Social & Environment Management System (SEMS)
SEMS is a set of policies, procedures, tools and internal capacity to identify and manage the Bank’s exposure to Social & Environmental (S&E) risks of its clients. DFCC Bank’s SEMS, which was developed in 2016 is implemented by the Sustainability Unit.
The following activities were commenced from 2020 for all term loans over LKR 25m:
- Conducting an environmental and social risk categorization during the project appraisal. This serves as a useful indicator for loan approving authorities and a decision tool on the level of environmental and social impact monitoring required for each transaction.
- Commenting on the environmental and social aspects in appraisal reports by the Sustainability Unit for the benefit of approving authorities
- Monitoring of the environmental and social aspects of all approved loans by the Sustainability Unit during the entire loan tenure.
Implementation of a SEMS is also required under Principle 1 of the 11 Sustainable Banking Principles of the Sri Lanka Banks’ Association’s (SLBA’s) Sustainable Banking Initiative (SBI).