up and transitional review options to be used to recover processes in their to effectively navigate and overcome the activities. This branches down to 3 other required time-frames, cost, level of confidence Risk Strategies various risks and challenges introduced by the departments that take a more operational and effects. It also ensures that an appropriate Boubyan’s risk strategy is composed of a number COVID-19 pandemic. The resulting impacts of approach towards risk management and emergency and crisis response structure is built, of strategies pertaining to different areas our risk management and business resilience business resilience, as illustrated in Figure 3.5a which will enable an effective response and and business units, which include: business practices are presented in this section. as follows. recovery from disruptions. continuity management (BCM), Technology Risk Department (TRD), Information Security In addition, the BCM strategy aims to reduce Department (ISD), operations, fraud, and BLME. negative impacts that may arise from disruptive Each of these, in accordance with their risk incidents, promote and embed continuity and aspects, are described in more detail below. resilience awareness in Boubyan’s culture, and comply with regulatory requirements

46 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 47 2. Technology Risk Department (TRD) 4. Operational Risk Management Department Effectiveness of Risk Strategy in COVID-19 necessary committee meetings. The tasks are The Technology Risk Department’s strategy (ORM) Resilience being conducted either remotely or through is built around the overall risk strategy of Boubyan implements an operational risk on-sitework in the office. Boubyan, aiming to realize the benefits at an management framework for the Operational Though this report is considered the first/ optimal cost while optimizing risk management. Risk Management Department (ORM). The baseline sustainability ESG report, it is a 3. Economic Support & Relief Package: The strategy is aligned with Boubyan’s vision, framework sets out the Group-level governance, strong case study for Boubyan and all related The Banking sector is an important player in the mission and objectives of being customer policies and procedures to proactively concerned stakeholders, which shows how successful execution of the economic support focused, technology driven, agile and innovative identify, measure, report, mitigate and control the business model and risk strategy is in package, and Boubyan has taken the necessary regarding the needs of Boubyan customers who operational risk exposures associated with place. This includes the BCM, which was steps to ensure that an online portal has already are dependent on digital banking services, given the businesses and operations at all levels of adequate, effective, and dynamic enough to been set up to accept financing applications. their speed, convenience and ease of use. Boubyan. ensure resilience throughout the effects of Clear processes and documentation have Furthermore, Boubyan’s strategy is directed the global COVID-19 pandemic. As a number already been put in place to ensure a swift toward deploying more advanced technologies 5. Fraud Risk Management Department of ESG factors emphasize resilience and risk processing of the applications through all credit and online systems, including internet banking (FRMD) strategies, Boubyan considered the advanced approval channels with a fully special dedicated systems, mobile banking payment systems, Boubyan is committed to implementing measurements and compliance with such ESG team to handle SME applications, including the online trading platforms, and portals, in order controls for detection and prevention of fraud, factors, which would ensure sustainable value current teams that handle corporate banking to reach customers. In this regard, Boubyan bribery, and corruption. If internal fraud is for all stakeholders, including customers, for large enterprises. fully understands the magnitude and intensity identified, appropriate action would be taken in investors, shareholders, employees, and others. of technology risks from these digital and line with internal disciplinary policies of Human In this regard, Boubyan has quickly executed technology enabled-business services. Resources (HR) and the laws of Kuwait. On the its business continuity plan to secure a smooth We have invoked our emergency business other hand, external fraud is to be dealt with transition for all functions to perform its tasks continuity plan across Boubyan to eliminate In addition, Boubyan is mandated to put in on a case-by-case basis after conducting proper in an efficient manner with the lowest chances any operational disruption that might occur place adequate measures and robust operating investigation by Risk Management, Internal of operational losses. Boubyan continues to based on ensured availability of remote access processes to manage these risks in line with Audit, Legal and Human Resource Group provide full services for its various customers to key functions, including staff identification Boubyan’s risk appetite, risk tolerance, and (HRG), where applicable. Legal action and ranging from retail customers and SMEs to large of critical staff and their backups. Accordingly, regulatory and compliance requirements. insurance claims are subsequent actions based corporates. Boubyan has conducted a detailed we have ensured availability and readiness The Technology Risk Management strategy on recommendations of the relevant assurance assessment of the evolving risks due to the of the BCP site for the vital mission-critical for business practices covers the review of providers. COVID-19 crisis. Below is some information functions, and ensured business continuity operational and manual business processes, about how BCM was applied to the specific during the current situation and in case of full as well as their improvements and digitization For BLME, the Risk Management Framework business units: lockdown. Business continuity has especially initiatives. These initiatives encompass, but are (RMF) provides the foundation for ensuring been applicable and explained in the following not limited to, Robotic Process Automation that business risk-taking activity is consistent 1. Consumer Banking: areas: (RPA) and Robotic Desktop Automation (RDA), with BLME’s risk appetite, and that BLME Since the partial curfew, Boubyan has been near field communication (NFC), card-less delivers good service and good outcomes serving its clients through its retail branches 1. Cyber Security & Financial Ethics payments, contactless and wearable payments, for customers from its products. The RMF network, call center, ATMs, and digital channels Due to the migration to a virtualized mobile banking, and online banking. Also establishes an appropriate balance between (eg. retail app, WhatsApp, Internet Banking, environment and remote operating process, as part of the technology risk assessment, risks and reward, while also ensuring robust Digital Assistant). Boubyan continues to provide which is leading to an emerging and tangible attention is given to the customer experience controls and management of risk. The method its service under a full curfew through its non- risk, we have enhanced our 24/7 monitoring and special needs customers when publishing of managing risk begins with the definition of physical channels. capabilities regarding user activities via our new online and other services. the Risk Appetite, which, when combined with Systems and Organizational Controls (SOC) BLME strategy, articulates its willingness to be 2. Corporate Banking: team and are introducing tighter controls over 3. Information Security Department (ISD) exposed to risk events and losses. Boubyan has ensured full continuity for the the access of all endpoints. Moreover, we are The Information Security Department’s risk services provided to its Corporate Banking monitoring all cards, merchant acquiring and strategy articulates Boubyan’s plan to reduce clients. All necessary tasks continue to be digital channels’ transactions 24/7 for fraud risk and promote resilience in its own operations performed by the Business, Credit Risk Review, management. and financial system. and Corporate Operations including all

48 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 49 2. Operational Risk: and the resulting impact on the management was built over several years. This has enabled Technology Risk There was a quick move towards remote of the exposure. Boubyan did not categorize us to move within a few days to a virtual Looking specifically at certain areas of the working and virtual processing. Such moves such COVID-19 related deferral requests as environment, where operations have moved Risk Strategy, Technology is one vital area would usually expose any business to higher forbearance, with the vast majority remaining forward smoothly and remotely across all that is assessed for risk. The Technology Risk error risk and operational losses. Accordingly, in Stage 1 under IFRS9, unless wider credit risk its forums, including its credit underwriting Management model encompasses a systematic Boubyan has implemented methodical controls concerns had been identified. operations, executive committees, and treasury process of identifying, analyzing and responding and pressure to reduce such risks. and market operations. This has enabled to risk. This is broken down into a number of 5. Liquidity Risk Boubyan to continue delivering its products and sub-processes that are used as the basis for the 3. People Risk: Boubyan did not face any liquidity squeezes services to all its stakeholders. model; the process is iterative in nature. The Boubyan has ensured quarantine requirements starting from the onset of the COVID-19 following are the main sub-processes: satisfaction with all its staff since the beginning crisis up to its peak during the full lockdown, Furthermore, Boubyan took the necessary • Technology Risk identification of the crisis in March 2020. Boubyan has taken and beyond that. This has been driven by the measures to enhance its cyber security shield • Technology Risk Analysis the necessary precautions by providing personal following 3 major points: through 24/7 monitoring of all network traffic. • Technology Risk Evaluation, and protection equipment (facemasks, gloves and • Boubyan’s pre-crisis pro-active liquidity During that period, we did not experience any • Technology Risk Treatment sanitizers), as well as stopping all physical management and sourcing of long-term out-of-norm volume of instability or events. Therefore, the Technology Risk Management meetings to minimize infection risk. funding. By 2020 Q3, Boubyan, based on government process is a continuous cycle designed to • As the government continued to pay salaries direction, had returned to 85% of capacity in minimize the negative impact on technology, 4. Credit Risk: and driven by (a) Boubyan’s strong retail terms of on-site employees while maintaining which would eventually impact the business Boubyan conducted extensive continuous base, (b) limited venues of spending during COVID-19 health protocols. This return to objectives. credit assessments of its wholesale, corporate the lockdown, (c) mortarium of financing almost full capacity includes branches operating financing, and sukuk portfolios since the onset instalments, Boubyan observed significant at full capacity to ensure smooth services to all of the crisis. The review was a bottom-up review build-up in retail deposits and current and of our customer base. of more than 90% of the bank’s corporate savings accounts’ balances. The built-up of financing book and all of its sukuk book, where the retail deposits base has continued after 7. BLME-specific information the review included a continuous dialogue with the easing of the lockdown rules and has BLME successfully tested its ability to operate the obligor, viability of the business model, added sticky funding to Boubyan. remotely ahead of the March 20 lockdown. the need for support, reasons for cash flows • Availability of institutional funding, Management meetings were held daily in the delays, if any, and ability and frame of recovery. especially from the Kuwait Investment initial weeks of the first lockdown to ensure The outcome of these reviews extended also Authority (KIA). business continuity. The ability of working from to updating the internal rating and assessing This has allowed Boubyan to be very agile to home is further evidenced via the Operational its impact on Boubyan’s cost of risk, when meet requirements to replace upcoming Risk Committee and Executive Risk Committee, necessary. maturities or fund any new credit while as the second line of defense function asked maintaining its liquidity above that of departments and business areas to inform these Based on CBK’s guidance, we had engaged in the required liquidity regulatory ratios at committees of emerging risks and issues. detailed discussion on deferrals driven by the all times with very comfortable levels of above-mentioned assessments. The credit balances with the CBK. review was able to highlight the impact on different obligors, and was scaled-up also to 6. Operational Resilience and Business assess the impact on industries, based on the Continuity potential impact on cash flows and business The COVID-19 pandemic and its associated model. The obligors continue to be monitored social distancing and lockdown measures and assessed by the Risk Management Group created certain operational limits and (RMG) on a regular basis, highlighting any vulnerabilities. This was mitigated through major changes in the risk profile of any obligor Boubyan’s technical infrastructure, which

50 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 51 Case Study ISMS ISO 27001 Certificate

Overview: Outcomes International Standards Organization (ISO) ISO 27001 certification demonstrates that 27001 standard is an information security you have identified the risks, assessed the management standard that provides implications, and put in place systemized organizations of any size and industry with controls to limit any damage to the organisation. a framework for securing and protecting Boubyan has done these successfully. Other confidential and sensitive data. The banking benefits that Boubyan would reap from this industry, in particular, can benefit much from include: an ISO 27001 certification. Accordingly, - Increased reliability and security of systems Boubyan has been successfully accredited with and information ISO 27001. - Improved customer and business partner confidence Objective The objective of being accredited with this standard was meeting the 3 Security Goals, which are as follows: 1- Confidentiality Protect the confidentiality of data. 2- Integrity: Preserve the integrity of data. 3- Availability: Promote the availability of data for authorized users.

52 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 53 Operational Risk Operational risk is assessed according to • Complete details of loss events reported by Boubyan’s Operational Risk Management the Business/Support coordinators and submit (ORM) Model. The Operational Risk Manager loss events for approval and track them until will primarily be responsible for implementing they are concluded the ORM framework across Boubyan, in close • Manage and maintain risk databases–eg. key coordination with the Risk Champions, the risk indicators (KRI), risk and control self- business and support departments of Boubyan. assessment (RCSA), internal loss data, etc The Operational Risk Manager is mandated to: • Develop, review and monitor operational • Assist the Chief Risk Officer (CRO) in the risk profiles and ensure that operational risk development of the ORM strategy and impact is incorporated in the risk profile on a framework continuous basis • Initiate the operational risk assessment • Recommend corrective action where required database, coordinate with other departments • Generate reports and present them to the in incorporating new identified risks into management for their review and consideration the database, update the operational loss along with the suggestion for the corrective database on a regular basis and present a actions required where applicable periodic assessment report to the GM of Risk • Stay informed of emerging best practices/ • Implement the ORM framework and strategy regulations across Boubyan Bank • Coordinate the Insurance function within ORMD

54 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 55 Procurement Risk 3. ISD Looking at Boubyan’s own credit risk, in support transparency, Boubyan reports its credit ratings Boubyan conducts risk assessment focused on Procurement risk is not directly relevant to of its approach to managing risk and business from Standard & Poor’s (S&P) in Figure 3.5b, its procurement activities. These are explained information security, since information security resilience, it takes into consideration third- Moody’s in Figure 3.5c, and Fitch in Figure 3.5d. per area below. is mainly an internal operational issue. party ratings that are provided to Boubyan. For

1. BCM Figure 3.5b: S&P Ratings Boubyan’s BCM periodically conducts risk For BLME, there are a broad range of factors assessment of key vendors / suppliers to ensure assessed, like physical security, network Board / Governance KPIs To From the level of current capabilities of business security, user training & awareness, backups, Issuer Credit Rating A-/Stable/-- A-/Stable/-- continuity readiness and availability in the event incident response plans, crisis management, Stand-Alone Credit Profile bbb bbb of business disruption to ensure Boubyan’s site location, UK & international data protection Anchor bbb bbb mission critical products, services and operations laws, and ensuring adherence to UK’s GDPR. Business Position Adequate (0) Adequate (0) will continue. We have established a business There is appropriate use of BLME data, and Capital and Earnings Adequate (0) Strong (+1) continuity program, strategy, and a risk register review of the relevant policy, procedure and Risk Position Adequate (0) Moderate (-1) of identified internal and external threats to framework. In addition, financial ethics risk Funding and Average and Average and the resources (ie. people, premises, technology, assessment focuses on a range of financial Liquidity Adequate (0) Adequate (0) infrastructure, information and data). We have ethics factors, including anti-corruption and Support +2 +2 dedicated people with capabilities trained and bribery (ABC) and the Modern Slavery Act. GRE Support 0 0 aware of their roles and responsibilities in case Note that these factors are reviewed annually, Group Support 0 0 of business disruptive incidents to ensure that especially for material outsourcers. Sovereign Support +2 +2 critical activities are recovered and resumed in Additional Factors 0 0 a timely manner and we have alternate business Credit Risk and Credit Ratings continuity sites to sustain operations. Credit risk is one area that Boubyan considers in both its financial decision-making (externally) Note: As of November 12, 2020 2. TRD and Boubyan’s own credit risk (internally). Figure 3.5c: Moody’s Ratings Boubyan abides by the Vendor Risk Management Framework (VRMF), which was established The Corporate Credit Risk Review Policy is firmly Category Moody’s Rating and approved Boubyan management on based on the fact that that Risk Management November 2020 to cover new and existing acts as a second line of defense in credit- BOUBYAN BANK K.S.C.P. vendors and services suppliers. The framework sanctioning decisions. This is achieved through Outlook Stable Counterparty Risk Rating A2/P-1 and related assessments cover cyber security very thorough analysis of the credit risk, not Bank Deposits A3/P-2 aspects, business continuity, and regulatory only in the financing and market exposures Baseline Credit Assessment ba1 requirements. Also, the framework is under of Boubyan, but also in Boubyan’s various Adjusted Baseline Credit Assessment a3 the oversight of the Risk Management Group, products and activities. This analysis is a major Counterparty Risk Assessment A2(cr)/P-1(cr) and is implemented mainly by the Information input into the various approving authorities PARENT: NATIONAL BANK OF KUWAIT S.A.K.P. Outlook Stable Security team and Business Continuity team in within Boubyan. To assist in managing and Counterparty Risk Rating A1/P-1 coordination with the IT and General Service understanding the risks in our financing Bank Deposits A1/P-1 Department. The assessment considers cyber activities, credit ratings are assigned to obligors Baseline Credit Assessment a3 and business continuity risk factors for vendors to indicate the degree of credit risk inherent in Adjusted Baseline Credit Assessment a3 and suppliers, in addition to governance aspects, the exposure. This is further complemented by Counterparty Risk Assessment Subordinate A1(cr)/P-1(cr) Subordinate -Dom Curr Baa1 (hyb) including policies, process, procedures and an understanding and assessment of the credit Commercial Paper P-1 compliance. Also, there are social responsibility risk mitigants provided, if any, and their true BOUBYAN TAKAFUL INSURANCE COMPANY K.S.C. aspects in terms of awareness, staff training and ability to reduce the bank’s losses in cases of Outlook Stable development, and customer data protection. default. Insurance Financial Strength -Dom Curr Baa2 BOUBYAN SUKUK LIMITED Bkd Sr Unsec MTN P(A3)

Source: Moody’s Investors Service

Note: as of December 16, 2020

56 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 57 Figure 3.5d: Fitch Ratings Figure 3.5e: Reporting Frequency

Rating Risk Area General Risk Reporting CBK Risk Reporting

Foreign Currency Long-Term IDR A+ BCM • BCM issues a monthly risk profile • - Short-Term IDR F1 TRD • Monthly reporting of risk profile and risk • All communication with CBK and regulators Viability Rating bbb- appetite monitoring. is established through Boubyan’s • Report on periodical basis to GM, Chief Compliance Department. Otherwise, there Risk Officer (CRO), and Risk committees, is no regular or direct reporting mandated Support Rating 1 as well as to other senior management for CBK. Support Rating Floor A+ members across Boubyan, as advised by CRO and where applicable.

Sovereign Risk AA ISD • Monitoring is done 24 hours, 7 days a • - Long-Term Foreign-Currency IDR AA week, and 365 days per year. Reporting is done on a monthly basis. Long-Term Local-Currency IDR ORM • The Operational Risk Management • The Operational Risk does not submit Outlooks Department provides monthly reporting reports directly to CBK. However, there is through the Risk Profile Report sometimes information provided to CBK Long-Term Foreign-Currency IDR Stable upon their request. Sovereign Long-Term Foreign and Local Currency IDR Stable Fraud • Fraud Transaction monitoring for Cards, • There is monthly reporting to the CBK, Acquiring (POS), and Digital Banking is conducted through the Compliance Note: As of October 23, 2020 conducted daily. Department.

Internal Capital Adequacy Assessment • For BLME, they have an annual Internal • Submitted to CBK. Process (ICAAP) reports Capital Adequacy Assessment Process (‘ICAAP’) which is submitted to the Risk Registers Risk Monitoring and Reporting Prudential Regulation Authority (PRA) on Boubyan uses risk registers as important risk At Boubyan, there is periodic monitoring and request.

management tools. In the BCM, related risk reporting of the aforementioned risk areas, Stress Test report • N/A • Reported to CBK Semiannually (June and registers were developed and maintained for with different reporting frequencies per area. December). areas that include: communications technology This frequency of reporting is provided in International Financial Reporting • N/A • Reported on a quarterly basis (March, (ICT), information security, human resources, Figure 3.5e as follows. . In addition, the Central Standards (IFRS) 9 report June, September, December), through the health and safety, procurement, and security. Bank of Kuwait (CBK) is one of the regulators Finance Department. Other risk registers were also developed and that Boubyan is transparent with, especially maintained for technology risk, information concerning the risk elements assessed. The same security risk, operational risk, and fraud risk. Figure 3.5e describes the CBK risk reporting per For BLME, key liquidity metrics are reported Risk Management Standards and specific area as well. daily. Capital and large exposure is reported Frameworks on a weekly basis. All key risk indicators (KRIs) Boubyan conducts risk management in are monitored and reported to the Executive accordance with widely recognised risk Risk Committee and Executive Committee management standards and frameworks, every month, while reporting to the Board Risk including the International Standards Committee is done quarterly. Organization (ISO), Committee of Sponsoring Organizations of the Treadway Commission (COSO), and Basel Convention. The specific ones are listed per year as follows..

58 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 59 Risk Management Standards and • ISO27001:2013 – Information security Frameworks management system • CSF – Cyber Security framework 1. BCM • BASEL - Basel Committee on Banking Boubyan uses international standards Supervision and industry best practice guidelines in • COSO ERM – Enterprise Risk management implementing and maintaining the business framework, including the following elements: continuity planning program, as listed below: • A forward-looking Risk Appetite framework • Business Continuity Management – ISO that guides the bank in its various and most 22301:2019 significant risk-taking decisions • Business Operational Resilience – ISO • Comprehensive coverage of all risks and their 22316:2017 interconnections • Business Impact Analysis – ISO 22317:2015 • Near real-time database that supports the risk • ISO 31000:2018 Risk Management Principles monitoring, control, and reporting and Guidelines • ISO 31010:2018 Risk Assessment Techniques • Currently, there is no mandate to comply • ISO Management Systems, including the 7 with specific Technology Risk Management Principles: standards; however, the strategic objective 1-Leadership for Boubyan’s Technology Risk Management 2-People Engagement function is to ensure alignment with COBIT 5 3-Process Approach for Risk, as it provides the basis to integrate 4-Continual Improvement easily and effectively with other frameworks, 5-Evidence Based Decision Making standards and practices, such as ISO27001, 6- Relationship Management PCI-DSS, Central Bank of Kuwait (CBK) CSF, 7- Customer Focus and IT Governance. • Basel Committee on Banking Supervision • BASEL III High-level 7 Principles for Business 3. ISD Continuity and High-level 7 principles for • ISO27001 Business Operational Resilience. 4. Fraud Risk Management 2. TRD • Basel Standards are applicable for RCSAs The approach and techniques used in this and Global Payment Association (Europay, Technology Risk Management Framework are Mastercard, and Visa - EMV) standards are customized to suit Boubyan’s Technology Risk followed. Management requirements. They are inferred from various leading risk management practices In addition to the above risk management such as: standards and frameworks, BLME is applying • COBIT 5 – COBIT for Risk, ISACA regional ones, as follows. • Risk IT – Risk for information technology, • UK Prudential Risk Authority (PRA) ISACA • Financial Conduct Authority (FCA) • ISO31000:2018 – Risk Management principles, • European Banking Authority regulatory guidelines and Assessment Techniques expectations • PCI-DSS – Payment card industry data security standard

60 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 61 3.5.1 Risk Controls 2. ISD 3.5.2 Business Resilience and Stress Testing As an example, Figure 3.5.2 provides selected (102-11, 102-15) The ISD is maintaining Technical and (102-11, 102-15, 205-1) scenarios considered in relation to the COVID-19 Controls are vital tools used in Boubyan’s risk Administrative controls. The various risk functions at Boubyan ensure crisis. These scenarios played an important role management. Internally, Boubyan manages that the business model remains resilient, and in Boubyan’s risk management efforts when risks through a series of preventative controls Operational this is further checked through periodic stress deciding current and future actions to mitigate (to avoid the risk events), detective controls Boubyan implements operational preventative, testing. This has especially been vital during the related challenges through the COVID-19 (to identify the risk events), and corrective corrective, and detective controls as follows: the COVID-19 crisis to ensure that Boubyan business continuity planning (BCP). controls (to fix the risk events). Accordingly, • Preventive controls remains resilient against the various challenges risk mitigation procedures are implemented by • Maker and Checker processes presented by the pandemic. Figure 3.5.2: Selected COVID-19 Scenarios the appropriate business functions in order to in Scenario Analysis overcome the risk events. More information • Corrective controls Boubyan takes a proactive stance on scenario • Scenario 1 Staff Absenteeism about risk controls is provided per area below. • Data backup measures planning, stress testing, and reverse stress- • Scenario 2 Supply Chain Failure • Roll back to point in time functions testing, viewing such tools as more than a • Scenario 3 Workplace Environment Infection 1. TRD regulatory requirement. These tools are utilized and Staff Protection Boubyan implements Technology Risk • Detective controls as critical input for managing Boubyan’s balance • Scenario 4 Utility Failure (Power Management related preventative, detective, • Checker functions sheet, capital position, and plans. Stress testing Telecommunication) and corrective controls, as follows: • Quality assurance functions is also very useful in identifying pockets of • Preventive controls: • Maker and checker concept to all possible growing risks that may have the ability to • Enforcement of separation of duties functions exponentially grow in cases of crises and • Authorization stress. Boubyan conducts these tests at least • Policy, process, procedures and standards 4. Fraud Risk Management twice a year for regulatory purposes and more • Data classification As part of compliance with the Fraud Risk frequently within the year as the need arises. • Data encryption Management Policy, all Boubyan business • Firewalls functions are mandated to implement fraud This area includes conducting a series of stress • Virtual LAN control measures for implementing processes tests and scenario planning. Accordingly, the • Others and procedures in their respective business tests are conducted regularly, at least twice areas. Fraud RCSA for business divisions is under a year, as well as more frequently within the Detective controls: implementation. Over and above this, fraud year as the need arises. Meanwhile, scenarios • Event log monitoring monitoring tools and controls are implemented are updated at least annually in conjunction • CCTV and surveillance logs for transaction monitoring of Cards, Acquiring with the review of the multi-year business plan, • Review of access rights (POS), and Digital Banking transactions. or more frequently if required. Scenarios are • Audit logs documented in the Stress Testing & Scenarios • Unauthorized changes Policy. Moreover, Credit and Liquidity scenarios • Network intrusion detection For BLME, its approach to risk control is are monitored and reported monthly. • Antivirus embedded in the organization’s process, • Others which is derived from the ISO 31000 standard. Specifically, the approach can be broken down Corrective controls: into 6 steps as follows: • All measures taken to repair damage or 1. Risk identification restore resources and capabilities to their 2. Risk assessment of each principal prior state following an unauthorized or risk and sub-risk unwanted activity 3. Risk mitigation • Backup restoration 4. Execution and monitoring • Automatic removal of malicious software 5. Assurance • Business continuity 6. Monitoring and reporting • Recovery plans • Incident response plan • Others

62 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 63 Case Study COVID-19 Business Continuity Plan

Introduction •Bank employees and outsourced staff Boubyan’s COVID-19 business continuity •Supply chain facility management planning (BCP) considered in-depth instructions, maintenance, key supplies, service providers changes, circumstances, and compliance with and contactors the direction of governmental institutions. Other •Core IT systems, IT operations IT infrastructure areas considered were the CBK regulations •Vital records protection and off-site tape and guidance, and the interests of the various backups (national and international) Boubyan stakeholders. Ultimately, Boubyan’s •Telecommunication data voice and internet BCP showed to be a vital tool in proactively service provider (ISP) managing throughout the COVID-19 crisis. •Kuwait Ministry of Interior (MOI) curfew permissions and workplace access for the Purpose and Objective Data Center, IT disaster recovery (DR) Site, Call Boubyan’s COVID-19 BCP was developed as a Center, and Fraud Authorization Monitoring guide to facilitate the continuity, availability, •Cyber security monitoring 24/7 and resilience of essential and mission-critical •Security Control Monitoring products, services and business functions during the current COVID 19 crisis. Outcomes: As result of Boubyan’s executed action plans, The objectives of the BCP were the following: there were no material negative impacts or •Reduce transmission of the COVID-19 virus business disruptions on Boubyan’s operations. strain among employees, customers/clients, Periodical and continuous reviewing, updating, and partners amending and documenting of COVID-19 BCP •Minimize illness (generally) among employees according to evolving circumstances and CBK and customers/clients instructions were implemented. •Maintain mission-critical operations, products Boubyan BCP is continuously collaborating and services with a range of internal stakeholders, and is cooperating with them at a range of levels COVID-19 BCP Priorities to ensure Boubyan’s resilience and ability to COVID-19 BCP emphasized mission-critical anticipate, absorb, and adapt to any internal products, services, and business operations, and/or external changing circumstances during and a key understanding of how a partial or full these periods of heightened uncertainty and lack of such elements would impact Boubyan’s disruption. Ultimately, the BCP is committed business operations. Mission-critical elements to contributing to Boubyan’s vision, mission, included, but were not limited to, the following: and core values in responding to the COVID-19 crisis.

