Stakeholder Engagement and Materiality Assessment
Stakeholder Engagement
At ICICI Bank, we continue to enhance our relationships with our external and internal stakeholders. Such engagement is also essential for the integration of our strategies with our growth plans. We believe that regular interaction with stakeholders keeps us apprised about their evolving expectations, as well as the opportunities for value creation in a rapidly changing macro environment. At the same time, it helps us in identifying the risks of our operations and their impact.
We have developed a structured approach to engage with our stakeholders at different levels within the organisation. We have identified points of contact for each of our key stakeholder groups (employees, customers, investors, shareholders, government officials, regulatory bodies, suppliers, vendors, NGOs, community). These are tasked with attending to the specific stakeholder group, keeping them informed, and maintaining a regular dialogue with them.
We engage with our employees through meetings, workshops, mailers and other mediums on a continuous basis. We regularly engage with our shareholders through annual general meetings, financial result declarations, media releases and investor meets. For suppliers/vendors, we conduct channel partner meetings, one-to-one meetings and regular operational reviews. Customer interactions are done primarily through customer engagement surveys, our website and our customer care/grievance portal, on a continuous basis. Community/NGO engagements are driven through our CSR arm - ICICI Foundation for Inclusive Growth.
Our engagement process acknowledges the uniqueness and individual goals/concerns of each stakeholder group. The Board and Senior Management take into account the priority areas highlighted by the stakeholders, and further deliberate on the required course of action to address them. Feedback from our stakeholders flows into our decision-making for future policies, operations, products, and services. Besides, we also have well-articulated policies to establish a culture of ethical and transparent relationships with our key stakeholders.
Materiality Assessment
Acknowledging Stakeholder Expectations
Amid the rising uncertainty globally due to the pandemic, climate change and other events, we wish to remain more connected with our stakeholders so that we can be aware about issues that matter to them and our business.
In line with this objective, we conducted our first materiality assessment exercise to identify key material topics for our stakeholders and business. Our five-step approach for assessing material issues involved:
- Stakeholder Identification: We identified the key stakeholders by mapping their interests with our business, and determining their role vis-à-vis our organisation. The external groups identified were customers, investors, vendors/suppliers, NGOs and communities. The internal stakeholders were members from the Management and Employees.
- Identifying the Universe of Relevant ESG Topics: This was done based on discussions with internal stakeholders, peer review and benchmarking, sector research, media reports and secondary sources. A total of 23 sustainability topics were identified and evaluated for consideration at a strategic level. They were organised into four broad themes: governance, workplace, environmental management and community engagement. We also ensured that these topics adhere to the sustainability reporting standards and frameworks.
- Stakeholder Consultation: We developed questionnaires to capture the perspective of the identified set of internal and external stakeholders, on the identified pool of material topics. We made sure that the responses from the diverse stakeholder groups were incorporated into our materiality study. Our survey and questionnaire were designed to bring out the key issues, risks and opportunities from the stakeholders’ point of view. These questionnaires were circulated among our stakeholders as an online survey. We also had meetings with a subset of internal stakeholders, aimed at understanding their concerns and the core areas we needed to consider as priority.
- Data Collection and Analysis: We collated the responses received from the online survey of stakeholders. We then analysed the data for a visual representation of the level of priority of every material topic with respect to every stakeholder. We circled out the ones that were common to all.
- Calibration of Results: Based on the analysis of the responses received through the online survey and in-depth discussions with our stakeholders, we developed a materiality matrix to prioritise the topics into high, medium and low categories, based on the order of preference listed by the stakeholders.
HIGH
These issues are of the greatest importance to both stakeholders and ICICI Bank. We have prepared an effective and externally visible management response to these issues for long-term business success sustainability.
MEDIUM
These issues are of medium to high importance to stakeholders and to ICICI Bank but since they do not have a major impact on the Bank's operations, therefore they fall in the medium category. We have considered these priority topics in the development of our internal strategy.
LOW
These topics have been rated in the order to low priority by the stakeholders of the Bank. We have considered these topics in the long-term aspirational goals and identified these as opportunities for improvement.
