PAKISTAN SUSTAINABILITY SUMMARY 2018 Here for good · Vietnam; and Africa & Middle East (AME)...

PAKISTAN SUSTAINABILITY SUMMARY 2018

Here for goodDriving commerce and prosperitythrough our unique diversity

Being a responsible companyOVERVIEW

Sustainability data

Investing in communities

Contributing to sustainable economic growth

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Standard Chartered is a leading international banking group

OUR REGIONS

How we are organised

OUR CLIENT SEGMENTS

GLOBAL

Corporate &Institutional Banking

Private BankingHelping over 8,000 clients grow and protect their wealth.

LOCAL

Commercial BankingSupporting over 45,000 local corporations and medium-sized enterprises across Asia, Africa and the Middle East.

Retail BankingServing over nine million individuals and small businesses.

@StanChart

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Unless another currency is specified, the word ‘dollar’ or symbol ‘$’ in this document means US dollar and the word ‘cent’ or symbol ‘c’ means one-hundredth of one US dollar.

Unless the context requires, within this document, ‘China’ refers to the People’s Republic of China and, for the purposes of this document only, excludes Hong Kong Special Administrative Region (Hong Kong), Macau Special Administrative Region (Macau) and Taiwan. ‘Korea’ or ‘South Korea’ refers to the Republic of Korea. Greater China & North Asia (GCNA) includes China, Hong Kong, Japan, Korea, Macau and Taiwan; ASEAN & South Asia (ASA) includes Australia, Bangladesh, Brunei, Cambodia, India, Indonesia, Laos, Malaysia, Myanmar, Nepal, Philippines, Singapore, Sri Lanka, Thailand and Vietnam; and Africa & Middle East (AME) includes Bahrain, Egypt, Iraq, Jordan, Lebanon, Oman, Pakistan, Qatar, Saudi Arabia and the United Arab Emirates (UAE).

Within the tables in this report, blank spaces indicate that the number is not disclosed, dashes indicate that the number is zero and nm stands for not meaningful. Standard Chartered PLC is headquartered in London.

The Group’s head office provides guidance on governance and regulatory standards. Standard Chartered PLC stock codes are: HKSE 02888; LSE STAN.LN; and BSE/NSE STAN.IN.

About this report For more information about our sustainability performance, visit sc.com/sustainability

Sustainability reporting is embedded throughout our 2018 Annual Report and Accounts. Visit sc.com/annualreport

Photo competition In 2018 we ran our Annual Report staff photo competition again, this time showcasing our three valued behaviours. The top three entrants can be found on the front and back covers.

Europe & Americas

Centred in London and New York with a presence across both continents. A key income originator

for the Group.

Africa & Middle East

Present in 25 markets, of which the most sizeable

by income are the UAE, Nigeria and Kenya.

ASEAN & South Asia

Our largest markets by income are Singapore and India. We are active

in all 10 ASEAN countries.

Greater China & North Asia

Serving clients in China, Hong Kong, Korea, Japan,

Taiwan and Macau. The Group’s largest region by income.

Our heritage and values are expressed in our brand promise, Here for good. Our operations reflect Our Purpose, which is to drive commerce and prosperity through our unique diversity. We are present in 60 markets and serve clients in a further 85. Our businesses serve four client segments in four regions, supported by eight global functions.

Visit sc.com to download our 2018 Annual Report

Serving over 5,000 large corporations, governments,banks and investors.

Standard CharteredSustainability Summary 2018


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01

Introduction

Progressing sustainability

2018 SUSTAINABILITY HIGHLIGHTS

$20.8bnmobilised for infrastructure

$103mfor Seeing is Believing from 2003 to 2018

$690mfor microfi nance institutions

99.6% of employees recommitted to Group Code of Conduct

No. 2 bank globally for blended fi nance by leading network convergence

100kgirls reached through Goal

Read more about our 2018 performance on pages 6–11

OUR REFRESHED STRATEGIC PRIORITIES

The Bank has defi ned refreshed strategic priorities for the next three years. Purpose and People, which incorporates our commitment to sustainable and responsible banking, are at the centre of these priorities.

Purpose and People

Deliver our

network

Grow our affl uent business

Improve productivity

Optimise low-returning

markets

Transform and disrupt with digital

Measuring our progressOur new Group KPI measures how well we are embedding sustainable and responsible practices across our business, operations and through our community programmes by looking at progress against the targets set out in our 11 Sustainability Aspirations.

In 2017 – the fi rst year we reported progress on the Aspirations – 88.6 per cent were achieved or on track. This increased to 90.9 per cent in 2018 demonstrating our progress.

% of Sustainability Aspirations achieved or on track

2017

88.6%2018

90.9%

For more, go to sc.com/annualreport

“Financing and sustainability go hand in hand. We deliver

our commitment to sustainable and responsible

banking through our business, the priorities set

out in our Sustainability Aspirations and industry

and global collaborations, including our participation

in the UN Global Compact.”Bill Winters

Group Chief Executive


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Embedding sustainability across our business

Sustainability and our purpose are core to who we are as an organisation. Since the Bank has been in the region for over 150 years, we have drawn on the unique diversity of our people, markets, skills and expertise to support commerce across Pakistan. We help individuals and businesses manage their finances as they develop their wealth, and connect global capital with emerging markets to promote prosperity. We do this to deliver on our promise to be Here for good.

Our approach to sustainability comes to life through our sustainability pillars - contributing to sustainable economic growth, being a responsible company and investing in communities – and 11 Sustainability Aspirations, which set out actions and targets to ensure we live up to our promises. These pillars and Aspirations form the basis for this summary of our 2018 performance.

As a responsible company, we have continued to transform people’s lives through our community programmes with employees contributing more than 1,000 volunteering days. Globally, we surpassed our $100 million target for Seeing is Believing (SiB), our initiative to tackle avoidable blindness and visual impairment, two years earlier. In Pakistan, our SiB journey in numbers is truly inspiring, impacting over 12 million beneficiaries. We have conducted over 500,000 sight restoring surgeries, trained over 60,000 lady healthcare workers, screened over 1.5 million children for refractive errors, while we have 24 visually impaired employees working in the Bank.

We still have projects that will continue to be implemented till 2020 in Karachi, Lahore, Islamabad, Mansehra, Haripur, Swat and Swabi. We continue with a focus on diabetic retinopathy and accelerating support for female cataract patients through our partners Sight Savers and Layton Rehmatulla Benevolent Trust (LRBT).

Futuremakers by Standard Chartered, is our global initiative to tackle the issue of inequality and seeks to promote greater economic inclusion for young people in our communities. We will do this by supporting disadvantaged young people from low-income households, particularly girls and people with visual impairments, to take part in programmes focused on education, employability and entrepreneurship.

Futuremakers builds on the success of our existing community programmes. Many of our current programmes are included under Futuremakers. For example: • We will expand Goal, our existing girls’

education programme• We will endeavour to incorporate financial

education into all programmes• We will develop new global community

programmes in employability and entrepreneurship

Globally, we have set a target of raising $50 million for Futuremakers by Standard Chartered, our new global initiative to tackle inequality and promote greater economic inclusion in our communities, between 2019 and 2023. For Pakistan, this would translate into furthering our Goal programme. Our adolescent girls’ focused programme grew in its third year to span 17 schools in Lyari, Saddar and Keemari and reached more than 4,500 girls. We will also be looking at providing a financially inclusive environment for females by launching initiatives such as Women in Tech.

I am proud to share our community initiatives of 2018 and our Sustainability Aspirations for 2019 in this Sustainability Summary.

Shazad DadaChief Executive OfficerStandard Chartered Bank(Pakistan) Limited

Shaping our response to climate change

#TuesdayGoals: Conducting Financial Education for adolescent girls


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Climate change is one of the greatest challenges facing society today. Recognising the scale and complexity of the challenge, we are collaborating with clients and external stakeholders to f ind solutions that support the Paris Agreement.

In 2018, we reinforced our commitment to addressing climate change. We announced our decision to end financing for new coal-fired power plants anywhere in the world, save where we have an existing commitment. This followed extensive consultation with investors, civil society organisations and government representatives who where informed about our decision.

Before the announcement, we engaged with affected clients to discuss our position and its implications for them. Given coal’s role in power generation in our markets, this decision required us to decline participation in potential transactions.

To support clients through the low-carbon transition, we have committed to develop a methodology to measure, manage and ultimately reduce emissions related to the financing we provide. This has implications beyond our own business. As such, we are collaborating with other financial institutions via the Science Based Targets Expert Advisory Group and through signing the Katowice Commitment to progress in this initiative.

We have updated our Aspiration for climate change to reflect these new commitments and will focus on delivering against these targets in 2019.

Last year, to provide Financial Education (FE) to the girls’ enrolled in the Bank’s community programme, Goal, our staff volunteered their time to conduct FE sessions.

The objective of these sessions was two-fold: to create a better understanding of the Goal programme running in Pakistan, and to improve financial savviness among the adolescent girls. This initiative called #TuesdayGoals was launched as a collaboration between the Bank’s Corporate Affairs, Brand and Marketing and the Group Internal Audit teams. Key highlights of this initiative are:

• We had numerous Regional/Group visitors: Gloria Mamwa, Regional Head of Property, AME, Property-People; Paul Anthony McCrystal, Regional Head Mace Macro; Sunil Kaushal, Regional CEO, AME; Kariuki Ngari, Global Head, Retail Distribution; Millicent Clarke, Regional Head HR, AME and Andy Halford, Group CFO, visiting Goal schools during their visit to Pakistan.

• On one particular day, we had six members from the Bank’s leadership team visit 5 Goal schools. On this day alone, 104 employees led Financial Education sessions for over 1,600 students.

Other achievements to note are:

• 12 unique schools were catered to through this activity

• 2,563 Goal girls reached through #TuesdayGoals

• Almost 450 Financial Education sessions were conducted on a range of subjects

• 438 employees volunteered for these sessions

03

CASE STUDIES

Being a responsiblecompany


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Our approach to sustainability

OUR SOCIO-ECONOMIC IMPACT

Measuring our impact in East Africa

Here for good

Being aresponsible

company

Contributing tosustainable

economic growth


Since 2009, we have measured the socio-economic impactof our financing in markets to better understand how wecontribute to sustainable economic growth. To date, wehave commissioned independent socio-economic impactstudies in Bangladesh, Ghana, Indonesia and Sub-SaharanAfrica. In 2018, we published our latest report assessing thecontribution we make in Kenya, Tanzania and Uganda.East Africa is on the rise. Growing trade in the region issupported by the East African Community through acustoms union and common regional market. It has ayoung and growing labour force, rapid adoption oftechnology and steadily improving living standards.We want to ensure that the business we do in the regionsupports sustainable development.

Using 2016 data, the report illustrates the positive socio-economic impact of our financing. We provided $3.4 billion in financing to businesses, consumers and government agencies helping key sectors like manufacturing to expand and connecting the region to global markets. We supported a further $2.8 billion of value-added impact through salaries, tax and local company profits – equivalent to 2.1 per cent of the region’s GDP. We directly and indirectly supported more than one million jobs with our clients and their associated value chains.