64 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 65 3.6 Compliance • Ownership rights Figure 3.6.1a: Code of Conduct Categories

(102-16, 103-1, 103-2, 207-1, 207-2, 207-3, 207-4) • Rights of attendance and calling for general Sustainable organizations are those that exhibit assembly Compliance with Laws, Rules and Regulations: including Islamic Sharia’a, proper compliance with a range of applicable • Rights of voting, election, and discussion Central Bank of Kuwait (CBK) instructions, Capital Markets Authority (CMA) regulations and standards, both externally • Rights of profit, appropriations, and placement regulations, and Boubyan’s policies and values (ie. regulatory authorities) and internally • Rights in access to information (ie. policies and procedures). A specific area of compliance that is often disclosed in Policies for Ethics Professional Standards: addressing various matters such as exercise of due sustainability includes business ethics, covering Specifically concerning Boubyan’s Code of care, objectivity, and confidentiality fraud, money laundering, and corruption. More Conduct, this has been developed to ensure information about Boubyan’s compliance and that Boubyan staff behave and do business in Personal Standards: covering ethical values, personal trading in Boubyan ethical business aspects is given in this section. an ethical way in line with standards. This Code stocks, conflict of interest, training, and gift handling Boubyan ensures regulatory compliance with is periodically reviewed (every 3 years), with General Standards: including public statements, announcements in newspaper various bodies, including the Central Bank of the last review and approval being conducted or other media, and Anti-Money Laundering (AML), and Know-You-Customer Kuwait (CBK), due to being a financial institution, during 2015 and 2016. However, during (KYC) practices and the Capital Markets Authority (CMA), due to 2019, another internal review of the Code of Conduct was conducted, with no changes being listed in the Kuwait Boursa (Kuwait stock Figure 3.6.1b: Procedure for Code of Conduct -Violation exchange). Accordingly, reports are frequently to update. On December 2019, the Code of sent by Boubyan to these regulatory bodies to Conduct was circulated to Boubyan staff for its transparently affirm compliance. acknowledgement. The department head or The HR Department, manager of the violating jointly with the Legal, 3.6.1 Policies There are various standards addressed in the employee sends an official Audit, and/or Risk Code of Conduct, including compliance with (102-16, 102-17, 102-25, 102-35, 103-1, 103-2) internal memo or email to Department (as required) Through coordination among the Board of laws, rules, and regulations, professional the HR Department. investigate the situation, Directors, executive management, and the standards, personal standards, general along with all concerned respective business functions, Boubyan has standards, and policies for ethics throughout persons. developed various policies as tools in order the Code of Conduct. These are further to govern, monitor, improve, and implement explained and categorized in Figure 3.6.1a as strategy in various areas. Policies range across follows. Note that these elements specifically pertain to Boubyan Bank, while subsidiaries several topics that include, among others, Proper disciplinary action All disciplinary action(s) implement their own separate approaches to shareholder rights, ethics, remuneration / is issued by the HR should be issued by the business ethics. compensation, code of conduct, workplace Department, after the HR Department, and in matters, financial ethics, and others. approval of the Human accordance with both It is important that the staff Code of Conduct Resources Group General Boubyan’s penalty list, is monitored and complied with, and the Code Shareholders’ Protection Rights Policy Manager (GGM), as well as and the Kuwait Labor accordingly delineates a certain procedure to Boubyan ensures shareholders’ rights through the CEO, if required. Law. the Shareholders’ Protection Rights Policy. As be followed in case of staff violation of the part of the policy, all equity shares are ordinary Code, as illustrated in Figure 3.6.1b as follows. with equivalent voting rights, in compliance with Kuwait’s commercial laws and Boubyan’s Boubyan has other policies that govern ethical and anonymous mechanism to identify and articles of association and by-laws. Specifically, matters—including the Conflicts of Interest communicate any ethical concerns. Additionally, the Policy addresses the following areas: Policy, Integrity Policy and Whistleblowing at BLME, various ethical matters are governed Policy—all of which have the purpose of and communicated through the Employee ensuring ethical business practices, ensuring Handbook and Whistleblowing Policy, which independence from conflicts of interest, and similarly provide mechanisms and procedures providing mechanisms to voice any feedback, for stakeholders to voice any ethical concerns. concerns, or grievances concerning any ethical In addition, BLME Board Directors have access matters. Specifically, the Whistleblowing to independent legal advisors, if required, paid Policy provides stakeholders with a safe for by BLME.

66 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 67 Policy for Compensation / Remuneration members by 2022. Accordingly, the percentage Figure 3.6.1d: Aspects Promoted in In addition to policies governing business of independent Board members is expected to Corporate Governance ethics, Boubyan has developed policies be around 18% by 2021, and around 31% by governing compensation and remuneration. 2022. As for BLME, the Board independence Every year, remuneration disclosure is provided rate is currently 36.4%, compared to the in the Governance Report as part of the Annual previous year (2019) figure of 44.4%. BLME Report. Board independence was reduced due to the appointment of 2 non-independent (Boubyan For BLME, compensation and remuneration Bank) nominees in 2020. matters are governed by the BLME Remuneration Discipline Transparency Accountability Framework, in line with the Senior Manager Corporate Governance Manual and Certification Regime (SMCR) of the UK Boubyan’s Corporate Governance Manual Prudential Regulation Authority (PRA). plays an important role in codifying our governance aspects. It is built around a set of Policy for Conflict of Interest 9 pillars illustrated in Figure 3.6.1c, and aims Concerning Board and executive management to promote aspects listed in Figure 3.6.1d. Independence independence, this is one of the areas that is Note that our Corporate Governance Manual is Social Responsibility and Objectivity usually disclosed as part of ESG disclosures. reviewed by the Board Committee on a periodic Responsibility One way that Boubyan monitors and ensures basis and when required, to ensure that their independence is through the Conflict of Boubyan continues to adopt high standards Interest Policy. and professional practices. In case of any 3.6.2 Anti-Fraud and Corruption Anti-Money Laundering (AML) recommended amendments or updates, they (102-16, 102-17, 103-1, 103-2, 205-1, 205-2, 205-3, 206-1) Looking at money laundering matters, Boubyan Accordingly, Boubyan is currently in the would be presented to the Board of Directors Boubyan is very conscious of and protective periodically receives anti-money laundering process of appointing 2 independent Board for review and approval. against various financial ethics behaviors, (AML) reports, while AML is also reviewed by members by 2021, and 2 more independent including corruption, fraud, money-laundering, the BRCC on a quarterly basis. Furthermore, the bribery, and anti-competitive practices. To Board receives reports on all Kuwait Financial govern this, Boubyan has a range of anti- Investigations Unit (KFIU) cases. Figure 3.6.1c: Boubyan Pillars of Effective bribery, anti-corruption, anti-money laundering Corporate Governance Pillar 1 Pillar 2 (AML), and anti-fraud policies. These policies For BLME, Board oversight of AML is delegated Board of Directors Corporate Values, are reviewed annually, or more frequently to the Audit Committee, which receives a Conflict of Interest and Group depending on circumstances. Through Board quarterly update report from BLME’s Money Structure meetings, the Board of Directors are also Laundering Reporting Officer (MLRO). This Pillar 9 Pillar 3 informed of these matters. report is discussed at every scheduled quarterly Protection of Senior Stakeholders’ Management meeting. Rights Accordingly, we disclose the number of corruption, fraud, bribery, and money- Financial Ethics Violation Pillars for laundering incidents for the 2020 period If financial ethical violation is committed by Pillar 4 Pillar 8 Effective CG for Boubyan, noting that the incidents have any of our personnel, Boubyan has a certain Protection of Risk Shareholders Management successfully been kept at Zero (0) for all cases. procedure to be followed involving the Financial Rights & Internal Controls Committee, which must be completed within 5 working days. This procedure is laid out in Pillar 7 Pillar 5 Figure 3.6.2 as follows. Complex Corporate Remuneration Structure Policies and Pillar 6 Systems Disclosure and Transparency

68 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 69 Figure 3.6.2: Financial Ethics Violation Procedure

Financial Committee (level I) reviews and investigates, then sends recommendations to other concerned departments.

The Audit Department conducts a study and reports to other concerned departments.

The Risk Management Department conducts an investigation.

The HR Department calls the Financial Committee members to meet.

Recommendations are provided based on nature of the violation.

Meanwhile, for BLME, if a financial ethics subject to due diligence reviews in relation to incident occurs, this would be raised to the information security, financial ethics and data money laundering reporting officer (MLRO). protection, depending on the nature of the The MLRO’s response will depend on the nature partnership. These reviews would consider the and severity of the incident, but may include appropriateness of controls within the partner notification to the appropriate authorities. organization and also a more general review of the business to ensure that BLME is comfortable Financial Ethics Due Diligence entering into a relationship with them. BLME One way that Boubyan protects against would conduct appropriate screening for high financially unethical elements is through risk or other indicators. conducted due diligence on any new or potential business partners. Specifically for BLME, when a new business partner is on-boarded, they are

70 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 71 4 | Sustainable Marketplace Experience

As the marketplace is one of the 4 sustainability / ESG dimensions (MEWC), Boubyan reports on marketplace aspects that include, among others, responsible services and solutions, brand power and recognition, customer experience, and sustainable procurement. Sustainable organizations should exhibit strong economy-related indicators, not only in their bottom-line, but also in the way they give back to the local economy through direct and indirect impacts. Specifically in ESG, the marketplace dimension touches on social aspects for mainly customer impacts, governance aspects for internal activities, and environmental aspects in the responsibility side of products and services. This focus is further enabled by national and global sustainability frameworks that highlight economic / market aspects throughout sustainability / ESG directions.

As such, the marketplace is a Sustainability – “Gene and Core Value” for Boubyan. Two stakeholders specifically targeted in this section include customers (through the responsible products and services provided, and enhanced customer experience), as well as suppliers (through our focus on local procurement). In Good Health and Well-Being fact, through engagement with our stakeholders in the form of materiality assessment, we have prioritized a total of 7 material Decent Work and Economic Growth topics that pertain directly to the marketplace. Industry, Innovation and Infrastructure

Responsible Consumption and Production

72 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 73 4.1 Responsible Services and Solutions (102-2, 102-4, 103-1, 203-1, 416-1, 417-1) Figure 4.1b: Banking Awareness Campaigns Project name: Branch Appointment Service Boubyan reports on the responsibility aspects headquarters reinforces this strategy as it Project name: Know Your Rights The «Branch Appointment Service» was and positive impacts of its services and is also being designed to be “green” and The «Know Your Rights» campaign is an all launched as a response of re-opening Boubyan solutions, as part of ensuring a sustainable environmentally friendly. Boubyan’s financial year ongoing campaign by Boubyan Bank, that Bank branches post the COVID-19 crisis lock- marketplace experience. This includes activities pertain to a series of sustainability- targets all our customers segments - which down. The service started in June and is still investments into socially responsible projects, related projects, displayed in Figure 4.1a aims at increasing the customers awareness ongoing, it allows all Boubyan Bank customers conducting banking awareness campaigns, below. The figure displays 4 of these projects, of their rights with the bank. This campaign to book an appointment in advance prior to their ensuring product safety and quality, supporting amounting to a total financial value of is in line with CBK’s requirements in raising branch visit. The main purpose of this service is small and medium sized enterprises (SMEs), and 152.65 million KD. While examining lending customers awareness, where a number of to ensure our customers safety by eliminating communication of the various ways that we opportunities, ESG opportunities often do arise, awareness messages are communicated with customers crowding and decreasing the waiting cater to customers’ needs through our products and Boubyan aims to support such projects. our customers on a monthly basis. time. and services. More information about our Looking at the specific projects outlined below, responsible services and solutions is provided selected outcomes contributed to include, Project name: Special Needs Customers Project name: Center of Excellence Forum throughout this section. among others: environmentally-friendly Social Media Posts The Change Management Department at operations, sustainable waste management, Boubyan Bank has an all year ongoing campaign, Boubyan Bank hosted the «Center of Excellence Socially Responsible Investment sustainable water management, and clean in which the targeted segment is our special Forum», highlighting our contribution to local Our digitization strategy is largely propelled fuel. In addition to these projects, Boubyan needs customers. The campaign’s objective organizations. The objective of the project, is by Socially Responsible Investing. We have supports natural liquid gas (NLG) producers is to increase our special needs customers to share and leverage knowledge on how local an obligation to our environment and digital through financing, in an effort to support awareness of the benefits and services provided organizations can continuously improve and innovation allows us to reduce our carbon environmentally-friendly projects. especially to them. A message at least every develop. footprint. Furthermore, the new Boubyan month is communicated with our special needs customers, to fulfill CBK’s requirements Project name: Msa3ed Competition in increasing the awareness of special needs Figure 4.1a: Sustainability-Related Investments The «Msa3ed Competition» was launched customers. in August 2020 (until year end). The main Project Sustainability Features Financial amount objectives of the competition are to increase our Project name: Boubyan Security Tips customers engagement, raise their awareness Desalination plant in UAE Desalination plant 22.65 million KD Messages through Social Media Channels regarding Boubyan›s products and services, Boubyan Bank has an all year ongoing familiarize them with Msa3ed application and campaign, where messages are communicated increase Boubyan’s top of mind. This media on a weekly basis through our social media competition provided more exposure to Kuwait waste-water treatment plant Waste management 40 million KD channels. The content of the messages provide Boubyan’s products and services, and increased security tips with the objective of increasing our our engagement with customers and raised customers awareness regarding their accounts their awareness of our products. Kuwait clean fuel project with Kuwait Clean / renewable energy 90 million KD information and security. National Petroleum Company (KNPC) Project name: Encouraging Cards Usage Posts 152.65 million KD As a response to the COVID-19 crisis, Boubyan Banking Awareness Campaigns Bank launched a campaign which encourages all customers to pay with their cards and avoid Several awareness campaigns have been platforms and Boubyan’s website. The topics are paying with cash. The campaign started in launched to increase the consumer’s banking provided with details concerning the specific March and is still ongoing, with the objective of financial knowledge through social media awareness campaigns, displayed in Figure 4.1b increasing our customer’s awareness to avoid as follows. physical contact to ensure their safety and wellbeing.

74 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 75 Product Safety and Quality our auto finance loans products. CBG is also Figure 4.1c: Sectors of SME Clients At Boubyan, all the products and services that focusing on the workplace by recruiting and we provide to customers are rigorously tested investing in people, and providing a suitable internally to ensure they meet Boubyan standards work environment for the teams to achieve and our promise to customers. Accordingly, a their full potential, leading to high quality multifunctional team of experts reviews and customer services. There is also a solid layer tests any new product functionalities before it of governance applied to product safety and is rolled out to customers. quality, as related policies are under the maker- checker process (or -4Eyes process), and go For BLME, all business proposals and through certain approvals. For BLME, product applications for credit are submitted to its safety and quality is further governed by the Credit Committee, which must articulate any Product Committee and BLME Product Policy. climate change risks, as well as the mitigation that must be taken into account at the client / customer level, before any financing offer can Small and Medium Sized Enterprises (SME) be made by BLME. Support One way that Boubyan embeds responsible In addition, at Boubyan, there are various aspects into its business is its support of small sustainability-related aspects within our and medium sized enterprises (SMEs). Looking products and services, which have been specifically at Boubyan’s own clients, we have especially developed by the Consumer Banking around 2,500 current SME clients as of 2020. Group (CBG). These include the digital services These come from a range of sectors, illustrated that yield various paperless outcomes, as well in Figure 4.1c as follows. as plans to embed environmental aspects into

We support SMEs through retail banking, 4.1d lists the various services provided to SMEs. whereas the Consumer Banking Group (CBG), The figure also shows that there is a 1,000 KD under the Business Banking Department, minimum deposit, and compares the services provides numerous services to SMEs. Figure provided to other industry peers in the nation.

76 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 77 Figure 4.1d: Services and Support to SMEs In addition, Boubyan conducted factoring Case Study transactions for SME suppliers— supporting Basic requirements and services them in managing their account receivables Current account and increasing their cash liquidity. Incubation Program Business credit card POS/PGW Boubyan had been especially supportive of Local and international transfers SMEs in 2020 during the COVID-19 pandemic. Debit card An initiative we took is that we waived the Deposit card ePay service fees and subscription fee for all SMEs customers for four months. Furthermore, Overview: Additional services the POS/PWG fees for all our customers were Boubyan’s Incubation Program is an initiative Salary portal also waived for four months, as a response to that assists and incubates entrepreneurs by Government debit card support our customers during the COVID-19 providing them with knowledge, training, Petty cash card crisis. networking facilities, workshops and access Link payment (ePay) to mentors in order to help them build and In addition, BLME also supported local businesses grow their ideas to start their entrepreneurship Channels in the UK by sending BLME employees themed journey. Online banking gifts to help them work well from home. The Mobile banking Bank selected products with an ESG focus Objective: Branches (5) where available, and by engaging with local The objective of Boubyan’s Incubation Program businesses on social media, helped boost the is the following: In addition to retail banking, Boubyan supports profile of local companies. • To stimulate the startup markets in Kuwait SMEs through corporate banking. This includes • To give guidance so business owners are able credit analysis with the Kuwait National Fund Incubation Program to build and maintain a sustainable business for SME Development (SME Fund). From 2017 Boubyan had established an Incubation • To target and support entrepreneurs who are until the present, we met, analyzed, and Program (Boubyan Incubator) to support local passionate, and want to develop their idea presented 1,685 cases of SMEs to be approved startups and entrepreneurs. In this regard, we into a solid and sustainable business by the SME Fund. As a result, 387 of the SME have recruited advisors who have a regional cases obtained final approval from the SME and international presence to mentor the Outcome: Fund, valued at a total financial amount of 53 entrepreneurs and assist them in various sectors The outcome of the Incubation Program million KD. and levels. The end results aim at establishing a was that Boubyan was able to support healthy startup, ready to grow organically and entrepreneurs. Entrepreneurs’ businesses got sustainability. More information is provided as ready to fly, became well established, were follows: able to contribute to the local market, and possibly expand globally. In addition, the Program allowed for the establishment of new partnerships that added value to both Boubyan and the local market.

78 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 79 Excellence in Project Management

Boubyan ensures excellence in the management Then, after project completion as well as during of strategic projects, especially guided by our various points during the project, we follow an Center of Excellence Division. The engagement approach to assess the impacts of our projects. approach of our project management includes A number of indicators are used by the project executing the tasks that have been previously manager to assess project success, mainly defined in the project management plan, and examining the project cost versus the output. meeting key objectives within a predefined The 4 evaluation points are listed below: timeline, resources, and budget. A project 1. Schedule execution strategy (PES) approach is used, which 2. Cost outlines the execution of tasks to complete 3. Stakeholder satisfaction project successfully. It is usually developed by 4. Performance against the business case the project’s leaders along with one or more representatives of the business owners by: In examining project management excellence 1- Focusing on the final outcome, by ensuring in 2020, the COVID-19 crisis is one area that that project goals and objectives have been should be considered. During this pandemic, clearly and thoroughly defined. the amount of activity to be coordinated and 2- Getting team onboard by having clear and mobilized was increased. The need to properly straightforward communication plans; clear plan was key, especially to do quickly and explanation of strategy execution gives with the right rigor. There were often multiple the project team a better understanding of meetings with different agendas, stakeholders how they will each contribute, what their and priorities. Accordingly, we have managed responsibilities will be, what is expected of to adapt quickly and effectively to these them, and much more. challenges, with teams being able to pivot to 3- Exhibiting leadership skills, management rapid and large-scale shift to working remotely skills (strategic and business), and technical with a minimal disruption to ongoing strategic 4.1.1 Banking Services project management skills. projects that experienced a sudden changes to (102-2, 102-6) the way they were managed. This involved re- Products and Services The project management process begins with an setting the processes to govern delivery, with Boubyan offers a variety of products and extensive initiatives-planning exercise, which some projects requiring significant changes to services to our customers. This includes 41 takes place prior to each year to identify and ways of working to remain effective. During currently open branches in Kuwait. The specific agree on the list of initiatives/projects that will the pandemic, we managed to effectively close branches are listed in Annex 6: Boubyan Open be executed during the year, and ensure that all planned strategic projects, such as the ISO Branches in Kuwait. only the right project that is aligned to strategic 27001 Certification Project. goals will be executed. Furthermore, the various products and services Throughout the project management process, offered include the following, Throughout project execution, the overall technology plays an important role in ensuring • Personal banking, for individual customers project efficiency is measured based on whether quality and efficiency—especially being • Private banking, for high-net-worth- the project outcome meets the strategic useful during the pandemic. Specific digital individuals (HNWI) objectives within the dimensions of project tools used include Microsoft (MS) Teams, Jira, • Business banking, for businesses efficiency - time, budget and scope. Moreover, Confluence, VPN access, Sciforma for Project • Corporate banking, for corporations the following 6 steps are adhered to, in order to Management, etc. These helped in facilitating ensure project quality and excellence: project execution, team follow up, documents 1. A good plan collaboration, and project execution. 2. Appropriate communication 3. Manage stakeholders 4. Good measurement 5. Constant review 6. Act early

80 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 81 Table 4.1.1a: Products and Services

Products and Personal Banking Private Banking Business Banking Corporate Banking Products and Personal Banking Private Banking Business Banking Corporate Banking Services Services

Accounts Salary Accounts Private Banking Business Accounts Business Accounts Investments Fixed Deposits Fixed Deposits Wakala Fixed Deposits - Platinum Account account - Current Account - Current Account - Al Hana - Al Hana - Wakala - One Account - Call Account - Call Account - Al Hana USD Deposit - Al Hana USD Deposit Money Market Fund II - Retirees Account - Barwa Account - Al Mona - Al Mona Boubyan Capital - Current Account Account Solutions - Amil Account - Sama - Sama USD Liquidity Fund - Money Market Fund II - Epayment Gateway - Wakala - Wakala - USD Liquidity Fund Youth Accounts - Swift Transfer Account Solutions - Al Jana - Al Jana Boubyan Kuwait Real - Boubyan Kuwait Real - PRIME Account - Merchant Sales - Swift Transfer - Educational savings - Educational Savings Estate Fund Estate Fund - Al Ghaly Account - Merchant sales plan Plan - Multi Asset Holding Multi Asset Holding Fund Saving Accounts Boubyan Capital Boubyan Capital Fund - Boubyan Capital’s - Savings - Boubyan KD Money - Money Market Fund II Brokerage - Premium Savings Market Fund II - USD Liquidity Fund Boubyan Capital’s - Boubyan USD Liquidity - Boubyan Kuwait Real Brokerage Account Solutions Fund Estate Fund - Waferli (saving tool) - Boubyan Kuwait Real - Multi-Asset Holding - Safety boxes Estate Fund Fund (for valuables) - Multi-Asset Holding - Islamic Global Sukuk Fund Fund - Islamic Global Sukuk - Boubyan Capital’s Cards Credit Cards Credit Cards Credit Cards Debit Cards Fund Brokerage - Visa Signature - Visa Infinite Credit - Deposit Card - Local and GCC Equity - World Mastercard Card Debit Cards - Visa Debit Card Fund - Special Edition World - Mastercard World - Visa Debit Card - Boubyan Capital’s Elite Mastercard Elite Credit Card - Deposit Card Brokerage - Visa Platinum - Mandoub Card - Mastercard Platinum Debit Cards - Petty Cash Card - Visa Infinite Debit Debit Cards Card Card Solutions Partnerships ExpandCart - Visa Debit Card - Visa Business Offers Holistic Development Card Solutions Reporting & Consulting Prepaid Cards - UTap Services - Prepaid Cards - Online Credit Card NiU Business Hub - Gift cards Issuance - Digital prepaid card - 3D Secure - Visa checkout Card Solutions - Boubyan Rewards - UTap Services Insurance Insurance products Insurance products Insurance products Insurance products (NGC technology) - UTap Wearables (Garmin Pay and Fitbit Pay) - Samsung Pay - Credit Card Issuance - 3D Secure - Visa checkout There are specific products, services, and - Boubyan rewards BLME Banking Services - Boubyan checkout features that have been developed during the In addition, specialized products and services - Visa and Mastercard offers COVID-19 pandemic, which are listed below. are provided by BLME, which are listed in Figure • Local and international transfers 4.1.1b as follows. Note that BLME provides Finance Finance Products Finance Products Finance of Small, Murabaha • Activate online access various competitive banking and financing - Housing - Housing Medium, and Large - Auto - Auto Enterprises and Ijara • Reactivate the block cards solutions, especially to the UK mid-market, as - Furniture finance - Furniture finance Economic Entities • Upgrade online transfer limits well as supporting companies with links to the - Health - Health Trade - Education - Education • Handing over cards and PINs to customers Gulf Cooperation Council (GCC) region. BLME - Short-term finance Treasury during the partial lockdown Finance Solutions clients range from multinational corporations Financial Solutions - Digital Murabaha to family businesses that generally earn a - Digital Murabaha - Flexi Payment - Flexi Payment minimum operating profit of 1£ million across a variety of sectors.

82 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 83 Figure 4.1.1b: BLME Products and Services Figure 4.1.1d: Banking Channels - Business and Corporate Banking

Savings Accounts Conventional Channels Digital Channels Premier Deposit Account (PDA) Branches Corporate Mobile App Notice Account Special needs branches Online Banking

Business Finance Real Estate Corporate Banking Another service offered is the trade services. Provision of commercial real estate financing One area that Boubyan excels in is corporate Boubyan’s Trade Services Department offers Commercial real estate investment funds banking services. Accordingly, Boubyan offers a innovative and simplified solutions to the most range of long and short-term financing products complex deals and helps you manage your Wealth Management / Private Banking that are designed to meet the corporate client’s international trade transactions more efficiently Card Portal specific business requirements and support to via a smart online platform. Mortgages (ie. residential) manage day-to-day expenses more effectively. Specialist assets and syndications 4.1.2 Dynamic Islamic Services Club deal investments Specifically concerning FX spot / forward, an (102-2, 102-6, 103-1) Aviation (ie. private jet) and Yacht Finance FX spot is a simultaneous purchase/sale of Considering that Boubyan is an Islamic Current Account an amount in one currency for another with organization, Sharia’a principles and standards Prepaid Debit Cards different value dates. This allows sums of one have an important role and are embedded Holiday Home Finance currency to be used to fund charges in another throughout activities, products, and services. Investment Solutions currency without the risk of an exchange rate. Specifically, Sharia’a banking has an important Boubyan offers foreign exchange services in role to play in business development, profit, major currencies and GCC currencies, both financial modelling, and the ability to offer Banking Channels for remittances and for purchase and sale of competitive Islamic financial products. Sharia’a Boubyan customers are provided with a range type of banking. Accordingly, personal and currency notes. practices are especially integrated into the of banking channels to use to meet their needs. private banking channels are shown in Figure products listed in Figure 4.1.2 below. These can be either conventional channels, or 4.1.1c, while Figure 4.1.1d shows the banking digital channels, with nuances between the channels available for business and corporate Figure 4.1.2: Boubyan Islamic Products banking.

Figure 4.1.1c: Banking Channels - Personal and Private Banking Current Accounts Savings Accounts Wekala Deposits Mudaraba Deposits Savings plans

Conventional Channels Digital Channels Branches Boubyan Mobile App Special needs branches Online Banking Boubyan Direct Msa3ed (personal assistant) Personal financing Mudarabah Mussawama Credit Cards - charge ATMs WhatsApp banking Murabaha (profit-sharing and and revolving Doorstep Banking Android Wear and (cost-plus financing) loss-bearing) Call center Apple Watch

Prepaid Cards Wadiah Musharaka Ijara (leasing) (safekeeping) (joint venture)

84 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 85 4.1.3 Investment Services 4.1.4 Insurance Services (102-2, 102-6) (102-2, 102-6)

Boubyan Capital is the investment arm and high-net-worth-individuals (HNWI). Boubyan Takaful Insurance Company (BTIC) Insurance Plans, Motor Takaful Insurance Plans, (subsidiary) of Boubyan, which is specialized in Boubyan Capital also manages the proprietary is the insurance arm (subsidiary) of Boubyan, and Medical & Group Takaful Plans. However, the provision of investment services, including investments of Boubyan Group. The various which offers a variety of insurance products. Figure 4.1.4 provides a detailed list of insurance asset management, alternative investments, products and services offered by Boubyan Generally, the insurance products are provided products that are offered through the 8 different and brokerage services, mainly to institutions Capital are listed in Figure 4.1.3 as follows. through the following 3 plans: General Takaful classes of business.

Figure 4.1.3: Boubyan Capital Product and Services Figure 4.1.4: Boubyan Takaful Insurance Products

Classes of Business Product Name Classes of Business Product Name Asset Management Boubyan KD Money Market Fund II Fire Fire Marine Marine Cargo Householders Comprehensive Marine Hull & Machinery (H&M) Boubyan USD Liquidity Fund Property - All Risks Aviation Hull & Liability Terrorism Boubyan Multi Asset Holding Fund Political Violence Motor Comprehensive Islamic Global Sukuk Fund Hotel Block Insurance Third-party Liability Coverage (TPL) Drivers License Local and GCC Equity Fund General Burglary Personal Accident Other services Accident Jewellery Orange Card Plate Glass Motor 30:30 Travel Insurance-Credit Card Public Liability Life Domestic Helper Fidelity Guarantee Credit Life Alternative Investments Workmen›s Compensation Credit Card Boubyan Kuwait Real Estate Fund Bankers Blanket Saving Plan Kidnap and Ransom Professional Indemnity Fire SME3 Medical Malpractice SME4 Boubyan Capital Brokerage Money SME5 Personal Accident SME6 Employers› Liability SME1 Specified Professions SME2 Live Stock Insurance Doctor Plan Sustainability / ESG Aspects of Investment investment could have. For example, the Real Engineering Contactors - All Risks Life Treaty Based Regarding the investment decisions, Boubyan Estate team purchased a building in the US for Erection All Risks Shoun Capital applies the Sharia’a principles, which Boubyan’s international real estate investment Machinery Breakdown Family Protection Machinery Breakdown Lop are themselves aligned with sustainability / fund, as the purchased building had been Gold Electronic Equipment Medical Group Medical ESG aspects. We aim to be transparent about LEED certified. Throughout the investment Boilers Plant & Equipment Travel Travel these investments. We invest in conservative process, the Real Estate team conducts the due Deterioration of Stock investments, which are around medium risk. We diligence and refers the opportunity to the Real care about customer satisfaction, constantly Estate Committee to decide whether to invest assessing the quality of our brokerage in the real estate property or not. Sustainability / ESG Aspects at Boubyan supporting employees through workmen’s services, and updating it regularly. Concerning Takaful compensation insurance and personal accident governance, our investment decisions go In addition, Boubyan Capital has launched Boubyan Takaful insurance products have some insurance, among others. through a range of criteria and approvals, awareness campaigns focused on financial ESG aspects aligned to them. Concerning the ultimately ensuring proper compliance with knowledge and responsible banking behavior. environment, there are resource savings (ie. Boubyan Takaful’s products also have various CMA requirements. These include: paper) incurred as a result of adopting digital health and safety aspects, including the • Educating Boubyan relationship managers transformation. As for the social aspects, these medical / health insurance. Note that while Moreover, regarding the real estate portfolio, (RMs) about the products provided include: providing employees with training, health insurance premiums may rise as a result Boubyan Capital considers the “Environment” • Giving detailed information about the providing health insurance to the community, of health crises, risks, and challenges like factor in ESG in terms of green buildings, investment provided and services provided providing family protection for families, offering COVID-19, Boubyan have successfully ensured ensuring that there are no building violations, • Providing a Risk Assessment survey with our property insurance to protect against losses, that health insurance premiums were not and considers matters related to tenants, investment to better gauge risk profile (in changed in the reporting period. rent, fire safety, etc. Other ESG considerations progress) include the building certifications that real

86 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 87 Insurance Claims power. This includes the brand tracker survey, Figure 4.2 illustrates the Brand Power rating Concerning the claims paid by Boubyan Takaful There are some directions to reduce resource conducted on a yearly basis, where many results regarding 2020. The results show that in 2020, there were no claim amounts for consumption (ie. energy, water, and waste), and branding indicators are measured and assessed, Boubyan had the second-highest brand power business financial losses or personal accident as standards from the following are considered: including top of mind (TOM), consideration, compared to its industry peers in Kuwait. part of occupational injury. However, Boubyan Leadership in Energy and Environmental Design awareness, and brand power. Note that brand Boubyan had achieved a brand power rating of Takaful paid a total of 35,860 KD in workmen’s (LEED), Earth Observation and Geomatics power is assessed using the Kantar Millward 19.0, with 143 in Meaningful, 148 in Different, compensation claims (as part of occupational Engineering (EOGE), and Uptime Institute. Brown Brand Power model, which considers and 121 in salience categories. injury), and a total of 816,108 KD in life salience, different, and meaningful indicators. insurance claims. Examining the social aspects of our activities, Boubyan conducts social responsibility Figure 4.2: Brand Power Score (2020) 4.1.5 Engineering and Facilities initiatives. Also, operations’ safety and quality are ensured by requiring, in all construction Management contracts, that contractors adhere to all safety (102-2, 102-6, 307-1) measures, especially for the headquarters and Boubyan reports on its engineering and the new data center projects.. Also, the projects facilities management activities, which are have dedicated safety officers to ensure the mainly carried out by the subsidiary Boubyan safety and quality requirements. Finally, the 121 National. The Engineering unit is responsible governance aspects of our activities can be for the supervision of the design and building identified from the various manuals, policies, 143 Boubyan’s civil and mechanical, electrical, procedures, regulations, and contracts that and plumbing (MEP) requirements. On the we abide by and implement throughout our other hand, the Facilities Management unit is activities. Governance aspects are also evident 19 responsible for all facility management and from the communication and feedback channels, maintenance activities in Boubyan, as well as Boubyan National receives feedback from as the execution of facility management and the branch manager / department manager and maintenance contracts signed with clients. staff during the handing over of projects.

