Bank Islam Integrated Annual Report 2022

3 Implementation of BNM’s Climate Change Principles-based Taxonomy (CCPT) The CCPT Classification exercise enables financial institutions to understand the extent of their portfolio exposure to climatic impacts and risks. In line with this, BIMB has obtained an initial view of climatic risk exposure based on the classification guidance of C1 to C5. Per the Guiding Principles, the data is intended to be used to determine areas where opportunities for sustainable financing may arise as well as sectors or market segments that may be riskweighted in future to manage and mitigate negative climatic impact. We use a combined methodology using data and references from multiple sources to form a basis for application of the Climate Change Principles-based Taxonomy (CCPT) guidelines. 4 Application of the CCPT Guidance BIMB recognises the impacts of climate change on the environment and society as well as the importance of ESGrelated governance systems to enable businesses to improve on and implement robust systems and controls over their sustainability footprint. The role of banks in financing businesses and consumers enables them to participate in various economic activities that may impact the environment and society in terms of climate change and sustainability. The implementation of CCPT enables BIMB to obtain an overview of how key financing assets are tied to climate risk and identify opportunities for more sustainable financing channeled towards climate-positive economic activities. The CCPT details the assessment of existing and prospective customers by applying Guiding Principles (GPs) through dual perspectives. The GPs applied are in accordance with the CCPT Guidance Document and are summarised below. Overview of Classification Exercise for Companies: CCPT Classification C1 C2 C3 C4 C5 Climate Supporting Transitioning Watchlist Classification Overview: Company has ESG policies and action plans and the transaction is climate positive. Company has implemented ESG-related remedial actions and the transaction is climate positive. Company has implemented ESG-related remedial actions however, the transaction is climate negative. Company has not implemented ESG-related policies but the transaction is climate positive. Company has no significant ESG policies and the transaction is climate negative. Entity-level ESG Policies and Practices GP3 GP4 GP4 None None Transactionlevel ESG Impact GP1/2 GP1/2 Negative GP1/2 Negative OR GP5 Sustainability Statement Bank Islam Malaysia Berhad 151 01 05 03 07 02 06 09 04 08

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