Our purpose is to drive commerce and prosperity through our unique diversity.

By focusing on three sustainability pillars – contributing to sustainable economic growth, being a responsible company and investing in communities – we believe we can achieve our purpose, in line with our valued behaviours, and deliver on our promise to be Here for good. The pillars are supported by our Sustainability Aspirations, which provide measurable targets to demonstrate how we are achieving sustainable outcomes across our business.

Launched in 2016, the Aspirations are aligned to the United Nations (UN) Sustainable Development Goals (SDGs). Details of our progress delivering the Aspirations can be found in the subsequent pages.

Balancing economic,environmental and social needs

Recognising that our most significantenvironmental and social impact comes from the business we finance, in 2018 we set out

on how to balance economic, environmentaland social needs in our decision makingthrough our Sustainability Philosophy. For the first time, we publicly shared the list of Prohibited Activities that the Bank will notfinance. The list includes restrictions involvingchild and forced labour, trade in endangeredwildlife, and Arctic and tar sands’ explorationand production. The full list can be found atsc.com/prohibitedactivities

Following a comprehensive review, in 2018, we released our revised cross-sectorenvironmental and social risk frameworkand updated Position Statements, whichare consolidated across five sectors andtwo themes. These draw on InternationalFinance Corporation (IFC) PerformanceStandards, the Equator Principles and globalbest practice, setting out the conditionsunder which we will support the activities ofclients operating in sectors with high potentialenvironmental or social impact. The reviewresulted in a revised position on powergeneration and a decision to end financingfor new coal-fired power plants, save wherewe have an existing commitment.

05

ENVIRONMENTAL AND SOCIAL ISSUES RESPONSES

Climate change Position Statements (sc.com/positionstatements) Climate change disclosure aligned to the Task-force on Climate-related Financial Disclosures(sc.com/tcfd)Climate change Aspiration (p7)Principal Uncertainty in Risk & Capital Review (p213 of the 2018 Annual Report & Accounts)

Conduct, values and ethics

Group Code of Conduct (sc.com/codeofconduct)Conduct Aspiration (p9)Stakeholders and responsibilities (p42 of the 2018 Annual Report and Accounts)

Environmental and social risk management

Sustainability Philosophy (sc.com/sustainabilityphilosophy)Position Statements (sc.com/positionstatements) Environmental and Social Risk Assessment (sc.com/esrisk)Our standards and policies (sc.com/standardsandpolicies)

Human rights 2018 Modern Slavery Statement (sc.com/modernslavery)Position Statements (sc.com/positionstatements) Stakeholders and responsibilities (p42 of the 2018 Annual Report and Accounts)

Talent attraction and engagement

People Aspiration (p9)Stakeholders and responsibilities (p42 of the 2018 Annual Report and Accounts)Colleagues (p44–46 of the 2018 Annual Report and Accounts)

Identifying opportunities Supporting our communities

Understanding our sustainability themes

To further integrate sustainability and responsibility across the organisation, we created a new Bank-wide Sustainability Forum, with members nominated by the Management Team (MT) and chaired by a member of the MT, to develop and deliver the Bank’s sustainability strategy.

The forum, which is supported by a new Sustainable Finance Working Group, and strengthened working groups on human rights and climate change, reports regularly to the MT and the Brand, Values and Conduct Committee of the Board.

During the year, we consulted stakeholders on increasing our commitment to sustainable finance and adapting our community programmes to respond to the changing economic and social needs in our communities. These consultations contributed to our enhanced ambition to promote sustainable finance and economic inclusion in our communities.

In addition, we deepened our engagement across a range of sustainability themes that matter to stakeholders and impact our business, including coal, climate change and human rights. The outcomes of the limited-scope materiality review we conducted in 2017 continue to represent the key themes raised by stakeholders in 2018.

We share how we manage and measure progress against these issues through policies and statements on sc.com, our Annual Report and Accounts and this publication. The table below sets out where stakeholders can find responses to the top five issues identified.

Our ambition is to increase our support for sustainable finance. In 2018, we set up a dedicated team to identify and develop opportunities for sustainable finance in our markets.

The Sustainable Finance team brings together our business expertise with our capabilities in environmental and social risk management. Its role is to identify opportunities to develop new financial products and services that have a positive impact, while also ensuring that environmental and social considerations are incorporated into banking decisions.

In 2018, we launched Futuremakers by Standard Chartered to tackle inequality and promote greater economic inclusion in our markets. We aim to raise $50 million between 2019 and 2023 to provide disadvantaged young people with the opportunity to learn new skills and improve their chances of getting a job or starting their own business.


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Being a responsible Sustainability Investing in Being a responsible Sustainability Investing in CONTRIBUTINGTO SUSTAINABLE ECONOMIC GROWTH company datacommunities


Overview

SUSTAINABLE FINANCE

Leveraging the RMB opportunities

Objective

We use our core business of banking to promote sustainable development in our markets.

OverviewHere

for good

Contributing tosustainable

economic growth

Pillar 1

New 2019 Sustainability Aspirations are in the gate-fold at the back of this document

As set out in our Sustainability Aspirations, we work with clients to deliver sustainable economic growth through the finance we provide. In 2018, we mobilised $20.8 billion for infrastructure development, including $2.9 billion towards clean technology, and helped our clients issue $9.1 billion in green bonds. We exceeded our Power Africa commitment by supporting more than $5 billion of power generation projects between 2013 and 2018.

We closely manage lending to high-impact sectors and continue to progress our approach to climate change. In 2018, we reviewed 827 transactions against our Position Statements and trained more than 1,300 front-line colleagues on our revised environmental and social risk framework. We set out our intention to develop a Bank-wide climate risk management framework and published our first report aligned to the recommendations of the Task-force on Climate-related Financial Disclosures (TCFD).

We set a Climate Change Aspiration in 2016 as an important first step toward understanding the impact of climate change on our clients and portfolio. Since then, we have developed assessment criteria for energy utilities’ clients and expanded this to other high emitting sectors in 2018. Given that the complexity of this issue necessitates a holistic and strategic approach, we have not yet introduced these criteria into our decision-making processes and therefore have marked this Aspiration as Not Achieved. We are building on this work as we develop our climate risk management framework.

In 2019, we will develop a Bank-wide sustainable finance strategy, extend environmental and social risk reviews to Private Bank transactions and take forward the targets in our updated Climate Change Aspiration.

Standard Chartered Bank, in collaboration with State Bank of Pakistan (SBP), conducted a workshop on “Leveraging the RMB opportunities”. The workshop was attended by over 50 clients of the Bank and was organised by Standard Chartered Pakistan to create awareness for the Renminbi (RMB) capabilities being offered by the Bank. The session was conducted by Carmen Ling, Managing Director & Head Global RMB, Standard Chartered and Becky Liu, Head China Macro Strategy, Standard Chartered.

As the trade volumes between China and Pakistan continue to grow significantly year on year, there are many opportunities presented to Clients in Pakistan. Corporate entities can request settlement of invoices in RMB and the Bank feels that it is well prepared to meet the increasing requirement for Renminbi trade related settlements in the market. Leveraging on our extensive footprint and over 150 years of history in both China and Pakistan, the Bank is well-positioned to facilitate business flows between the two markets.

In addition, SBP has allowed traders of Pakistan and China to trade different goods and services through Chinese Currency, Yuan. Imports, exports and financing transactions can be denominated in the Chinese currency.


07

AspirationsTarget: We will work with our clients to: Target date Progress

Infrastructure Jan 2017 – Dec 2019(infrastructure)

Achieved / Ongoing

2018: $20.8 billion2017 – 2018: $33.6 billion

Jan 2016 – Dec 2020(clean technology)

Achieved / Ongoing

2018: $2.9 billion2016 – 2018: $4.9 billion

Climate change

May 2016 – Dec 2017(partially met in 2017; carried forward to 2018)

Not Achieved

See facing page for more information

Jan 2018 – Dec 2018 Achieved

Entrepreneurs Jan 2017 – Dec 2019 Achieved / Ongoing

2018: $3.2 billion2017 – 2018: $6.0 billion

Jan 2017 – Dec 2019 Ongoing

2017 – 2018: 14%

Digital: Jan 2017 – Dec 2019 Ongoing

2018: 14 mobile wallet markets – down from 15 in 2017

2018: 39% increase in average mobile money transactions to more than 97,725 per month

Commerce Jan 2016 – Dec 2020 Ongoing

2018: 2,625 new clients2017 – 2018: 4,724 new clients

Impact and sustainable fi nance

Jan 2016 – Dec 2020

Jan 2016 – Dec 2020

Jan 2016 – Dec 2020

Achieved / Ongoing

2018: $690 million2016 – 2018: $1.7 billion

Ongoing

2018: 3 funds available

Ongoing

Ranked number 2 bank in the world for blended fi nance by Convergence, a leading globalnetwork for blended fi nance

Aspirations progress key

On track Not on track Achieved Not achieved

Everyone should have access to safe,reliable and affordable power andinfrastructure which transforms livesand strengthens economies

Provide advisory, financing,debt structuring services andpolicy advice for $25 billionof infrastructure projects,including $4 billion towardclean technology

Introduce criteria to assessalignment to a 1.5-degreeclimate scenario for energysector clients and transactions

Expand climate assessmentcriteria to other high-emittingsectors

Provide $6 billion to BusinessBanking clients

Grow our lending to smallerbusiness clients in ourCommercial Bank by 20%as measured by assets

Continue to provide ‘last mile’payments and collections toclients in our footprint thoughour Straight2Bank wallet

Bank 8,000 of our clients’international and domesticnetworks of suppliers andbuyers through banking theecosystem programmes

Provide $1 billion of financingto microfinance institutionsto extend access to finance

Facilitate opportunities for ourPrivate Bank clients to investin impact investing funds inour markets

Continue to promote blendedfinance capabilities

Climate change is one of today’s greatestchallenges and addressing it is essentialto promote sustainable economic growth

Entrepreneurs are the heart of localeconomies, creating jobs andempowering people

Everyone should have access to digitalbanking products enabling safe, efficientand inclusive banking

Trade creates jobs and contributes toeconomies by enabling people toconnect across borders

Innovative financial products andpartnerships can help us solve globaldevelopment challenges and improvethe lives of millions in our markets

Worked with the United Nations Environment Programme Finance Initiative (UNEP-FI) and 15 banks to paleoclimate assessment criteria for additional sectors including oil and gas and transportation, and reported publicly through UNEP-FI. This has informed our approach to managing climate risks

Being a responsible Sustainability Investing in Being a responsiblecompany

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Investing incommunities Overview

CONTRIBUTINGTO SUSTAINABLE ECONOMIC GROWTH

Being a responsible companyOverview

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With USD62 billion of projects scheduled along the China-Pakistan Economic Corridor (CPEC) – equivalent to 21 per cent of Pakistan’s GDP – China’s Belt & Road (B&R) initiative stands to have a dramatic long-term impact on Pakistan’s domestic economy and businesses.

CPEC, the principal B&R initiative in Pakistan, stands to be much more than a corridor or transit route for Chinese exports and imports. It includes a range of infrastructure projects and proposed special economic zones along the route from Kashgar, China’s westernmost city, through central Pakistan to Gwadar port on Pakistan’s southwest coast. Together these could transform Pakistan’s economy.