Throughout these activities, some ESG elements 4.2 Brand Power and 148 can be identified. Concerning environmental aspects, all contractors are required to Recognition adhere to the Kuwait Environment Public (103-1, 103-2) Authority (KEPA), and all other authorities. This Brand power and recognition is relevant in compliance is a mandatory requirement in the sustainability due to its connection to and Regarding plans for brand power, Boubyan aims and has received numerous other awards contracts, and all bidders must adhere to the reflection of overall customer satisfaction, to become a top-tier wealth management hub throughout the years to strengthen the brand government laws. (1) experience, and perception. Branding for the GCC and high-net-worth-individuals value. Also, social media comments are closely accordingly plays a strong role in ensuring that (HNWI), especially through the introduction monitored for any indications / impacts on an organization remains sustainable, continues of digital platforms and successful products. branding, and quick action is taken on any (1) Note the following selected laws with which to achieve awards and recognitions, and Boubyan aims to build up an offshore issues. to comply: engages customers. More information about proposition. • Law No. 42, year 2014 branding and recognition is given in this section. Boubyan achieved a number of awards and • Amendments under law No.99 for year 2015 • ESIA Decree No. 2015/2 4.2.1 Awards and Recognitions recognitions in 2019 and 2020, which are listed • Decree No. 2017/2 One of Boubyan’s strengths is its brand power as follows. • Decree No. 2019/2 and recognition, for which brand assessments / • Ministry of Electricity & Water (MEW) - R6 and S1 brand audits are periodically (yearly) conducted, Awards are often a good indicator of excellence and it continuously aims to improve its brand and solidity of practices. In this regard, Boubyan has participated in the Service Hero Awards,

88 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 89 Best Islamic Digital Bank - Global First Place Award in Customer Best Social Humanitarian Boubyan Bank (2019 ,2020) Service - Kuwait Initiative - Noor Boubyan Boubyan Bank (2019) Best Social Humanitarian Initiative 5th Safest Bank in GCC of private sector institutions at the Boubyan Bank (2020) Best Islamic Bank in Customer GCC. (2019) Service - Kuwait Best Islamic Digital Bank - Middle East Boubyan Bank (2019) Replacement & Nationalization Boubyan Bank (2019) of Manpower - GCC Best Islamic Bank in a Decade - Boubyan Bank won Replacement Best Islamic Digital Bank - Kuwait Kuwait and Nationalization of Manpower Boubyan Bank (2019) Boubyan Bank (2019) Award for the fifth year in a row. (2019) Best Islamic Bank - Kuwait Kuwait’s Best Islamic Bank in Boubyan Bank (2019) Customer Service Boubyan Bank (2020) Most Innovative Digital Bank - Kuwait Boubyan Bank (2019)

Best Mobile Banking App - Kuwait Boubyan Bank (2019)

Awards and Recognitions

Best Islamic Bank in Kuwait Best Fixed Account Provider Best Internal Audit Group - Boubyan Bank has been named the Best BLME (2019 ,2020) Kuwait & GCC Islamic Bank in Kuwait for 3rd year in row. Boubyan Bank (2019) (2020)

90 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 91 4.3 Customer Experience (102-2, 102-6, 103-1, 103-2, 416)

Customer experience contributes to the Boubyan conducts studies with external Figure 4.3b: Boubyan Customer Retention sustainability of an organization, as an enhanced parties to measure the level of customer experience by this valuable stakeholder group service, satisfaction, and loyalty. One customer Likelihood of staying with Boubyan (percentage): comes with a range of win-win situations survey that was conducted was the Market and benefits for those parties involved. Performance Index (MPI) by Ispsos for Boubyan. More information about Boubyan’s customer The objective was to carry out a market survey experience aspects is given in this section. to understand the level of awareness of the top financial institutions in Kuwait, to measure As customers are important stakeholders for the financial institutions on the 3 metrics of Boubyan, it is important to continuously assess (1) best customer services, (2) trustworthiness, 75% 77% 88% and improve their experience. Internal studies and (3) thinks-ahead. This survey is conducted by the Customer Experience Management (CXM) every quarter, with a sample size of 600 to Department specifically focuses on customer 650 customers, selected at random. The Q1 2020 Q2 2020 Q3 2020 satisfaction as a main indicator. For 2020, the survey successfully represented a range of Business Banking Department achieved a result demographics, including age and gender, while of no less than 95 % Additionally, during the focusing on local nationality (Kuwaitis). The last 3 months, we achieved a result of 100%. results of the MPI survey are provided in Figure Figure 4.3c: Boubyan Trustworthiness Score 4.3a as follows. Trustworthy Bank (mean score – 10point scale rating):

Figure 4.3a: Market Performance Index (MPI) Results

Among Kuwaitis Q4 2019 Q1 2020 Q2 2020 Q3 2020

Awareness (Top of Mind - %) 25% 25% 26% 27% 8.4 6.0 8.0

Trustworthy (Mean score out of 10) 8.0 8.4 8.0 8.0 Q1 2020 Q2 2020 Q3 2020 Best Customer Service (Mean score out of 10) 8.0 8.4 8.0 8.0

In addition, the MPI survey conveyed a number trustworthiness, with relatively high figures for Figure 4.3d: Boubyan Best Customer Service Score of other results. Namely, Figure 4.3b shows Boubyan compared to peers, reaching a mean that Boubyan has high customer retention score of 8/10 as the latest figure. Next is Figure Best customer service (mean score – 10point scale rating): rates compared to peers, which also increased 4.3d, which shows the best customer service throughout the year, reaching 88 %. Note that rating, with similarly relatively high figures for this has increased throughout the year despite Boubyan compared to peers, also reaching a challenges of COVID-19. Figure 4.3c shows the mean score of 8/10.

8.4 8.0 8.0

Q1 2020 Q2 2020 Q3 2020

92 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 93 Case Study

SROI SROI Topic Level Interpretation Value Outcomes Customers Loans

Best Customer Service High 1.64 KD *Satisfaction During COVID-19 through Market sustainability value Performance Index (MPI) value for each 1 KD invested. Overview: The COVID-19 pandemic created a widespread global shock and a severe economic slowdown. There has been a slowdown in all economic sectors worldwide and more than one third of the global population Customer Statistics Boubyan’s readiness and resilience, covering was placed under lockdown. Kuwait went through a Boubyan Bank also records the number of all operational and client-facing matters. In lockdown that slowed down consumer spending and active customers, reported for 2020 in Figure addition, this shows that Boubyan has strong closed many small businesses. Therefore, the Kuwait 4.3e. The customers reported have been / well-defined products and services that cater Banking Association (KBA) advised implementing a broken down further according to age group for all age groups. This has been reached based 6-month payment deferment for loans. The 6- month and service type. Additionally, a summary of on a clear understanding and assessment of deferment was offered to customers with personal customer numbers has been provided in Figure their needs and quality of services. Accordingly, finance (PF) arrangements and/or credit cards. 4.3f, showing around 8.5 % change increase the Figure below shows the diversity in age and in number of customers from 2019 and 2020. how Boubyan manages to attract all age groups Objective This shows sustainable growth, and reflects through tailored products. The objective was to support employees who have been affected by the pandemic—whether by losing their job, having a cut in their salary, or small business owners who have seen decreased cash-flow or consumer spending during this period. The deferment of the PF <=14 Total or credit cards is without an extra fee, or any increase 8% 100% on profit.

14-18 >=60 Outcomes: 4% 5% The customers had 6 months’ deferment of all Figure 4.3e: Boubyan Customers installments with Boubyan by default (including Kuwaitis and non-Kuwaitis), and there was also a December 2020 ,19 18-21 Age Group 40-50 mechanism for customers who wish to continue paying 11% 11% their installments to be able to do so. In addition, Boubyan, after the lockdown, offered a 3-month grace- period (if desired) to all customers applying for new finance without increasing the profit amount. This 18-21 30-40 campaign remained for 6 weeks. 11% 20% 21-30 In addition, note that the payment deferral was also 34% conducted at BLME. Specifically, in response to the COVID-19 pandemic, BLME developed a process to collate, review and approve payment deferral requests Figure 4.3f: Boubyan Customers - Summary from customers. This process was developed having regard to regulatory guidance, and in order to support 2019 2020 Additional %-Change our clients during what is an exceptionally challenging period. 385,267 385,267 +30,301 +8.5%

94 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 95 Special Needs Accommodations

Regarding special needs accommodations and first priority service for special needs, as per 4.3.1 Customer Journey all related setups in branches and facilities, Figure 4.3g. In addition, at BLME, special needs Boubyan went beyond the CBK requirements. accommodations are supported and mandated Specifically, Boubyan ensures that all branches by the Vulnerable Customers section of our In line with the role of customer experience Boubyan assesses and reports on the customer and sites are equipped with special needs Treating Customers Fairly (TCF) Policy. Note, in sustainability, the customer journey journey that clients undertake when dealing customers accommodations, including inclined however, that BLME does not have any branches specifically looks at the part of the experience with us. Boubyan’s customer journey has flat entrances, safe automatic doors, and for customers to visit since it is not a retail bank. that involves the steps that a customer takes been undergoing various digital / automation when experiencing an organization’s product enhancements, which have been conducted or service. Similar to customer experience, the according to a Digital Group Roadmap, in Figure 4.3g: Special Needs Accommodations customer journey is just as important to enhance cooperation with various departments across to ensure sustainable marketplace impact. More Boubyan. The recent and planned digitization information about Boubyan’s customer journey initiatives of the customer journey are provided aspects is given in this section. in Figure 4.3.1a as follows.

Figure 4.3.1a: The recent and planned digitization Inclined flat entrances Safe automatic doors First priority service for initiatives of the customer journey special needs Credit Card Issuance New Customer On-Boarding (phase 2) released through the Customer Charter (Phase1) released through the • We will always provide YOU with innovative retail app in January 2020 retail app in November 2019 In addition, Boubyan abides by a Customer channels that allow you to bank conveniently Virtual Prepaid Card Issuance Charter published on our website, which is and securely, anytime, anywhere. released through the retail app provided in Figure 4.3h below. The charter • We will always provide YOU with Sharia’a- in February 2020 both communicates Boubyan’s promise to Kuwait Clearing Company compliant products that cater to your needs (KCC) Digital Service its customers, specifically highlighting our and exceed your expectations. released through the retail app commitment to excellence, and sets out what in February 2020 is expected from the customer. Fixed Deposit Partial Debit/ Boubyan Credit What we expect from YOU Digitization released through the retail app Figure 4.3h: Boubyan Customer Charter in August 2020 of Customer Activated Renewed Card Journey released through the retail app “Our commitment to YOU in • To be part of the Boubyan Bank family. Our in August 2020 achieving excellence in family treats all with courtesy and respect. Digital Murabaha • To provide us with timely and accurate phase2released through the retail app in February 2021 everything we do information. We need it to serve you better. • To provide us with candid feedback, both • We will always serve YOU in a friendly, positive and negative. Your feedback drives courteous and professional manner. our journey towards perfection. New Customer On-Boarding New Customer On-Boarding • We will always provide YOU with accurate (Phase 3) to be released (Phase 2) to be released through through the retail app later in the retail app in April 2021 (not information, honest advice and protect your 2021 (not yet launched) yet launched) wealth and privacy. • We will always listen to YOU carefully, and will always take prompt action on feedback, inquiries and complaints.

96 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 97 Case Study Digital Transformation of our Customer’s Journey - Retail Mobile App

Overview: Block/unblock temporary or permanent Objective: Boubyan during 2020 introduced many Debit/Credit Card: The objective of the retail mobile app was features and systems to reduce customer visits Through the retail app, customers can choose to make Boubyan’s services and products to the branches, or to reduce the number of to block/unblock their debit/credit cards, more convenient, efficient, and accessible to calls. A main alternative digital channel for either temporarily or permanently. Unblocking customers. the customers that was developed is the Retail temporary blocks was previously only available Mobile App. Features of the Application include through the call center and branches. Outcomes: the following: The objectives of the retail mobile app have Activate Dormant Account: been met by making Boubyan’s services and KCC eDividends: It gives users the ability to activate a suspended products more convenient, efficient, and It enables the user to register for receiving account. Boubyan has an automated process to accessible to customers. his/her stock dividends from the Kuwait suspend a customer account in case there are stock exchange. It also provides the ability no financial activities over 1 year. Previously, to automatically credit one of the customer to activate a suspended account, customers accounts. Previously, this service was only had to visit a branch to do so. Now, with such available for the user via a branch visit. functionality available in the app, the user can directly activate his/her suspended account. Fixed Deposit (FD) - Partial Deposit/ Withdrawal: Activate New Credit Card issued through Boubyan has several fixed deposit products, the DST / automated teller machine (ATM) / and the retail app allows the user to partially interactive teller machine (ITM): withdraw or make a deposit without breaking Boubyan has 3 channels, other than the the fixed deposit itself. Previously, such service branches, to receive the issued credit card. was only available via branch visit. Starting Previously whenever a customer issued a card from mid of 2020, Boubyan customers through through DST/ITM/ATM, he/she had to call the the retail app now are able to use this feature. call center or visit a branch to activate the new credit card. Now, whenever a customer issues a card through DST/ITM/ATM, they can simply access the app to activate the card.

98 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 99 Overall, the successes of the Retail Mobile App Group. The total FTE savings across various Boubyan aims to innovate and offer unique and update the yearly action plan by identifying and the Msa3ed chatbot on the customer journey elements are calculated as 9.5, as per Figure products and cost-conscious services through main areas to improve, and is the main source for can be measured and assessed, especially in 4.3.1c as follows. Further information about secure digital channels, resulting in value competitors’ service performance monitoring. terms of the full-time equivalent (FTE) saving digital directions is provided in Chapter 7: addition for the clients. Useful KPIs used Boubyan has achieved a CSI score of 98 % for KPIs that Boubyan has set, achievement of Impacting through Innovation and Digitization. to assess customer satisfaction include the the year 2020 (as per Figure 4.3.2b), the highest which is the responsibility of Boubyan’s Digital customer satisfaction index (CSI) and the Net among its national peers. Promoter Score (NPS). The CSI is used to monitor Figure 4.3.1c: Full-Time Equivalent (FTE) Savings Total FTE Savings 9.5 Figure 4.3.2b: Customer Satisfaction Index (CSI) 2019 2020 SROI Level Interpretation Value Outcomes 97% 98% Digitization efficiency Medium 0.02 KD *Full time from Retail mobile app sustainability employment Figure X: Net Promoter Score (NPS) value for each (FTE) saving value 1 KD invested. (efficiency value) 2019 2020

4.3.2 Customer Satisfaction Over the past several years, we have ensured 73% 72% customer satisfaction and service. Since our activities are mainly customer-centric, Customer satisfaction is important to be Boubyan has made sure to advance all services, In addition to CSI and NPS, other ways that Figure 4.3.2c displays the evaluations (and assessed and reported at Boubyan, since supporting our customers throughout the years Boubyan measures and assesses customer associated roles) conducted with the number customers are important stakeholders to us. to achieve high customer satisfaction results. satisfaction include: online surveys, telephone of evaluations and customer results for each. After all, satisfied customers ensure positive The outcomes are provided in Figure 4.3.2a, surveys, call monitoring, internal customer The result was a total of 8,471 evaluations outcomes for both Boubyan and the customers reflecting a range of efforts contributed by our satisfaction survey by IT, and mystery shopping. conducted, and an average score of 93.75 % themselves benefitting from our products and internal stakeholders. across the evaluations. services. More information about our customer satisfaction approach is given in this section.

Figure 4.3.2a: Boubyan Customer Satisfaction Overview

Service Hero Award NPS (Net Promoter Score) Best Islamic Bank in Kuwait for TOP NPS in Kuwait the 11th year in a row

63 75 77 82 73 72 46 64 Second Place Country Winner Award 2013 2014 2015 2016 2017 2018 2019 2020

CSI (Customer Satisfaction Index) Service Quality Score TOP Bank in Kuwait

97 97 97 97 98 92 94 95 95 95 85 90 88 93 92 78 87 93 95 95

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

100 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 101 Figure 4.3.2c: Customers Evaluation Results 4.3.3 Complaints Management the time required for solving complaints (turnaround), complaints closing, and call- center waiting times. Accordingly, Figure Evaluation / Role # of Evaluations Score Evaluation / Role # of Evaluations Score Boubyan has developed a customer complaints 4.3.3a shows the number of complaints to both management mechanism that is often assessed, 6M+ 655 88.40% Service Teller 10 95.70% the Complaint Unit, the Customer Care Unit, improved, and reported. This mechanism has and BLME. Note that as a result, the number RM 655 88.40% Teller 286 91.34% especially been useful in adequately managing of complaints to both units have decreased, customer experience and ensuring customer seeing an overall decrease of - 75.1% change of Call Monitoring 2034 92.65% New Customer Survey satisfaction. Some KPIs considered include complaints overall. Contact Center Agents 2034 92.65% (Welcome Call) 3935 96.28%

Customer Satisfaction 29 93.46% Auto Sales 966 97.87% Figure 4.3.3a: Number of customer complaints

Retention 15 91.56% Direct Sales 1622 95.13% 2019 2020 %-Change

Customer Care Unit 14 95.49% Private 106 98.27% Complaint Unit 77 61 -20.8%

Mystery Shopping 1818 91.43% Relationship Manager 204 96.19% Customer Care Unit 4,050 957 -76.4% Auto Sales 105 90.69% Relationship Officer 915 96.10% BLME 34 19 - 44.1% Contact Center Agents 418 92.29% Business Banking 122 98.65%

Relationship Manager 177 95.91% Total 4,161 1,037 - 75.1%

Relationship Officer 481 91.89%

Service Officer 341 87.59% Grand Total 8471 93.75% Another KPI used to assess customer complaints challenges that similarly impacted the whole management is the average waiting time for sector, especially concerning remote working customers while contacting the customer call from home, laptop provision, and the number center. These are provided in Figure 4.3.3b as of agents assigned. However, this was quickly Amid the changes caused by COVID-19 • Adapting some insurance products follows. Note that the slight increase of average mitigated by sufficient laptop provision. Boubyan has organized a number of initiatives • Issuing certain insurance products remotely waiting time is attributable to COVID-19 reflecting the need to help curb the spread of • Activating and adopting the BCM plan the virus. Boubyan continued its innovative according to the new circumstances approach in holding many events and activities, • Covering COVID-19 in travel plans Figure 4.3.3b: Customer Complaints Waiting times which were directly related to customers, • Offering more flexible payment terms to and managed to hold them virtually through clients 2019 2020 remote communication applications (eg. • Accelerating any payments due to any Zoom, Microsoft Teams, etc.). This approach is customers / clients expected to continue over the upcoming years. 26 Seconds 40 Seconds Specifically for BLME, we have communicated Specifically looking at Boubyan Takaful, its various messages to our clients regarding safety, approach to keeping customers satisfied in light using emails and updates on our website. Many of COVID-19 developments has included: messages were also communicated straight from BLME’s CEO. The Customer Complaints unit is also active in communicating with clients and receiving any feedback or queries.

102 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 103 4.3.4 Customer Privacy and Security (103-1, 103-2, 418-1)

A vital element for Boubyan to continuously and security ensure that there are no data Figure 4.4b: Local vs. Foreign Suppliers Expenditure ensure, assess, and report is customer privacy leaks. Our staff are also committed to the and security of data (ie. protecting against highest values of data protection and integrity, Local Suppliers Foreign Suppliers Total Suppliers breaches and data leaks). We ensure this and our internal controls on user access and Expenditure (KD) Expenditure (KD) Expenditure (KD) through a range of technological capabilities. security are adequately in place. Specifically, the Information Technology Group (ITG) One of the KPIs used to assess data privacy Department is implementing a range of security 21,517,578 10,750,119 32,267,698 and security is the number of data leaks, standards based on the Information Security 67 % 33 % 100 % which have successfully been kept at Zero Policy and related policies and procedures, (0), as per Figure 4.3.4. Note that our internal in line with the International Standards controls and line of defense on data privacy Organization (ISO) standards and Payment Card Industry (PCI) standards. In addition to the focus on local procurement, In addition to social aspects, we identify the Figure 4.3.4: Number of Data Leaks other social aspects considered through our environmental aspects of our procurement. supply chain is adherence to human rights For example, Boubyan has contracted with a 2020 quality and standards. In this regard, we check supplier to provide photo-cell tap faucets in the that our vendors treat their employees fairly headquarters, which would reduce the water and that their rights are conserved, especially consumption. Zero 0 regarding salary payments, sick leave, annual leave, etc.

4.4 Sustainable Procurement At Boubyan, we focus on local procurement, (102-9, 102-10, 103-1, 103-2, 204-1, 308-2, 414-1) with the approach of giving back to the community in which we operate. Prioritization As sustainability is a “Gene and Core Value” for for suppliers includes local vendors, quality, us, we continue to ensure that our procurement delivery, and price. In line with this, Figure practices exhibit similar sustainability values. 4.4a shows our local and foreign procurement Integrating these values into an organization’s figures expressed as both number and percent supply chain and vendor relations and of suppliers per type. The result shows a priority practices often impact the overall sustainability for local procurement with Boubyan procuring performance of the organization. More locally from 81% of its vendors. This priority to information about our sustainable procurement local procurement is further reflected in Figure practices is given in this section. 4.4b, where procurement expenditure to local suppliers was 67% of the total expenditure to suppliers.

Figure 4.4a: Local vs. Foreign Number of Suppliers

Foreign Suppliers

105 Total 19 % 540 Local Suppliers 100 %

435 81 %

104 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 105 5 | Managing our Human Capital

Boubyan recognizes that sustainability is crucial in the workplace, especially as it forms one of the dimensions of sustainability (MEWC). Human capital matters touch on social and governance elements as part of ESG, and pertain to various other national and international sustainability frameworks, disclosures, and drivers. As such, the workplace is a Sustainability – “Gene and Core Value” for Boubyan, forming a vital cornerstone of our sustainable reporting. Accordingly, we report on aspects that include gender and age diversity, Kuwaitization, retention and turnover, employee engagement, and employee rights, among others. No Poverty

Further emphasizing the value of workplace elements, we have Good Health and Well-Being derived 5 material topics related to human resources upon engagement with our stakeholders. Gender Equality

Decent Work and Economic Growth

Reduced Inequalities

106 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 107 5.1 Employee Diversity and Inclusion (102-7, 102-8, 202-2, 103-1, 405-1, 406-1)

As part of our sustainability / ESG visionary Gender Diversity SROI SROI Topic approach, we continuously measure the Looking at gender diversity, female employees Level Interpretation Value Outcomes diversity aspects of our workforce, and represent about 26% of our total employees aim to make our workplace as inclusive as across all subsidiaries (481 females), out of Female employment: High 1.21 KD *Female possible. Diversity aspects specifically focus which 17.2% female managers and above (43 sustainability employment on gender, age, and nationality demographics. females), and 7% female executive managers value for each value Accordingly, Boubyan continues to provide and above (1 female). Concerning the Board of 1 KD invested. equal employment opportunity, in line with our Directors, Boubyan’s Board is 100% male Board Dignity at Work Policy. As a result, 0 cases of members while BLME Board of Directors has 1 Boubyan is committed to further empowering For BLME, women empowerment is reflected workplace discrimination incidents have been female member. women in the workforce, especially through in a number of ways, which include providing recorded at Boubyan. More information about creating an environment of non-discrimination. enhanced maternity package, ensuring training our workplace diversity and inclusion is given Figure 5.1a displays the number of employees To this end, we have open opportunities and development opportunities, participating in in this section. per gender, broken down per entity and in total. for all employees regardless of gender, and the HerCapital Programme by the UK Sponsors The gender implications show that Boubyan’s have various initiatives, including the Female for Educational Opportunity (SEO). workforce consisted of 490 females in 2019, Diwaniya gathering for females in the Branch and 481 females in 2020. Network. This has shown to be a supporting Employment Type Diversity platform to help grow and nurture female Another facet of employee diversity is having a Figure 5.1a: Boubyan Employees per Gender development. range of employee types, including part-time, full-time, and internships—while continuously Year 2020 2019 We are also growing our female pipeline in aiming to take in our employees full-time. The Boubyan Boubyan Boubyan Boubyan BLME Boubyan Boubyan Boubyan Boubyan BLME the workforce, especially from junior to senior breakdown of employees according to these Subsidiary Bank Capital Takaful National Bank Capital Takaful National management. We have appointed a female employment types, expressed in both total and Chief Strategy Officer at a senior level, as well as per subsidiary levels, are provided in Figure Men 1139 32 74 80 76 1122 30 86 84 77 female appointments at deputy general manager 5.1b. The results show that the total workforce Women 396 5 22 8 50 392 7 36 9 46 (DGM) level. Concerning our various employee- decreased by 0.37% from 2019 to 2020, related programs, we ensure that we have at though the number of part-time employees Total per 1535 37 96 88 126 1514 37 122 93 123 least 50% females in program nominations, increased by 1. subsidiary and 60% to 70% program nominations for Total per group 1,882 1,889 Kuwait Fund for the Advancement of Science (KFAS) abroad programs. *Note: BLME was not acquired by Boubyan during 2019.

Figure 5.1b: Boubyan Employees per Employment Type

Year 2020 2019 26% 74% Boubyan Boubyan Boubyan Boubyan BLME Boubyan Boubyan Boubyan Boubyan BLME Subsidiary Bank Capital Takaful National Bank Capital Takaful National Boubyan female employees Boubyan male employees Part time 0 0 0 0 5 0 0 0 0 4

Full time 1535 37 96 88 121 1514 37 122 93 119

Total per 1535 37 96 88 126 1514 37 122 93 123

Employment type subsidiary

Total per group 1,882 1,889

*Note: BLME was not acquired by Boubyan during 2019.

108 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 109 Age Diversity 5.2 National Empowerment Starting with Kuwaiti nationality managerial Employee diversity not only covers gender, but workforce, as reflected in Figure 5.1c below. As (102-8, 103-1, 103-2, 202-2, 404-1, 404-2) positions (managers and above), this increased other demographic aspects that include age. a result, compared to 2019, the Under 30 age- from 53% in 2019 to 56% in 2020, which Boubyan recognizes that there are different group had decreased by -13.5% change, the Boubyan is constantly considering national was a -5.7% change increase. As for overall skills and advantages to be reaped from each 50-30 age-group increased by -10% change, empowerment when managing its workforce, Kuwaitization in Boubyan, that is shown age group, and accordingly records, assesses, and the Over 50 age-group increased by -4% specifically concerning strategies to strike in Figure 5.2a, which gives the number of and reports the age implications of our change as summarized in Figure 5.1d. a balance between the diversity benefits of Kuwaiti and non-Kuwaiti employees across varied nationalities in the workforce, while also our Kuwait operations—namely Boubyan Bank attracting, hiring, retaining, and developing local and the 3 other subsidiaries in Kuwait. As a Figure 5.1c: Boubyan Age Diversity employees. The empowerment of the national result, the group-wide Kuwaitization rate is workforce is viewed as both a compliance shown as 64.5% in 2019 (from 1,217 Kuwaiti Year 2020 2019 matter and as an initiative from Boubyan to give employees), and 64.5% in 2020 (from 1,214 Boubyan Boubyan Boubyan Boubyan BLME Boubyan Boubyan Boubyan Boubyan BLME back to and support the community in which it Kuwaiti employees). This shows a slight increase Subsidiary Bank Capital Takaful National Bank Capital Takaful National operates. For Kuwait operations, progress in this of the group-wide Kuwaitization rate by about domain is assessed through the Kuwaitization -0.2%change. Under 30 640 12 11 12 29 736 14 17 17 30 rate, and the percentage of Kuwaitis in 30-50 838 21 73 63 72 725 19 92 65 67 managerial positions. More information about As a caveat, note that the number of Kuwaiti

Age group Age group our empowerment of the national demographic employees for Boubyan Bank itself has Over 50 57 4 12 13 25 53 4 13 11 26 is given in this section. remained the same at 1,178 Kuwait employees in both 2019 and 2020, recording about 77% Kuwaitization rate at Boubyan Bank for 2020 as Figure 5.1d: Boubyan Age Diversity Summary displayed in Figure 5.2b.