Importance to Internal Stakeholders
- Compliance with regulations and other laws
- Digital innovation/transformation
- Data privacy and cybersecurity
- Corporate governance and business ethics
- Transparency and disclosures
- Improving customer experience and satisfaction
- Customer fairness and right-selling
- Financial performance
- Stability of risk management and risk outcomes
- Leadership development and succession planning
- Employee health and well-being
- Board diversity including qualification/ experience
- Grievance redressal mechanism for stakeholders like customers and employees
- Opportunities for learning, development and training for employees
- Diversity and inclusion
- Promoting financial inclusion, access and literacy
- Social impact and governance evaluation in lending
- Employee engagement and feedback mechanism
- Promoting environment positive projects (e.g. lending to “green” sectors)
- Responsible sourcing and sustainable procurement practices
- Participating in community development
- Carbon emissions & resource efficiency in the Bank’s own operations
- Exposure of the Bank to climate-related risks in its loan portfolio
The top 13 material issues for the Bank, based on the ranking in the Materiality Matrix and Management Discussions, are:
Promoting Environment Positive Projects
ICICI Bank has been supporting capacity creation in environment-friendly areas, such as renewable energy, waste processing, use of electric vehicles and green buildings, with an appropriate risk-return assessment. There is also a focus on promoting environmental sustainability through the Bank’s CSR initiatives.
Exposure of the Bank to Climate Related Risks in its Loan Portfolio
The Bank’s Board has underlined the need to address the impact of the risks posed by climate change. We evaluate projects using our Social and Environmental Management Framework as part of our lending policies.
The Bank has taken steps to embed ESG and climate risk assessment into its credit assessment, and has established a Climate Risk Management Framework.
To read more, refer to page 85 of this report.
Carbon Emission and Resource Efficiency in the Bank’s Own Operations
The Bank is committed to minimising the environmental impact of its operations and facilities. It is working towards meeting this objective by adopting best practices and certifications that ensure green standards in the Bank’s operations.
Customer Fairness and Right Selling
Our relationship with our customers is based on the principle of 'Fair to Customer, Fair to Bank'. We aim to be a trusted financial services provider of choice for our customers and ensure that our products and services are offered to customers in a fair and ethical manner.
To read more, refer to pages 30-33 of ICICI Bank’s Annual Report 2021-22.
Improving Customer Experience and Satisfaction
We endeavour to offer seamless omni-channel experiences to our customers. Our digital platforms offer smooth digital journeys, along with personalised solutions and value-added features. We regularly conduct customer satisfaction surveys to understand their needs and take feedbacks on the products and services we offer. Our value proposition for customers and our efforts to create a positive customer experience have led to a sustained improvement in the Bank’s Net Promoter Score.
Leadership Development and Succession Planning
We have a robust succession planning process, which measures the depth of the leadership bench. The Bank has a strong bench for all the key positions and continuously measures the depth of succession for all critical roles.
Compliance with Regulations and Other Laws
We strive to be a responsible organisation by complying with the relevant legal and regulatory requirements. Our legal and risk teams assure that all our operations follow the standards established by regulatory bodies, while being vigilant on recent developments. Regular training and awareness sessions are conducted for relevant internal stakeholders. E-learning modules are prepared for employees at large.
Financial Performance
Our strategic focus is to grow the core operating profit within the guardrails of risk and compliance. We are investing in areas that are critical for delivering enhanced customer experiences, boosting productivity, and improving operational efficiency. Along with business growth, we also aim to maintain a strong risk and capital management strategy, and ensure a balance of risks and rewards.
Stability of Risk Management and Risk Outcomes
As a financial intermediary, and being exposed to various types of risks, we have laid strong emphasis on adherence to risk management policies and processes. We have put in place an Enterprise Risk Management and Risk Appetite Framework that articulates the risk appetite, and drills down the same into a limit framework for various risk categories under which various business lines operate.
Digital Innovation/Transformation
We continuously strive to create digital innovations with rich features and functionalities for our customers. The Bank’s digital platforms have transformed to provide best-in-class seamless digital journeys. The open architecture platforms have enabled us to extend banking services even to non-ICICI Bank account holders. The Bank is transforming from Bank to BankTech.
Data Privacy and Cybersecurity
We have been investing in building resilience and responding effectively to cyber attacks. The Bank has put in place a dedicated information/cybersecurity governance framework. We have a Personal Data Incident Handling Forum (PDIHF), a Data Leakage/Loss Prevention (DLP) system, and a 24x7 Security Operation Centre (SoC) to protect data, and always ensure the highest level of cybersecurity. Our teams are regularly undergoing training to stay updated, with the latest procedures and systems in place to ensure complete security of data.
Corporate Governance and Business Ethics
We are committed to act professionally, fairly, and with integrity in all our dealings. We have established effective policies and frameworks that encourage employees to act in accordance with the highest professional and ethical standards. Regular communication and training of employees is undertaken with regard to our code of conduct, information security, anti-money laundering, anti-bribery and anti-corruption, frauds, and such other issues are undertaken.
Transparency and Disclosures
At ICICI Bank, we recognise the criticality of transparency and disclosures as part of a strong corporate governance structure. We endeavour to maintain an ethical and transparent relationship with all our stakeholders. We endeavour to maintain an ethical and transparent relationship with all our stakeholders so that they can make informed decisions on their engagement with us.