Much more is being financed, built and operated by or with Chinese support. The state-owned Three Gorges Corporation (CTG), for instance, is planning three hydro-power projects in north-eastern Pakistan with a combined investment of USD5.7 billion and a planned total capacity of 1,118MW. The first of these - the Kohala hydro-power project - will come online in 2020.

The economic boost from additional power capacity is a clear benefit. “There are various estimates of the impact on GDP, but we expect at least a 1.5-2 per cent improvement if the power shortage is addressed,” says Arslan Nayeem, Standard Chartered Head of Global Banking in Pakistan. “Three to five years ago, a lack of power was one of corporates’ prime concerns; now that’s being addressed to a great degree with enough projects coming online.”

Powering a stronger economy

Trade routes and developing Gwadar Port are focus points of CPEC, thanks to Pakistan’s geographic position at the epicentre of trade corridors from Western China to the Middle East, Africa and Europe, which in theory could make it the nexus of some USD2.5 trillion of trade flows. But it also encompasses a range of infrastructure investments to bolster the business environment, including power generation.

Shortage of power has long bedevilled business in Pakistan. Around two-thirds of the scheduled CPEC investment will be in 21 power plants, 3 in a bid to end a supply deficit of around 5,000MW. Although plans to end load-shedding by 2018 haven’t come to pass, scheduled outages in main cities have halved in recent years as new capacity has come online; by the middle of this year an additional 9,000MW is scheduled to be added, increasing capacity by 50 per cent.

Heavier commitments

Concerns have been raised about the nature of Chinese investment and the debt loads incurred in concessional loans to finance construction. But a shift in the nature of Chinese involvement in such projects suggests the partnership is focused on long-term success.

In the past, the role of Chinese firms in overseas infrastructure might have been restricted to engineering, procurement and construction (EPC). Belt and Road, and the CPEC as its flagship initiative, is different; Chinese companies are major equity stakeholders in many projects (as CTG is in the Kohala plants) under a build-own-operate-transfer model, giving them a vested interest in their long-term success. Kohala is due to be transferred to Pakistan after 30 years of operation.


Belt and Road explained: The Belt and Road in Pakistan


Currently nine SEZs have been identified, all of which are at the feasibility study stage. The hope is that with the improved connectivity and stable power supply, together with tax and investment incentives in the SEZs, Pakistan can attract some of the manufacturing that is becoming increasingly expensive in China, as well as investment to unlock Pakistan’s own natural resources, from minerals to agriculture.

Given its lower labour costs, there is an opportunity for Pakistan to attract some of the investment, associated with the mass movement of jobs, out of China in the coming years. Potential investors would also see the benefits in Pakistan’s domestic economy, with a growing base of young consumers: around 55 per cent of the country’s 205 million people are under the age of 25.

If the economic growth of recent years can be maintained, the consumption potential of a growing middle class would be enticing.

Some Chinese firms are already banking on Pakistan as a growth market. China Mobile established its first overseas subsidiary in the country in 2008, buying local mobile network operator Zong. Since CPEC was announced, the M&A flurry has increased; a Chinese-led consortium took a stake in the Pakistan Stock Exchange and Shanghai Electric Power acquired one of the country’s biggest energy distributors, K-Electric, for USD1.8 billion. The deals are not just infrastructure related. Alibaba, the Chinese e-commerce giant, invested in and recently acquired Daraz, a Pakistani online store. Alibaba’s payments affiliate, Ant Financial, also struck a strategic partnership in early 2018 that will see Ant investing over USD180 million in Pakistan’s Telenor Microfinance Bank.

Climbing over hurdles

It is fair to say that the most significant transformational benefits for Pakistan are long-term and a matter of CPEC reaching its full potential. There will be challenges to surmount along the way, such as the fact that the initial infrastructure construction phase requires importing a large amount of capital equipment, which puts Pakistan’s limited

In the short term, Chinese equity commitments also have an impact on financing terms. “When Chinese firms take large equity stakes, the funding becomes altogether different in terms of pricing, appetite, structure, timelines and so on,” says Abbas Hussein, Managing Director and Head of Project and Export finance for the Middle East, North Africa and Pakistan at Standard Chartered. “When you have a Chinese sponsor and when that sponsor is pressurising Chinese relationship banks - because at the end of the day they benefit as well - they get more aggressive financing, there is a higher probability of their being awarded projects, and it has a direct impact on the equity internal rate of return (IRR). So equity does make a massive difference.”

Creating new in-roads

CPEC’s infrastructure phase isn’t just about power: it includes five road-construction and three rail sector projects, upgrading many routes that have received scant investment since Pakistan gained independence. The expansion and reconstruction of the 1,830km-long ML-1 rail line is the largest of these, with an estimated cost of USD8.2 billion.

“These investments have positive externalities far beyond the projects themselves,” explains Standard Chartered Senior Economist Bilal Khan, in particular by improving connectivity within the country. “A lot of domestic cargo, on routes like Karachi to cities in Punjab, is currently transported by road, far less efficiently than by freight car. That infrastructure gap is a supply side constraint that stands to be resolved.”

Though many infrastructure projects are still on the drawing board, those that are in the construction phase have already boosted ancillary business in Pakistan such as cement and steel. Pakistan was the world’s fastest-growing steel producer in 2017, with crude steel output up nearly 40 per cent from 2016. Cement production has also been rising steadily and was up 14.7 per cent year-on-year by end-March 2018. “Our clients in the steel and cement industries are contemplating expansion because they see the opportunity for growth,” Nayeem says.

New zones, new hopes

From Pakistan’s perspective, CPEC is the gateway to far greater integration into the global economy and hopefully a means to break out of a cycle of financial instability that has led to successive balance-of- payments crises. Key to this is making the country a more attractive investment environment and ultimately boosting export earnings. In the longer term, Special Economic Zones (SEZs) along the CPEC route will be instrumental.

forex reserves under pressure, as does local liquidity project financing. “In the short term, deficits will increase and certain [local] banks will hit sector exposure caps,” warns Hussein, necessitating a greater role for export credit agencies, government-to- government loans and multilaterals.

Aside from the implications of greater levels of foreign debt, there is the issue of servicing the return requirements of Chinese asset owners when the projects are up and running. “In the first 10 years, it will be about servicing debt; beyond that guaranteed return-on-equity [contracts] means operators will also be sending dividends and profits back to China,” Khan says. “Pakistan will have to make foreign exchange available for that, at the rate of between USD1 billion-2.5 billion per year, depending on how much capacity comes online.” For the power sector, there is also the question of how problems with distribution and utilisation can be addressed, even as capacity is increased.

Nevertheless, CPEC is a tremendous vote of confidence in the future of business in Pakistan, focused both on its domestic economy and for exports.

“Does Pakistan just become a transit route? No, we want to take advantage of the trade corridor and develop industries that create employment and forex reserves and make the economy sustainable,” says Shazad Dada, Standard Chartered CEO in Pakistan. “We aspire to achieve what China has accomplished in the past four decades; consistently grow the economy at 5 per cent-plus per annum, grow the middle class, while taking millions out of poverty, and seize the opportunity to integrate with Belt and Road trade flows worth over USD2.5 trillion.”

If China’s Belt and Road initiative is executed properly, because Pakistan is at the forefront, it has the opportunity to follow a similar development path.

09


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CONTRIBUTINGTO SUSTAINABLE ECONOMIC GROWTHOverview


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To create awareness and understanding of the Belt and Road initiative, Global Banking Pakistan organised a series of engagements with its clients on Renminbi (RMB) internationalisation. The first phase focused on RMB solutions and investment opportunities for our Corporate Clients and Financial Institutions. The delegation was led by Carmen Ling and accompanied by Becky Liu, Iris Lai Ting Wong, Frankie Shu On Au, senior members of the RMB and Belt and Road initiative from Standard Chartered based in Hong Kong.

The second phase of this initiative was of a strategic nature, catered towards Chinese clients only. The networking events were held in Karachi and Islamabad. Delegation from China led by Jean Lu and accompanied by Sebastian Chee Hiong Er, Maggie Zhiyi Li, Leah Li Zhang, Jeff Dapeng Wang and Jenny Jin. Altogether over 140 clients attended the two events. Shazad Dada delivered the opening address, talking about the strategic nature of Standard Chartered, presence along the route and the best in class services available for clients to leverage. Jean Lu and Arslan Nayeem, Head of Global Banking, Standard Chartered Bank (Pakistan) Limited, gave a joint presentation, in English and Mandarin, taking the audience through the host of services offered.

Sessions on RMB internationalisation known as ‘Leveraging the RMB opportunity’ were held at the Learning Resource Centre, State Bank of Pakistan. This opportunity was used to engage the regulator as well. Mr. Syed Irfan Ali - Executive Director, Banking Policy & Regulations Group was the keynote speaker. Shazad Dada, Chief Executive Officer, Standard Chartered Bank (Pakistan) Limited, gave an introductory speech highlighting the strength of SC network and host of solutions that the experts have to offer. The RMB experts gave a detailed presentation on products and services that our network can offer. The session was attended by over 80 Corporate Clients and ended with a detailed Q&A session with the team, including Adil Salauddin, Head of Financial Markets, Standard Chartered Bank (Pakistan) Limited. In addition to this, a second session was held, which was attended by over 50 people representing the Financial Institutions only. The two-hour briefing sessions covered all aspects of currency trading including account opening, FE loans, FX spot/swap trading and cost savings when transacting in Yuan and PKR.


The Belt and Road initiative – roadshows to engage clients

The UK Prime Minister’s Trade Envoy visits Standard Chartered, Discussion on UK participation in infrastructure projects in Pakistan

The UK Prime Minister’s Trade Envoy to Pakistan Rehman Chishti, MP,led a delegation of six senior business representatives from the UK’s financial, legal and professional services sector to discuss commercial participation in infrastructure projects in Pakistan.

They were joined by CDC Group plc, the development finance institution owned by the UK government, which is actively looking for investment opportunities in Pakistan.

The visit to Standard Chartered was a part of a three-day, three-city visit to Karachi, Lahore and Islamabad, to meet with ministers, senior government officials and businesses.

The delegation in Karachi was hosted by Shazad Dada, Chief Executive Officer, Standard Chartered Pakistan, at the Bank’s Head Office over lunch. The mission and the delegates discussed various forthcoming infrastructure projects, investment opportunities and how UK companies can play a greater role in the development of Pakistan’s infrastructure.

Commenting on the visit, Shazad Dada, Chief Executive Officer, Standard Chartered Pakistan said, “The Bank has a positive view on Pakistan’s economy and believes the country offers huge investment opportunities and is open for business. There are tremendous infrastructure opportunities for UK businesses in Pakistan in the wake of the China Pakistan Economic Corridor (CPEC), once the economic zones are established. Pakistan is a key trading partner of UK and with the implementation of CPEC projects, the business communities of the two countries will potentially get even closer.”

