Greetings to all the clients and business partners of Trade and Development Bank of Mongolia.
I believe that the Mongolian banking sector as the leading sector in the economy today can help facilitate growth and development that is sustainable in the long run by financing businesses that are environmentally friendly and model a good example to the society. Standing at the forefront of this principle, Trade and Development Bank of Mongolia has already started acting on its environmental and social responsibility with good attention and has implemented several major projects.
For example, in 2012, we partnered with Dutch Development Bank (FMO) and became the first bank in Mongolia to implement Environmental and Social Risk Management System (ESRMS) fully in our operation and brought a completely new perspective of banking into our sector. In regards to our ESRMS, we monitor the loans we finance carefully by not putting profit first when making decisions, but by carefully evaluating every loan before we make a decision and rejecting requests from clients and businesses that have negative consequences on the environment and society and thus reducing their risk. In the process of implementing this new concept, we are training all of our employees, especially our account managers, E&S monitoring officers, and bringing awareness to our customers in the hopes of cultivating new standpoint and outlook on environmental and social responsibility.
Furthermore, it is a noteworthy event that in November, 2013 the banks of Mongolia joined the Mongolia Sustainable Finance Initiative and signed MoUs which is a huge step towards the future of our country’s development. Through this partnering of commercial banks in standing up against violation of human rights, climate change, water and ground contamination, and air pollution thus reducing E&S risks, we are on our way to fulfill our vision of creating a sustainable future and development.
I am delighted to announce that as the leading bank in Mongolia, we aspire to be a good model to the other banks through our environmental and social contributions.
Sustainability plays a central role in development goals shared by countries around the world. By conducting our business environmentally and socially friendly, together we can avoid E&S risks and by doing so, create a sustainable business model. Through our Environmental and Social Responsibility policy, we aim to address issues such as responsible living of natural resources, restoring the nature, occupational health and safety, accessibility of financial services for all levels of society and better fulfilment of corporate social responsibility through our financing.
Globally, banks and financial institutions play important roles in achieving sustainability in the business world. Under the same principle as credit risk rating and mitigation, banks can assess their customers’ environmental and social risk, and protect their customers’ from E&S risks by partnering with them to help them fulfill their environmental and social responsibility.
Moreover, Trade and Development Bank will contribute to gender equality efforts by ensuring through gender mainstreaming, that the needs and interests, effective participation, and resultant benefits of women and men are equally prompted within the organization and its investment through gender-responsive assessment, consultation, design implementation, and monitoring and evaluation processes.
Policies and procedures
TDB, for the first time in Mongolia, in partnership with the Dutch Development Bank, has implemented a complete ESRMS which consists of Environmental and Social Management policy, Environmental and Social risk assessment of clients’ business activities in accordance with the latest methodologies and monitoring of their E&S risks.
This system refers to business loan requests only and excludes loans for personal use. In this system, we identify the clients’ E&S risks and help them mitigate these risks.
TDB will not finance business activities that are forbidden by international agreements, protocols, IFC’s performance standards and Mongolian laws and therefore has made “Exclusion list” of activities not to finance.
The businesses that are not included in the “Exclusion list” must be classified according to their business activity and loan transaction as either green, yellow or red.
Based on the assessment, when necessary, the bank sets covenants to loans and gives guidance to the clients on risk mitigation measures.
The fulfillment of the additional covenants in the loan contract is reviewed periodically. Please see our system of assessing, reducing, mitigation, preventing and monitoring risk from the following diagram.
What is the Exclusion list and what businesses do we choose not to finance?
Depending on the type of business activity, and sector, risk level is classified as shown below.
Mining, mineral resource quarrying, processing
Trading of foodstuffs and other commonly used products
Hotel and food service
Renovation, construction decoration
Information and communication
Construction material manufacturing
Financial and insurance activity
Road, bridge and construction
Dairy product manufacturing
Real estate intermediation activity
Production and trading of alcohol and cigarettes
Other food product manufacturing
Education, art, concert, and recreation
Raw meat and leather processing
Metallic product manufacturing
Human health and welfare activity
Electricity, power, and gas station
Transportation and warehousing
Chemical product manufacturing
Water and drainage accumulating system, waste management and cleaning activity
Professional, scientific, and technical activity
Trading of petrol
Manufacturing of other products
Small business with employees, loans for private use
When conducting due diligence, the following documents may be requested from the customer. These include:
By implementing E&S policy, following advantages arise for the Bank, the customer and the environment and society.
For the Bank:
For the customer:
For the environment and the society:
We ensure that Project Complaint Mechanism is incorporated into all projects or programmes financed by the Green Climate Fund (GCF). Thus, if you have been negatively affected by a GCF-funded project or programme, you may freely reach out to the project implementers and the bank to resolve the issue.