Figure 5.2a: Boubyan Workforce per Nationality

Year 2020 2019

Boubyan Boubyan Boubyan Boubyan Total Boubyan Boubyan Boubyan Boubyan Total Subsidiary Bank Capital Takaful National Bank Capital Takaful National -13.5% +10% +4% Kuwaiti 1178 23 11 2 1,214 1178 21 18 0 1,217

Nationality Non-Kuwaiti 357 14 85 86 542 336 16 104 93 547

Figure 5.2b: Boubyan Bank Kuwaitization

2020 2019 %-Change 77% 77% 0%

110 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 111 SROI Compensation and Remuneration member, which is also in compliance with SROI Topic Level Interpretation Value Outcomes Compensation and remuneration is provided to CBK requirements. As for BLME, compensation Boubyan staff in line with related compensation and remuneration matters are governed Kuwaitization - Boubyan High 1.33 KD *Employment policies, as well as the Employee Incentive Plan, by the Remuneration Framework and the Bank sustainability value and (in BLME’s case) Remuneration Framework Remuneration Policy Statement, , built around value for each and the Remuneration Policy Statement. a set of principles of remuneration. 1 KWD invested. Also, Boubyan discloses Board and executive management compensation in its annual Succession Planning governance report (and as part of annual Part of performance management is also To support this direction of national no tie-back, as well as opportunities for about reporting), in compliance with Central Bank ensuring that performance and business empowerment, Boubyan created the Talents 150 internships per year. Other initiatives we of Kuwait (CBK) requirements. For the Board, functions are sustained now and into the Development internal department, and is conducted also include the MAP program to Boubyan specifies the remuneration provided future, which is made possible through a further attracting Kuwaiti talent through its attract bright talent, building relationships with for the Chairman, Board Executive Committee solid succession plan. Accordingly, Boubyan brand and the Employee Value Proposition. local universities during career days, as well as (BEC) members, and the non-BEC members. is committed to an active succession plan Externally, the brand and the values that partnering with the Manpower and Government For executive management, Boubyan discloses approach, which follows the process displayed Boubyan stands for appeals to the wider Restructuring Program (MGRP) to bring in new the aggregate compensation rather than per in Figure 5.3 below. market, and to this end, we are able to source talented Kuwaiti recruits. In addition, Boubyan and acquire a variety of Kuwaiti talent. This is has conducted an external hackathon with Figure 5.3: Boubyan Succession Plan Process present in our Employee Value Proposition, and the International Business Machines (IBM) the wider financial and non-financial benefits corporation and the Public Institution for Social 1 7 6 that we offer. Some opportunities we offer Security (PIFSS) for Kuwaiti digital talent. include a Masters of Business Administration The succession plan is annually The approved succession plan Every year, the succession plan (MBA) opportunity funded by Boubyan, with reviewed for all roles in terms is communicated with the CBK is presented to the Nominations of criticality and importance, during its annual audit. Note that Resources Committee to obtain focusing especially on all senior CBK is the only external body its approval. roles per department. that is exposed to the succession 5.3 Performance Management plan, keeping it otherwise (102-38) internal and confidential. An important way that Boubyan is managing its Employee Handbook and the Performance and employees is by developing and implementing Capability Process. It is accordingly stipulated a fair and structured performance that the appraisal process is conducted 2 times In addition, we review We create a plan for Then, we ensure We consider which management process, especially linked to KPIs, per year—one in the mid-year, and once during the skills requirements each successor through that the succession positions must be fast- compensations, balanced scorecard, and career year-end. The probation period also has its own and exposure required. a digital platform plan is aligned with tracked compared to paths. More information about our performance evaluation process. (Oracle). our strategies and others. directions. management of our workplace is provided in this section. Note that this appraisal process was able to 2 3 4 5 continue despite the challenges presented At Boubyan, the performance management by COVID- 19. Employees carried on working process involves a number of departments remotely to complete the agreed goals for 5.4 Capacity Building employees through training and development (102-8, 103-1, 103-2, 205-2, 404-1, 404-2) and governance bodies, including department 2020 as per the performance plan (including opportunities is provided in this section. Capacity building through the provision of heads, the HR Department, and the Board sales and services), which were then linked to Figure 5.4a provides a summary of the training training and development opportunities to Nomination and Remuneration Committee the balanced scorecard. hours and courses data, though more details employees is critical for Boubyan to ensure (BNRC). Furthermore, the performance about training and the specific courses can be a sustainable business model. Accordingly, management process is mainly governed by the found in the annexes. Specifically, Annex 1 lists we record the training courses and hours Boubyan’s training for 2020, Annex 2 lists the provided to employees each year. Boubyan training for 2019, and Annex 3 provides the conducts employee feedback regarding the training conducted for BLME employees for training provided, and also provides employees both 2019 and 2020. As a result, a total 46,710 with a Guide for Learning and Development. training hours across the 224 different training More information about how we support our courses provided were recorded for 2020.

112 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 113 Figure 5.4a: Training Courses and Hours

2020 2019 SROI SROI Topic Level Interpretation Value Outcomes

# of Courses Training Hours # of Courses Training Hours Fresh graduates High 1.33 KD *Employment 224 46,710 379 66,421 employment: sustainability value value for each 1 KD invested. SROI SROI Topic Level Interpretation Value Outcomes

Training Very 14.41 KD *Training value As for internships, Figure 5.4c displays the of whom intern with Boubyan Bank. Interns High sustainability number of interns per subsidiary, and total per approaching Boubyan are especially interested value for each year. The result is 24 interns in 2020 the majority in getting exposure to an Islamic Bank. 1 KD invested. Figure 5.4c: Internships

Year 2020

For BLME, it reports information about training which is completed by all employees. The same Boubyan Boubyan Boubyan Boubyan BLME and exam certification for the Islamic Finance platform also contains financial ethics training Subsidiary Bank Capital Takaful National

Qualification (IFQ). As of 2020, 24% of BLME modules, which contain some human rights Number of interns per 19 0 0 0 5 employees are certified with the IFQ, while elements. subsidiary a further 13% have attended the training but have yet to pass the exam—as the next cohort Youth Development Total number of interns 24 per group is scheduled for May 2021. While training and development for Boubyan employees is important, Boubyan is also Specifically looking at human rights training, committed to youth development through 5.5 Retention and Turnover this is often a disclosure in sustainability capacity building —ie. providing internship (102-8, 401-1) reporting. Accordingly, Boubyan does not yet opportunities and hiring recently qualified Retention and turnover often serve as important totals per year. The result shows an overall have training for this specific topic, though other university graduates. The number of these new indicators as to how well organizations manage workforce size decrease of -0.37% change, a topics indirectly tackle it. For example, for BLME, graduates in Boubyan’s workforce is displayed their employees, ultimately aiming for optimal decrease of new hires by -55.1% change, and one of the e-learning training modules is titled in Figure 5.4b per subsidiary and in total. levels of high employee retention and low a decrease of turnover of -41.3% change. Note “Preventing Discrimination & Harassment,” The result shows 88 new, recently qualified employee turnover. This is especially important that this was a successful decrease of turnover, university graduates in Boubyan in 2020. as this type of performance would reflect a as it indicates a good level of retention among strong adherence to a fair and equitable work Boubyan’s employees. While most organizations environment and conditions that encourage were reducing the number of staff as a response Figure 5.4b: Fresh University Graduates employees to stay, rather than facing otherwise to the COVID-19 challenges, Boubyan hired 173 costly and challenging turnover amounts. new employees, and reduced the turnover by a Year 2020 Through Boubyan’s management of its large amount compared to 2019. Boubyan Boubyan Boubyan Boubyan BLME human capital, these aspects are considered. Subsidiary Bank Capital Takaful National Accordingly, we report our figures related In addition, retention is assessed more to retention and turnover, and our resulting specifically among employees who have been Number of fresh 87 2 0 1 3 graduates per subsidiary impacts in this area are also covered in this sponsored to get their Masters of Business section. Administration (MBA). The result shows Total number of fresh 88 that out of the 88 employees sponsored, 51 graduates per group Boubyan’s retention and turnover indicators persons were retained in Boubyan, yielding a are reflected in Figure 5.5, which shows the 58% retention rate among MBA-sponsored turnover and new hires per subsidiary, and the employees.

114 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 115 Figure 5.5: Retention and Turnover

Year 2020 2019

Boubyan Boubyan Boubyan Boubyan BLME Boubyan Boubyan Boubyan Boubyan BLME Early leave permissions for Allowed mothers to work Subsidiary Bank Capital Takaful National Bank Capital Takaful National mothers: from home: 2 working hours per day 3 days per week Number of new 149 4 0 2 18 350 9 0 6 20 hires employees

Number of 129 3 5 7 18 236 4 10 4 22 turnover 5.7 Employee Satisfaction and Engagement employees (102-8, 102-43)

Total of new 173 385 Having a well-satisfied and engaged workforce Whistle-Blowing and Employee Complaints hires employees per contributes to the overall sustainability of an Boubyan ensures that the engagement includes group organization now and into the future. More feedback and complaints mechanisms available Total of turnover 162 276 information about Boubyan’s performance in to employees. Employees have access to an employees ensuring that our workforce is engaged and anonymous whistle-blowing mechanism to per group satisfied is presented in this section. voice any grievances, and these whistle-blowing claims are reported directly to the Chairman, as Note: BLME was not under Boubyan acquisition during 2019. Boubyan is continuously aiming to keep the per the CBK governance requirements. Since workforce engaged and satisfied. For example, adopting the Whistle-blowing Policy in 2012, every year, Boubyan holds recognition events to no whistle-blowing cases have been reported. 5.6 Employee Rights reward the best-performing employees in sales (102-8, 103-1, 103-2, 401-2) and service, which is done for all frontliners, Boubyan has another mechanism for employee Adherence to employee rights is important in As a result of the COVID- 19 pandemic, as well as the best performance in back-office complaints known as “We Listen.” This channel sustainability, as it reflects our commitment employee rights would have been infringed departments. In 2019, these events were is administered by the HR Department. The cases to treat the employees fairly and equitable, in other companies where compensation was conducted quarterly (4 events). In 2020, this received through “We Listen” total 5 employee providing the rights and labor conditions that cut; however, in Boubyan, the rights were fully was done once (quarter 4), rather than quarterly, complaints in 2019, and 1 employee complaint they are entitled to. More information about adhered to as staff continued to be compensated due to COVID-19 . The next recognition event is in 2020, which is an -80% change decrease in Boubyan’s performance concerning employee fully, and with no salary or benefit cuts. The planned for February 2021. employee complaints, as per Figure 5.7a. Note rights is presented in this section. workplace operated as business as usual, with that the category of these complaints belonged staff working in shifts or alternative days. For BLME, to measure employee engagement, to the following: pay / benefit / recognition Boubyan continuously abides by employee we have conducted an employee engagement and physical work environment. Also note that standards and rights, and adheres to the Boubyan shows support through women survey, with an overall excellent employee these do not include the IT-related complaints, Kuwait Labor Law and related regulations. empowerment, especially for mothers, as per engagement score of 83 in 2020, up on 82 in as there is a generic IT helpdesk system in place Through this compliance, we are also indirectly Figure 5.6. Accordingly, employees who are 2019. In addition, BLME conducted several to address IT concerns, which then generates embedding human rights into our employee mothers working in our branches are allowed employee engagement activities in 2020 incident reports. rights. Employee rights and standards are to ask permission to take two hours’ early including a Start of Season event, several guest ensured through various HR policies, including leave per day if needed. In addition, female speaker events and multiple employee mails the employee Code of Conduct policy, BLME’s employees in various departments across outs. Employee Handbook, and BLME’s Dignity at Boubyan are allowed to work from home for 3 Work Policy. days a week, especially in order to support their Figure 5.7a: Boubyan Employee Complaints per Year children with their studies. % Change of Employee Employee Complaints - 2019 Employee Complaints - 2020 Complaints

8 2 - 75%

116 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 117 5.8 Health and Safety (102-8, 103-1, 103-2, 403-1, 403-2)

Boubyan records and reports the turnaround BLME encourages open dialogue with its Ensuring the health and safety of our Boubyan every 2 years. We believe that the time for resolving employee complaints. For employees. This approach is further supported stakeholders, namely our employees, is of OHI is one of the best available predictors of Boubyan Group, this is set at 5 working days by BLME’s Employee Handbook, especially the utmost importance, especially concerning an organization’s future capacity to perform, starting from the date of receiving the case. concerning areas that include feedback, COVID-19 measures. Having a healthy and safe showing that healthy organizations outperform However, concerning IT employee complaints, conduct champions, monthly gatherings, and working environment ultimately has an impact unhealthy ones by about 3 times. At Boubyan, the IT Department abides by the service-level others. on any organization’s overall sustainable the last OHI survey was conducted in 2018, agreements (SLAs), which vary per department performance. More information about how while the survey for 2020 was postponed to and per case. Employee Benefits we ensure health and safety throughout our 2021 due to COVID-19 . Boubyan provides employees with a range of business is given in this section. For BLME, the turnaround time for resolving benefits, separate from the usual salary and Specifically concerning COVID- 19, Boubyan employee complaints ranges from 2 weeks to incentives. These not only have an impact on At Boubyan, one way that we are measuring implemented a number of health and safety 1 month, depending on a number of factors, attracting and retaining valuable talent in our health and safety is through the organizational measures, including those displayed in Figure including the type of complaint, its formality workforce, but also contribute to ensuring health index (OHI), which is conducted in 5.8a. (formal or informal), whether or not an that our employees are satisfied, comfortable, investigation takes place, the time availability and meeting their associated labor rights. of parties involved, among others. Figure 5.7b shows Boubyan-wide benefits for Figure 5.8a: Boubyan Health and Safety Measures employees.

Figure 5.7b: Employee Benefits

Sanitization Sterilization of Body temperature Remote working facilities and floors checks platforms (eg. Zoom, Microsoft Teams, etc.) Health Insurance (ie. Health Assessment Life Insurance Family Air Tickets medical, dental) Allowance

Frequent health Full disclosure on all Emergency drills checkup for human’s social media platforms (conducted once per Children Education Grade Allowance Performance Bonus Per Diem payments resources (ie. staff) and in case of a reported year) Assistance (depending on job grade non-human resources COVID19- cases and region of travel) (ie. data servers/data centers)

118 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 119 Case Study The Impact of Health and safety measures are further 3. Stress Testing team supported and governed by the Health and There is also a Stress Testing team that audits COVID-19 on the Safety Policy, Business Continuity Plan, the the above two teams, especially checking Employee Code of Conduct, and the Board compliance with the business continuity Audit Committee’s review of the internal audit management (BCM) and the internal audit (IA). Workplace health checks on branches. From the Board, For BLME, throughout 2020, the Board of Overview: oversight of health and safety is conducted at a the Director and the Board Nominations and Boubyan was very proactive in addressing the COVID-19 high-level / indirectly through related policies, Remuneration Committee (BNRC) discussed plans, and activities. pandemic. We made various efforts to ensure that it staff wellness and health and safety matters was business as usual, but also to ensure the safety of in the context of the COVID- 19 pandemic To ensure employees’ health and safety, our employees and customers. At the same time, we on a regular basis. Normally, in previous aimed to maintain the delivery of essential banking Boubyan has created 3 working committees, years, the CEO would have overall day-to- explained as follows. services for all involved. We equipped staff who were day responsibility for the oversight of health required to work remotely with virtual private network and safety matters, and this would involve (VPN) access, and those who were required to come 1. Safety team discussions with the Board through the regular into work were equipped with the essential personal Focusing on safety for staff and customers, the quarterly update reports. Both the CEO and the protective equipment (PPE). A comprehensive education Safety team is a diverse group of individuals who Head of the HR Department would appraise the program, including Instagram and push notifications on focus on education, awareness, communication BNRC concerning staff wellbeing matters on the HR application, were put in place so that all staff and ensuring track and trace for employees for a regular basis. Health and safety are further were kept updated of the progress. Not all areas were the bi-monthly and monthly assessments. The supported by BLME’s Wellness Hub. open, but staff were rotated around during this time results of the survey are reviewed, and high-risk so that we could still offer services, and vulnerable cases are followed up. If required, swab tests At Boubyan National, there is compliance staff were identified and kept from coming into work. are also done. with the procedures issued by the authorities For example staff who had diabetes, hypertension, asthma etc., were told to work remotely. In addition, governing health and bank management. we created a committee of 3 working groups managing 2. Emergency Response team This includes conducting meetings remotely, Boubyan has an Emergency Response team the health and safety matters of COVID-19. keeping distance between employees, comprising premises and our Human Resource checking employees’ temperature, and Business Partners (HRBPs), as any infections are Objective: locating dispensers of anti-bacterial hand To ensure the safety of our employees and our advised to them both directly. Swab tests are cleansing gel prominently around the done, and, in case of any positive results, the customers, but at the same time provide essential facilities. Procedures are also in place so that services area is closed and sanitized for a number of if any employees feel symptoms of COVID- days. Then, track and trace is done for all staff 19, they inform their managers and the HR Outcomes: and customers who came in close contact with Department, then proceed to conduct a swab The success of the approach that Boubyan took is as the individual who tested positive. test before returning to work depending on follows the results. (1) Low infection rates (2) Mobilized staff force who are aware and take One important health and safety KPI that is COVID-19 seriously. Note that our last survey for often reported is occupational injury incidents, check-in with staff on COVID was 94% completed which has successfully been kept at zero for by all staff Boubyan as shown in Figure 5.8b below. (3) No negative impact on employee’ benefits yet (4) Well-structured internal plan, rollout, and committee structure to manage and implement health and safety matters, while ensuring compliance 2019 2020 Zero (0) Zero (0)

120 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 121 6 | Engaging our Society

Boubyan is committed to engaging with the community, in order to act as a responsible corporate citizen and give back to the community in which it operates. After all, society is one of the sustainability dimensions (MEWC), and is strongly aligned No Poverty with the social elements of ESG. A number of areas within national and international sustainability frameworks further Zero Hunger emphasize the social dimension. Community engagement and investment is important to ensure that any organization is able Good Health And Well-Being to sustainably operate within its community. At Boubyan, we contribute to our community through various of areas, which Quality Education include youth / education, women empowerment, health initiatives, environmental issues, and our range of community Gender Equality engagement tools. As such, we recognize that the community Sustainable Cities and Communities is a Sustainability – “Gene and Core Value.” Further highlighting this, we have prioritized 3 community-related material topics Partnerships For The Goals through our materiality assessment / engagement with our stakeholders.

122 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 123 Social Engagement Strategy Social Support in the community, which is displayed in Figure Our social engagement is implemented us to deliver unique and innovative programs, As part of the social engagement, one indicator 6c,including the social support area, and strategically, stemming from Boubyan’s while carefully listening to our stakeholders, of social support is the total amount invested description. Corporate Social Responsibility (CSR) Strategy, and ultimately catering to the needs of our and the CSR strategy framework is illustrated stakeholders. Governing our CSR directions Figure 6c: Social Support in Figure 6a as follows. The framework is is our CSR Policy, which focuses on areas composed of our CSR vision and mission, displayed in Figure 6b. In addition, BLME adopts Social Support Description strategic objectives, thematic priorities, its own directions in CSR, which are stated in

and then cascaded to the different types of BLME’s CSR Policy, Charitable Donations Policy, International relief Donation to the Lebanon relief operations initiatives. As a result, our CSR strategy allows and List of Approved Charities. Government support Participation in a government support fund under the supervision of Kuwait Banking fund Association (KBA) Figure 6a: Boubyan’s CSR Strategy Framework Youth and education Contribution to youth through engagement and educational initiatives

Women empowerment Contribution to women through women empowerment initiatives

Investing in our Health and safety Conducting health and safety related initiatives for a range of stakeholders Prioritize, Manage, Tag line Tag line communities Monitor internal Go an extra mile to empower the communities external Live well, Do good Environment Conducting initiatives that had environmental themes we serve, with more than just financial service with your bank CSR vision and mission To work with communities and addressing salient sustainability and special local needs, through continuous engagement to achieve effective and Sustainable improvement in quality of life of communities

Volunteering number of initiatives. Figure 6d provides more

Strategic Promotion of Supporting the Innovative products Encouraging Preservation of our Creating a volunteering culture at Boubyan details about employee volunteering hours per Objectives Education and Society and and services Customers and Culture Training Sustainable living Employee is important as a channel to give back to the event. The results show a total of about 520 Environment Participation community. Volunteering allows our internal volunteering hours, across 140 volunteers, stakeholders to participate and contribute noting that the number of volunteers may include overlaps across initiatives. Thematic to their society. In line with this volunteering Health | Education | Philanthropy | Entrepreneurship | Women empowerment | Financial literacy Priorities culture, Boubyan employees volunteered for a Types of Initiatives Internal initiatives | External initiatives | Products and services Figure 6d: Employee Volunteering

Initiative No. of Hours per Total Volunteering Figure 6b: Boubyan’s CSR Policy Focus Areas Volunteers Volunteer Hours

Kuwait Red Crescent Support 20 3 60

Kuwait Civil Defense Support 20 3 60

World Cleanup Day 100 4 400 Youth Education Health Total 140 - 520

Environment Sports Special needs

124 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 125 SROI Figure 6.1b: Educational Initiatives – 2019 SROI Topic Level Interpretation Value Outcomes Initiative name Employee community Very 17.78 KD *Volunteering value volunteering High sustainability *Activities value Recite with Boubyan - Quran competition 2019 value for each 1 KD invested. Sponsor of K -TECH expo- 2019

Figure 6.1c: Educational Initiatives - 2020 6.1 Youth Empowerment Initiative name Description (103-1, 103-2, 201-1, 413-1)

One of the focus areas of Boubyan The youth focus is evident in Boubyan’s products Tarateel Program 2020 (Online) Quran Program for the children of Boubyan customers, ages 6 to 9 years old. In this program, 16 Boubyan employees and 20 children participants were involved, and it was held online. community engagement includes youth that target young people, such as technological and its empowerment. This theme of youth advancements and the provision of a state- Recite with Boubyan - Quran Competition for the memorization of the Glorious Quran, open for the children of Boubyan and non- Competition 2020 (Online) Boubyan customers. empowerment is expressed through a range of of-the-art mobile banking application for activities, including attracting youth through customers. Accordingly, we record the number Darisni with Boubyan Campaign Campaign aiming to assist students with continuing their academic studies, especially concerning the - 2020 transformation to online education during COVID-19. Accordingly, Boubyan provided free lessons to internship and fresh graduate employment, of youth customers (age 24 years and below), students for a month, via the Darisni Application. Big Tree Society initiatives, youth educational who make up around 34% of our customers, as Boubyan Summer Camp Boubyan launched an online summer camp for customer’s children aged 6 to 10 and totalling events, summer camps, and Maker Faire. More per Figure 6.1a as follows. 20 children, using Zoom. It included a range of activities and events over 2 weeks. Note that a information about the way we empower our satisfaction survey was conducted at the end of the end; the results show that with a response rate of youth is presented in this section. 27%, the satisfaction score was 93%. Boubyan Reading Marathon 7 - For every 10 pages the participants read, Boubyan and Clinica donated 1 KD for children who could 2020 - (Online) not afford educational fees. Figure 6.1a: Boubyan Youth Customer Segment out of Customer Base GUST Collaboration Boubyan Continuous Improvement Department collaborated with the Gulf University of Science and Technology (GUST), where students were given an assignment to improve a chosen process in Boubyan, as a part of on-field training. The specific process involved using lean methodology for Customer Segment % of customers creating the Murabaha deals process. Interactive Children Guide Boubyan developed an interactive “Children guide” to entertain and educate children during Youth Customers 34% COVID-19. Topics in the guide included Islamic, Learning, Arts and Crafts, Games, and Activities. Reading Volunteering 2020 BLME conducted an initiative wherein 10 BLME employees volunteered during school term time to read with students from disadvantaged backgrounds.

While Boubyan focuses on youth customers, related engagement through 3 initiatives in Future Frontiers Mentoring BLME conducted its own educational initiative, in the form of the Future Frontiers Mentoring Program. Program Through this program, BLME employees mentored children from underprivileged backgrounds into there is an additional focus on youth through 2019, and 11 initiatives in 2020 respectively. work or future education (aged 16 to 18 years). The program started with a Lunch and Learn event in social engagement related to education. Figure November 2020, and continued with one-on-one coaching sessions by 13 BLME employees. 6.1b and Figure 6.1c display the education- Boubyan Cube Challenge Boubyan organized this event to encourage meaningful games, which developed mental abilities for children and adults alike while increasing the levels of challenge among them. Then, the top 10 winners were awarded financial rewards by Boubyan’s management and the panel of judges.

Boubyan E-Cup FIFA 2020 Boubyan held this tournament remotely this year (online). The tournament was for young men who Tournament were at least 16 years old. Prizes were given to first, second, third, and fourth place.

126 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 127 SROI SROI Topic Level Interpretation Value Outcomes Figure 6.3a: Boubyan Health Initiatives - 2019

Summer Camp Very 4.88 KD *Value of social Event name High sustainability activities Tech Neck - Awareness Digital Campaign 2019 value for each 1 KD invested Health & Fitness Expo

BMI Check-Ups - 2019 Future Frontiers Program High 1.02 KD *Value of volunteering sustainability *Monetary contribution Steps with Boubyan - 2019 value for each 1 KD invested Obesity Campaign - 2019

Diabetes Awareness Campaign - 2019 6.2 Women Empowerment Noor Boubyan 4 Campaign (201-1, 413-1)

Empowerment of women through social empowerment was another focus for Boubyan’s Figure 6.3b: Boubyan Health Initiatives - 2020 engagement is one area that contributes social engagement, with details in Figure 6.2 as Initiative name Description to sustainable development. Women follows:

Awareness campaign with Conducted awareness campaign (phases 1 and 2) with the Nutribox App, to increase the level of health Nutribox App 2020 immunity, especially regarding COVID-19. Figure 6.2: Women Empowerment Initiatives Safety Kit Distribution - Kuwait Distributed safety kits that included health protective items (ie. sterilizers, masks, gloves, etc.), in Initiative name Description Airport 2020 Kuwait International Airport to passengers.

Steps with Boubyan 2020 Initiative conducted where participants exercised by walking at the Al-Hamra Mall. In return for Sponsoring the Ideal Mother Sponsored the Ideal Mother Award to honor mothers each 5 minutes of walking, Boubyan donated 1 KD. The proceeds of the campaign were donated to Award during Mother’s Day underprivileged community members. This year, due to COVID-19, Boubyan launched the Boubyan Steps mobile application, as the event was held more virtually during Ramadan. As a result, around 5,000 participated through the App.

Boubyan Health Program Conducted weekly health awareness lectures for staff, focused on COVID-19, psychological aspects, social aspects, proper nutrition, bolstering immunity, sports, fitness, returning to work, and lifestyle 6.3 Health Initiatives improvement. These were conducted via digital channels (Microsoft Teams). (201-1, 413-1, 416-1) 2020 New Lifestyle - Seminar Conducted lecture seminar by Dr. Abdullah Al-Mutawa, for 250 customers. The seminar focused on taking care of your health, and learning about key nutrition, fitness, and psychological habits that Health is often found to be one area that • Conducting Boubyan’s events and activities enable a healthy lifestyle. organizations focus on throughout their through digital and online channels BLME Social Media Awareness BLME consistently updated the website and social media in line with new government guidance, community engagement. More information • Spreading health and COVID- 19 awareness ensuring that customers and the community were up to date with new developments. Also, as BLME about Boubyan’s implementation of health messages via social media platforms was aware that COVID-19 was seeing a rise in cyber-crime and scams worldwide, BLME featured scam prevention and cybersecurity as ongoing themes on its social media, such as posts that regularly linked initiatives is provided in this section. • Publishing news related to various Boubyan to the #Takefive and stopfraud.org.uk website. departments in daily newspapers World Mental Health Day 2020 Noting the mental health repercussions of COVID-19, BLME expressed its support of the World Mental In comparison with the yearly community Health Day 2020 in its social media channels. BLME also engaged an author to speak of her lived engagement conducted, 2020 was a unique Overall, Boubyan conducted 7 health initiatives experience with mental health challenges and her dramatic tale of survival after becoming lost in the desert. Employees were sent a copy of her book to help raise awareness and understanding around year in that Boubyan focused on health and in 2019 and 12 health initiatives in 2020, which mental health and resilience. safety related matters due to COVID- 19. was a 71 % change increase in the number Generally, this type of awareness can be found of health initiatives from 2019 to 2020. in the following: More details in Figure 6.3a and Figure 6.3b respectively as follows.