The UK Prime Minister’s Trade Envoy to Pakistan, Rehman Chishti, MP, said, “This is my second visit to Pakistan since being appointed as the UK Prime Minister’s Trade Envoy to Pakistan. I am delighted to bring with me a delegation of some of the United Kingdom’s leading companies to support Pakistan in the development of the country’s infrastructure. The UK and Pakistan have a shared ambition to deepen our trading relationship and it is the UK government’s firm desire to see more British companies doing business with, and in Pakistan, creating jobs and prosperity and playing an active role in Pakistan’s economic development. The UK is in a strong position to participate in projects owing to our world-class strengths, ensuring projects deliver strong development outcomes, deliver shared prosperity objectives and better meet international standards. I thank Standard Chartered Bank for providing a forum to take this discussion further and gaining insight from key businesses that are already well established in the market.”

A number of important sectors of economy were represented, including textile, energy and financial services.

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BEING A RESPONSIBLECOMPANY Overview

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ENVIRONMENTAL PERFORMANCE

Saving and Investment Patterns of Women – a perspective by the Bank

Perspectives is a series of Facebook Live sessions conducted to connect directly with the audience and own the digital thought leadership space in the Banking and Financial Services Industry.

Run by the Head of Wealth Management and the Head of Corporate Affairs and Brand Marketing, the session was interactive to live questions from the audience.

The session received an outstanding response and successfully broke records of all previous Perspective sessions. The organic reach of the session was 21,774 with 4.9K views and over 400 reactions and comments within the first 12 hours.

Objective

OverviewHere for good

Being aresponsible

company

Being a responsible company

We manage our company responsibly by promoting good conduct, supporting the f ight against f inancial crime, integrating our valued behaviours and managing our environmental impact.

We are committed to embedding responsible practices across our operations. Central to this is upholding our Group Code of Conduct. In 2018, 99.6 per cent of employees recommitted to the Code. During 2018, 1,469 concerns were raised through our confidential and anonymous whistle-blowing channel, Speaking Up, of which 606 were within scope and investigated.

We are partnering to lead the fi ght against fi nancial crime with 99.9 per cent of colleagues completing training on anti-bribery and corruption (ABC) and anti-money laundering (AML).

Responsible practices are reinforced through our valued behaviours and in 2018, we integrated these into the way we hire, recognise, reward and develop colleagues. In addition, we defi ned a new long-term approach to diversity and inclusion, launched a global wellbeing programme and set a new target to pay a Living Wage in our markets by 2020.

We continue to reduce our own environmental impact. In 2018, we achieved our energy target for properties in temperate climates one year earlier, advanced our tropical climate target and set new Science-Based Targets to reduce our greenhouse gas emissions. Although we reduced water use by 57 per cent between 2008 and 2018, we are currently not on-track to achieve our 72 per cent target by 2019. We are working across our properties to fi nd innovative ways to achieve it.

We updated our Aspirations for people, environment, conduct and f inancial crimes’ compliance and will focus on delivering against these targets in 2019.

New 2019 Sustainability Aspirations are in the gate-fold at the back of this document

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Aspirations Target: We will Target date Progress

PeopleOur people are our greatest asset, and our diversity drives our business’ success

Increase gender representation:30% women in senior roles

Sept 2016 – Dec 2020 Ongoing

2018: 27.7% in senior roles

Roll-out a comprehensive employee wellness programme across four key markets (UK, US, Singapore and Hong Kong)


Roll-out a refreshed diversity and inclusion strategy Bank-wide


EnvironmentReducing our own impact on the environment will protect our planet for the benefi t of our communities

Reduce annual energy use by35% to 230 kWh/m2/year in our tropical climate locations (80% of portfolio)

Jan 2008 – Dec 2019 On track

2008 – 2018: 33% reduction

Reduce annual energy use by 31% to 275 kWh/m2/year in our temperate climate locations (20% of portfolio)

Jan 2008 – Dec 2019 Achieved/Ongoing

2008 – 2018: 35% reduction

Reduce our annual water use by 72% to 0.5kL/m2/year


2008 – 2018: 57% reduction

Reduce annual office paper use by 57% to 10kg/FTE/year


2012 – 2018: 24% reduction

ConductGood conduct and high ethical standardsare essential in achieving fair outcomes for our clients

Effectively embed the conduct management framework, so that all staff are able to identify, mitigate and manage conduct risk


99.6% of employees reconfirmed commitment to the Code of Conduct in September 2018

Conduct identified as new Risk Type in the Enterprise Risk Management Framework

Financial crimes’ complianceFinancial crimes’ have serious social and economic consequences, harming individuals and communities

All eligible bank staff to complete relevant ABC, AML and sanctions’ training with less than 2% overdue

Ongoing Ongoing

99.9% of employees completed ABC training

99.9% of employees completed AML training

99.9% of employees completed sanctions training

Deliver at least 10 correspondent banking academies


21 Correspondent Banking Academies delivered




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Contributing to sustainableeconomic growth

We consider climate change as one of the greatest challenges facing the world today, given its widespread and proven impacts on the physical environment, human health and its potential to adversely impact economic growth.

We operate in over 60 markets including many in Asia, Africa and the Middle East, giving us opportunity to engage with a wide range of stakeholders including clients, governments, civil society and academics on the impacts of climate change. We are committed to playing our part in contributing to, facilitating and leading this dialogue across our markets.

Climate change is a complex phenomenon which presents a mix of physical and transition risks and opportunities to countries, businesses and individuals. At Standard Chartered Pakistan, recognising the impact and complexities of climate change, we undertook numerous initiatives that helped us reduce the Bank’s carbon footprint in Pakistan.

We launched the Go Green initiative to combat greenhouse gas emissions. The following steps were undertaken within this initiative:

• 5 locations transferred to on grid solar power generation systems. The locations are branches in Quetta, Karachi and Peshawar

• Air-conditioning management units installed in air conditioners across the country to ensure less energy is consumed

We recognise the role of the financial sector in achieving the 2015 Paris Agreement goals of holding the increase in the global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit temperature increase to 1.5°C, supporting climate adaptation, and directing finance flows toward a low carbon transition.


Moving to a low-carbon future – stepping up as a responsible company


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The Central Bank of Pakistan – The State Bank (SBP) hosted and conducted a seminar encapsulating its vision 2020 for Fairly Treating Clients (FTC). The session titled “Responsible Banking Conduct - A cultural transformation”, was held at SBP Headquarters Karachi on May 03, 2018.

Grave importance was laid upon responsible culture as a sustainability model, as through establishing the right culture, it will convert good intentions into actionable outcomes. Management can then capitalise on results in sustainable profitability and growth.

The top management of banks and other relevant stakeholders including SECP, PBA and PMN attended the Seminar.

Key take away from this session was the stress laid upon fostering and nurturing the right culture. The drivers of culture are comprehensively covered in Conduct Assessment Framework (CAF) under an exclusive module on culture. It assesses culture of banks on:

• Policy and institutional arrangements they have in their bank regarding FTC • Voice of employee on FTC • Voice of customer on FTC • Communication and investments in FTC • Incentives and performance indicators

The 5th session of the Living Islam Series (LIS), a home-grown Islamic Thought Leadership initiative, in Karachi. The topic of discussion was 'Parenting and Modern Challenges'. The session was attended by approximately 220 people. The audience comprised of our clients and staff members from the CB, GB and Retail segments.

These are further elaborated as follows:

• The behaviour of individuals in banks is guided by the 'tone from the top' to prioritise responsible conduct

• The intention of the top management needs to be visible in a bank through its investment in structures, human capital, systems and procedures. Banks that are doing what is required to be done are merely doing the bare minimum and are standing on the bottom of FTC regime. Those who are self-assessing and following the expectations laid down in Conduct Assessment Framework (CAF) are the ones that are climbing up the FTC ladder

• FTC or Responsible Banking conduct is not a stagnant proposition. It is a continuously evolving and changing quest. As the consumer needs are changing, so are the modes of deliveries. Accordingly, banks need to have their eyes and ears to the ground! They need to be timely and properly equipped to address the upcoming challenges

Thought leadership initiative: Living Islam Series

Amongst participating speakers were senior colleagues from Standard Chartered Bank, who elaborated on their journey as a global bank on managing and measuring culture while ensuring Fair Treatment of Consumer; Mr. Sergio Gomez, from Central Bank of Brazil shared Brazilian regulator’s experience of supervising conduct and culture; and Syed Faraz, partner PwC emphasized on the quantifying techniques for culture. SBP also laid ground for its regulatory expectations from the industry.

The Director (BC & CPD), Mr. Muhammad Akmal, concluded the Seminar, who in his closing remarks stressed that Responsible Culture is a priority area for SBP. He explained that SBP expects the banks to foster a culture that supports the spirit of regulations by conducting their business responsibly. He also emphasised that SBP along with the banks can take the banking industry to the new horizons of Responsible Banking Conduct and Financial Stability.

SBP Seminar on “Responsible Banking Conduct - A cultural transformation”

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Recognition on international platforms

Standard Chartered won 5 awards at the HR Metrics-Diversity Hub, Diversity and Inclusion awards. Participating organisations were provided an opportunity to evaluate their D&I practices as per Global Diversity and Inclusion Benchmark Standards and provide evidence to the jury for validation.

We won awards for

• Best Practices in D&I Vision

• Best Practices in D&I Benefits

• Best Practices in D&I Social Responsibility

• Progressive Practices in D&I Communication

• Progressive Practices in D&I Sustainability

Global Diversity & Inclusion Benchmarks are the Standards for organisations around the world to support organisations globally in the development and implementation of Diversity and Inclusion best practices. GDIB was developed by 95 global expert panellists, co-authored by Julie O'Mara (Former National President American Society for Training & Development) and Alan Richter, Ph.D. The Centre for Global Inclusion USA is home of the Global Diversity & Inclusion Benchmarks. Its mission is to serve as a resource for research and education for individuals and organisations in their quest to improve diversity and inclusion practices. Details at www.centreforglobalinclusion.org

GDIB awards are conducted by Diversity Hub Pakistan, on an annual basis. Objective is to recognise organisations who use GDIB to leverage organisational performance. 2019 awards’ contesting organisations were assessed for 5 levels of readiness: Inactive, Reactive, Proactive, Progressive and Best Practice.



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INVESTING IN COMMUNITIES



COMMUNITY INVESTMENT

Celebrating two yearsof Goal in Pakistan

Objective

We seek to promote economic and social developmentin our communities.

OverviewHere

for good


Pillar 3

New 2019 Sustainability Aspirations in the gate-fold at the back of this document

We marked two years of Goal in Pakistan by spending the morning with some of our Goal girls at Mazhar e Aloom school, Lyari. The morning saw the girls staging a welcome tableau/dance, followed by a fashion show curated by them, which showed the best of their culture. This was then followed by a series of ice breakers and games that drew the Standard Chartered team into the activities. We also got to hear some of the girls talking about how Goal has impacted their lives and helped empower them. The highlight of the event was the inaugural exhibit and sale of the crafts’ that Goal graduates had produced under the pilot entrepreneurial module.

Over 50 girls are now engaged in producing a range of items, ranging from food to craft to henna art, which would help them set up income streams for themselves to become economic leaders in their community. A pair of girls that were exploring art as a livelihood had produced a portrait of Shazad Dada, CEO Pakistan, which he proudly purchased from them.

