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ESG risks and the "answer sheet" of the Agricultural Bank of China

ABC's efforts
  • Poverty reduction ：One of the main objectives of the 2030 Agenda for Sustainable Development is the eradication of poverty, and China, as the biggest developing nation, will have a significant impact on the success of this objective. As China's biggest provider of financial services in rural areas, the Agricultural Bank of China has contributed to the decline in rural poverty. The bank has supported the growth of many poor families and micro and small businesses by offering a range of financial services, including loan approval, credit guaranteeing, and financial counselling (Schleicher et al., 2018). The Agricultural Bank of China also actively participates in organizations that fight poverty, like the National Poverty Alleviation Fund and rural credit cooperatives, by providing critical support and assistance to underdeveloped rural regions and encouraging sustainable development there.

  • Environmental Protection： Secondly, Agricultural Bank of China has made significant contributions to green finance and environmental protection. Recognizing the importance of environmental protection to sustainable growth, Agricultural Bank of China has actively promoted the creation of green financial services. By creating green credit, green bonds and other financial products that encourage customers to invest in environmental protection initiatives, the bank has supported the development of a green economy.

  • ESG risks ： But we all know that nothing is absolute. Even though the banking sector plays an extremely important role in the Sustainable Development Goals. But there are times when outdated policies, development strategies of banks can expose them to ESG risks. ESG risks can be expensive for investors as well as for the company or organization themselves because they can (Cornell, 2020), for example, affect the company or institution's financial performance, market capitalization, or share price. As a consequence, an increasing number of investors, institutions, and regulators are worried about and taking action to control ESG risks. In terms of preventing ESG risks, the Agricultural Bank of China has also undertaken active measures. （See blog3 for more details）.


Cornell, B. (2020) “ESG preferences, risk and return,” SSRN Electronic Journal [Preprint]. Available at: https://doi.org/10.2139/ssrn.3683390.

Schleicher, J., Schaafsma, M. and Vira, B. (2018) “Will the sustainable development goals address the links between poverty and the natural environment?” Current Opinion in Environmental Sustainability, 34, pp. 43–47. Available at: https://doi.org/10.1016/j.cosust.2018.09.004.

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