128 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 129 6.4 Environmental Initiatives (201-1, 413-1)

Figure 6.3b: Boubyan Health Initiatives - 2020 Initiatives that promote environmental Boubyan conducted social engagement aspects can be part of an organization’s through environmental initiatives. There were 2 Initiative name Description social engagement as well. More information environmental initiatives in 2020, as displayed about Boubyan’s environmental initiatives is in Figure 6.4 as follows. Staff Recognition for COVID-19 Recognized and honored Boubyan staff who worked throughout the partial curfews and total lockdowns in collaboration with the HR Department. accordingly provided in this section.

COVID-19 Guides Designed, printed, and distributed various types of instructions related to COVID-19 to Boubyan customers and staff, following the return to work. This includes publishing health and COVID-19 Figure 6.4: Boubyan Environmental Initiatives awareness guides, including: • Boubyan Health Guide Initiative name Description • Lockdown Guide • Boubyan Online Shopping Guide Boubyan Coffee initiative with Conducted awareness initiative to reduce the use of plastic and conserving the environment • Boubyan Government Services Guide Dose 2020 • Immunity Guide • Other messages Sponsorship of the World Sponsored a campaign to clean certain areas in Kuwait Cleaning Day Distribution of Disposable Prayer Boubyan distributed plastic disposable prayer mats around mosques in Kuwait, aiming to curb Mats infections cases resulted from shared prayer mats.

UK National Health Service (NHS) Throughout the COVID-19 crisis BLME shifted its CSR focus to the National Health Service (NHS). As Support and Donations this crisis touched our employees in unique ways, we requested employees nominate NHS facilities that had special meaning to them. We received a number of nominations from employees who 6.5 Engagement Tools had family members working on the front line as doctors and nurses. We had employees nominate (102-43) hospitals that had helped them or a family member through a medical emergency. We made other donations to the NHS in London, Manchester and Redditch. In total, £33,000 (~13,477 KD) was The use of engagement tools is crucial • Website donated across these facilities. to attracting and maintaining continuous • Outdoors advertising Food Bank Donations BLME also focused on supporting local Food Banks. The unprecedented economic ramifications of engagement with the community. These • Call center the COVID-19 crisis in the UK meant many were struggling to feed themselves and their families Therefore, demand in food banks increased greatly. Accordingly, BLME donated a total of £13,175 (~ engagement tools range from social media • Automated Teller Machines (ATMs) 5,381 KD) to Food Banks across the UK. channels to marketing campaigns / offers done • Branches for customers. More information about our • Boubyan Direct engagement tools is provided in this section. • Malls SROI SROI Topic • Internal communications / emails Level Interpretation Value Outcomes Boubyan uses engagement tools in order to conveniently engage with the community, Specifically, Figure 6.5a displays the number Steps with Boubyan High 2.01 KD *Value of mainly through its social media and marketing of Boubyan followers / subscribers for selected sustainability volunteering communications channels. These include: social media channels. It shows that there have value for each *Health outcomes for • Newspapers, radio, TV been increases across each of the channels 1 KD invested. participants • Social media (Instagram, Twitter, YouTube, (Instagram, Twitter, and YouTube), as well as *Monetary health Facebook, LinkedIn, Glassdoor) a -13 % change increase of total social media donations to • Digital media followers / subscribers. community

Figure 6.5a: Boubyan Social Media Followers / Subscribers - per year Boubyan Health Program Medium 0.89 KD *Employee health sustainability outcomes 2020 2019 % value for each Social Media Channel followers / subscribers followers / subscribers Change 1 KD invested. Instagram 345,215 333,264 4 %

Twitter 210,869 198,244 6 %

YouTube 167,000 108,000 55 %

Total 723,084 639,508 13 %

130 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 131 SROI SROI Topic Level Interpretation Value Outcomes Through Boubyan’s varied engagement tools The engagement channels specifically include and marketing activities, there is ample marketing campaigns / offers, which are often Customer marketing High 1.46 KD *Monetary savings for communication related to segments, products, assessed for their success, looking at the campaigns / offers sustainability customers services, and engagement. All of Boubyan’s campaign’s objectives and KPIs. Figure 6.5b value for each *Comfort for events, activities, and contributions towards displays a number of marketing activities, 1 KD invested customers society are published through the channels. campaigns, offers, and discounts (totalling 12), Specifically concerning BLME, it has compiled which were provided to customers to increase a list of sustainability / ESG-related topics engagement, satisfaction, added-value, “Top- communicated on its social media, which are of-mind ratio,” and loyalty. Note that these listed in Annex 8: Sustainability / ESG Related continued to be offered to customers by In addition, BLME has its own approach (national and sectoral media) that especially Topics on BLME Social Media Boubyan, despite challenges from the COVID19- concerning community engagement tools and focused on BLME’s savings products, and pandemic. giving back to the community. BLME Corporate BLME’s real estate coverage—reaching over 1 Communications team has implemented million readership. Accordingly, BLME’s social ongoing media and social media monitoring. As media channels followers had also increased Figure 6.5b: Boubyan Marketing Campaigns / Offers a result, this has shown to have press releases markedly. Marketing Campaigns / Offers Details

New Year Catering Offer Provided a catering offer for the new year, for the first time, which was the following: “50 KD discount on catering services for 20 persons from Junkyard, Humble Burgers, Proper Sliders, Taco Eataco, The Kitchen, and Chubby Balls and have a joyful New Year family gathering.” This offer was provided to 100 Boubyan customers, who were selected based on a draw to receive the discount vouchers.

National & Liberation Day offer Provided a 50% discount offer from Melenzane and Recco restaurants, for the Kuwait National and Liberation Days celebrations.

Eid Offer Provided a 15% discount offer from Melenzane restaurant, for the period of Eid celebrations.

New Hijri Year offer Provided 40% discounts on orders from Nino, Leila Mn Lebnan, and Johnny Rockets restaurants.

Boubyan Moments - Trapani Conducted campaign with Trapani restaurant, Morouj, providing offers and discounts through games Morouj with customers.

Lazurd App Provided a 20% discount offer from Lazurd Application.

Deliveroo offer Provided 5 KD off promo code for the first 250 Boubyan customers, noting that we are the first bank in Kuwait to start conducting digital offers.

B-Online Exclusive Offer Provided an exclusive offer at B-Online for platinum and private Boubyan customers—being conducted for the first time.

The Butchery offer Provided a special offer at The Butchery for the first 200 Boubyan credit-card customers—being done for the first time.

Macro Offer Provided an offer at Macro for the first 100 Boubyan platinum and private credit-card customers— being conducted for the first time.

Platinum Experience II Conducted campaign for Boubyan platinum customers as part of Platinum Experiences, as a shopping experience in collaboration with Harvey Nichols.

Free Concierge Services for Provided a first-time offer of free concierge services for Boubyan platinum and private banking Platinum Customers customers holding credit cards, including new concierge service registration and utilization.

132 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 133 7 | Impacting through Innovation and Digitization

Innovation and digitization elements are important to ensure that an organization is on the right track towards a sustainable future. This area touches on a number of sustainability dimensions (MEWC) and ESG elements, due to the various benefits reaped from innovation and digitization for the various stakeholders involved. As a part of this, technological advancements have Good Health and Well-Being impacts that range from convenience in both internal operations Decent Work and Economic Growth and customer experience, to environmental savings as a result of time and resource efficiencies. As such, Boubyan recognizes Industry, Innovation and Infrastructure innovation and digitization as a great potential for sustainable development, ultimately being a Sustainability – “Gene and Sustainable Cities and Communities Core Value.” In addition, throughout our engagement with our stakeholders (via materiality assessment), we have prioritized Responsible Consumption and Production a total of 3 material topics associated with innovation and digitization. Climate Action

Partnerships For The Goals

134 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 135 7.1 Innovation (103-1, 103-2)

Being a “Gene and Core Value,” sustainability Boubyan applies a range of innovative methods among others, digital financing platforms for Boubyan’s innovative initiatives focus is integrated into our operations, especially within its operations, as well as externally while Corporate and Personal Finance departments, on disruptive markets, such as financial through our innovation and digitization developing or enhancing customer products and business banking for more lead generation technologies (FinTechs). In line with this, approach. Innovation, specifically, is important and services. Digitization also plays a role in (eg. i2i standards management platform, and Boubyan has formed partnerships that pioneered for paving the way towards Boubyan’s future, project management excellence, and in the Finfirst digitization) us into these new areas, while also adding value aiming for unique and advanced ways of digital transformation cycle. Our innovation • Partnered with major third-party providers to Boubyan customers, from reducing cost to doing business. More information about our and digitization approaches are built around specialized in providing backend and services enhancing their experience in digital and retail innovative approach is displayed in this section. a framework that is illustrated in Figure 7.1a, to enable Boubyan to be more agile services. We put effort into enabling Boubyan which focuses on digitization, modernization, • Assessed all business units within Boubyan to to be available on various financial platforms and agility. gain insight and details about their needs, and in the region to access a wider customer base, accordingly proposed ways to innovatively and access the digital products. Accordingly, enhance and transform them selective innovative partnerships are described Figure 7.1a: Innovation and Digitization Framework • Participated in Boubyan’s Rewards Program below: Hackathon • Finfirst: This is a financial services platform 1- Acquire, Engage and Transact Digitally • Participated in reviewing and providing that digitizes and eases the use of financial Digitization partners with financial risk assessment from products and services, including obtaining a (Journeys and activities) Boubyan Capital car loan and personal Murabaha. Boubyan • Sharing the latest trends from many aspects Boubyan received hundreds of leads in the 90 (ie. infrastructures, user experiences and days of operations. research) with our internal stakeholders, to • ExpandCart: ExpandCart is a leading 2- Digital to the core make sure that Boubyan is covering them, e-commerce platform in the Middle East and Leading Modernization along with keeping up with our increased North Africa (MENA) region. It provides a Innovation (Transform, upgrade technology) customer base in line with said trends collection of tools and resources to manage an online store, process orders, sell products Innovative Partnerships online, and other related services. Accordingly, Boubyan partnered with ExpandCart to add value to customers and business offerings. 3- Digital to the core Boubyan is often approaching partners for • Partnered with AWS Activate to empower New ways of working digital / innovative projects, aiming for partners entrepreneurs and startups, and provide (Culture and talent) who are well reputed concerning their ability them with cloud computing resources from to minimize environmental risks and focus on Amazon Web Services (AWS) to help them applying the ESG standards. Some ESG areas innovate and grow. This comes in line with Innovation Initiatives • Spread innovation culture within Boubyan especially include local and international Boubyan›s Incubation Program focus on To emphasize the value of innovation, Boubyan by communicating related ideas and hosting philanthropy. We aim to work with partners who providing the best services and solutions to is constantly assessing the market, utilizing our related events prioritize their employees’ health and condition, support the initiatives of young Kuwaitis and networks, forming partnerships that can assist • Implemented an idea management platform— along with their safety at work. With regards Kuwaiti startups taking part in its incubation in adapting to disruptive innovation, and lastly ie. Tawasol Application to governance, we focus on due diligence program. internally spreading the culture and knowledge • Shared recommendations with internal teams to ensure that there is no conflict of interest to make us embrace this ideal. Accordingly, in terms of research and trends, along with when it comes to partnering with the entities, Boubyan conducted several innovation preparing proof of concepts (POCs) and including startups and other enterprises. initiatives, which are listed as follows: value related to their fields. This includes,

136 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 137 A specific cycle is followed when deciding to project, which is illustrated in Figure 7.1b as Figure 7.1c: List of lean projects completed partner with another entity for an innovative follows.

Figure 7.1b: Digital / Innovation Partnership Cycle Reduce number of calls Reduce salary rejected Reduce Cycle Time of Enhance Tracking & received by CPD records Processing Travel Plan Cycle Time for Fraud Rule Notifications Governance for Cards

Enhance change ranking Improve Client Experience Eliminate manual work Eliminate CBK complaints process (CIF closed) for Rescheduled PF by to close Fixed Deposits for Credit Card Renewals/ The We assess the We shortlist We draft Direct Sales accounts with zero balance Replacement fees Continuous requirements, and pitch contracts and Improvement and scout for the potential move forward Automate Assignment Of Reduce Cycle time of Enhance Social Media Increase QR Usage in Department partners who partnerships. toward Right Process Expected fee process of procedure Transfers for Corporate international Credit Branches (CID) meets can apply establishing with internal and innovate the stakeholders within the partnership. Reduce Siron KYC alerts Reduce Siron Embargo Recover Lost Fees Enhance Private Banking alerts of Swift Cancelation Eligibility Report to collect business Request information. needs.

Rental Costs Reduction Reduce Cycle Time & papers printed of new Murabaha Reduce Transaction Time For Boubyan Locations process and Papers Printed for During COVID-19 AlGhaly Account

Change Management and Continuous Major achievements this year by the Continuous Improvement Improvement Department include the launching Note that all lean project improvements must of the change. Only then is it moved to the Digitization and innovation played an especially of lean and continuous improvement projects, be justified and validated with data in the final «Completed» phase. Note that our process important role in mitigating COVID-19 and the Live Request page on the Tawasol project storyboard involves obtaining regulatory function challenges. Namely, Bouyan’s Continuous Application. All opportunities along with their . This is done by comparing the previous original approvals (ie. Sharia’a, Risk, among others) Improvement Department arranged laptops associated information are now received and state with the final state after improvement, before implementing the change. to be provided for all employees, to allow for tracked on Tawasol instead of using Excel sheets especially demonstrating the impact of the remote working —as a result of the mandatory and emails for receiving and tracking projects change. Data is collected by any of the following Looking at the controls, no project is manpower reduction percentage. progress. Tawasol also allows the employees to methods: considered complete unless control measures This department, along with other departments, view and redeem rewards for the lean points • Collected from the management information are put in place to ensure sustainability of the was key to overcoming the COVID- 19 they have collected after completing their system (MIS) for automated systems improvement and sustaining the gains. This is challenges (ie. remote working, reduction of projects. As a result, a total of 19 lean projects • Collected from multiple readings are measured done through procedure updates, automation working hours, and focus of COVID-19 recovery) were completed in 2020 (despite COVID-19 manually by the project team of processes, changes in contracts, etc. All through technology. challenges), and Figure 7.1c provides a list of • Collected by any other means to ensure changes must be approved by the Sharia’a & the completed projects. reliable data Operational Risk departments, whereas the Boubyan’s change management strategy is Operational Risk Department directs us if further focused on overcoming the various COVID-19 The change management involvement in lean approvals are required from other departments, challenges, as well as spreading the Lean projects is continuously assessed. Specifically, including Legal, Compliance, IT Risk, etc.). culture awareness across the Boubyan. The the “Control” phase of lean projects is for strategy is to also certify Lean Ambassadors to testing and monitoring the change. Projects Bouyan’s Continuous Improvement Department assist in identifying opportunities and guiding are announced for completion only after is open for inputs from employees from all the employees on how to identify «waste» and an approval is obtained from the process over Boubyan, which goes through a process use the Lean methodology to eliminate it. owner, confirming the validity and success outlined in Figure 7.1d as follows.

138 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 139 Case Study Tawasol Application Figure 7.1d: Change Management Process for Employee Cycle Overview: The Continuous Improvement Department (CID) is 1) Boubyan employee raises the opportunity in the Tawasol Application. used to receive opportunities for process enhancement from all over Boubyan via emails. All communications The opportunity is assigned to a Continuous Improvement specialist to follow up regarding the project’s status were previously done 2) with the initiator and validate the opportunity. in Excel-sheet format for tracking and reporting purposes. This issue started from the beginning of the If the opportunity is valid, it is considered as a project, and goes through the new approach by this department in 2017, and on an 3) subsequent stages. average there were 87 projects for which tracking was The opportunity is measured: measuring the current state with supporting required per year. This affected the staff at the CID, 4) information, such as the process map, KPIS, cycle times, number of errors, etc as well as the project owner from a communications and tracking perspective. The desired outcomes were 5) The opportunity is analyzed: root cause analysis is conducted to identify the root to enhance the communication and reporting tools for causes of the problem. this matter—out of which came the idea of the Tawasol 6) The solution is proposed: the recommended solution to overcome the issue and the Application. proposed changes. Objective: 7) The solution undergoes quality assurance and control plan: validating the The objectives of the Tawasol Application were as improvement and ensuring measures are taken to sustain the gains. follows: 1. Set a standard and systematic communication tool for the Continuous Improvement Department (CID). 2. Enhance the systematic communication and reporting tools between CID and the project owner.

Outcomes: The outcomes of the Tawasol Application were as follows: • Implemented a standard systematic communication tool (Tawasol – Live Request) to share the project’s status between CID and project Owner • Provided various features added to serve multiple stakeholders • Provided ability for the CID to track project status per stage • Provided ability for the project owner to request and inquire about their Reward Points • Provided the Lean Ambassador project details • Eliminated / reduced the time wasted to generate weekly/monthly reports • Established Dashboard (Power Business Intelligence “BI”) aligned and integrated with the systematic tracking tool (Tawasol – Live Request) • Provided easy management reporting outcomes that reflect live data from Tawasol — Live Request

140 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 141 7.2 Digitization and Technology (103-1, 103-2, 203-1)

Boubyan emphasizes digitization and • Mobilized IT resources (human & non-human) Figure7.2a: Internal Digital Technologies technology in creating a journey of virtual to continue operations within our disaster services, to be accessible to both internal recovery (DR) site Name / type Description / Purpose of use stakeholders (ie. employees) and external • Activated all virtual means of banking—ie. Robotic Process Automation RPA is the technology that allows us to configure computer software, stakeholders (ie. customers). Because these call center, interactive voice response (IVR), (RPA) or a “robot” to emulate and integrate the actions of a human interacting within Boubyan’s systems to areas are vital in paving the way to the future, applications, among others execute a business process

they are recognized as priorities in Boubyan • Ensured data center accessibility for all Pegasystems Business Process Management Platform that is being used currently for: to ensure its sustainability. More information authorized personnel 1. Workflow Management about our embrace of technology and digital • Distributed IT resources to specific identified 2. Case Management 3. Business Rules Engine tools is given throughout this section. staff for operations with specific internal controls in place Service-Oriented Architecture Oracle SOA Middleware is a collection of standards-based software products that span a range of (SOA) tools and services Information Technology (IT) Overview from Java Enterprise Edition (EE) and developer tools, to integration services, identity management, The IT Department at Boubyan overlooks the For BLME, the response to COVID-19 is consistent business intelligence, and collaboration The SOA middleware is the software that connects software components or enterprise applications. journey of transition to virtual banking. We with the approach followed by Boubyan, and Middleware is the software layer that lies between the operating system and the applications understand the business needs and ensure this is key in maintaining adequate technology BCAP Back Office Portal that been used heavily for Boubyan’s operational tasks that our IT resources are scaled up to provide related services across Boubyan. Accordingly, that are not available in the core system as an interface excellent and seamless service to our customers. BLME’s IT-related response included a Application Programming An API management tool that sits between a client and a collection of backend services We provide a framework and manage any number of actions that focused on customer Interface (API) Gateway digital transformation projects, be it through communication, continuity, disaster recovery, Broadcom

iOS, Android, Fitbit, Garmin, or Samsung Pay, and crisis management. Digital Channels Platform Development platform for designing and developing digital services for different channels for Retail among others. Our mandate is to serve as the and Corporate services

front line to meet any transformational needs Digital Technologies RASA - artificial intelligence (AI) Machine learning framework to automate text- and voice-based assistants. It is used to build the AI of Boubyan through a technology perspective. Boubyan reports on its digitization and Digital assistant - Msa3ed. In addition, it is integrated with tensorflow for AI prediction and other use Automation is one of our core values and we technology, focusing on features that include cases aim to achieve it throughout our operations, accessibility, platforms, channels, mobile Msa3ed Artificial Intelligence (AI) Digital Assistant chatbot for customers especially to minimize time and risk. apps, automated processes, digital marketing, Mobile Banking Develop mobile banking for both retail and corporate banking, using native and react native savings, and impacts related to COVID-19. languages Notably, the IT Department at Boubyan had Accordingly, a selected list of Boubyan’s Near Field Communication (NFC) Boubyan in-app provisioning on Android Operating System (OS) for NFC-HCE card payment for both an especially active role to play during the internally-used digital channels are displayed -Host Card Emulation (HCE) VISA and Mastercard (MC) COVID-19 pandemic. With curfews and in Figure 7.2a. In addition, Boubyan uses digital lockdowns implemented, Boubyan had to technologies to enhance the experience of Digital Channels Back office Handle all operations related to digital channels users and services ensure that its operations remained active and external stakeholders (ie. customers), which are Boubyan Checkout Provides checkout channel interface for Boubyan customers

its customers were not negatively affected. We also displayed in Figure 7.2b as follows. Django Content Management System (CMS) and development framework for all Boubyan websites understood that the priority was to transition to a virtual banking mode instead of a one-to- Aion Components Digital On Boarding tool & eKYC one branch-based banking model. Accordingly, below are some actions taken by the IT Department to contribute to this.

142 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 143 Figure 7.2b: External Digital Technologies (related to customers) Digitization Achievements Information Security Boubyan had set up a business plan regarding Boubyan is constantly striving to ensure Name / type Description / Purpose of use Outcomes investments in digitization and innovation, and improve information security, which is focusing on maintaining our market leader especially demonstrated in the following areas Boubyan Retail Application / Boubyan retail app provides retail customers • Provides top quality user experience Internet Banking direct access to conduct banking activities • Reduces the pressure on the branches position. The following lists the selected / activities conducted by Boubyan,as follows: (remotely using a mobile device such as a • Provides easy access on the majority of achievements completed in 2020: smartphone or tablet) for the following: financial products and services 1. Financial transactions • Minimizes the manual operational tasks 1. Onboarding our systems with SecDevOps 2. Opening new accounts • Increases products sales • Launched the revamp of the mobile app and 2. Adding Jason Web Token (JWT) 3. Getting financial statements of accounts/ credit cards website 3. Adding one-time-password (OTP) per device 4. Applying for finance • Launched the revamp of Boubyan Rewards linking 5. Applying for a credit card • Scaled up Digital Factory (2 additional squares: 4. Adding OTP for critical services 6. Other innovative digital banking services 2nd mobile square, back office automation) 5. Adding check device by iOS and Android Msa3ed is Boubyan’s interactive chatbot • Provides top quality user experience • Delivered 5 new digital e2e customer journeys, 6. Using DexGuard for Android MSa3ed (Chatbot) available 24/7 to assist clients with any • Reduces the pressure on the branches questions or inquiries via Boubyan App, • Provides easy access on the majority of including back-office activities (onboarding, 7. Using Secure Sockets Layer (SSL) pinning WhatsApp and live chat financial products and services credit card, Murabaha, mortgage) across 8. Prevent Jailbreak Msa3ed is a unique interactive tool designed • Minimizes the manual operational tasks to add convenience to your digital banking • Increases products sales channels 9. Using Transport Layer Security (TLS) 1.2 experience. • Increases the clients knowledge base about • Digitized back-office processes for efficiency 10. Designing new services as microservices, Msa3ed services include: Boubyan’s products & services -Opening a new account or a fixed deposit • Launched mobile wallet and migrating existing critical mission services -Making local and international bank transfers • Introduced WhatsApp-based banking services to microservices -Accessing Boubyan’s PayMe service -Cardless and Civil ID withdrawal 11. Revamping Retail from stateful to stateless -Purchasing iTunes and Google Play cards In addition to these achievements, Boubyan -Making credit card and mobile bill payments -Requesting IBAN information ensures that staff working in IT and digitization Boubyan Digital Group Management (DGM) -Getting information about the next salary matters are qualified with the appropriate As the Digital Group Management (DGM) transfer date -Getting assistance to block a card certifications, including, among others, MBA, Department is the digital factory of Boubyan, PMP, CCA, MCP, etc. These are displayed more DGM is always striving to be aligned with the Boubyan Corporate App/Internet Banking N/A fully in Annex 7: Boubyan IT and Digitization strategic objectives of Boubyan as a whole. The provides Corporate/SME clients with fast, easy access to their corporate accounts, available Staff Certificates. DGM is broken down in Figure 7.2c below. around the clock. It allows businesses to Boubyan Corporate App/Internet manage accounts, perform inquiries, check Banking balances, and receive account details and other related services online. Some features include: -Viewing all accounts, Murabaha, and credit cards Figure 7.2c: DGM Squads -Approving or rejecting transactions and requests initiated by Online Banking. -Calling the Relationship Manager directly from the App -Viewing financial transactions -Opening new accounts -Getting financial statements of accounts/ credit cards -Uploading salary Files Mobile Banking (MB) Chatbot Website -Giving multiple users access based on the organization chart -Providing financial reports & charts

Official Websites Official websites for Boubyan and each of the Convenient channels to provide information subsidiaries about: -Products -Offers -Discounts Corporate Digital Robotic Process PEGA -Services usage • One of the main platforms for marketing Banking Automation (RPA) campaigns • Covers all bank clients base

144 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 145 The DGM’s strategic alignment is especially information to clients about the pandemic by Digitization at Corporate Banking Digitization in Light of COVID-19 ensured by working closely with other divisions redirecting the users to the proper governmental Digitization is also important for Corporate At Boubyan, we have responded to COVID-19 to introduce a yearly roadmap, following channels for the latest news and updates. DGM Banking and the ability to serve corporate by keeping our clients up to date through our agreement with all of Boubyan’s main divisions. also had more than 40 change requests in clients. Accordingly, corporate clients have notifications and digital platforms, as well The roadmap covers various divisions and their production. 2 main ways to conduct their transactions as complying with the required regulations, roles in achieving Boubyan’s KPIs, whether digitally with Boubyan, which are namely including those from the Capital Markets digital, operational, cost saving, etc. Based Furthermore, the DGM remained working at full through the Online Banking portal, or through Authority (CMA) and the Kuwait Banking on the priorities set for this roadmap, the capacity, including employees working remotely the Corporate Banking Application. Digitization Association (KBA). Specifically, digitization DGM commits to providing “Go Live” for from their homes. During the lockdown, the supports numerous functions, including (but and technology have played an important role the roadmap. Accordingly, Annex 9 displays priority was shifted towards the services that not limited to) the following: at Boubyan in light of the COVID-19 crisis. some KPIs aligned with the associated digital can help users in light of COVID-19 adaptation, More information concerning the impact platforms and processes, which are further including: the ability to digitally activate credit • Processing salaries of digitization, specifically on products and integrated into the overall roadmap. cards, manage fixed deposits, call-back, and • Requesting new or renewing Murabahas services during COVID-19, is given below: provision of digital Eidya (gift). • Performing local and international transfers • Performing single and/or bulk transfers Moreover, Boubyan’s DGM remained operating Boubyan App Active Mobile Users • Conducting cheque-book requests during the COVID-19 challenges, to release Boubyan measures the percentage of active • Audit certificate requests new services during the pandemic. Accordingly, mobile users on Boubyan App out of the total • Viewing credit facility limits and utilization there were 4 retail mobile application releases, customer base, which increased from 64% in • Providing detailed information related to cash and 3 other website releases. For example, 2019 to 71% in 2020, which was about an and non-cash deals Boubyan introduced an appointment system -11% change increase, as shown in Figure 7.2d. • Others for branch visits, which can be done through To further assess this important KPI, Boubyan has the retail mobile app, website, and/or through conducted a detailed survey named “Boubyan the Msa3ed chatbot. Concerning the Msa3ed App - Happiness and Satisfaction Study.” Chatbot, Boubyan provided much necessary

Figure 7.2d: Active Mobile Users

2020 2019 %-change:

71% 64% +11%

Digitization at Consumer Banking Group keep safe and social distance. Customers can (CBG) perform various operations in a self-service Digitization plays an important role with CBG. mode, such as payments, card control, finance Digitization allows customers to perform a management and the opening of new saving range of financial activities, such as payments and term deposits. Specifically, these can and opening new products, directly from their be done through Boubyan digital channels, mobile or desktop at home, without the need including the mobile app, website, Chatbot, and to go to a branch, which provides convenience WhatsApp. Then, the matters can conveniently and accuracy in terms of service to users. be handed over to a Boubyan agent if any This has become crucial, especially in 2020, further information or support is required. with the spread of COVID-19 and the need to

146 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 147 Case Study Digitization Impact of Services and Products During COVID-19

Overview: - Ability to send email and get account - Msa3ed Call Back: a service that lets Although the COVID-19 pandemic heavily relationship manager through the app Boubyan’s Chatbot respond back on behalf impacted the Finance Sector across the world. - MSa3ed Public Mode - ability to use of the call center when the waiting period Boubyan succeeded in maintaining its provision Boubyan’s chatbot through WhatsApp, is too long to contact the call center. of top-quality services to our clients through without logging into the Boubyan App for The chatbot also assists the caller in any its digital channels, especially during Kuwait’s certain services inquiries through the app full/partial lockdown phases, which lasted from 5) Branch appointment updates through April 2020 until September 2020. 3) Mobile App update 6.12 in September which Boubyan’s website, done in July 2020 Also, Boubyan kept introducing new digital contain: 6) On-board and open account through services and updates to satisfy our client base. - Activate Renewed Card - ability of clients Boubyan Direct (ITM Machines), done in These included the following: to activate their credit cards, which are September 2020 delivered for them through a carrier without 1) Mobile App update 6.10 in March, which the need to visit the branch or call the call Boubyan continued providing the existing contained: center services through BBYN app and the Msa3ed - Linking children accounts with the parent - Book Branch Visit - to comply with Kuwait Chatbot, especially during the lockdown account: to View/Monitor children accounts laws of controlling maximum limits of period, when all of Boubyan’s branches were balances, transfer from and to children people in the same place through providing either closed or partially available. Boubyan accounts, open new children accounts. customers with an appointment system, customers were able to use our main digital - Tracking the status of international which they can use to book appointments to channels (retail app and Chatbot) instead of transactions visit any Boubyan branch they prefer visiting the branches for the main banking features, including; 2) Mobile App update 6.11 in June which 4) Mobile App update 6.13 in October which • Opening accounts contained: contains: • Opening fixed deposits - Pause/Resume credit cards - ability of clients - PASS Service (ticketless and cashless parking) • Issuing debit/credit cards to temporarily activate and deactivate their top up and registration - While the country • Renewing credit cards credit card through the app was at the end of partial lockdown, Boubyan • Balance inquiry - Partial withdrawals and deposits for AlMona introduced through our app a service to • Getting financial statement and AlJana fixed deposits (FDs): ability to register and top up PASS applications. PASS • Local/international transfer partially withdraw or deposit funds to/from applications provide services to enter and • Electronic vouchers existing fixed deposits without visiting the exit car parking areas without the need • Payments branches for physical cash payment or any human • Card control - Ability for CLICK users to open new FDs interaction. • Cradles withdrawals services - ability to open fixed deposit for Youth • Utap/Tap and pay segment without visiting the branches - Ability to send an email to the Relationship Manager (RM) and save their contact number

148 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 149 In addition, Boubyan provided customers • Fixed deposits through the retail app: Sustainability / ESG Aspects of Digitization (ESG) aspects, which are displayed in Figure with the option to continue auto paying for 1. Q1 Average: 1294 account Boubyan’s digitization directions are linked to 7.2e as follows. finance deals / credit card installments by user 2. Q2 Average: 1677 account various environmental, social, and governance choice, after the Central Bank of Kuwait (CBK) 3. Q3 Average: 1804 account instruction of stopping to deduct the monthly 4. Q4 Average: 1646 account Figure 7.2e: Sustainability / ESG Aspects of payments for the period between April to Digitization October 2020. Also, Boubyan customers were • Saving accounts through the app: able to log in to Msa3ed and ask to resume the 1. Q1 Average: 2224 account Environment (E) 1. Reduced the paper waste by designing many paperless journeys, including: On-Boarding Phase 2, deduction of installments. 2. Q2 Average: 3314 account Credit Card Issuance, and e-vouchers 3. Q3 Average: 3661 account 2. Reduced ink consumption due to the less printing reliance 3. Introduced many branch services through the digital platforms to reduce the branch visits and Objective: 4. Q4 Average: 2905 account consequently reduce time and transportation The objective of digitization efforts during

COVID-19 was to maintain providing full • Account to account transfer through the retail Society (S) 1. Introduced Digital Eidya (gift) to reduce human contact during the COVID-19 pandemic services and products through digital channels, app: 2. Providing redirection through the Msa3ed Chatbot, especially helping with efficiency, convenience, accuracy, and communication COVID-19 news updates from official government channels and provide alternative channels rather than 1. 2019: 971,725,421 3. Providing new application skin for the youth segment to be more convenient for their banking branches and the call center. Also, the objective 2. 2020: 1.496,330,402 activities. was to provide new digital services that helped 3. Change: 54% increase the customer with the current situation of Governance (G) 1. All of our new digital services have been reviewed and confirmed by Boubyan’s Compliance, social distancing. Operational Risk, and Legal teams to make sure they are compliant with the national and CBK regulatory requirements. 2. All of our new Digital services have been communicated with the CBK for approval and feedback Outcome: before the deployment date. 3. Digitization directions are ensured to be guarded with the appropriate governance mechanisms, The aforementioned objectives were achieved controls, and checks-and-balances. as per the details in the Overview section. The 4. Specifically for BLME, digitization directions are done while being governed by the following: • General Data Protection Regulation (GDPR) result of these digitization directions during • UK Data Protection Act of 2018 COVID-19 was highly noticeable through • UK Prudential Regulation Authority • Shai’a compliance the digital channels report, which showed • Payment Services Directive (PSD2) significant increases on the retail app usage during the period between April to October of 2020. The following shows progress against various digitization KPIs for quarters 1 through 4.