The Standard Chartered team supported the girls’ efforts by shopping at all the stalls, to encourage the budding entrepreneurs. The morning ended with Shazad speaking to the girls and encouraging them as he reiterated the Bank's support to Goal and the young girls.

We work closely with local partners to deliver programmes that foster healthy and economically-empowered communities. In 2018, we invested $49.2 million in our communities and our colleagues contributed more than 65,000 volunteering days.

It was a milestone year, as we surpassed our $100 million fundraising target for Seeing is Believing (SiB), our global initiative to tackle avoidable blindness and visual impairment. We raised $5.2 million through fundraising and Bank-matching in 2018 and $103.6 million between 2003 and 2018, reaching 176 million people through SiB projects globally.

As we approached our SiB target, we engaged with stakeholders to understand the challenges facing our communities and where we could make the greatest impact. Our response is Futuremakers by Standard Chartered, our new global initiative to tackle inequality and promote greater economic inclusion in our markets. We aim to raise $50 million between 2019 and 2023 to empower the next generation to learn, earn and grow.

Through Futuremakers, we will build on Goal, our existing education programme, and develop new programmes focused on employability and entrepreneurship. Goal reached more than 100,000 girls in 2018. We will integrate fi nancial education into all of our programmes. In 2018, we provided financial education training to more than 111,000 young people and over 5,400 entrepreneurs, of whom 90 per cent were women.

We updated our Aspiration for community engagement to reflect our new Futuremakers initiative and will focus on delivering against these targets in 2019.

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Aspiration Target: We will Target date Progress

Community engagementHealth and education are vital for thriving and prosperous communities

Invest 0.75% of prior year operating profit (PYOP) in our communities

Jan 2006 – Dec 2020 Achieved / Ongoing

2018: $49.2 million communityexpenditure, which represents 2.04% of PYOP

Raise $100m to tackle avoidable blindness


2018: $5.2 million raised and matched by the Bank

2003 – 2018: $103.6 million raised and matched by the Bank

Empower 600,000 girls through education and sports


2018: 100,189 girls participated in Goal

2006 – 2018: 481,978 girls participated in Goal

Educate 5,000 micro and small businesses, with 20% women-owned or led


2018: 5,438 micro and small businesses – 90% women-owned or led

2013 – 2018: 10,995 micro and small businesses – 73% women-owned or led



COMMUNITY INVESTMENT

Celebrating with Seeing is Believing

The Bank reached the goal set in 2011 to raise USD100 million for the fight against avoidable blindness and visual impairment. What is special about this great achievement is that the Bank has reached this target two years ahead of the target date, 2020.

In Pakistan, Standard Chartered has come a long way in the Seeing is Believing journey. Starting simply with restoring people’s eyesight by conducting cataract surgeries in partnership with a local partner, LRBT (Layton Rahmatullah Benevolent Trust), and training lady healthcare workers to eventually perform complex projects, like the current Diabetic Retinopathy project, across numerous districts in the country.

The journey in numbers is truly inspiring, impacting over 12 million beneficiaries. Through its various partners, Standard Chartered has conducted over 500,000 sight restoring surgeries, trained over 60,000 lady healthcare workers, screened over 1.5 million children for refractive errors, while employing 24 Visually Impaired employees.



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Baby Steps - Shah Bibi's story of how Goal changed her life

Living away from family in a new environment and attending a bigger school made her diffident in the classroom. It was at that time that Goal programme started at her school. “In football I made new friends, it rebuilt my confidence and I started enjoying being at school”, Shah Bibi shared. She was going to school, playing football, and learning life-skills. She was taking little steps towards her dream to acquire higher education. But another road block awaited her.

On her way to school, she encountered a group of boys who bullied and harassed her. Soon this started happening regularly. “I was scared to share this with anyone at home because I was afraid they will have only one solution for me, which was to quit school. I was distressed but I had to find a way to tackle this trouble or I would have to quit my education”, Bibi told us. She discussed this with the coach who encouraged her to feel confident and fearless. She also encouraged Shah Bibi to confide in her grandmother who suggested that she change her route to go to school. She followed this advice but still her confidence was badly shaken.

With the support and mentoring from her coach and regular participation in Goal, she not only overcame her fears, but also improved her academic performance, as well. She was selected as Junior Leader and began participating in sports regularly. Her football team was runner up of the inter-school football tournament. Because of her cheerful personality, she is popular among other football players and classmates.

“Goal has taught me confidence and my aim is bigger than the troubles I face. Because of this confidence I can accept challenges and get over them”, she says.

Shah Bibi knows that going to school and playing football is a difficult choice. She comes from a background where girls are married at a young age to ease the economic burden of the parents and transferring it to another family. The community is one where girls are usually not allowed to go to school after primary. However, Shah Bibi has recently been promoted to 7th grade after scoring good grades in the exams.

Becoming a Goal Junior Leader and a member of the school football team, are both great achievements for her. Coming to school and playing football is a luxury that was only made possible by taking little courageous steps. 14 year old Shah Bibi, from Government Girls Secondary School Mir Ayoub Khan, Karachi, lives with her grandmother in order to attend school. Since her family was not quite supportive of her choice to continue her education, she was able to bargain for herself on the grounds that she would live at her grandmother’s house, in order to avoid resentment from the community.

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The Goal Entrepreneurship and Employability Fund aims to empower girls to use their talents to think outside the box, and become economically independent, to a certain degree, if not entirely.

Through the project, a number of girls were identified who were involved in making handicrafts at home during their free time. However, they lacked other skills that could help complement their existing stitching talent i.e. designing, latest trends, diverse styles of embroidery, etc. Most of them could only design traditional Balochi dresses. Hence, they needed more training and skill development to be able to market their handmade products and to be more sell-able.

The idea was to build the girls’ capacity to a level where they could create a fusion of traditional as well as modern wear - not just the cultural and modern dresses, but in accessories like laptop bags, cushion covers, handkerchiefs, scarves, jewellery boxes, handbags, pillow covers, small purses, among others.

With the efforts of the project team, they were able to partner with Sindh Indigenous and Traditional Crafts Company (SITCO). The company was fortunately searching for hard-working girls

who could be a part of their programme. Select Goal girls are now enrolled with SITCO, and even paid a nominal stipend of PKR 3,000 (approximately USD24), for their great work. Although this was not part of the project plan, but it was considered an important initiative for the ultimate benefit of these girls. In order to give continued support, Right to Play with the support of Standard Chartered has arranged logistics for around 20 girls from two partner schools, to receive training four days a week on regular basis. All of them are Goal alumni, six of the girls who are enrolled in embroidery sessions at SITCO are receiving the stipend. Additional benefit is that the management provides basic raw material free of cost, such as sets of needles, threads, cut pieces of cloths, etc.

To our complete surprise, more girls from partner schools are now interested in joining SITCO. The whole initiative has turned into a big success story and a path of reinforcement for Right to Play's strategy for such programmes in the future. Partnering with SITCO can prove extremely beneficial as it is not just an ordinary training centre but also a company that links artisans to a bigger market, including export market, if they are able to develop highly refined products.

The GOAL of entrepreneurship: opening doors for many



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A super-duper awesome mentoring session with Goal girls

The Employee Volunteering (EV) activity involved hosting twenty girls from grades 6 and 7, to visit the Main Branch. This aspect of volunteering was led by an employee from the Finance team, while the other girls waited their turn by playing foosball, trying their hand at snooker and duboo (a local version of carrom). Meanwhile, Muhammad Adeel Younus and Omer Saleem at the Main Branch walked their visitors through the various branch functions, showed them a mock transaction and batted a host of queries from an entranced audience.

Speed mentoring was held with the Standard Chartered volunteers. The focus of these sessions was around the future ambitions of the girls, focusing on their enablers, as well as possible strategies to navigate any challenges they may be presented with. This interactive session was joined by Andy Halford, Group CFO, who was on a two day visit to Pakistan and got involved in the mentoring session over the course of the morning. The mentoring session was followed by a fun filled Goal coaches led activity, the objective of which was to teach the Goal girls the concept of ‘Saving’.

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With the achievement of USD100 million funds raised for Seeing is Believing, Standard Chartered today is proud of its achievement in the eye care sector. The Bank has contributed equally to the funds raised, as every dollar raised in fundraising was matched by the Bank. Our story is equally inspiring when we look at the number of lives the Bank has reached: 167 million people across 37 countries, supporting 4.4 million sight-restoring surgeries and training more than 318,000 health workers, since 2003.

Pakistan has been one of the prominent markets for the Bank, with a very strong Seeing is Believing presence. In fact, we are the leaders in the eye care sector in Pakistan and our projects have helped contribute towards a 20 per cent reduction in cataract blindness. In recognition of the Bank’s efforts, the Government of Pakistan has made Standard Chartered the only corporate partner of the National Committee for Eye Health, an umbrella government led entity under the National Programme for Prevention of Blindness.

We started small; in partnership with Sightsavers through a 3-year project starting in 2004; Seeing is Believing through its implementing partners Sightsavers and Layton Rahmatullah Benevolent Trust (LRBT) helped conduct over 100,000 sight restoration surgeries. This is where a need for eye health awareness was identified and we took the next step in an endeavour to integrate eye health into primary healthcare.

In 2007, we trained 40,575 lady health workers in partnership with Sightsavers. This project helped demonstrate the practicability and impact of integrating eye care into primary health care channels. The impact of this project exceeded expectations, whereby 900,000 cases of potentially blinding conditions (which would otherwise have been ignored by someone who is not aware about eye care) were referred to hospitals for further treatment and the healthcare workers ensured that cases were followed up. As a result, there was a policy shift towards integrating eye care into the Government’s primary healthcare planning, ensuring sustainability of the objectives that SiB had initially envisioned for the Bank. This led to the development of revised and updated eye health focused chapter in LHW’s training curriculum, which is now an integrated part the training calendar as well. Moreover, three important eye health indicators were made part of the HMIS of PHC system.

Fast forward to 2011, we partnered with Sightsavers once again, only this time to create demand for uptake of eye care services and awareness about eye health at the grassroots level, that is, among children. Through this project, the urban slum areas were targeted in 5 cities; Karachi, Lahore, Faisalabad, Multan and Rawalpindi. The project aimed to identify blind and low vision children and to provide the required eye health services (surgeries, spectacles, low vision devices) during school eye-health related activities. At the closing of this project, 26,000 teachers had been trained, 1.5 million children screened for refractive errors, 70,000 refractive errors corrected, almost 57,000 children had clear vision by simply receiving free spectacles, while 2,500 sight restoration surgeries were conducted.

The journey of Seeing is Believing in Pakistan



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The journey of Seeing is Believing in Pakistan

Sustainability of eye care services was an imperative aspect for the Bank and therefore, we launched a project where the eye care need was very high in Pakistan, Khyber Pakhtunkhwa (KPK). The project commenced in 2016 to provide comprehensive eye care services, that is, from being referred by the lady healthcare worker, Basic Health Units, Rural Health Centres, medical doctors or GPs to receiving free treatment at hospitals in the end. This project is being implemented by the Department of Health KPK, Sightsavers International and Fred Hollows Foundation, with an aim of not only providing eye care to men and women with visual impairment and improving eye care services in the four districts of KPK, but also driving advocacy within the Government to ensure their commitment to this aspect at provincial level. As at December 2018, the project has reached 983,000 beneficiaries and this number will continue to increase until the project reaches its expected completion in 2020.

