Sustainable Trade Criteria: Customer Due Diligence Guidelines

The Customer Due Diligence Guidelines aim to promote sustainability in trade finance by identifying high environmental, social or governance (ESG) risks associated with commodities or other goods and services produced by a bank customer or within its supply chain, and available mitigants. A better understanding of those risks and their potential reputational, credit and regulatory impact will help leverage banks’ role in financing sustainable trade and encouraging sustainable practices, as well as assist banks in their implementation of internal sustainability policies and standards.

The Customer Due Diligence Guidelines were developed by the ICC Banking Commission’s Working Group on Sustainable Trade Finance after extensive consultation with its members as well as selected National Committees, and validation by the Executive Committee. This suggested template aims to promote sustainability in trade finance by identifying high environmental, social or governance (ESG) risks associated with commodities or other goods and services produced by a bank customer or within its supply chain, and available mitigants.

A better understanding of those risks and their potential reputational, credit and regulatory impact will help leverage banks’ role in financing sustainable trade and encouraging sustainable practices, as well as assist banks in their implementation of internal sustainability policies and standards.

The Guidelines also serve as an aid to help banks evaluate customer responses, taking into account each bank’s individual management strategies and ESG, reputational and credit risk policies. These Guidelines may be used whenever banks deem it as appropriate, for example as part of a periodic client-level review, or after particular ESG risks associated with a customer’s operations or supply chains have been identified.

To maintain records of the client due diligence process using these Guidelines, we recommend including the following information as reference:

  • Client Name:
  • Client ID:
  • Date of discussion:
  • Call Report Documented by:
  • Type of discussion:  In person / via conference call
  • Bank Participants (Name & Title):
  • Client Participants (Name & Title):
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