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BANK HAPOALIM SUSTAINABILITY REPORT 2016 Economic, Social & Environmental Responsibility SOCIAL RESPONSIBILITY IT's in OUR HANDS BANK HAPOALIM Contents

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BANK HAPOALIM SUSTAINABILITY REPORT 2016 Economic, Social & Environmental Responsibility SOCIAL RESPONSIBILITY IT's in OUR HANDS BANK HAPOALIM Contents BANK HAPOALIM SUSTAINABILITY REPORT 2016 Economic, Social & Environmental Responsibility SOCIAL RESPONSIBILITY IT'S IN OUR HANDS BANK HAPOALIM Contents 4 34 78 106 132 152 Introduction The best interests Society and the Quality of life Living with the 156 Corporate Governance 04 Messages from the Chairman of of the client community and well-being environment 160 Ethics the Board and CEO Customers, products, and Creating value for society and for the well being and caring for Logistical resources and the 162 Compliance 07 The Bank’s Vision services economy employees environment 164 The Doing Good Model 12 Social Responsibility and Sustainability at the Bank 166 GRI & Global Compact Index 18 Presenting the Material Issues for Reporting 22 (Multi-year) Summary of Corporate Responsibility Performance 25 Adopting Responsible Initiatives 32 Activity Directions and Main Objectives for 2016 among households, segments and in this sector, reflecting the strength and - of which more than 50% are women population groups, such as new seniors professionalism of Bank Hapoalim. In - is an outstanding figure in the Israeli (people in or near retirement age), young recent years, the bank doubled the number economy, attesting to the uniqueness target audiences and through various of branches in Arab communities and, of the bank's work environment. This initiatives in the public sphere. Thus, for during the past year, two new branches year, as part of its human resources example, the bank took an active part in the have been opened in Arab communities. development efforts, the bank continued Financial Awareness Week project - during As part of our effort to strengthen ties with to train employees and managers through which bank customers and the public in Arab society in Israel, we are promoting courses at Poalim Campus, online training Israel were offered to participate in a series various initiatives for this sector on the and digital empowerment at the branches. of conferences in various bank branches, community level as well. with the aim of increasing awareness of In 2016 the bank continued to lead the informed financial conduct and proper In 2016, the bank continued to lead entire banking system in its efforts for the management of banking activity. financing in the Israeli economy, even as community. The bank focused on projects some of our customers are undergoing in the area of education, with special In 2016, the Bank continued its strategic a complex and challenging period, while emphasis on education towards prudent activity in the small business segment, leading the financing of projects promoting financial conduct as a key for promoting with the understanding that this segment environmental sustainability. As in recent financial freedom. In addition, thousands Message from Bank Hapoalim Chairman, is one of the pillars and growth engines years, the bank continued to serve as the of the bank’s employees volunteered in of the Israeli economy. The bank’s deep leading financing entity in Israel for activities 2016 in social organizations across Israel, Mr. Oded Eran and the CEO, Mr. Arik Pinto commitment and ongoing activity in this and infrastructure in areas such as: power throughout the year. area is reflected in enhancing the value generation from renewable energies; power proposition, creating innovative products, plants to generate energy from natural gas; Following a decade of corporate We are proud to present the annual retail and business customers; innovation by a significant enhancement of our digital and providing ongoing financing and facilities for the proper treatment of waste; responsibility, we are being recognized sustainability and corporate social in financial products and services; focused value proposition to customers, along with consulting to this customer segment. green building, etc. In this manner, we help by local and global entities and ratings, responsibility report of Bank Hapoalim development of global operations; and strengthening of personal and human The bank continues to serve as a leading create a more environmentally-friendly and are proud to be in line with leading for 2016. This is the tenth CSR report continued operational excellence as a relations. Innovation is part and parcel of credit provider for this segment, along with infrastructure for Israel’s future. banks across the world. As part of this published by the bank, evidence of the way of life. We understand that - within the bank's corporate culture, aiming to service that is tailored to small businesses, commitment, the bank continues to be bank's ongoing commitment to this area these channels of activity, which promote offer services to the public in a personal, and by providing assistance in dealing with The bank continued to promote and committed to the ten principles of the and to its various stakeholders: to the the bank’s business sustainability and humane and technological manner. In the the unique challenges facing them. develop the quality of its largest and United Nations Development Program shareholders; customers; employees excellence, we are committed - both past year, the bank has established the most important resource: the employees (UNGC), which promotes economic and suppliers across Israel; and to the managers and employees - to promote Innovation Division to initiate and leverage The bank continues its activity to promote and managers, while maintaining labor development in a manner that is beneficial community and Israeli society within which corporate responsibility as an integral part innovative solutions and new growth growth in the Arab sector. Economic relations, which has been a strategic asset to the community and to future generations. the Bank operates. This activity realizes of our activity. As part of this commitment, engines - both digital and technological - development of this sector has social for the bank for years. The Employees' This is a milestone, but as part of the part of the bank's vision and leadership the bank has established, over the past and to accelerate the pace of change and implications, which have a positive impact Association is a full partner in leading challenges we face, we will strive for in the field of sustainability and social year, the Stakeholders' Division, in order to execution of initiatives. on the economy and society. The bank's the bank to impressive achievements, significant achievements in this field in the responsibility in Israel. conduct a dialogue with the stakeholders, momentum among the Arab population in serving as a role model for the entire coming years. with the aim of creating common value. In 2016, we continued to enhance financial Israel has altered the competitive conditions industry. The bank's managerial backbone In 2016, the bank began implementing freedom - a key value in the bank’s vision - its strategic plan for 2016-2018. Entitled In 2016, we continued to serve our large for our customers and the general public. “Personal, Human and Technological”, the customer base through the branches Our role at the bank is to serve as our plan focuses on a number of key areas: and various technological channels. This customers’ financial facilitators, assisting creating an optimal and flexible infrastructure year was characterized by targeting and them through products and tools that for topics such as: capital management; customizing services and products to support behavior change to promote human resource development; building various types of customers according to adequate financial conduct. As part of an innovative technological infrastructure the special and varied financial needs of this effort, we continued to promote tools Oded Eran Arik Pinto as a platform for advanced services for each group. The past year was marked to assist prudent financial management Chairman of the board of directors CEO INTRODUCTION 4-5 Corporate Responsibility at Bank Hapoalim: About the Report Assimilating the Bank Hapoalim vision This is the tenth report to be published by new managers filled the positions of secondly - auditing the adequacy of the Bank Hapoalim for its stakeholders. Each Chairman of the Board and CEO (assumed reporting; thirdly - the completeness of report surveys a full year of activity within office at the beginning of 2017). This the reporting on our carbon footprint; The Bank Hapoalim Vision our overall sustainability and corporate report has been prepared in accordance and fourthly - compliance with the social responsibility plan. The annual with the GRI Standards: Comprehensive reporting guidelines on material aspects To be a leading global financial institution, headquartered reports, published since 2007, reflect option. Most of the data in the report were in accordance with the requirements of the varied, thorough, systemic, and methodical generated by the information systems at GRI, which examined the bank’s process in Israel, focused on its customers and working activity. The sustainability and CSR reports the bank, in accordance with GRI reporting for identifying issues for reporting and reflect the bank’s journey - from the requirements. Information was collected found it to be in compliance with the new towards their financial freedom. To create value for inception of the plan to the present day regularly and routinely throughout the reporting standard’s provisions. our stakeholders while upholding the principles of - to instill corporate social responsibility. year. However, some of the data were Each report focuses on different highlights,
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