Prevalence of Diabetes was on the rise in Pakistan, and along with it Diabetic Retinopathy (DR) that can cause permanent blindness. The International Diabetes Federation (IDF) ranks Pakistan at number seven globally for high rates of diabetes in the population, with prevalence estimated at 7 million in 2010 projected to increase to 11.5 million by 2025. With this aspect in view, a project was launched in 2014 titled ‘Strengthening Pakistan’s response to Diabetic Retinopathy’. The aim of the project was prevention of visual impairment due to DR through early detection, regular follow up and appropriate management of Sight Threatening DR among known persons with diabetes in the three cities of Pakistan; Karachi, Lahore and Rawalpindi. The key focus of the project is on developing a comprehensive and integrated eye care system to ensure known diabetic patients are screened for DR and a management plan is established. The project has been doing incredibly well and therefore was recognised by the Global Compendium of Best Practices of DR services. By December 2017, almost 900,000 beneficiaries were impacted through this project, which aims to run till June 2020.

Today, as we celebrate 15 years of SiB, we have truly come a long way in Pakistan, when it comes to our community programme to tackle avoidable blindness. Starting simply with restoring people’s eyesight by conducting cataract surgeries in partnership with a local partner, LRBT, and training lady healthcare workers to eventually perform complex projects like the current Diabetic Retinopathy project across numerous districts where eye care need is high in the country.

Touching over 12 million beneficiaries in this endeavour, today our numbers tell an inspiring story, 500,000 sight-restoration surgeries supported, 60,000 lady healthcare workers trained, 1.5 million children screened for refractive errors. Through our advocacy efforts, the Government of Pakistan also recognises the importance and impact of providing eye care in the health sector.

Seeing is Believing in Pakistan demonstrates our commitment to work with partners in the public and private sector towards the New Sustainable Development Goals (SDGs) endorsed by World Leaders at the United Nations in September 2015. By investing in projects that focus on comprehensive eye health Seeing is Believing supports SDG 3 – to ensure healthy lives and promote well-being for all.

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Majeedan – Giving eyesight back to women first

Majeedan was born in Khanewal. Belonging to a large family, she had eight siblings along with many cousins who were always over at their house. She had a happy childhood and though poor they had a roof over their head and food on the table. Her father could not afford to send his children to school, but every day in the morning Majeedan would run outside to see children in the neighbourhood go to school with their backpacks, while she looked on longingly and wished she could do so too. Her mother would console her by saying,“Even if you don’t get to go to school, you can still learn if you are willing.” And so Majeedan’s mother busied her by teaching her how to cook.

At the time Majeedan was not aware that she would have to depend on this very skill one day to survive. With time she was married and had two sons. Her husband a labourer was much older to her in age and after a couple of years of their marriage, he passed away from a prolonged illness. At that time, her sons were still young and dependent on her. She did the only thing she knew – she found work in a house as a cook. It was tough for her managing her house and going to work, she would leave her sons with their neighbours as they were still young, but she never complained, thankful that they did not have to beg for their livelihood.

Majeedan’s sons now grown up have started to work at a farm. Although their pay is not much, they have asked their mother to quit working now and rest. When Majeedan complained that she was unable to see out of her right eye at all, they thought it was because of her age but a neighbour told them that most eye conditions are now treatable and advised them to go to LRBT Khanewal Hospital, where she said Majeedan would get quality treatment, free of cost.

Majeedan came to LRBT and was operated on for cataract surgery. She has quit her job and now spends her days relaxing and meeting family and friends. She knows that had she not gotten her sight back, her life would have been very different from what it is today.


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Football has been an integral part of Standard Chartered’s Sponsorship and Community strategy. In line with this, the Bank partnered with Karachi United for two consecutive years to host the Standard Chartered - Karachi United Youth Football League.

Aga Khan School Kharadar won the Girls and Lyari Kakri won the U-14 Boys Standard Chartered - Karachi United Youth League Final, which was recently held in Karachi. Earlier, Baldia Centre and KU Academy had won the U-10 and U-12 boys editions respectively. This league was sponsored by Standard Chartered, as part of its community service mandate to promote sports amongst children.

The final tournament was held at the Karachi United Stadium and was attended by more than 400 spectators hailing from different areas of Karachi.

The objective of the “Standard Chartered Karachi - United Youth League” was to provide a platform for the Youth football teams from across Karachi who came together, broke barriers and inculcated the spirit of competition.

A total of 800 boys and girls from across Karachi participated in this tournament. 128 matches were played in different locations, including Old Golimar, Clifton, Malir, Baldia, Lyari, Korangi and Mauripur. Through this tournament 12 community centres were engaged.

Commenting on the league Mr. Imran Ali, Director Youth and Community at Karachi United said, “This is the second season of the SC KU Youth League and we have seen some excellent competition, friendships and stories develop as a result of this. This kind of competition is necessary for our youth as through sport so many have embraced skills such as discipline, respect, teamwork, which will help them in their lives. I would also like to specifically call out and thank the mentoring sessions by SC staff, as many participants have been inspired through these. We value our partnership with SC and look forward to a good future.”

Making a positive impact in the community through football

Commenting on the sponsorship, Ms. Khadija Hashimi, Head of Corporate Affairs and Brand & Marketing said, “This was a tremendous opportunity for us to further enhance our commitment to the communities in which we operate. The SC-KU league has enabled us to create opportunities, build healthy competition and inculcate respect in the local communities through sport. Standard Chartered has a long association with football. We are proud to support Goal, a global Standard Chartered community initiative, which enables financial education through sport for adolescent girls, in Pakistan. We hope that through Football we can bring a positive social benefit that is a unifying force across our communities in Karachi.”

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The Standard Chartered - Karachi United Youth Football League was launched in the fourth quarter of 2018. Through this league, the Bank engaged 800 children from the under-served communities who will be engaged via 128 matches. Also included in these 800 were the 80 girls who were engaged to harness their football skills, which otherwise they would not have had access to.

See how the tournament is having a positive impact on the lives of the children participating in this.

Samaad Hussain

11 years old from Shireen Jinnah Colony: ‘Youth League has provided me with a platform to channelise my energy into sports rather than get into injurious activities.”

Samaad Hussain lives in Shireen Jinnah Colony where young boys have easy access to and get accustomed to destructive and injurious activities like glue sniffing. They also get exposed to drug abuse, sickness, and violence. Samaad was also vulnerable to these external factors, but according to him, his football coach inspired him to stay away from such activities and join the Karachi United Center. Samaad added that the Youth League has provided him with a platform to channelise his energy in positive activities and helped him to learn team coordination, time management and leadership skills. He also mentioned that the Youth League gave him a chance to interact with children of different ethnicities, languages and religions.

Anas

11 years old from Shireen Jinnah Colony: “This League has taught me that failure and success are part of life, but the important thing is to stay positive and keep trying.”

Anas joined the Shireen Jinnah Colony Center two months ago to harness his skills as a football player. He said that before joining the Center, when he used to get done with school, he used to go out and waste his time flying kites. Resultantly, he could not see a future for himself because he lacked professional guidance and training. After joining the Center, Anas’s football coach motivated him towards playing football and participation in life skills sessions to boost his personal development. Anas explained that his coach made him realise how to spend his time in a constructive manner. He further added that his coach has always encouraged him to seek the company of positive people who can inculcate positive and healthy habits in him.

Case Studies: Making a positive impact through football



Sustainability data



27

Case studies: Girl power! Empowering adolescent girls through football

Part of 800 children were 80 girls who participated in the Youth Football League. Read some of these participating girls' stories below:

Sabiha

Sabiha, 15 years, has been playing football since 2015. Sabiha said that when she started playing football her mother was against it because she feared that football would affect future marital prospects. However, with her father‘s support, Sabiha was able to pursue her dream. Originally from interior Sindh, Sabiha moved to Bihar Colony, Karachi, with her family, in the search for a better lifestyle. “I miss my friends, but I have good days and bad days. I did go through a phase where I was crying ‘I want to go home,’ but comparing the two, I’ve got a much better life over here,” she said.

According to Sabiha, it is a proud moment for her to participate in this league as it will give her a chance to prove those wrong who think girls are supposed to stay inside the home. She further shared that sport can be a force to amplify women's voices and tear down gender barriers and discrimination.

“For me, playing football means to claim spaces in society that are usually reserved for men.”

Aneesa

This 16 years old quick witted talker is the captain of Kiran Foundation Team. According to Aneesa, she is lucky that her family encourages her to pursue her passion for football, as girls are usually restricted by their families due to societal pressure. One of four siblings, this Lyari born teenager shared her experience “it’s been amazing, we’ve bonded so well as a team, the experience, I can’t describe it.” Football originally provided Aneesa the opportunity to meet new people, coming from various indigenous backgrounds, where they all learn from each other. She added that learning new skills through this league is only the beginning of my football career.

According to her she considers women’s football as a symbol for gender equality and social integration. At the end she said: “I want to break the societal barriers that stop girls from making their dreams come true. I want to be a role model for other girls in my community.”


Sustainability data



Celebrating International Women’s Day #Pressforprogress

Standard Chartered Pakistan under its Diversity & Inclusion platform joined hands with British Deputy High Commission and celebrated International Women’s Day.

The Bank along with British Deputy High Commission organised short master classes, which were conducted by leading women and men who are specialists in their areas. These master classes were attended by 100 girls from O and A levels of leading schools in Karachi. These schools were British Overseas, Foundation Public School, Indus Academy and Bayview College.

These master classes focused on four subjects:- Women and Leadership- Women and Finance- Women and Entrepreneurship- Women and Personal Branding

The concept was to enlighten the girls and give them access to successful professionals who could talk about their leadership and professional development journey to them.

These sessions were hosted at the British Deputy High Commission.

As the Bank aspires to be a leader in gender diversity, supporting women in the workplace, as customers and in the community, Standard Chartered remains committed to be ‘Here for good’ in the markets where it operates, and is determined to make a difference not only to help women fulfil their potential as leaders in the Bank, but to also play a critical role with its clients and communities in supporting and furthering the role of women in every society, including Pakistan.



Sustainability data



The Bank organised an iftar for over 1200 children studying at Hope schools from all over Karachi. It has become a tradition, whereby every year staff from across the bank volunteer to organise this iftar. Financial Education master classes are also run for some of the students to enhance their understanding about saving and managing finances.

HOPE Iftar

Children from all districts of Karachi are invited along with their teachers to have iftar with Standard Chartered employees.

29


Sustainability data



Going green on Independence Day

Led by the Bank’s Finance team, staff volunteered in the Standard Chartered BDHC Independence Day Employee Volunteering. This activity was conducted at Acton House, the British Deputy High Commission, Karachi.

71 children from the Edhi Home’s school were hosted for a tree plantation/environmental awareness drive, accompanied by their teachers, and principal.

