Forbright Bank's journey toward reducing carbon emissions and transitioning to sustainable funds.
Forbright Bank – Member FDIC, Equal Housing Lender – is a full-service bank taking action to decarbonize the economy. Headquartered in Chevy Chase, Maryland, Forbright is committed to accelerating the transition to a sustainable, clean energy economy by financing the companies, investors, and innovators driving that change.
South Pole provided an educational workshop to the executive team and Sustainability Committee of the Board of Directors about financed emissions, TCFD and SEC disclosure and Net Zero pathways.
As a follow up, Forbright also wanted to calculate the financed emissions of its portfolios in order to understand the full scope of emissions in alignment with its mission to help decarbonize the economy.
Forbright Bank is largely invested in business loans and real estate. When assessing the carbon footprint of investments, data availability is the main obstacle that financial institutions, particularly those with lending portfolios, need to overcome in order to attain results and indicators.
South Pole carried out a portfolio screening, ensuring coverage even when faced with data limitations, through the use of industry averages for both emission factors and investees' or borrowers' financial data.
Results helped identify emissions hotspots, such as carbon intensive loans or investments, and provide an indicative measurement of how carbon intensities compare across different industrial activities. This benchmark and baseline will allow Forbright Bank to understand high intensity sectors and areas in their portfolio for improvement.
Forbright Bank was looking to develop an Energy Transition Framework for its sustainable lending arm across green infrastructure, real estate and energy. This framework would provide the portfolio with a criteria and methodology to screen, assess, and report impact of investments on a periodic basis and aggregated and detailed disclosure on impact. The framework would enable Forbright to select projects based on their ability to meet the portfolio's desired climate impact objectives.
Creating a harmonized and cohesive compilation of the most applicable quantitative metrics across several sustainability sectors and categories can get complicated. Forbright Bank needed an aggregated framework that included the relevant narratives on assessing qualitative and quantitative impact, allowing distinction between direct and indirect impacts.
South Pole identified and defined KPIs, metrics, and indicators, enabling the portfolio to assess its progress with the following:
Moreover, South Pole supported with an illustrative impact report including a summary of recommended impact reporting characteristics in line with EU regulations and global reporting standards.
I've worked with a few different South Pole teams on distinct projects and have found them to be consistently strong in working collaboratively towards our desired outcome with open communication and deep subject matter expertise. We value the South Pole team as an extension of our team when working to build credible climate-related solutions.
Samantha Norquist, Chief Sustainability Officer, Forbright Bank