Digitization KPIs Performance • Total retail app users logging in: 1. Q1 Average: 3,314,685 2. Q2 Average: 3,673,756 3. Q3 Average: 4,624, 475 4. Q4 Average: 4,814,872

150 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 151 More specifically concerning the environment, Certificates: Cost Optimization through Digitization Boubyan’s DGM plays a crucial part when Boubyan clients can get any of their accounts or Boubyan recognizes that digitization comes it comes to measuring and assessing the banking certificate digitally rather than visiting with a series of outcomes, including cost savings environmental impacts and savings associated a local branch to request the printed certificates / optimization. The cost savings features of with digitization. These are explained in the Boubyan’s digitization directions are displayed following: Statement of account: in Figure 7.2g as follows. Boubyan clients can log into the retail app and • The daily activities of the DGM does not require receive a copy from their account statement Figure 7.2g: Digitization with Cost Optimization paper usage, and the full team relies on digital without the need to print any paper copies communication and system workflows, rather than paper communication. One KPI to assess the efficiency outcomes of • The digital teams are using applications like digitization efforts is the number of customer Apache Payme Msa3ed Push Apple iMessage confluence and Jira to obtain any needed reports generated digitally / electronically, Maven job chatbot notifications notifications approvals digitally, rather than depending on rather than printed. These have successfully manual paper signatures. increased by a -% change of 36.4% (resulting SecDevOps jRebel DEV/SIT/QA Payout – Business process • In terms of client services, the DGM introduced indirectly in various environmental savings, onboarding integration checkout management (BPM) many flows on the level of the retail app that including paper and ink) as displayed in Figure does not need any paper wastage. These are 7.2f as follows. In addition, Boubyan has 1 Integration Robotic Process Internal Ongoing proof of concept (POC) listed as follows: type of invoice that is generated digitally / services Automation management electronically. (RPA) for platform Credit card issuance: upgrades Through the app, the user approval on any form within this journey is being approved digitally rather than providing a signature on physical papers

Figure 7.2f: Boubyan Digital / Electronic Customer Reports

2020 2019 %-change:

15 customer 11 customer +36.4% reports reports

152 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 153 Case Study Digital Transformation of our Customer’s Journey - Through the Msa3ed App

Overview: artificial neural network to Msa3ed to detect One rule-of-thumb for the success of Msa3ed, An important digital channel developed was patterns in data. We undertook the proof-of- which is evidenced by exponential increases the Msa3ed Chatbot (Personal Assistance). concept to not only increase accuracy and in usage as of late, comes down to a basic confidence levels, but to enhance the human principle: Listen to what the customer really A happy and satisfied customer is at the heart behavioral aspects of our digital assistant to needs on a day-to-day basis, and map out the of every successful venture, and the engine that new heights – all in line to serve our customers’ pain points. Year on year, we were able to keeps Boubyan running. At Boubyan, we realized needs and expectations. effectively increase our unique user base by early on the significance of reengineering our 26% and total logins by over 120%. methodologies to listen, accept and adapt to WhatsApp Banking, in partnership with Infobip, our customers’ needs to offer products and was recently piloted and launched by Boubyan Many of the pain points are relatively hard services that are relevant, and solve pain-points to further enhance our customer experience to capture using standard data analytics. As otherwise not addressed in the market. by offering an encrypted, secure and reliable a financial institution that fosters creativity way to conduct financial requests on the go. To and experimentation, we decided to launch a We have launched many exciting and tackle a greater market share and appeal to the recent service to cater to use cases that weren’t innovative products and services through our masses, we have readily made available Msa3ed addressed by the books: The “Remind Me” Digital Assistant, Msa3ed, which was the first to all customers and non-customers alike, feature was born, allowing our customers to artificial intelligence (AI) banking chatbot receiving quick responses to many inquiries, receive actionable push reminders to pay their in Kuwait. Msa3ed serves as the mascot of whether financial or non-financial requests. mobile and internet bills with the ability to Boubyan, identifiable as a 29-year-old married execute payment on the reminder day instantly. Kuwaiti man with an optimistic outlook on life. We tailored the service to appeal further Questions that he often gets include: to our customers by allowing users to not These initiatives set Boubyan ahead of the “Are you married?” only explore Boubyan’s various products curve, allowing teams to invent unparalleled “Do you dream?” and services, but also listing their account digital experiences while staying true to its “Where do you work, Msa3ed?” balance, last 5 transactions on their accounts mission statement and overall vision. Some “Are you a human or a bot?” and credit cards, share the International Bank features of Msa3ed are described below: Account Number (IBAN), and more. Live chat As more users type, Msa3ed gets smarter. handover to a customer care agent is available • Call Back: This is, in part, to a great team who maintains for further support. To tie it all in and remain Call Back is designed to reduce the pressure on the highest standards of integrity and consistent, we have launched Msa3ed Public, the call center. This is especially useful during a professionalism by teaching the bot all the which enables accessibility to Msa3ed to all heavy traffic period. Should a customer contact nuances and grammatical complexities involved non-Boubyan users, allowing end-users to the call center during heavy traffic, and drops with supervised machine learning. Recently, we sift through Boubyan’s wide-ranging financial the call due to waiting time, the chatbot sends were proud to have successfully deployed an portfolio, locate branches, or just to chat. a push notification to the customer through a

154 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 155 push notification. The notification asks if the Objective: chatbot may assist the user, after which the The objective of the Msa3ed chatbot was to Other Roles of Digitization Integrating technology into our services: user is either satisfied with Msa3ed’s response, service the customers more conveniently and Digitization and technology make an impact Technology enhanced our services in a number or the user can request to be called back by efficiently, allowing alternatives to call center both internally and externally, across several of ways. For example, we applied virtual Boubyan’s call center. and branch visits. areas, as listed below. reality (VR) technology to showcase and sell to new markets. We automated processes • My IBAN: Outcomes: Enhancing reputation: that had too many repetitive tasks, increasing A service in which the chatbot can provide IBAN The outcomes of the Msa3ed chatbot were Digitization helps maintain Boubyan’s values efficiency. In addition, we applied automation number for the users. achieved as the AI technology was able to internally and externally among stakeholders. and smart home technology to have more conveniently and efficiently help customers Brand implications are especially evident in environmentally-friendly constructions. • My Next Salary Date: with their needs, allowing them in certain cases customer products and services, participating One of the most frequent inquiries to Boubyan’s to avoid the call center and branch visits. in webinars, and promoting brand values within Mitigating risks: call center team is usually the salary deposit professional networks. Technology has been useful to assess and date. To reduce the pressure on the call center, mitigate our risks. Specifically, it provided Msa3ed provides the expected salary date Developing an agile mindset in Boubyan: for risk profiling, showing credit worthiness for each user automatically, whenever the Boubyan internal stakeholders take pride in aspects. It also added value to scalability and customer inquiries about it. ownership, always working and collaborating simplicity to managing large transaction values, with other divisions and departments towards especially through mitigating the human errors • Transfer Excess Balance from credit card: achieving successful partnerships, while that would be otherwise involved. Many customers visit the branches to apply a respecting their needs. We especially showed request through branch staff to transfer any teamwork and cooperation while adapting excess balance above the credit card limit back to change, especially when it comes to the to his/her account. Previously, such request COVID-19 crisis and embracing technology. will be sent to Boubyan’s Cards Operations Ultimately, digitization enables us to deliver Department to be executed. Now, both through with a quality-first mindset. mobile banking and the Msa3ed chatbot, the user can transfer his/her excess balance to his/ Enhancing operational efficiency and her card automatically. excellence: Digitization helped us achieve enhanced • Block or Unblock the Debit or Credit Card: operational efficiency and excellence, Through the Msa3ed chatbot customers can especially by creating and following processes choose to block/unblock their debit/credit cards, and procedures that reduced time and made either temporarily or permanently. Unblocking workflows more convenient. This was especially temporary blocks was only available through done for contracting procedures with partners, the call center and branches. and generally removing work hassles from our internal stakeholders. In addition, we were able to reduce operating costs of accessing new markets, by hiring more sales and operational staff.

156 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 157 8 | Assessing Our Environmental Impact

We recognize that environmental aspects are important to sustainability, being one of the sustainability dimensions (MEWC), and relating to environmental aspects in ESG. Environmental performance is also integrated into a number of local and international sustainability frameworks. As such, the environment is a Sustainability – “Gene and Core Value” for Clean Water and Sanitation Boubyan. Environmental matters specifically assessed include Responsible Consumption And Production water, waste, energy, and greenhouse gas (GHG) emissions. To support these disclosures, 1 environmental material topic was Climate Action prioritized as a result of engagement with stakeholders through materiality assessment. Life Below Water

Life on Land

158 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 159 8.1 Waste Management (301-2, 306-1, 306-2, 306-3, 306-4)

SROI As part of environmental performance, Boubyan decreased its paper consumption SROI Topic Level Interpretation Value Outcomes Boubyan assessed its waste consumption and across each of the 3 types by -29% change management. This is important in sustainability from 2019 to 2020, as shown in Figure 8.1a. The Paper Consumption High 1.11 KD *Printing cost savings as it shows that an organization is able to difference was a decrease of paper consumption reduction sustainability *Greenhouse gas (GHG) leave a minimal or well-managed mark by specifically 3,172,500 pieces of A4 paper. value for each emissions savings on the environment while providing value The environmental saving outcomes of this 1 KD invested. *Water savings to stakeholders. More information about reduction of paper is presented in Figure 8.1b, *Energy savings Boubyan’s waste management and results in specifically showing savings in GHG emissions, this area are provided in this section. energy, and water. Plastic Consumption Paper Consumption Every year, BLME recycles paper, with the We assess our waste management through where we successfully saw a -38% change Generally, we take on initiatives to reduce exception of the year 2020, since staff only plastic use, where we measure our plastic decrease in plastic use from 2019 to 2020, as the use of paper, especially through the occupied the office for 2 months due to consumption and implement initiatives to displayed in Figure 8.1c. Note that Boubyan has use of technology / digitization, and virtual COVID-19. In 2019, BLME’s paper recycling reduce it. Our plastic use is measured in 2 types, not yet implemented plastic recycling. communication (ie. email and share-folders), achievement was acknowledged by Paper ultimately aiming for a green environment and Round with an annual award, showing a total Figure 8.1c: Boubyan Plastic Use paperless office. Accordingly, we measure our recycling load of 1,670 kg, translating into paper consumption by three types—namely savings of 2.34 MTCO2e. Paper Type 2020 2019 % Change cartons, reams, and paper sheets. Remarkably, Folder file pocket type 2660 packet 490 785 -38 % (100 pieces per packet) Figure 8.1a: Boubyan Paper Consumption Pieces of plastic Paper Type 2020 2019 % Change 49,000 78,500 -38 %

Paper Cartons (5 reams per carton) 3,150 4,419 -29 % (2,500 papers per carton) SROI SROI Topic Level Interpretation Value Outcomes Reams of Paper 15,750 22,095 -29 % Plastic reduction Medium 0.06 KD *Plastic cost savings sustainability *GHG savings from value for each plastic reductio Sheets of Photocopy A4 Paper 7,875,000 11,047,500 -29 % 1 KD invested.

Figure 8.1b: Environmental Savings of Paper Reduction

Environmental Saving Amount Units

Greenhouse Gas (GHG) emissions 129 MTCO2e

Water usage 339,000 Imperial gallons (IG)

Energy usage 118,401 kWh

160 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 161 8.2 Water Management (303, 303-5)

Another facet of our environmental performance Regarding this area, Boubyan National has Figure 8.3: Electricity Consumption and Intensity is how we measure and manage our water developed a plan to install photocell tap water consumption. Similar to waste management, faucets at the Boubyan headquarters and the this shows the sustainability of the company new data center, which would help reduce Year 2020 by leaving a minimal or well-managed mark the amount of water consumed. Accordingly, Electricity Consumption on the environment. More information about Boubyan reports its water consumption in Figure (kWh) 10,958,176.00 Boubyan’s water management and its impact is 8.2, expressed in total water consumption (IG). provided in this section. These cover Boubyan’s 26 facilities, Boubyan Capital, Boubyan Takaful, and Boubyan National. For BLME, the head office is ensured by the As a caveat, 2020 should not be considered landlord to only engage with energy suppliers as a baseline year, since it was an exceptional Figure 8.2: Water Consumption and Intensity who provide clean fuel, supported by the year due to COVID-19. A lot of the business following certification: had been converted to remote working, which • Renewable Energy Guarantees of Origin resulted in indirect environmental reductions Year 2020 (REGO) due to lockdown, and health and safety working Water Consumption • Renewable Gas Guarantees of Origin (RGGO) measurements. (imperial gallons) 3,830,091 LED lighting has been used in BLME facilities Scope I since 2019, when it replaced conventional Scope I GHG emissions are defined as “all direct lighting. Also, the building management system emissions from the activities of an organization, For BLME, the head office (Cannon Street) is At Boubyan, for example, for electricity, we (BMS) was optimized in relation to chillers and or under their control.” For Boubyan, this is equipped with waterless urinals in the toilets, are using light-emitting diode (LED) lighting, in boilers in 2019, leading to energy savings. derived from the fuel consumption of owned installed by the landlord since 2018, to help compliance with Kuwait Ministry of Electricity Furthermore, a metering project and energy cars, which is displayed in Figure 8.4a. As a reduce water discharge. Accordingly, the Green and Water (MEW) regulations, which helps management system (EMS) implementation are result, Figure 8.4b shows the scope I GHG Apple Award was presented for this project reduce our electricity consumption. Our underway, and are planned to be completed by emissions calculated from owned cars, yielding in 2019. Additionally, water-saving faucet electricity consumption is further reduced 2021. a total of 75 MTCO2e, 508 grams sulfur oxide aerators have been installed in all washrooms by setting our heating, ventilation, and air- (gSOx), and 84 grams of nitrogen oxide (gNOx) and showers, since the end of 2019. conditioning (HVAC) system at 24 degrees of scope I GHG emissions. Compared to 2019 Celsius—around room temperature. In addition, 8.4 Greenhouse Gas (GHG) figures, this is a -36% change decrease in CO2e, 8.3 Energy Efficiency Boubyan’s headquarter building considers -59% change decrease in SOx, and -36%change sustainability / green environment aspects in the Emissions and Intensity decrease in NOx. These emissions figures can (302-1, 302-5) design, derived from silver Leadership in Energy (103-1, 103-2, 305-1, 305-2, 305-3, 305-4, 305-5, 305-7) also be expressed in intensity ratio figures per and Environmental Design (LEED) standard. Boubyan employee—being displayed in the As part of our environmental impact, we An important KPI in assessing any entity’s same figure. measure and assess our energy consumption As per Figure 8.3, Boubyn reports its grid environmental performance, specifically its and efficiency. A sustainable organization is electricity consumption, expressed in total climate change / carbon footprint impact, able to provide value to stakeholders while electricity consumption (kWh)—applicable is greenhouse gas (GHG) emissions. GHG adequately managing its energy usage. More to Boubyan’s 26 facilities, Boubyan Capital, emissions are often broken down into 3 information about Boubyan’s energy efficiency Boubyan Takaful, and Boubyan National. scopes—scope I, scope II, and scope III—each is provided in this section. reflecting different areas of GHG emissions. With this environmental baseline set, Boubyan aims to continue to measure, assess, and eventually reduce GHG emissions in total and within the associated scopes. More information about Boubyan’s GHG emissions performance is provided in this section.

162 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 163 Figure 8.4a: Boubyan Fuel Consumption from Figure 8.4c: Boubyan Electricity Owned Cars and Vehicles - 2020 Consumption and Scope II GHG Emissions

Owned Cars Liters Year GHG scope II (MTCO2e) 19 31,685 2020 6,984

Figure 8.4b: Boubyan Scope I GHG Emissions Scope III Analysis of our business air travel is displayed and Intensity Scope III GHG emissions are defined as “all in Figure 8.4f, noting that for this year, business % Change other indirect emissions from activities of the travel data only pertained to Boubyan Bank, Year 2019 2020 (2019 to 2020) organizations, occurring from sources that they Boubyan Capital, and Boubyan National. The do not own or control.” For Boubyan, this is estimated amount is provided in CO2e, NOx, GHG Emission CO2e SO x NO x CO2e SO x NO x CO2e SO x NO x calculated from both business travel and from and SOx for 2020, expressed total amounts. fuel consumption of non-Boubyan owned, Meanwhile, Figure 8.4g illustrates business third-party cars and vehicles (ie. rented / under travel GHG emissions for CO2e allocated contract). among regions. Amount 118 1,258 132 75 508 84 -36 % -60 % -36 % Information on fuel consumption of our non- As an aggregate result, Figure 8.4h shows the Boubyan-owned cars and vehicles (ie. rented total scope III GHG emissions calculated from Intensity Amount 0.06 0.67 0.07 0.04 0.27 0.04 -36 % -59 % -36 % cars) is displayed in Figure 8.4d, with analyzed both non-owned cars and business travel, / employee GHG emissions of rented cars expressed in both yielding a total of 95 MT CO2e of scope III total and intensity figures in Figure 8.4e. These GHG emissions, as well as other NOx and SOx Units MTCO2e g SO x g NO x MTCO2e g SO x g NO x MTCO2e g SO x g NO x are each reflected in CO2e, NOx, and SOx units. amounts.

Figure 8.4d: Boubyan Fuel Consumption from Non-Owned Cars and Vehicles - 2020 SROI SROI Topic Level Interpretation Value Outcomes

Scope I GHG Emissions Very 2.03 KD *Greenhouse gas (GHG) Rented Cars Liters High sustainability emissions savings value for each 7 17,438 1 KD invested.

Scope II Scope II GHG emissions are defined as “indirect displays Boubyan’s scope II GHG emissions of emissions from electricity used and purchased 6,984 MT CO2e, derived from grid electricity by the organization.” Accordingly, Figure 8.4c consumption.

164 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 165 Figure 8.4e: Scope III GHG Emissions – Figure 8.4h: Scope III GHG Emissions – Total - 2020 Rented Cars Only % Change Type Rented Cars + Air Travel Year 2019 2020 (2019 to 2020) GHG Emission CO2e SO x NO x GHG Emission CO2e SO x NO x CO2e SO x NO x CO2e SO x NO x

Amount 133 780 149

Amount 75 516 84 41 154 46 -45 % -70 % -45 % Units MTCO2e g SO x g NO x

Intensity Amount 0.04 0.27 0.04 0.02 0.08 0.02 -45 % -70 % -45 % / employee Total GHG Emissions The total GHG emissions in 2020 for Boubyan (scope III), and non-owned cars (scope III). The Units MTCO2e g SO x g NO x MTCO2e g SO x g NO x MTCO2e g SO x g NO x are presented in Figure 8.4i, covering rented total shows 7,085 MTCO2e in 2020, expressed cars (scope I), grid electricity (scope II), air travel as 3.8 MTCO2e per employee.

Figure 8.4i: Total GHG Emissions - 2020 Figure 8.4f: Scope III GHG Emissions – Air Travels Only GHG Scope MTCO2e

Year 2020 Scope I 75

GHG Emission CO2e SO x NO x Scope II 6,984

Amount 92 627 103 Scope III 133

Total GHG 7,191 Units MTCO2e g SO x g NO x

*Note: Amounts calculated with the assumption of business class travel Climate Change Compliance • The Executive Risk Appetite has been updated Generally, environmental matters at Boubyan to include that every Credit Application must Figure 8.4g: Scope III GHG Emissions per are addressed by the Board at a high-level and include an assessment of Climate Change Region– Air Travels Only indirect manner, such as in policy-making—ie. impact on the client. the Corporate Communication Policy. • The Macro Economic Update now includes a Region GHG Emissions (MTCO2e) Climate Change Tracker presented through For BLME, environmental matters are the Executive Risk Committee (ERC), Executive Middle East 19 discussed at the Board Risk Committee and Committee (EXCO), and the Operational Risk the Risk Management Department, and also Committee (BRC). communicated through brief papers. BLME has • A positioning paper has been presented 73 Europe taken further steps to embed climate change through June’s ERC, setting out some further matters into its governance, which are outlined steps to be taken in order to identify, manage Total 92 as follows: and report our exposure to Climate Change • The Chief Risk and Compliance Officer across both Transitional Risk and Physical (CR&CO) has been allocated as the responsible Risk. Senior Management Function holder. • Reference to pollution, waste, and resources issues has been added into BLME’s Corporate Social Responsibility Policy.

166 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 167 9 | Annex

Annex 1: Boubyan Training Courses - 2020 Hours per # of Total Subsidiary / Hours per # of Total Subsidiary / Training course Participant participants Hours Department Training course Participant participants Hours Department

2020 IIF Annual Membership Meeting 40 2 80 Boubyan Bank Certified Fraud Examiner - ACFE 40 1 40 Boubyan Bank ABC’s of Service 10 1 10 Boubyan Bank Certified International Financial Accountant (CIFA) 25 2 50 Boubyan Bank ACAMs Inaugural Global Sanctions Masterclass 1.5 6 9 Boubyan Bank Certified Sharia Auditor Certificate (CSA) - Exam Only 7 5 35 Boubyan Bank & ACAMS Webinar 1 1 1 Boubyan Bank Boubyan Capital Acceptance Technical Optimization, Support for Certified Strategy & Business Planning Professional 8 1 8 Boubyan Bank Acceptance Issues 1 1 1 Boubyan Bank Chargebacks Simplified 1 1 1 Boubyan Bank ACI Dealing Certificate 8 1 8 Boubyan Bank CIA - Part 1 40 1 40 Boubyan Bank ACI Dealing Certificate Course 45 2 90 Boubyan Bank CISI - Kuwait Capital Markets Authority Rules and Regulations 20 4 80 Boubyan Bank Agile Innovation and Problem-Solving Skills 8 1 8 Boubyan Bank CISSP Exam Preparation Training Course 28 1 28 Boubyan Bank Agile Leadership Principles and Practices 8 1 8 Boubyan Bank Coaching for Results 1.5 1 1.5 Boubyan Bank Anti-Money Laundering (AML) & Counter Terrorist All Boubyan Groups Combating Financial Fraud & Related resources 8 1 8 Boubyan Bank Financing (CFT) Assessment 2020 2 1699 3398 Communicating with Confidence 8 1 8 Boubyan Bank Anti-Money Laundering (AML) & Counter Terrorist Boubyan Bank Communication Foundations 8 1 8 Boubyan Bank Financing (CTF) - Arabic 2 7 14 Conducting Usability Testing 8 1 8 Boubyan Bank Anti-Money Laundering (AML) & Counter Terrorist Corporate Compliance And Sarbanes-Oxley Act 2002 6 1 6 Boubyan Bank Financing (CTF) - English 2 4 8 Boubyan Bank Corporate Innovation & Fintech Collaboration 6 1 6 Boubyan Bank Anti-Money Laundering (AML) Training 2.5 214 535 Boubyan Bank Creative Thinking Techniques and Tools for Success 7 1 7 Boubyan Bank API Designer 6 1 6 Boubyan Bank Credit Assessment and Analysis 35 3 105 Boubyan Bank API Security Architect 7 1 7 Boubyan Bank Credit Card Sales Best Practices 2 12 24 Boubyan Bank Applied Corporate And Business Law 6 1 6 Boubyan Bank Critical Thinking and Problem Solving 8 3 24 Boubyan Bank Archaeoastronomy 6 1 6 Boubyan Bank Customer Experience Masterclass 40 3 120 Boubyan Bank Artificial Intelligence Intro 8 2 16 Boubyan Bank Customer Experience with Master Card’s Chief Experience Induction Program Boubyan Bank & Officer, Donald Chesnut 1 3 3 Boubyan Bank Boubyan Capital & Customer Relationship Management 8 2 16 Boubyan Bank 48 147 7056 National Customer Satisfaction & Loyalty 21 2 42 Boubyan Bank ATD MENA 14 2 28 Boubyan Bank Customer Service: Call Control Strategies 1 1 1 Boubyan Bank Automation Awareness Sessions - Automation Strategy 1.5 70 105 Boubyan Bank Data Analytics 6 2 12 Boubyan Bank AWS Certified Cloud Practitioner 8 1 8 Boubyan Bank Data Quality Fundamentals Certificate 6 1 6 Boubyan Bank Being an Effective Team Member 8 1 8 Boubyan Bank Data Visualization 1 1 1 Boubyan Bank Boubyan Health Sessions 1 80 80 All Boubyan Groups Data Visualization 8 1 8 Boubyan Bank Boubyan Rewards Hackathon 8 9 72 Boubyan Bank Decision-making and Problem-solving 8 1 8 Boubyan Bank Build your own chatbot 8 2 16 Boubyan Bank Defining Digital Payment 8 1 8 Boubyan Bank Business Etiquette - Central Sales 3.5 8 28 Boubyan Bank Defining Digital Payments - Virtual 32 1 32 Boubyan Bank CABBM-2020-G1-Certified Assistant Bank Branch Digital Strategies For Business 102 1 102 Boubyan Bank Manager 35 6 210 Boubyan Bank Digital Transformation 6 1 6 Boubyan Bank Certificate for Specialist in Demand Guarantees (CSDG) 8 1 8 Boubyan Bank Digital Transformation (Coursera) 35 1 35 Boubyan Bank Certified Anti Money Laundering & Financial Crimes Driving Stakeholder Value - Virtual Conference & Awards 4 1 4 Boubyan Bank Prevention Professional (CAMLFC) 31.5 2 63 Boubyan Bank EDUTREX 2020 (Education and Training Expo) Virtual Certified Bank Branch Operations Manager (CBBOM) 140 4 560 Boubyan Bank Exhibition 8 1 8 Boubyan Bank Certified Enterprise Risk Manager 40 1 40 Boubyan Bank & Effective Innovation: Ideation Strategies, Tips & Tricks 1 1 1 Boubyan Bank Boubyan National Effective Listening 8 1 8 Boubyan Bank Certified Fraud Examiner 40 3 120 Boubyan Bank EIKON Certification from Refinitiv 8 3 24 Boubyan Bank Embracing the Future of Learning 1.5 2 3 Boubyan Bank Emotional Intelligence 18 1 18 Boubyan Bank English for Business and Banking - Part 1 140 2 280 Boubyan Bank