Supervised by Standard Chartered staff teams, the children were divided into three groups and engaged in flower pot painting, vegetable patch cultivation, and tree plantation. The children asked insightful questions as to the nature and nurturing of the various vegetables seeds they were planting; engaged wholeheartedly in conversations about soil composition and the nutritional needs of different kinds of trees at different stages. They thoroughly enjoyed unleashing their creativity in painting their individual flower pots.

The activity was preceded by a rendition of Pakistan’s national anthem by the gathering, led by the visually impaired Pakistan Voice and Virtual staff, followed by speeches by Elin Burns, the British Deputy High Commissioner; Shazad Dada, Chief Executive Officer, Standard Chartered Bank (Pakistan) Limited, and Faisal Edhi, the Principal of the Edhi Foundation. They highlighted the importance of environmental awareness and the role trees play in securing the same for all.

Ms. Burns and Mr. Dada also planted a tree at the BDHC premises to commemorate the occasion.

The Edhi foundation is a non profit social welfare organisation in Pakistan, that provides among other services, schooling for the underprivileged as well as orphans under its care.



SUSTAINABILITY DATA



Sustainability dataContributing to sustainable economic growth

Microfinance2018 2017 2016

Loans extended ($million) 690.0 591.4 409.9

Clean technology2018 2017 2016

Value of funds provided and facilitated ($million) 2,860.0 1,228.0 800.8

Employees trained in environmental and social risk management (ESRM)2018 2017 2016

Employees trained1 1,308 568 118

1 Employees targeted for training are those in client-facing roles and relevant support teams. Higher training numbers in 2018 are due to the roll-out of the revised environmental and social risk framework in Commercial Bank and targeted training on topics such as modern slavery

ESRM clients and transactions2018 2017 2016

ESRM clients and transactions reviewed 827 487 328

Transactions reviewed by sector2018

(%)2017

(%)2016

(%)

Chemicals & Manufacturing 24.4 17.9 28

Infrastructure & Transport 11.6 11.7 16.5

Oil & Gas 8.7 9.2 12.5

Mining & Metals 8.8 11.9 8.8

Fossil Fuel Power 12.7 14.8 13.1

Forestry 0.4 0.0 0.6

Palm Oil 1.6 1.2 3.7

Agribusiness 7.4 9.0 4.6

Ship Breaking 0.1 0.2 0.9

Nuclear Energy 0.5 1.0 0.3

Renewables 2.5 1.9 1.8

Dams & Hydro-power 1.6 1.4 1.2

Other 19.6 19.3 6.7

Tobacco 0.1 0.4 1.2

31


SUSTAINABILITY DATA



Equator Principles

Project finance mandates Project-related corporate loansProject advisory

mandates

Cat A1 Cat B2 Cat C3 Cat A Cat B Cat C

Total 2016 7 6 – – – – 2

Total 2017 1 9* 1 1 2 – 1

Total 2018 4 7 – – – – 3

2018

Sector

Mining – – – – – – –

Infrastructure 1 3 – – – – 1

Oil & Gas 1 2 – – – – 2

Renewables 1 – – – – – –

Telecoms – – – – – – –

Power 1 2 – – – – –

Other – – – – – – –

Region

Greater China – – – – – – –

North East Asia – – – – – – –

South Asia – 2 – – – – –

ASEAN – 1 – – – – 1

MENAP 2 2 – – – – 1

Africa 1 1 – – – – 1

Americas – 1 – – – – –

Europe 1 – – – – – –

Designation4

Designated 1 2 – – – – –

Non-Designated 3 5 – – – – –

Independent Review

Yes 4 6 – – – – –

No – 1 – – – – –


Community expenditure2018

$million2017

$million20163

$million

Cash contributions 22.9 22.1 21.3

Employee time (non-cash item) 18.8 18.1 17.3

Gifts in Kind (non-cash item)1 0.1 0.1 –

Management costs 4.5 4.5 4.7

Total (direct investment by the Group) 46.3 44.8 43.3

Leverage2 2.9 5.0 9.6

Total (incl. leverage) 49.2 49.8 52.9

Percentage of prior year operating profit (PYOP) 2.04 12.18 –

1 Gifts in Kind comprises all non-monetary donations 2 Leverage data relates to the proceeds from staff and other fundraising activities

3 PYOP for 2016 was not meaningful, based on 2015 operating profit

Contributing to sustainable economic growth (continued)

1 ’Cat A’ or Category A are projects with potential significant adverse environmental and social risks and/or impacts that are diverse, irreversible or unprecedented

2 ’Cat B’ or Category B are projects with potential limited adverse environmental and social risks and/or impacts that are few in number, generally site-specific, largely reversible and readily addressed through mitigation measures

3 ’Cat C’ or Category C are projects with minimal or no adverse environmental and social risks and/or impacts

4 ’Designation’ is split into designated and non-designated countries. Designated countries are deemed by the Equator Principles to have robust environmental and social governance, legislation systems and institutional capacity designed to protect their people and the natural environment. Non-designated countries are countries that are not found on the list of designated countries. The list of countries can be found at www.equator-principles.com

* This number has been restated from 2017. Details of the revised 2017 data are available in our EP submission and at www.sc.com/en/equator-principles-reporting-2017/



SUSTAINABILITY DATA



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Being a responsible company

People

Global1 2018 2017 % change

Full-time Equivalent (FTE) 85,336 85,931 (0.7)

Headcount (year end) 85,402 86,021 (0.7)

Employed work 82,827 82,838 0.0

Fixed term workers 2,575 3,183 (19.1)

Non-employed workers 12,064 15,043 (19.8)

Headcount (12-month average) 86,269 86,794 (0.6)

Male

FTE 46,139 46,634 (1.1)

Headcount 46,153 46,658 (1.1)

Female

FTE 39,198 39,297 (0.3)

Headcount 39,249 39,363 (0.3)

Nationalities 125 125 0.0

Position type 2018 2017 % change

Executive and non-executive director (Board and Management Team) 13 13 0.0

Female executive and non-executive director 4 4 0.0

Senior management (Bands 1–2) 258 255 1.2

Female senior management 53 43 23.3

Middle management (Bands 3–4) 3,836 3,635 5.5

Female middle management 1,082 956 13.2

Rest of headcount 81,308 82,131 (1.0)

Female rest of headcount 38,114 38,364 (0.7)

Employment type 2018 2017 % change

Business FTE 38,598 40,594 (4.9)

Business headcount 38,621 40,636 (5.0)

Business female headcount 19,586 20,219 (3.1)

Support services FTE 46,739 45,337 3.1

Support services headcount 46,781 45,385 3.1

Female support services headcount 19,663 19,144 2.7

Region 2017 % change

Greater China & Northeast Asia (GCNA) FTE 20,428 1.6

GCNA headcount 20,451 1.6

GCNA female headcount 12,894 1.8

ASEAN & Southeast Asia (ASA) FTE 47,794 (0.9)

ASA headcount 47,814 (0.9)

ASA female headcount 18,981 (1.2)

Africa & Middle East (AME) FTE 13,928 (5.4)

AME headcount 13,941 (5.4)

AME female headcount 5,831 (4.1)

Europe & Americas (EA) FTE 3,782 7.0

EA headcount 3,815 6.8

EA female headcount 1,657 7.4

2018

20,757

20,771

13,128

47,350

47,371

18,748

13,182

13,184

5,594

4,047

4,076

1,779

33


SUSTAINABILITY DATA



Being a responsible company (continued)

Age 2018 2017 % change

< 30 years FTE 20,812 22,890 (9.1)

< 30 years headcount 20,819 22,898 (9.1)

< 30 years female headcount 10,962 11,856 (7.5)

30–50 years FTE 58,652 57,639 1.8

30–50 years headcount 58,692 57,696 1.7

30–50 years female headcount 25,647 25,128 2.1

> 50 years FTE 5,872 5,402 8.7

> 50 years headcount 5,891 5,427 8.5

> 50 years female headcount 2,640 2,379 11.0

Talent management 2018 2017 % change

Global voluntary turnover rate (%) 13.2 13.0 1.5

Global turnover rate (%) 16.4 17.3 (5.2)

Male (%) 16.7 16.9 (1.3)

Female (%) 16.0 17.6 (8.9)

GCNA (%) 16.5 18.2 (9.1)

ASA (%) 17.7 17.7 (0.1)

AME (%) 12.3 14.9 (17.4)

EA (%) 13.9 15.2 (8.3)

< 30 years (%) 23.9 24.2 (1.2)

30-50 years (%) 13.7 14.4 (5.0)

> 50 years (%) 14.6 16.7 (12.7)

Average tenure (years) – Male 6.4 6.2 4.5

Average tenure (years) – Female 6.7 6.5 3.7

Roles f illed internally (%) 42.4 37.5 13.1

of which f illed by females (%) 41.0 44.5 (7.9)

Employees with completed performance appraisal2 (%) 99.7 99.9 (0.2)

Absenteeism rate3 (%) 1.38 1.35 2.2

Learning 2018 2017 % change

Employees receiving training (%) 95.6 95.7 (0.1)

Employees receiving training excluding mandatory learning (%) 82.7 89.2 (7.3)

Senior management (%) 94.9 92.6 2.5

Management (%) 97.7 97.2 0.5

Average number of training days per employee (including mandatory learning) 2.88 3.17 (9.1)

Average cost of training per employee4 751 640 17.3

1 For all metrics expressed as a percentage, percentage change means percentage point change

2 Employees with completed performance appraisal numbers are based on 30 September 2018 eligible population

3 Absenteeism rate excludes Korea

4 Average cost of training per employee was updated in 2018 to include in-business headcount performing training roles



SUSTAINABILITY DATA



EnvironmentIn 2018, our measured Scope 1 and Scope 2 emissions were assured by The Carbon Trust, our independent third-party assurance provider for greenhouse gas (GHG) emissions, ensuring the accuracy and credibility of our reporting.