TDB’s Project Complaint Mechanism is open to receiving complaints from all people who have been or might be negatively affected by a GCF-funded project or programme. Project Complaint Mechanism aims to assess issues in detail and redress the grievances of people negatively affected by the project or programme by offering viable solutions to the issues.
What type of issues does TDB’s Project Complaint Mechanism handle?
If you have complaints about the bank’s other operations, please submit it here.
How does TDB’s Project Complaint Mechanism solve your complaints?
How does TDB keep your information confidential?
If, however, the Bank believes that the complainant’s identity must be revealed in order to effectively solve the issue, the Project Complaint Mechanism will ask for the complainant’s consent.
How to submit a complaint to TDB regarding a GCF-funded project or programme?
You may submit your complaints through the following channels.
Click HERE to submit a complaint online.
You may send your complaint to email@example.com
You may mail or hand-deliver your complaint to TDB’s Head office located in Peace Avenue 19, 1st khoroo, Sukhbaatar district, Ulaanbaatar city.
The complaints you submit must have the following information in order to be eligible:
- Name, phone number, email address, home address and signature of the complainant
- Name of the GCF-funded project or programme at issue
- Description of the harm that has been caused or might be caused by the GCF-funded project or programme
- Whether the complainant has contacted the project implementer to resolve the harm
- Results the complainant hopes to achieve by submitting the complaint
- Whether the complainant is requesting that their identity be kept confidential
Name of the project or programme
Location of the project or programme
TDB’s Project Complaint Mechanism is designed to receive, assess and resolve complaints submitted by people who have been negatively affected a GCF-funded project or programme.
If you are submitting your complaint via email or hand-delivering your complaint to our head office, please be noted that your complaint has to include the following information:
You can submit your complaint to Project Complaint Mechanism within 2 years after the GCF-funded project or programme was closed or 2 years after you became aware of the negative impacts caused by a GCF-funded project or programme.
No. Submitting a complaint does not suspend or otherwise affect the formulation, processing, or implementation of the project unless agreed to by the Bank, the GCF and the relevant parties concerned.
No. GCF-funded projects or programmes being implemented in partnership with TDB are required to include project-level complaint mechanism on top of TDB’s Project Complaint Mechanism for GCF-funded projects and programmes. Thus, you may also reach out the project implementers to resolve the harm that has been caused or might be caused due to the project or programme.
No. However, if you could provide the bank with solid evidences to support your case, it will greatly improve the problem solving process.
Due to the different nature of each complaint, TDB’s Project Complaint Mechanism will spend different amount of time on resolving each complaint. However, we aim to resolve your complaints within 120 days.
You may request for confidentiality at the time of submitting your complaint. However, in this case your information will still be made available to the Bank’s officers in charge of the Project Complaint Mechanism and the project or programme. And if TDB’s Project Complaint Mechanism decides that it is necessary to reveal your identity in the problem solving process to the project implementer and the relevant parties, we will request for your consent. If revealing the complainant’s identity is vital to effectively resolving the complaint and the complainant objects to revealing their identity, the Project Complaint Mechanism may inform the complainant and terminate the process on the basis that agreement could not be reached.
Trade and Development Bank is committed to providing financing solutions for green and climate projects and programs to achieve inclusive financing for sustainable development, and as such we are developing our “Climate 30+ Initiative”, a green recovery initiative, for its corporate, SMEs and retail clients to assist in their effort to reach low carbon and green growth targets, and ultimately support the Government of Mongolia to achieve its climate ambitions. This initiative will be the first Mongolian private sector driven climate and sustainable development initiative.
For the first time in Mongolia, TDBM has developed the Sustainability Framework and started to provide green and social loans under this framework. The TDBM has always been the pioneering bank in Mongolia on areas of environmental and social safeguards management, gender equality and now sustainable development.
TDBM is the first organization to commission an SPO (Second-Party Opinion) on its Sustainability Framework in compliance with the Green Bond Principles, the Social Bond Principles and the Sustainable Development Bond Guidelines. SPO was provided by Vigeo Eiris, a subsidiary of Moody's Investors Services. The Bank’s Sustainability Framework received a rating of ‘Robust’.
TDBM’s Sustainability Framework describes the process of issuing Green, Social and Sustainability bonds (“GSS Bonds”) and selecting loans that can be financed within eligible categories to fulfill the Bank’s economic, environmental, and social responsibilities, as well as indicating the tracking, monitoring, reporting and disclosure processes of its net proceeds.
Green Eligible Categories:
Low pollution energy
Sustainable water and waste use and treatment
Sustainable agriculture, land use, forestry & biodiversity conservation
Social Eligible Categories:
Affordable basic infrastructure
Access to essential services
SME Financing and Microfinance