168 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 169 Hours per # of Total Subsidiary / Hours per # of Total Subsidiary / Training course Participant participants Hours Department Training course Participant participants Hours Department

English For Emails 31.5 3 94.5 Boubyan Bank IT-Security Awareness Training 1 118 118 Boubyan Bank Excel 2016 Essential Training 8 1 8 Boubyan Bank KFAS Changing the Game: Negotiation and Competitive Excel Essential Training (Microsoft 365 / Office 365) 2 1 2 Boubyan Bank Decision-Making 42 1 42 Boubyan Bank Factual Cases & Practical Applications Sanction Requirements Boubyan Bank & KFAS Customer Service Excellence 9 2 18 Boubyan Bank Ministerial Resolution No. 5 Workshop 7 15 105 Boubyan Capital KFAS Harvard Business Publishing Webinar 1 1 1 Boubyan Bank Financial Accounting Foundations 6 1 6 Boubyan Bank KFAS Innovating in the Digital World - London Business Financial Data Analysis for Leaders 6 2 12 Boubyan Bank School 105 1 105 Boubyan Bank Financial Leadership During Pandemic 1 4 4 Boubyan Bank KFAS Leading in Times of Uncertainty: Leverage Systems Boubyan Bank FinTech Law & Policy 8 1 8 Boubyan Bank Thinking to Build a Culture of Learning - Cornell 8 1 8 Forensic Accounting & Fraud Examination 8 1 8 Boubyan Bank KFAS London Business School: Mastering Digital Marketing 80 1 80 Boubyan Bank FX/MM WORKSHOP - Bourse Game 47.5 3 142.5 Boubyan Bank KFAS Managing Business in Challenging Times - HEC 24 1 24 Boubyan Bank G1 | Branch Managers Profitability Workshop 8 12 96 Boubyan Bank KFAS Open Innovation for Leaders - UC Berkley 63 1 63 Boubyan Bank G1 | CC CS TL Time Management 3 12 36 Boubyan Bank KFAS Social Media Strategy & Management 18 1 18 Boubyan Bank G1 | RO Advance Sales Module 1 17 17 Boubyan Bank Kuwaiti Sign Language - Level 1 35 13 455 Boubyan Bank G1 | RO Operational Excellence 1 17 17 Boubyan Bank Leadership and Organizational Behavior 8 1 8 Boubyan Bank G2 | Branch Managers Profitability Workshop 8 12 96 Boubyan Bank Leadership and Team Development 8 2 16 Boubyan Bank GIES Series 6 - Digitization of Banking: Lessons Learned from 1 1 1 Boubyan Bank Leadership Mindset 0.5 1 0.5 Boubyan Bank 2020 Leadership Training 8 1 8 Boubyan Bank Global Fintech Festival 8 1 8 Boubyan Bank Leading High-Performing Teams 7 3 21 Boubyan Bank GO1 - E Learning (soft skills) 8 605 4840 Boubyan Bank & Leading Organisations in Disruptive Times 132 1 132 Boubyan Bank Boubyan Capital & Lean Awareness for Central Sales 2 8 16 Boubyan Bank National Lean Six Sigma Green Belt Exam (Certified Green Belt Project Handling Difficult Situations 8 1 8 Boubyan Bank Leader) 7 1 7 Boubyan Bank Harvard ManageMentor 228 6 1368 Boubyan Bank Learning Excel 2019 1 1 1 Boubyan Bank How to be an Adaptable Employee During Change and Legal Overview 8 1 8 Boubyan Bank Uncertainty 8 1 8 Boubyan Bank Let’s Break the Chain of COVID-19 Infection 2 5 10 Boubyan Bank How to Make Working From Home More Effective 1 1 1 Boubyan Bank LinkedIn E-Learning Portal - access to all courses 120 118 14160 Boubyan Bank How to Manage Time Effectively G1 - 2020 8 11 88 Boubyan Bank LinkedIn Learning Virtual Summit 4 1 4 Boubyan Bank How to Manage Time Effectively G2 - 2020 8 12 96 Boubyan Bank Management/Leadership and Supervisory Skills 8 2 16 Boubyan Bank HR Fundamentals 30 5 150 Boubyan Bank Managing Virtual Teams 1 1 1 Boubyan Bank Humble Leadership: The Power of Relationships, Openness, Managing Your Team & People Management 8 2 16 Boubyan Bank and Trust 8 1 8 Boubyan Bank Masterclass: The Impact of Digital Transformation on IDC CIO Summit 2020 8 1 8 Boubyan Bank Leadership 3 1 3 Boubyan Bank IELTS English Preparation Program - English Placement Test 2 1 3 3 Boubyan Bank MGT433: SANS Security Awareness: How to Build, Maintain, 16 1 16 Boubyan Bank Improving Your Thinking 8 1 8 Boubyan Bank and Measure a Mature Awareness Program 16 1 16 Boubyan Bank INSEAD Negotiation Dynamics 21 2 42 Boubyan Bank Microsoft Certified Azure Fundamentals 6 3 18 Boubyan Bank Inspiring Leadership Through Emotional Intelligence 8 1 8 Boubyan Bank Middle East Future Storming Client Conference 18 2 36 Boubyan Bank Intelligence Tools for the Digital Age 8 1 8 Boubyan Bank Mindfulness Workshop 8 1 8 Boubyan Bank Introduction to Data Analysis using Excel 8 3 24 Boubyan Bank Mobile User Experience (UX) Design 30 1 30 Boubyan Bank Islamic Banking Refresher | Branches Support 2 6 12 Boubyan Bank Modern Office Management Program (MOMP) - Part 1 8 1 8 Boubyan Bank Islamic Finance and Capital Markets: Structure and Trading Office 365 New Features 0.5 1 0.5 Boubyan Bank of Sukuk 8 1 8 Boubyan Bank Onboarding New Hires as a Manager 8.5 2 17 Boubyan Bank IT Security Awareness Training (Boubyan Capital) 1 33 33 Boubyan Capital Operational Support Client forum 28 2 56 Boubyan Bank IT Security Awareness Training (Boubyan National) 1 26 26 Boubyan National Oxford Real Estate 8 2 16 Boubyan Bank IT-Security Awareness (August Phishing Training - Phishing Oxford School of Transaction Banking failed) 1 277 277 Boubyan Bank Payment Operations Basics 9 1 9 Boubyan Bank IT-Security Awareness (COVID -19 Post-Click Education Boubyan Bank & People Management 7 1 7 Boubyan Bank Message) 1 64 64 Boubyan National Placement Test - English for Business and Banking 2 4 8 Boubyan Bank

170 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 171 Hours per # of Total Subsidiary / Hours per # of Total Subsidiary / Training course Participant participants Hours Department Training course Participant participants Hours Department

PMI-Risk Management Professional Exam Preparation Course 30 1 30 Boubyan Bank RM Operational Excellence 1 61 61 Boubyan Bank PowerPoint 8 1 8 Boubyan Bank RM Advance Sales Module 1 61 61 Boubyan Bank PowerPoint 2016 Essential Training 3 1 3 Boubyan Bank IBS eLearning 8 339 2712 Boubyan Bank Practical Test-Driven Development for Java Programmers 4 1 4 Boubyan Bank General Management Program 200 1 200 Boubyan Bank Problem Solving 21 5 105 Boubyan Bank Customer Service Excellence 3 406 1218 Boubyan Bank Project Management Professional (PMP) 30 2 60 Boubyan Bank TeleSales Direct Sales 3 41 123 Boubyan Bank Public Speaking 8 2 16 Boubyan Bank Advance Sales Module 2 85 170 Boubyan Bank Remote Work Foundations 8 1 8 Boubyan Bank RO Operational Excellence 2 84 168 Boubyan Bank Risk Management 8 1 8 Boubyan Bank RO IJP 2020 14 25 350 Boubyan Bank 44,519 ScrumMaster Certification 8 1 8 Boubyan Bank *Note: Total 206 training courses Seamless Saudi Arabia Virtual 2020 24 9 216 Boubyan Bank Service Hero Excellence Seminar / Awards 3 7 21 Boubyan Bank Six Sigma: Define and Measure 7 2 14 Boubyan Bank Speed of Trust Foundations Workshop 5 3 15 Boubyan Bank Sports Marketing 6 1 6 Boubyan Bank Annex 2: Boubyan Training Courses – 2019 SQL for Data Science 8 1 8 Boubyan Bank STEP Conference 8 3 24 Boubyan Bank Hours per # of Total Subsidiary / Strategic Management Performance System (SMPS) Training course Participant participants Hours Department Certification Bootcamp 42.5 4 170 Boubyan Bank Strategic Thinking and Leadership - Wharton’s Accelerated Annual VISA Middle East and North Africa (MENA) Client Development Program (ADP) 8 3 24 Boubyan Bank Forum 8 1 8 Boubyan Bank Strategy & Operations 6 1 6 Boubyan Bank Invitation by McKinsey’s 1st Middle East Corporate Banking Strengthening Cybersecurity Preparedness for Banks? Roundtable 8 1 8 Boubyan Bank Confirmation 2 1 2 Boubyan Bank Chargeback, Arbitration and Compliance Level 3 8 1 8 Boubyan Bank The Certified Islamic Specialist in Trade Finance (CISTF) 35 2 2 Boubyan Bank 1 Day Cyber Attack Simulation Exercise 8 4 32 Boubyan Bank The Certified Manager (CM) Certification- Exam Preparation 10th Annual AML & Financial Crime Conference - MENA 8 1 8 Boubyan Bank Training Program - Part 2 14 2 2 Boubyan Bank 2019 CFO Forum 8 1 8 Boubyan Bank The Davos Human Capital 2020 2 2 2 Boubyan Bank 2019 Visa Bankcard Management School 8 1 8 Boubyan Bank The Outward Mindset 18 1 1 Boubyan Bank 23rd CET CONFERENCE - KUWAIT 9 3 27 Boubyan Bank The Regional Outreach Seminar for the Arab Region on 2nd Annual Middle East COO Conclave in Financial Services 8 1 8 Boubyan Bank Enhancing Cross-Border Payments - the Road Ahead 2 1 1 Boubyan Bank 360 Facilitation Workshop 8 16 128 Boubyan Bank The Six Morning Habits of High Performers 8 1 1 Boubyan Bank 7th Annual Advanced Credit Risk Modeling Under IFRS 9 16 2 32 Boubyan Bank The Virtual Future Talent Conference 2020: Purpose, Meaning 8th Annual - Risk Data Aggregation and Risk Reporting 19 2 38 Boubyan Bank & Culture 3 2 2 Boubyan Bank AAOIFI Conference 16 2 32 Boubyan Capital Time and People Management 8 1 1 Boubyan Bank ACAMS 7th Annual AML & Financial Crime Conference 14 1 14 Boubyan Bank TOGAF 9 Foundation 7 1 1 Boubyan Bank Accounting Shenanigans on the Cash Flow Statement 8 1 8 Boubyan Bank Training for Corporate Services & Products - Part I 2 6 6 Boubyan Bank ACI – The Financial Markets Association 8 1 8 Boubyan Bank U.S.-Kuwait Business Council 4th Annual Economic Forum 2 1 1 Boubyan Bank Active Equity Management 48 2 96 Boubyan Capital Understanding Credit Card Profitability 2 5 5 Boubyan Bank Advanced Certificate in Credit Management - 2020 (ACCM) Understanding Research Methods 8 2 2 Boubyan Bank - Part 1 90 2 180 Boubyan Bank Understanding Visa Disputes (UVD) workshop 8 5 5 Boubyan Bank Virtual Coaching 1 1 1 Boubyan Bank Visa First - Virtual 31.5 1 1 Boubyan Bank Visa Virtual Payments Forum MENA 2 2 2 Boubyan Bank WMF Business Recovery Session 5: w/ Wafa AlQatami Boubyan Bank & ‘Economic Awareness 1 10 10 Boubyan Capital Workshop - Digital (There is always a space for improvement) 7 18 18 Boubyan Bank IBM Training 8 137 137 Boubyan Bank

172 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 173 Hours per # of Total Subsidiary / Hours per # of Total Subsidiary / Training course Participant participants Hours Department Training course Participant participants Hours Department

Boubyan Bank & Cash Flow Statement 8 8 64 Boubyan Bank Advanced Negotiating Skills 16 10 160 Boubyan Capital CBK International Banking Boubyan Bank & Advanced Service and Sales 8 53 424 Boubyan Bank Conference 2019 8 21 168 Boubyan Capital Advanced Team Alignment Master Class Central Sales Academy 112 28 3136 Boubyan Bank Advanced Understanding of Financial Institutions from a 14 3 42 Boubyan Bank CEO conference participation (speaker) and media interview 8 1 8 Boubyan Bank fixed/structured finance risk perspective 24 7 168 Boubyan Bank Certificate for Documentary Credit Specialists (CDCS) Exam 8 1 8 Boubyan Bank Agile and Creative Business 18 1 18 Boubyan Bank Certificate in International Financial Reporting System AME Chicago International Conference 2019 28 1 28 Boubyan Bank (CertIFRS) Program - Exam Preparation 21 1 21 Boubyan Bank AML & CFT for Board Members Certificate Specialist of Demand Guarantee (CSDG) Exam 8 1 8 Boubyan Bank Anti-Money Laundering (AML) & Counter Terrorist Financing 3 13 39 Boubyan Bank Certified Bank Branch Manager - CBBM 2020 228 8 1824 Boubyan Bank (CFT) Assessment 2020 2 1600 3200 All Boubyan Groups Certified Credit Management (CCM) 2020 306 2 612 Boubyan Bank Boubyan Capital & Certified Credit Management (CCM) 2020 - Placement Test 2 4 8 Boubyan Bank AML & CFT Workshop 2 62 124 Boubyan National Certified Enterprise Boubyan Bank & AML, Compliance, and Consumer Finance Workshop (BMs) 2 35 70 Boubyan Bank Risk Manager 39 1 39 Boubyan National Analytics Experience 2019 Milan 21 - 23 October 8 1 8 Boubyan Bank Certified Internal Auditor (CIA) - Part 1 213.5 3 640.5 Boubyan Bank Anti-Money Laundering and Combating the Financing of Certified Islamic Specialist in Capital Markets (CISCM) 32 1 32 Boubyan Capital Terrorism AMLCFT Training 4 3 12 Boubyan Bank Certified Sharia Auditor Certificate (CSA) 245 2 490 Boubyan Bank Asian Regulations and Compliance 8 1 8 Boubyan Capital CFA Preparation Course 54 1 54 Boubyan Capital Asset Liability Management 18 1 18 Boubyan Bank Chargeback, Arbitration and Compliance Level 3 8 1 8 Boubyan Bank ATD Master Trainer Certificate 32 2 64 Boubyan Bank Chatbots & Digital Customer Experience Summit 19 3 5 Boubyan Bank Auditing Digital Risk and Potential Vulnerabilities within an Organization 16 14 224 Boubyan Bank Chatbots and Digital Customer Service Senate Dubai Authentic Leader Development 8 1 8 Boubyan Bank September 2019 & Dubai Product Leadership unConference 8 3 24 Boubyan Bank Automating Administration with Windows PowerShell 45 1 45 Boubyan Bank CIA Training Material 8 1 8 Boubyan Bank Awareness on New Application for Commercial Portfolio 2 3 6 Boubyan Bank CIPD Level 5 Diploma in HRM Module 3 40 2 80 Boubyan Bank Balance Sheet - Assets, Liabilities and Equity 8 7 56 Boubyan Bank Client Needs Analysis 8 15 120 Boubyan Bank Banking Accounts & Services via Internet and Related Crimes 10.5 3 31.5 Boubyan Bank Client Relations Orientation 16 5 80 Boubyan Capital Banking Confidentiality 10.5 4 42 Boubyan Bank Client Service Excellence 8 13 104 Boubyan Bank & Banking Dispute Resolution Forum 14 1 14 Boubyan Bank Boubyan Capital Basel III/Basel IV for Credit Department Staff 28 4 112 Boubyan Bank CMA Awareness Session 3 8 7 56 Boubyan Capital Basics and Functions 8 1 8 Boubyan Capital Coaching Session for Call Center 24 11 264 Boubyan Bank Basics of Treasury Management 21 4 84 Boubyan Bank Code of Conduct Awareness Session (Corporate) 1.5 28 42 Boubyan Bank Best Practice in Operational Risk Management 17 2 34 Boubyan Bank Communicating with Impact 16 14 224 Boubyan Bank Bonds, Loans and Sukuk KSA forum 8 1 8 Boubyan Bank Communication Skills 8 25 200 Boubyan Bank & Boursa Kuwait and MEIRA invitation to Making the Most of Boubyan Capital Your Annual Report and IR Website Seminar 2 1 2 Boubyan Bank Compliance & Governance 2 6 12 Boubyan Bank Building Crucial Payments Expertise - Beirut 8 1 8 Boubyan Bank Consumer Finance & Compliance Workshop 2 17 34 Boubyan Bank Buna Market Participant Onboarding Workshop 8 1 8 Boubyan Bank Consumer Protection - 2019 16 14 224 Boubyan Bank Business & Data Analysis 21 13 273 Boubyan Bank Contracts Review, Drafting & Scope of Work 14 9 126 Boubyan Bank Business & Industry Analysis 8 8 64 Boubyan Bank Corporate Bonds 8 1 8 Boubyan Bank 2 21 42 Boubyan Bank & Business Continuity Management (BCM) Workshop Corporate Credit Analysis 8 1 8 Boubyan Bank Boubyan National Corporate Finance and Credit Risk 8 1 8 Boubyan Bank Business Ethics & Quality Control 2 102 204 Boubyan Bank Creative & Innovative Thinking 21 8 168 Boubyan Bank Business Etiquette 3 132 396 Boubyan Bank Credit Analysis 115.5 1 115.5 Boubyan Bank Call Center Digital Skills Engagement Session 1 3 5 15 Boubyan Bank Credit Markets 8 2 16 Boubyan Bank Call Center Train the Trainer November 2019 16 10 160 Boubyan Bank Credit Risk Management 8 3 24 Boubyan Bank Cambridge General English Program - Placement Test 1.5 1 1.5 Boubyan Bank Customer Protection Manual Session 2.5 9 22.5 Boubyan Bank Capital Markets Authority Law 10.5 3 31.5 Boubyan Bank CXM & Sales Management Session for Part Timers (Direct Card Profitability 8 1 8 Boubyan Bank Sales ) 12 1 12 Boubyan Bank Cash Flow (specific reference to working capital and full cash Cyberthreats and Challenges for Financial Sector 4 3 12 Boubyan Bank flow cycle for corporate products and services) 16 9 144 Boubyan Bank Data Analysis Training 30 10 300 Boubyan Bank

174 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 175 Hours per # of Total Subsidiary / Hours per # of Total Subsidiary / Training course Participant participants Hours Department Training course Participant participants Hours Department

Defining Digital Payments 8 1 8 Boubyan Bank Financial Modelling - Excel Functions 8 1 8 Boubyan Bank & Dell EMC - Executive Briefing 8 2 16 Boubyan Bank Boubyan Capital Dell Technologies World 8 1 8 Boubyan Bank Financial Modelling - Excel Skills 8 4 32 Boubyan Bank Demonstration of Visa/Mastercard Issuance equipment 8 1 8 Boubyan Bank Financial Statements - Balance Sheet 8 6 48 Boubyan Bank & Derivatives 8 10 80 Boubyan Bank Boubyan Capital DevSecOps Training 2 18 36 Boubyan Bank Financial Statements - Profit and Loss Account 8 8 64 Boubyan Bank & Digital Audit & Fraud Analytics 24 2 48 Boubyan Bank Boubyan Capital Digital Leadership By Erik Qualman 7.5 6 45 Boubyan Bank Financial Statements Analysis 8 1 8 Boubyan Bank Digital Marketing and Social Media 21 1 21 Boubyan Bank Financial Techniques Applied by Islamic Banks 8 2 16 Boubyan Bank Digitalization in Banking Sector for Board Members 2 13 26 Boubyan Bank Financing 8 1 8 Boubyan Bank Direct Sales Interactive Session 8 7 56 Boubyan Bank Finastra Universe - Dubai 8 1 8 Boubyan Bank Discounted Cash Flows 8 3 24 Boubyan Bank FinTech Abu Dhabi 16 6 96 Boubyan Bank EC-Council Disaster Recovery Professional v3 7 1 7 Boubyan Bank Fixed Income 8 1 8 Boubyan Bank Economics in a Global Context 8 7 56 Boubyan Bank Fixed Income - Basic Concepts 8 4 32 Boubyan Bank Effective Business Writing 8 5 40 Boubyan Bank 8 Boubyan Bank & EFG Hermes Investors Conf + meeting with PRA + BLME 8 1 8 Boubyan Bank Formulae and Text Functions 8 1 Boubyan Capital Electronic Transactions and Electronic Payment Instruments 14 1 14 Boubyan Bank Fraud Management for Issuers and Acquirers 8 2 16 Boubyan Bank English Conversation Level 1 31.5 1 31.5 Boubyan Bank Fraud Prevention for Issuers and Acquirers 8 2 16 Boubyan Bank English Conversation Level 2 31.5 2 63 Boubyan Bank Fraud Prevention for Issuers and Acquirers - VISA 8 1 8 Boubyan Bank English for Business and Banking - Placement Test 2 1 2 Boubyan Bank FTIE - The Digital Revolution in the Financial Sector 21 2 42 Boubyan Bank English Placement Test & Psychometric Test for the RMLP- 1 8 Boubyan Bank & 2019 2 3 6 Boubyan Bank Fundamentals of Islamic Banking and Finance qualification 8 English Test for Certified Bank Branch Manager-2020 - Boubyan Capital Placement Test 1 13 13 Boubyan Bank Fundamentals of Islamic Finance - Session 1 2 7 14 Boubyan Bank & EQ Core Certification Workshop 32 1 32 Boubyan Bank Boubyan Capital Equities 8 8 64 Boubyan Bank Fundamentals of Islamic Finance - Session 2 2 14 28 Boubyan Bank & Equity Capital Markets 8 1 8 Boubyan Bank Boubyan Capital Ethics, Integrity and Fairness 8 2 16 Boubyan Bank Fundamentals of Islamic Finance - Session 3 2 10 20 Boubyan Bank & Excellence Program for Team Leaders in Call Center Boubyan Capital (Discovery Phase) 24 16 384 Boubyan Bank Fundamentals of Project Finance 8 3 24 Boubyan Bank Executive Development Program 90 1 90 Boubyan Bank Fundamentals of Securitization 8 1 8 Boubyan Bank Executive Transition Master Class 8 1 8 Boubyan Bank Fundamentals of Sovereign and Public Entity Credit Analysis 8 1 8 Boubyan Bank Executive Development Program 8 1 8 Boubyan Bank Fundamentals of Technical Analysis 40 7 280 Boubyan Bank & Experience 2019 8 4 32 Boubyan Bank Boubyan Capital Experienced Staff Training in Al-Hamad Tower (HR, Customer G1 - Customer Onboarding On ITM - iMAL Workshop 4 8 32 Boubyan Bank Protection, AML, and Islamic Banking) 12 14 168 Boubyan Bank G1 | Branches AML - GUST (October 2019) 2 21 42 Boubyan Bank Exploiting Disruption in a Digital World 47.5 1 47.5 Boubyan Bank G1 | Call Centre Excellence for Team Leaders (September 2019) 16 14 224 Boubyan Bank Factual Cases & Practical Applications Sanction Requirements Boubyan Bank & G1 | Excellence Program for Team Leaders and Supervisors in Ministerial Resolution No. 5 Workshop 8 12 96 Boubyan Capital Call Center Heart & Brain (October 2019) 16 15 240 Boubyan Bank Financial Math - Introduction 8 6 48 Boubyan Bank G2 - Customer Onboarding On ITM - iMAL Workshop 4 3 12 Boubyan Bank Boubyan Bank Finacle Conclave 2019 - annual banking leadership summit + G2 | Branches AML - GUST (October 2019) 2 21 42 Boubyan Bank Finastra Universe 8 2 16 Boubyan Bank & G2 | Call Centre excellence for Team Leaders (September 2019) 16 17 272 Boubyan Bank Financial Institutions Credit Analysis 8 6 48 Boubyan Capital G2 | Excellence Program for Team Leaders and Supervisors in 16 15 240 Boubyan Bank Financial Instruments 8 13 104 Boubyan Bank & Call Center Heart & Brain (October 2019) Boubyan Capital G3 - Customer Onboarding On ITM - iMAL Workshop 4 3 12 Boubyan Bank Financial Math - Introduction 8 2 16 Boubyan Bank & G3 | BCM 2 6 12 Boubyan Bank Boubyan Capital G3 | Branches AML - GUST (November 2019) 2 23 46 Boubyan Bank Financial Modelling - 3 Statement 8 2 16 Boubyan Bank G4 - Customer Onboarding On ITM - iMAL Workshop 4 5 20 Boubyan Bank Financial Modelling - Excel Basics 8 1 8 Boubyan Bank & G4 | Branches AML - Internal (November 2019) 3 11 33 Boubyan Bank Boubyan Capital G5 | Branches AML - Internal (November 2019) 2 19 38 Boubyan Bank

176 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 177 Hours per # of Total Subsidiary / Hours per # of Total Subsidiary / Training course Participant participants Hours Department Training course Participant participants Hours Department

GAQM - Certified Team Leader 7 1 7 Boubyan Bank Introduction to Risk 8 2 16 Boubyan Bank & GCC RTGS & Buna Payment Workshop 8 1 8 Boubyan Bank Boubyan Capital General Management Program - GMP 8 1 8 Boubyan Bank Introduction to Structure Finance 14 8 112 Boubyan Bank General Management Programme (GMP) 80 1 80 Boubyan Bank Introduction to Valuation 8 1 8 Boubyan Bank Global Custody 8 4 32 Boubyan Bank & ISD & BCM Tabletop Exercise 2019 - Customer Data Breach 2 9 18 Boubyan Bank Boubyan Capital Islamic Asset & Fund Management 8 5 40 Boubyan Bank & Global Finance Digital banking conference 8 2 16 Boubyan Bank Boubyan Capital Global Financial Compliance 8 5 40 Boubyan Bank & Islamic Banking Session 2.5 8 20 Boubyan Bank Boubyan Capital Islamic Banking Workshop for Central Sales 2 89 178 Boubyan Bank Go & See IsBank Turkey 8 1 8 Boubyan Bank Islamic Bond Market - Sukuk 8 5 40 Boubyan Bank Heart Saver First Aid CPR AED Course 8 1 8 Boubyan Bank & Islamic Credit and Finance Contracts 14 1 14 Boubyan Bank Boubyan Capital Islamic Hedging 14 2 28 Boubyan Bank HR / Sharia / Customer Protection / AML 8 12 96 Boubyan Bank Islamic Law of Contracts 8 1 8 Boubyan Bank HR Session - Internal (November 2019) 2.5 4 10 Boubyan Bank IT Security Manager 21 2 42 Boubyan Bank HR Symposium 7.5 5 37.5 Boubyan Bank ITFC Conference 8 1 8 Boubyan Bank ICA International Advanced Certificate in Anti Money 40 1 40 Boubyan Bank & ITIL v.3 Foundation Certification 32 8 256 Boubyan Bank Laundering Boubyan Capital Key Financial Statements 8 6 48 Boubyan Bank IELTS English Preparation Program - English Placement Test 1 1 1 Boubyan Bank Kuwait Corporate Day - Morgan Stanley & Boursa Kuwait 8 1 8 Boubyan Bank IIF Annual Meeting - 2019 19 4 76 Boubyan Bank & Labor Law No.6 of 2010 and the Latest Updates for 2019 8 3 24 Boubyan Bank Boubyan Capital Leadership Development 150.5 1 150.5 Boubyan Bank & IIF MENA CRO Forum, 14th high level meeting for the arab 8 1 8 Boubyan Bank Boubyan Capital region Boubyan Bank & Legal Aspects of Credit Collaterals 14 1 14 Boubyan Bank iMAL Assets 32 7 224 Boubyan Capital Level 3 International Award in Delivering Training 40 1 40 Boubyan Bank IMF Conference 8 2 16 Boubyan Bank Leveraged Buyouts 8 3 24 Boubyan Bank Implementing Winning Strategies 8 1 8 Boubyan Bank Lifecycle of a Trade 8 4 32 Boubyan Bank & Implementing Winning Strategies Program 28 1 28 Boubyan Bank Boubyan Capital Induction Program 112 251 28112 Boubyan Bank & Liquidity and Cash Conversion Cycle 8 10 80 Boubyan Bank Boubyan Capital Liquidity Risk Management in Islamic Banks 14 1 14 Boubyan Bank Initial Public Offering - IPO 8 1 8 Boubyan Bank Loans 8 3 24 Boubyan Bank Innovation and Design Thinking 16 22 352 Boubyan Bank Macro Economics 8 4 32 Boubyan Bank INSEAD Digital Transformation Leadership Program 36 2 72 Boubyan Bank Management and Leadership Skills 8 15 120 Boubyan Bank & Integrated Approach to Rehabilitation & Develop The Internal 45 1 45 Boubyan Bank Boubyan Capital Audit - Basic Level Management Assessment 8 1 8 Boubyan Bank Interest Rate Swaps 8 5 40 Boubyan Bank Managing Virtual Teams 8 1 8 Boubyan Bank Interest Rates and Risk 8 1 8 Boubyan Bank & Marketing and Sales Show 16 2 32 Boubyan Bank Boubyan Capital Mastercard - Chargeback, Arbitration and Compliance Level 3 21 2 42 Boubyan Bank International Professional Certificate in Anti-Money 20 3 60 Boubyan Bank Mastercard MENA Leadership Council 8 1 8 Boubyan Bank Laundering McKinsey Capability Building Workshop 8 17 136 Boubyan Bank International Professional Certificate in Regulatory 20 1 20 Boubyan Bank McKinsey’s Leading with inner Agility - Centered Leadership 8 1 8 Boubyan Bank Compliance Program International SME Business Banking Forum - London 8 1 8 Boubyan Bank Me Inc 24 2 48 Boubyan Bank & Introduction to Fixed Income 8 1 8 Boubyan Bank Boubyan Capital Boubyan Bank & Measuring Customer Satisfaction and Complaint Handling 21 2 42 Boubyan Bank Introduction to Global Capital Markets 8 1 8 Boubyan Capital Micro Focus Experience Event 2019 8 1 8 Boubyan Bank Boubyan Bank Microsoft Analyzing Data with Power BI 24 16 384 Boubyan Bank Introduction to Investment Management 8 1 8 Boubyan Bank & Microsoft Office Excel 2016 Intermediate to Advanced 16 9 144 Boubyan Bank Introduction to Islamic Banking & Finance 8 1 8 Boubyan Capital Microsoft Office PowerPoint 2016 Advanced 8 7 56 Boubyan Bank Introduction to Islamic Banking & Finance 8 17 136 Boubyan Bank & Money Market in Islamic Banks 7 4 28 Boubyan Bank & Boubyan Capital Boubyan Capital Introduction to Legal Documentation 7.5 12 90 Boubyan Bank