Review the methodology used to measure and assess our environmental performance data at sc.com/environmentcriteriaDownload the independent assurance report for 2018 performance at sc.com/environmentalassurance

2018 2017 2016

Measured Scaled Up Measured Scaled Up Measured Scaled Up

Offices reporting 174 – 188 – 189 –

Net internal area of occupied property (m2) 2,623 1,185,929 814,886 1,194,363 840,510 1,237,043

Green lease clause inclusion1 (%) 78 – 76 – 71 –

Occupied net internal area where data is collected (%) 69 – 85 – 72 –

Full-time employees (FTE)2 62,420 85,402 64,648 86,021 58,699 86,693

Annual operating income from 1 October to 30 September ($m) – 14,958 – 14,614 – 12,515

Greenhouse gas emissions – Absolute (tonnes CO2eq/year)

Scope 1 emissions (combustion of fuels) 4,467 8,584 5,870 7,922 6,312 13,562

Scope 2 emissions (purchased electricity) 4,267 139,366 113,908 180,014 136,570 186,553

Scope 1 & 2 emissions 8,734 147,950 119,777 187,936 142,882 200,115

Scope 3 emissions without distance uplift (air travel) 62,113 62,113 59,179 59,179 49,393 52,056

Scope 3 emissions with distance uplift (air travel) 67,704 67,704 64,505 64,505 53,839 56,741

Scope 1, 2 & 3 emissions 0,847 210,063 178,956 247,115 192,275 252,171

Scope 3 emissions (Global Data Centre)3 – 21,523 – 23,904 – 22,653

Greenhouse gas emissions – Intensity

Scope 1 & 2 emissions/m2 (kg CO2eq/m2/year) 132 125 147 157 170 162

Scope 1 & 2 emissions/FTE (tonnes CO2eq/FTE/year) 1.74 1.73 1.85 2.18 2.43 2.31

Scope 3 emissions/FTE without distance uplift (tonnes CO2eq/FTE/year) 1.00 0.73 0.69 0.69 0.57 0.60

Scope 3 emissions/FTE with distance uplift (tonnes CO2eq/FTE/year) 1.08 0.79 0.75 0.75 0.62 0.65

Scope 1, 2 & 3 emissions/m2 (kg CO2eq/m2/year) 208 177 220 207 229 204

Scope 1, 2 & 3 emissions/FTE (tonnes CO2eq/FTE/year) 2.74 2.46 2.77 2.87 3.28 2.91

Scope 1 & 2 emissions/$m operating income (tonnes CO2eq/$m/year) – 9.89 – 12.86 – 15.99

Scope 1, 2 & 3 emissions/$m operating income (tonnes CO2eq/$m/year) – 14.04 – 16.91 – 20.15

Environmental resource efficiency

Energy

Indirect non-renewable energy consumption4 (GWh/year) 162 224 168 277 185 245

Indirect renewable energy consumption5 (GWh/year) 17 17 21 19 23 20

Direct non-renewable energy consumption6 (GWh/year) 18 31 24 32 26 47

Direct renewable energy consumption7 (GWh/year) – – – – – –

On-site renewable energy consumption8 (MWh/year) 458 458 330 330 247 247

Energy consumption (GWh/year) 198 272 213 327 234 312

Energy consumption/FTE (kWh/FTE/year) 3,167 3,187 3,291 3,807 3,986 3,599

Energy consumption/m2 (kWh/m2/year) 240 230 261 274 278 252

Water

Water consumption (ML/year) 605 916 649 1,149 917 1,181

Water consumption/FTE (m3/FTE/year) 10 11 10 13 16 14

Water consumption/m2 (kL/m2/year) 0.74 0.77 0.80 0.96 1.09 0.95

Paper9

Print paper consumption (ktonnes/year) 1.05 1.49 1.62 1.89 – –

Print paper consumption/FTE (kg/FTE/year) 17.70 – 21.97 – – –

Waste10

Waste (ktonnes/year) 5.1 – 4.8 – 5 –

Waste/FTE (kg/FTE/year) 81 – 74 – 85 –

Waste reused or recycled (%) 46 – 24 – 38 –

Retired IT equipment reused or recycled (ktonnes/year) 0.19 – 0.19 – 0.15 –

1 Percentage of green lease clause inclusion in all new and renewed leases within the reporting year. Refer to the eco-effi ciency criteria for more information2 For environmental reporting purposes, full time employees (FTE) refers to the Group’s headcount at 31 December 20183 Scope 3 emissions calculated from total energy consumption from our outsourced global data centres4 Indirect non-renewable energy refers to purchased electricity from non-renewable sources5 Indirect renewable energy refers to purchased electricity from off-site renewable sources6 Direct non-renewable energy refers to the gross calorifi c values of renewable fuels consumed on-site 7 Direct renewable energy refers to the gross calorifi c values of renewable fuels consumed on-site8 On-site renewable energy refers to renewable energy generated and consumed on-site9 New methodology to measure paper consumption, introduced in 2017, resulted in 2016 data no longer being representative. It is, therefore, not shown10 We are reviewing our methodology for measured and scaled-up waste. Scaled-up waste data is not representative and is, therefore, not shown

10

17

82

10

35


SUSTAINABILITY DATA



Pakistan awards

74 wins at The Asset Triple A Awards 2016

Standard Chartered was named “Best Transaction Bank” at The Asset Triple A Treasury, Trade and Risk Management Awards 2016. The Bank took home a remarkable total of 74 awards, including:

• Best Transaction Bank• Best Working Capital and Trade Finance Bank• Best Regional Specialist Award - Supply Chain Solutions• Best Renminbi Bank (fifth consecutive win since 2012)• Best Structured Trade Finance Bank (11th consecutive win since 2006)• Best Regional Specialist Award - ECA Financing

In January, The Corporate Treasurer also named us Best Bank in Asia and winner of the Overall Cash Management award, among a total 11 awards – again the most awarded to any bank.

The Asset Triple A Treasury, Trade & Risk Management Awards 2016● Best Treasury & Cash Management Bank● Best Working Capital & Trade Finance Bank● Best Structured Trade Finance Bank● Best e-Solutions and Technology Partner Bank

Global Finance Awards 2016 - 2017● Best Digital Islamic Bank Award for 2016● Pakistan - Best Emerging Market Bank in Asia Pacific 2015 and 2016● Best Consumer Digital Bank Award

Finance Asia● Best Foreign Bank in Pakistan Award 2015

Islamic Finance News (IFN) Awards for 2015● Pakistan Deal of the Year Award for Standard Chartered Saadiq’s USD1bn Sukuk issue

Asia Money Awards 2017● Best International Bank in Pakistan

Finance Asia 2018● Best Foreign Bank in Pakistan

Pakistan Digital Awards 2018● Best Digital Marketing Campaign

Global Diversity and InclusionBenchmark Award for 2018:

● Best Practices in D&I Vision ● Best Practices in D&I Benefits● Best Practices in D&I Social Responsibility● Progressive Practices in D&I Communication ● Progressive Practices in D&I Sustainability


PILLAR 1: CONTRIBUTING TO SUSTAINABLE ECONOMIC GROWTH

Aspirations Targets: We will work with our clients to: Target date

InfrastructureEveryone should have access to safe, reliable and affordable power and infrastructure which transforms lives and strengthens economies

Provide advisory, financing, debt structuring services and policy advice for $25 billion of infrastructure projects, including $4 billion toward clean technology

Jan 2017 – Dec 2019 (infrastructure)

Jan 2016 – Dec 2020 (clean technology)

Climate changeClimate change is one of today’s greatest challenges and addressing it is essential to promote sustainable economic growth

Develop a methodology to measure, manage andultimately reduce the emissions related to the financing of our clients

Jan 2019 – Dec 2020

EntrepreneursEntrepreneurs are the heart of local economies, creating jobs and empowering people

Provide $6 billion to Business Banking clients Jan 2017 – Dec 2019

Grow our lending to smaller business clients in our Commercial Bank by 20% as measured by assets

Jan 2017 – Dec 2019

DigitalEveryone should have access to digital banking products enabling safe, efficient and inclusive banking

Continue to provide ‘last mile’ payments and collectionsto clients in our footprint through our Straight2Bank wallet

Jan 2017 – Dec 2019

CommerceTrade creates jobs and contributes to economies by enabling people to connect across borders

Bank 8,000 of our clients’ international and domestic networks of suppliers and buyers through banking the ecosystem programmes

Jan 2017 – Dec 2020

Impact and sustainable financeInnovative financial products and partnerships can help us solve global development challenges and improve the lives of millions in our markets

Provide $1 billion of financing to microfinance institutions to extend access to finance

Jan 2016 – Dec 2020

Facilitate opportunities for our Private Bank clients to invest in impact investing funds in our markets

Jan 2016 – Dec 2020

Continue to promote blended finance capabilities Jan 2016 – Dec 2020

Sustainability Aspirations 2019Our Sustainability Aspirations build on our three sustainability pillars, with measurable targets, to demonstrate how we are achieving sustainable outcomes across our business. These also allow us to measure our contribution to the United Nation’s Sustainable Development Goals (SDGs).

PILLAR 2: BEING A RESPONSIBLE COMPANY

Aspirations Targets: We will: Target date

PeopleOur people are our greatest asset, and our diversity drives our business success

Increase gender representation: 30% women in senior roles (Bands 1–4)

Sept 2016 – Dec 2020

Commit to pay a Living Wage in all our markets by 2020 and support this by:

Defi ning and implementing a Living Wage for all employed workers

Jan 2019 – Dec 2019

Conduct a feasibility analysis for incorporating a Living Wage into agreements for non-employed workers

Jan 2019 – Dec 2019

EnvironmentReducing our own impact on the environment will protect our planet for the benef it of our communities

Reduce annual energy use by 35% to 230 kWh/m2/year in our tropical climate locations (80% of portfolio)

Jan 2008 – Dec 2019

Reduce annual energy use by 31% to 275 kWh/m2/year in our temperate climate locations (20% of portfolio)

Jan 2008 – Dec 2019

Reduce annual water use by 72% to 0.5kL/m2/year Jan 2008 – Dec 2019

Reduce annual offi ce paper use by 57% to 10kg/FTE/year Jan 2012 – Dec 2020

Reduce annual greenhouse gas emissions by 90% to 18,000 tonnes by 2050* with interim targets of 36% to 121,000 tonnes by 2025 and 55% to 84,000 tonnes by 2030

Jan 2019 – Dec 2050

ConductGood conduct and high ethical standards are essential in achieving fair outcomes for our clients

Effectively embed conduct risk considerations into the Group’s product governance activities, with all businesses expected to implement the revised standards

Jan 2019 – Dec 2019

Financial crime complianceFinancial crime has serious social and economic consequences, harming individuals and communities

All eligible Bank staff to complete relevant ABC, AML and sanctions training with less than 2% overdue

Ongoing

Deliver at least 10 correspondent banking academies Jan 2019 – Dec 2019

PILLAR 3: INVESTING IN COMMUNITIES

Aspirations Targets: We will: Target date

Community engagementHealth and education are vital for thriving and prosperous communities

Invest 0.75% of prior year operating profi t (PYOP) in our communities

Jan 2006 – Dec 2020

Raise $50m for Futuremakers by Standard Chartered Jan 2019 – Dec 2023

Education: Reach one million girls and young women through Goal**

Jan 2006 – Dec 2023

Employability: Reach 100,000 young people Jan 2019 – Dec 2023

Entrepreneurship: Reach 50,000 micro and small businesses

Jan 2019 – Dec 2023

Support the development of the Vision Catalyst Fund Jan 2019 – Dec 2020

* From a 2017 baseline of 187,936 tonnes** Includes 481,978 girls reached through Goal between 2006 and 2018

ASPIRATIONS SUMMARY

2019 SustainabilityAspirations

Further informationOur online resources provide further information to support this document

Annual ReportFor a full review of our performance during 2018, visit sc.com/annualreport

Approach to sustainabilityYou can learn more about our sustainabilityphilosophy and our approach at sc.com/sustainability

Position StatementsFor details of our environmental and social standards and how we apply these in our work with clients, visit sc.com/positionstatements

Code of ConductYou can download our Code of Conduct at sc.com/codeofconduct

Tax reportingYou can f ind complete country by country tax reporting at sc.com/cbcr

Included inFTSE4Good

Contact usIf you have any comments or questions about the information in this report, contact us at [email protected]

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