178 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 179 Hours per # of Total Subsidiary / Hours per # of Total Subsidiary / Training course Participant participants Hours Department Training course Participant participants Hours Department

Money Markets 8 3 24 Boubyan Bank SEC504: Hacker Tools, Techniques, Exploits, and Incident 40 1 40 Boubyan Bank Moody’s Credit Lens Training - Spreading and Subjective 16 8 128 Boubyan Bank Handling Morgan Stanley and Boursa Kuwait - Kuwait Corporate Day 8 3 24 Boubyan Bank SEC560: Network Penetration Testing and Ethical Hacking 40 5 200 Boubyan Bank in London Securitization 8 1 8 Boubyan Bank National Unit of Kuwait Students 8 3 24 Boubyan Bank Shaping Business Decisions Bringing Behavioral in Practice 21 1 21 Boubyan Bank Negotiation Skills 8 17 136 Boubyan Bank Shareholder and Ownership Risk 8 4 32 Boubyan Bank Network International Workshop 8 1 8 Boubyan Bank SHRM Certified Professional (SHRM-CP) SHRM Senior 196 2 392 Boubyan Bank Opportunities and Services 8 2 16 Boubyan Bank & Certified Professional (SHRM-SCP) (Available in the OTC Platform) Boubyan Capital SHRM Essentials of Human Resources Certification-Exam 21 1 21 Boubyan Bank Overview of DELL EMC Latest Technologies 8 1 8 Boubyan Bank Preparation Parallel Thinking and Creativity 18 1 18 Boubyan Bank Sibos Conference 2019 28 3 84 Boubyan Bank Personal Effectiveness and Leadership 24 1 24 Boubyan Bank & Sibos Conference 2019 - London 8 3 24 Boubyan Bank Boubyan Capital Sign Language 16 8 128 Boubyan Bank Personal Effectiveness and Leadership Thinking 18 1 18 Boubyan Bank Silicon Valley Innovation Center 8 5 40 Boubyan Bank PLD model 5 40 1 40 Boubyan Bank Six Sigma Black Belt Certification Program 52.5 1 52.5 Boubyan Bank Plug & Play - Silicon Valley Program 28 5 140 Boubyan Bank SO Refresher 2 6 12 Boubyan Bank Plug and Play ADGM Demo Day 8 2 16 Boubyan Bank SO’s Focus Workshop 8 42 336 Boubyan Bank Portfolio Management Skillsets for Private Bankers 56 16 896 Boubyan Bank Strategic HR Mindset 21 2 42 Boubyan Bank Portfolio Management Skillsets for Private Bankers - 4 15 60 Boubyan Bank Supervisory Skills for First Time Leaders 16 18 288 Boubyan Bank Assessment Day SWIFT Regional Conference Turkey and Middle East 16 2 32 Boubyan Bank PowerPoint and Presenting: Intro and Overview 8 2 16 Boubyan Bank Talent Hackathon - Group 1 27 21 567 Boubyan Bank Product Knowledge (Central Sales Academy) [ Refresh ] 8 7 56 Boubyan Bank Talent Leaders 2019 40 31 1240 Boubyan Bank & Product Leadership unConference 8 3 24 Boubyan Bank Boubyan Capital Product Owner Workshop 3 10 30 Boubyan Bank Team Building 8 1 8 Boubyan Bank Project Implementation Workshop 6.5 3 19.5 Boubyan Bank The 5th Mediterranean Islamic Finance Forum and CIBAFI Project Management Essential 16 13 208 All Groups Technical Workshop - CIBAFI Conference - Barcelona 8 1 8 Boubyan Bank Project Management Professional (PMP) - 2020 60 5 300 All Groups The 9th Annual EFG Hermes London Conference 8 2 16 Boubyan Bank Ratings Agency’ 8 7 56 Boubyan Bank Realizing the Enterprise Data Cloud Roadshow 8 2 16 Boubyan Bank Recent Developments 8 2 16 Boubyan Bank & 8 Boubyan Capital Restructuring and Subordination 8 6 48 Boubyan Bank Risk Awareness Session 1 8 11 88 Boubyan Bank & Boubyan Capital Risk Awareness Session 2 8 11 88 Boubyan Bank & Boubyan Capital Risk Awareness Session 3 8 14 112 Boubyan Bank & Boubyan Capital Risk Awareness Session 4 24 13 104 Boubyan Bank & Boubyan Capital Risk Based Audit Masterclass 8 15 360 Boubyan Bank Risk Management in Banks 8 8 64 Boubyan Bank Risk Model Validation 8 1 8 Boubyan Bank RiskMatrix Workshop - CreditLens Credit Assessment & 7 3 24 Boubyan Bank Origination RM Workshop 22.8.2019 24 19 133 Boubyan Bank RO Workshop 8 35 840 Boubyan Bank RSA Authentication Manager Administration 14 1 8 Boubyan Bank RSA SecurID Suite Training Credit for Administration 8 1 14 Boubyan Bank SAP - Experience Business Center 0 5 40 Boubyan Bank SAS Certified Advanced Analytics Professional (Online) 2 0 Boubyan Bank

180 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 181 Hours per # of Total Subsidiary / Annex 3: BLME Training Courses - 2019 and 2020 Training course Participant participants Hours Department

The 9th Annual Forum For Heads of AML & CFT Compliance 8 1 8 Boubyan Bank Units in Arab Banks & Financial Institutions The Arab Monetary Fund (AMF) Workshop for BUNA System. 8 1 8 Boubyan Bank 2020 2019 # of # of The Berkeley Executive Leadership Program 8 1 8 Boubyan Bank partici- Position partici- Position The Big 5 Global Hub for the Construction Industry 8 2 16 Boubyan Bank Training course Hours pants Level Training course Hours pants Level The Certified Manager (CM) Certification- Exam Preparation 280 2 560 Boubyan Bank Leader’s Lunch and Learn 1 18 ExCo, Conduct at Work 1 120 ALL Training Program - Part 1 Department The Digital Revolution in the Financial Sector 24 1 24 Boubyan Bank & Heads & Line Managers Boubyan Capital Transition from LIBOR 0.5 80 ALL EXCEL Advanced 7 8 ALL The Foreign Account Tax Compliance Act (FATCA) 24.5 5 122.5 Boubyan Bank Mental Health Awareness at work 4 19 ALL EXCEL Advanced 7 8 ALL The Kit 8 1 8 Boubyan Bank Mental Health Awareness at work 4 18 ALL Mental Health Awareness at Work 4 80 ALL The Practical Problems in the Execution Procedures 10.5 3 31.5 Boubyan Bank Islamic Finance Qualification 21 9 ALL Islamic Finance Qualification 21 15 ALL Thomas International PPA Certification 15 2 30 Boubyan Bank Presentation Skills 6 9 ALL EXCEL Intermediate 7 8 ALL Time Management 8 16 128 Boubyan Bank & 6 2 line 7 8 ALL Boubyan Capital Managing and Leading Teams EXCEL Intermediate managers TOGAF 9 Foundation Certification 16 12 192 Boubyan Bank CeMap 32 11 ALL Presentation Skills 14 10 ALL TOT PCT Practitioner 27.5 1 27.5 Boubyan Bank Conduct and Culture 2 19 ExCo, SLT, & Mental Health First Aid Qualification 14 4 ALL Trade Finance 8 16 128 Boubyan Bank Board Trading Comparables 8 4 32 Boubyan Bank Intro to UK Asset Finance 1 9 Board plus Compliance 1 120 ALL Training Session for Business Continuity Awareness (Area 2 5 10 Boubyan Bank ExCo Managers) Cyber Fraud 1 100 Board Dignity at Work 1 120 ALL Transaction Comparables 8 1 8 Boubyan Bank Resilience 1 100 ALL Mental Health Awareness 1 120 ALL UK Regulation and Compliance 8 2 16 Boubyan Bank & 1 100 ALL 120 AL Boubyan Capital Fraud Prevention Culture and Conduct in a Regulated 1 ExCo Offsite with Executive Coach 16 7 ExCo Whistle Blowing 1 120 ALL UK Regulations Update 8 2 16 Boubyan Bank Executive Coaching 17 17 ExCo, Cyber Security and Crime Awareness 7 17 ALL UL Token & Mobile Payments Masterclass 18 3 54 Boubyan Bank Department Treating Customers Fairly Understanding Derivatives, Commodities, Money Market 8 1 8 Boubyan Bank Heads & Line Managers Rates and Bond Rates E Learning Modules (Compliance, Fin 6 80 ALL Executive Coaching 68 17 ALL US Regulation and Compliance 8 3 24 Boubyan Bank Crime, Cyber, GDPR and HR) User Experience Lab - Applied Innovation 21 4 84 Boubyan Bank Health & Safety 70 1 Manager Team Purpose, Strategy and Insight 16 60 Visa - Building Crucial Payment Expertise 21 1 21 Boubyan Bank ExCo, Department Visa - Effective Card Portfolio workshop 16 1 16 Boubyan Bank Heads & Line Managers Visa - Fraud Prevention for Issuers and Acquirers 14 1 14 Boubyan Bank ALL Visa CEMEA Risk Executive Council & Security Summit 2019 8 2 16 Boubyan Bank Visa to Host Operational Support Client Forum in Kuwait 7.5 1 7.5 Boubyan Bank VisaNet Financial Management 8 1 8 Boubyan Bank VMware World Conference 8 3 24 Boubyan Bank Women & Leadership in Global Business 30 1 30 Boubyan Bank Working Remotely 8 5 40 Boubyan Bank World Check Training 1.5 12 18 All Groups Boubyan Bank 15 6 2.5 التدقيق الشرعي على الفروع المصرفية Boubyan Bank 112.5 5 22.5 دورة تدابير الدفاع المدني العشرون لموظفي األمن والسالمة & Boubyan Bank 8 1 8 بالشركات والبنوك Boubyan Capital مكافحة غسل األموال وتمويل االرهاب Boubyan Bank 8 1 8 منتدي فض المنازعات المصرفية Boubyan Bank 24 3 8 مؤتمر أيوفي - البنك الدولي السنوى الرابع عشر Boubyan Bank 24 3 8 ندوة للتعريف بنظام المدفوعات الخليجي

Total 62,291

Note: Total 361 training courses

182 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 183 GRI Standard Page / Information

Annex 4: Global Reporting Initiative (GRI) Index 201-3 Defined benefit plan obligations and other retirement plans 113 202-2 Proportion of senior management hired from the local community 11 203-1 Infrastructure investments and services supported 74 203-2 Significant indirect economic impacts Throughout sustainability report GRI Standard Page / Information 204-1 Proportion of spending on local suppliers 67% 205-1 Operations assessed for risks related to corruption No significant risks were identified to corruption 205-2 Communication and training about anti-corruption policies and procedures Training Courses Appendix 102-1 Name of organization Boubyan Bank 205-3 Confirmed incidents of corruption and actions taken There were no confirmed incidents of corruption with employees 102-2 Activities, brands, products, and services 17, 82-88 206-1 Legal actions for anti-competitive behavior, anti-trust, and monopoly practices No relevant legal actions to report 102-3 Location of headquarters Kuwait City, Kuwait, 12 207-3 Stakeholder engagement and management of concerns related to tax 43 102-4 Location of operation 17 301-2 Recycled input materials used 160-161 102-5 Ownership and legal form 12 302-1 Energy consumption within the organization 162-163 102-6 Markets served 17 302-3 Energy intensity 162-163 102-7 Scale of the organization 17, 108 Annual Report https://boubyan.bankboubyan.com/en/explore- boubyan/investors-relations/annual-reports/ 302-4 Reduction of energy consumption 162-163 102-8 Information on employees and other workers 108-121 302-5 Reductions in energy requirements of products and services 162-163 102-9 Supply chain 104-105 303-2 Management of water discharge-related impacts 162 102-11 Precautionary principles or approach Integrated within risk management approach 58-60. 62-63 304-5 Water consumption 162 102-12 External initiatives 28-29 305-1 Direct (Scope 1) GHG emissions 163-164 102-13 Membership of Associations 8 305-2 Energy indirect (Scope 2) GHG emissions 164-165 102-14 Statement from senior decision-maker 2-6 305-3 Other indirect (Scope 3) GHG emissions 165-167 102-15 Key impacts, risks and opportunities 49-51, 54-58 305-4 GHG emissions intensity 167 102-16 Values, principles, standards, and norms of behavior 14-15, 66-68 305-5 Reduction of GHG emissions 163-167 102-17 Mechanisms for advice and concerns about ethics 67, 69-70 305-7 Nitrogen oxides (NOX), sulfur oxides (SOX), and other significant air emissions 163-167 102-18 Governance structure 38-40, 46 306-1 Waste generation and significant waste-related impacts 160-161 102-19 Delegating authority 38 306-2 Management of significant waste-related impacts 160-161 102-20 Executive-level responsibility for economic, environmental and social topics 38, 44 306-3 Waste generated 160-161 102-21 Consulting stakeholders on economic, environmental and social topics 20-23 307-1 Non-compliance with environmental laws and regulations There were no significant instances of non-compliance with 102-22 Composition of the highest governance body and its committees 38-42 environmental laws and regulations 102-23 Chair of the highest governance body 38 308-2 Negative environmental impacts in the supply chain and actions taken No significant negative environmental impacts were identified 102-24 Nominating and selecting the highest governance body 43 401-1 New employee hires and employee turnover 115-116 102-25 Conflicts of interest 66-68 401-2 Benefits provided to full-time employees that are not provided to temporary or part-time employees 118 102-26 Role of highest governance body in setting purpose, values and strategy Annual Report https://boubyan.bankboubyan.com/en/explore- boubyan/investors-relations/annual-reports/ 401-3 Parental leave 116 102-27 Collective knowledge of highest governance body Not specifically disclosed, though Board collective knowledge mainly 403-1 Workers representation in formal joint management-worker health and safety committees 120 involves economic matters, described through Chapter 3 - Page 36 403-2 Types of injury and rates of injury, occupational diseases, lost days, and absenteeism, and number 120 102-28 Evaluating the highest governance body’s performance 43 of work-related fatalities 102-29 Identifying and managing economic, environmental and social impacts 23 and throughout the sustainability report 404-1 Average hours of training per year per employee 113-114 102-30 Effectiveness of risk management processes 49-51, 63-64 404-2 Programs for upgrading employee skills and transition assistance programs Training courses annex 102-31 Review of economic, environmental, and social topics Throughout all sustainability report 404-3 Percentage of employees receiving regular performance and career development reviews Boubyan has a defined performance management approach for 102-32 Highest governance body’s role in sustainability reporting 42, 167 all workforce and is disclosed under, section 5.3 Performance 102-33 Communicating critical concerns Throughout all sustainability report and especially in materiality Managamenet (112) assessment (pg 30) 405-1 Diversity of governance bodies and employees 108 102-35 Remuneration policies 68, 113 406-1 Incidents of discrimination and corrective actions taken There were no incidents of discrimination during the reporting period 102-36 Process for determining remuneration 113 407-1 Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk Not relevant to Boubyan 102-37 Stakeholders’ involvement in remuneration Not disclosed 409-1 Operations and suppliers at significant risk for incidents of forced or compulsory labor There were no significant risks for incidents of forced or 102-38 Annual total compensation ratio Not disclosed compulsory labor, 56, 105 102-39 Percentage increase in annual total compensation ratio Not disclosed 413-1 Operations with local community engagement, impact assessments, and development programs 125-133 102-40 List of stakeholder groups 25 413-2 Operations with significant actual and potential negative impacts on local communities There were no significant actual and potential negative impacts 102-41 Collective bargaining agreements Labor unions are not relevant as per Kuwait law on local communities during the reporting period 102-42 Identifying and selecting stakeholders 24-25 414-1 New suppliers that were screened using social criteria 56 102-43 Approach to stakeholder engagement 24-25 414-2 Negative social impacts in the supply chain and actions taken There were no negative social impacts in the supply chain during 102-44 Key topics and concerns raised 20-23 the reporting period 102-45 Entities included in the consolidated financial statements Annual Report https://boubyan.bankboubyan.com/en/explore- boubyan/investors-relations/annual-reports/ 416-1 Assessment of the health and safety impacts of product and service categories 76 102-46 Defining report content and topic boundaries 1 416-2 Incidents of non-compliance concerning the health and safety impacts of products and services There were no incidents of non-compliance concerning the 102-47 List of material topics 21 health and safety impacts of products and services 102-48 Restatements of information No restatements as this is the first sustainability report 417-2 Incidents of non-compliance concerning product and service information and labeling There were no incidents of non-compliance concerning product 102-49 Changes in reporting No changes in reporting since this is the first sustainability report and service information and labeling 102-50 Reporting period 1st January 2020 - 31st December 2020 417-3 Incidents of non-compliance concerning marketing communications There were no incidents of non-compliance concerning 102-51 Date of most recent report This report is the first published sustainability report for Boubyan marketing communications Group for the year 2020 418-1 Substantiated complaints concerning breaches of customer privacy and losses of customer data No data losses or breaches were reporeted, 104 102-52 Reporting cycle Annual 419-1 Non-Compliance with Laws and Regulations in The Social and Economic Area Boubyan follows CBK regulations for Social and Economic Area 102-53 Contact point for questions regarding the report 1 [email protected]” 102-54 Claims of reporting in accordance with the GRI Standards 1 This report has been prepared in accordance with the GRI standards: core option” Annex 5: Kuwait Boursa Index 102-55 GRI content index The GRI content is provided here (184) 102-56 External assurance No formal independent external assurance of the sustainability report Sustainability Dimensions Sustainability Indicators Page was conducted 103 (103-1, 103-2, 103-3) Digitization and technology In materiality and throughout the report (21-23) 1. Annual report https://boubyan.bankboubyan.com/en/explore-boubyan/investors-relations/annual-reports/ 2. Sustainability report 1 103 (103-1, 103-2, 103-3) Innovation In materiality and throughout the report (21-23) Economy 3. Local procurement spending (%) 105 103 (103-1, 103-2, 103-3) Responsible services and solutions In materiality and throughout the report (21-23) 4. Full time employees 109 5. Employee wages and benefits (KWD) 103 (103-1, 103-2, 103-3) Customer experience In materiality and throughout the report (21-23) 113, 118 6. Environmental policy No environmental policy reported 103 (103-1, 103-2, 103-3) Dynamic Islamic services In materiality and throughout the report (21-23) Environment 7. Energy use 162-163 103 (103-1, 103-2, 103-3) Brand power and recognition In materiality and throughout the report (21-23) 8. Carbon emission 163-167 9. Water use 162 103 (103-1, 103-2, 103-3) Sound governance In materiality and throughout the report (21-23) 10. Waste generated 160-161 103 (103-1, 103-2, 103-3) Risk management and business resiliency In materiality and throughout the report (21-23) 11. Waste recycled (%) 160-161 103 (103-1, 103-2, 103-3) SME support In materiality and throughout the report (21-23) 12. Kuwaitization (%) 111 Social 13. Youth employment (%) 110, 114 103 (103-1, 103-2, 103-3) Youth empowerment In materiality and throughout the report (21-23) 14. Injury rate 120 103 (103-1, 103-2, 103-3) Diverse community impact In materiality and throughout the report (21-23) 15. Women in the workforce (%) 108 16. Training hours per employee 103 (103-1, 103-2, 103-3) National empowerment In materiality and throughout the report (21-23) 113-114 17. Employee turnover (%) 115-116 103 (103-1, 103-2, 103-3) Capacity building In materiality and throughout the report (21-23) 18. Human rights policy No human rights policy reported 103 (103-1, 103-2, 103-3) Employee diversity and inclusion In materiality and throughout the report (21-23) 19. Code of ethics 66-67, 69 20. Community investment 125 103 (103-1, 103-2, 103-3) Employee rights and engagement In materiality and throughout the report (21-23) 21. Board independence (%) 43-44, 68 103 (103-1, 103-2, 103-3) Health and safety In materiality and throughout the report (21-23) Governance 22. Risk management committee at the board level 41-42, 46-48 103 (103-1, 103-2, 103-3) Sustainable procurement In materiality and throughout the report (21-23) 23. Non-audit fees (%) 43 24. Voting results Voting results not disclosed 103 (103-1, 103-2, 103-3) Environmental Impact In materiality and throughout the report (21-23) 25. Links between executive pay and performance 43 201-1 Direct economic value generated and distributed 125 26. Compliance with the CMA’s Corporate Governance regulatory requirements 12, 66, 68

184 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 185 Annex 6: Boubyan Open Branches in Annex 7: Boubyan IT and Annex 8: Sustainability / ESG Related Kuwait Digitization Staff Certificates Topics on BLME Social Media

# Branch Name Certificate

1 Derwaza Certificate 1) Cybercrime prevention & Scam awareness / Stopfraud.org.uk 2 Mubarakiya Masters of Business Administration (MBA) 2) #Readoftheweek: The Responsible Investor: The potential of Islamic Finance to fill sustainable development goals 3 Min. Complex Certified ScrumMaster (CSM) - Scrum Alliance 3) Local Business: Cartwright and Butler 4 Salmiya Project Management Professional (PMP) - Project Management Institute (PMI) 4) #Readoftheweek:@spgglobalratings, the role of Islamic finance in ESG Investing 5 Eqailah Microsoft Certified Professional (MCP®) 5) Conduct and Culture Series: Training for Staff 6 Airport Microsoft Certified Technology Specialist (MCTS®) 6) TreesforlifeUK: Local UK company supporting ecosystems in the Scottish Highlands 7 Al-Adan Microsoft Certified IT Professional (MCITP®) 7) The SoapCo: local company creating ethical products and job opportunities for disabled or disadvantaged people. 8 Bayan Microsoft Certified Technology Specialist (MCTS®) 8) @ForeignBanks.org: BLME Employees feature on industry expert panels: Risk / HR/ Trade finance / LIBOR 9 Al-Rumaithiya SAP Certified Application Associate (SCAA®) 10 Fahaheel Certified Cloud Architect (CCA®) 9) Vitality Big Half Marathon: raising money for the Felix Project 11 Hutten SuiteCloud Developer II Certification 10) Evolve: Local UK company in Hertfordshire creating organic, hand crafted skincare 12 Mubarak Al-Abdullah Certified Consultant - SAGE® 11) The Trussell Trust Redditch foodbank 13 Al-Shuhada IT security manager 12) DG Brownies: Local UK Company

14 Al-Dasma ISEB - BA 13) Fat Macys: Local London Social enterprise supporting young people transition from temporary to permanent accommodation

15 Sediq IFQ 14) Vulnerable Customers Training provided for all our employees in consideration to COVID crisis

16 Manqaf Computer Security + 15) Hashi Mohammed: UK Lawyer and author of “People like Us” discussing issues of social mobility, inequality and ethnicity in 17 Subah Al-Salem Network + modem Britain 18 Hawalli ISO 27001 Foundation 16) Islamic Finance Forum Partnership: bringing together European regulators, Standard setters, leaders and Islamic Finance practitioners 19 Farwaniya Level 4 - Cyber security technologist 17) Good Money Week: aims to raise awareness on how to use your money ethically 20 Khaitan Bachelors Degree in Computer Systems Engineering and Programming 18) World Savings Day: importance of Savings to modern economies and to individual financial wellbeing 21 Al-Ahmadi Cisco CCNA 19) World Mental Health day 2020 22 Riqa Various Microsoft certifications (Workstation, Serve, Exchange, SQL) 20) Talk Money Week: Encouraging financial wellbeing 23 Al-Ardhiya Linux Fundamentals 24 Ishbilia CISP 25 Al-Dhahar Ethical Hacking 26 Al-Qaser Citrix Certified Associate 27 Jahra 1 Azure (Implementing Azure Infrastructure Solution) 28 Abdullah Mubarak 29 Saad Al-Abdullah 30 Jaber Al-Ahmed 31 Public Authority for Minor Affairs 32 Al-Audailiya 33 Al-Andalus 34 G1 35 Yarmouk 36 Avenues 37 Kaifan 38 Reqei 39 Qurtuba 40 Al-Khaldiya 41 Qibla

186 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 187 Annex 9: Impacts per Digital Platforms and Processes

Platform Process Impact

RPA/retail app WU beneficiary activation through retail app Enhance Customer Experience RPA Share prices: retrieve shares prices from the Kuwait Boursa and Enhance Staff User Experience FTE Savings update in the Islamic core banking platform (iMAL) FTE Savings

Increase Operational Efficiency Increase Operational Efficiency

Internal Audit Compliance

Reduce Human Errors RPA CBK Monthly files: Increase Operational Efficiency Automate the process of uploading Assets and Reduce Human Errors Liabilities Statement files into CBK portal RPA Siron Embargo: Automate Siron embargo alerts Regulatory Compliance Enhance Customer Experience

Enhance Staff User Experience

FTE Savings RPA Payment Files: Automate processing payments file of third parties Increase Operational Efficiency FTE Savings Reduce Human Errors

Reduce Operational Risk

RPA Vault Excess: obtaining approvals from branch managers for vault PEGA Personal Finance (PF) Deal Update Enhance Customer Experience excess Corporate | Changes & enhancements for CAD Enhance Staff User Experience FTE Savings process FTE Savings Internal Audit Compliance

Increase Operational Efficiency Reduce Human Errors

Reduce Human Errors Reduce Operational Risk

Internal Audit Compliance

RPA Overdrawn Accounts: Extracting reports for all overdrawn account and RPA Claims: collect approvals from users Automate raising claims on VISA and the KNET Payment Gateway Enhance Staff User Experience Internal Audit Compliance

FTE Saving Reduce Human Errors

Reduce Operational Risk Reduce Operational Risk

Regulatory Compliance

188 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 189 Annex 9: Impacts per Digital Platforms and Processes

Platform Process Impact

Enhance Customer Experience Enhance Customer Experience PEGA Corporate Banking - Changes & PEGA Early Settlement Branches Process enhancements for Cash Against Document Enhance Staff User Experience Enhance Staff User Experience (CAD) process FTE Savings FTE Saving

Increase Operational Efficiency Increase Operational Efficiency

Reduce Human Errors Internal Audit Compliance

Internal Audit Compliance Reduce Human Errors

Reduce Operational Risk Enhance customer Experience PEGA Corporate Banking - Changes & enhancements for Funds Available for Enhance Staff User Experience Enhance Customer Experience PEGA Early Settlement Branches Process Distribution (FAD) process Increase Operational Efficiency Enhance Staff User Experience

FTE Savings (CCOD) FTE Savings

FTE Savings (Corporate) Increase Operational Efficiency

Internal Audit Compliance (check list) Reduce Operational Risk

Reduce Human Errors (check list)

Enhance Customer Experience PEGA Product Management personal finance (PF) Enhance Customer Experience PEGA Claims process Enhancements Enhance Staff User Experience Enhance Staff User Experience Increase Operational Efficiency FTE Savings FTE Saving Enhance Staff User Experience Internal Audit Compliance (check list) FTE Savings Reduce Human Errors (check list) Increase Operational Efficiency

FTE Savings Enhance Operational Efficiency PEGA Product Management personal finance (PF) Enhance Staff User Experience Enhancements FTE Saving FTE Savings Reduce Human Errors Enhance Customer Experience

Enhance Staff User Experience

Increase Operational Efficiency PEGA/retail Cash Credit (CC) Exceeding Balance Transfer app FTE Saving Reduce Operational Risk

190 Boubyan Group | Sustainability Report | 2020 Boubyan Group | Sustainability Report | 2020 191 192 Boubyan Group | Sustainability Report | 2020