NH NongHyup Financial Group discussed its ESG vision and declaration of phasing out coal financing and the direction of management for 2021 at the 2021 Management Strategy Meeting held at the Video Conference Room of NH NongHyup Financial Group Headquarters in Jung-gu on Feb. 3. (Photo: NH NongHyup Financial Group)

“NH NongHyup Financial Group was founded based on the National Agricultural Cooperative Federation (NACF), an organization optimized for environmental, social and governance (ESG) purposes,” said Son Byung-hwan, chairman of NH NongHyup Financial Group at an event to declare the group’s management strategy earlier this year.

“Let’s move on to become a financial group that contributes to the people, local communities and the environment with the perception that the NACF is none other than a major ESG player.”

Chairman Son defined the identity of NH NongHyup Financial Group as “an ESG implementation group” when he announced the group’s management strategy earlier this year.

NH NongHyup Financial Group aims to become an eco-friendly financial group in 2021 and set “Transformation for ESG in 2025” as its mid-term vision.

As part of this plan, it is planning to invest 15.6 trillion won in the Korean New Deal in connection with the Green and Digital New Deal by 2025. The amount has swelled by a 1.8 trillion won since its announcement in September 2020.

The financial group also decided to stop all new investments related to the construction of coal-fired power plants at home and abroad.

NH NongHyup Financial Group allocated 14.9 trillion won, most of its funds for the Korean New Deal, to investment in the Green New Deal.

The financial group will the cash to make investments in the new and renewable energy sector, giving loans for solar energy facilities, buying ESG bonds and making alternative investments.

It also aims to achieve carbon neutrality that will eliminate greenhouse gas emissions from the financial group by 2050.

In November last year, Korean financial groups signed a business agreement to attain its goal of carbon neutrality and rev up green finance with the Ministry of Environment for the first time.

Moreover, NH NongHyup Financial Group has decided to invest 500 billion won in order to narrow digital information gaps among regions across the nation and give support to farmers and farming towns.

It plans to continue social contribution activities such as supporting the distribution of digital devices for the digitally marginalized, crowd-funding for farmers, and lending funds for purchasing livestock farm food.

It will also expand financial support for agricultural and food companies that pursue environment-friendlier agriculture such as green smart farms and eco-friendly processing companies and distributors. To this end, it set up the Green Financial Business Team.

NH NongHyup Financial Group also started to revamp its organization to establish an ESG promotion system.

Its Board of Directors established the Social Value and Green Finance Committee with an eye towards directly voting on ESG strategies and checking progress in ESG project implementation.

It decided to reflect ESG factors in evaluating CEOs of its affiliates. NH NongHyup Financial Group will also publish a sustainable management report that will explain its ESG performances and plans starting in 2021.

NH NongHyup Financial Group is planning to start making an improvement to an integrated platform to reorganize its services into digital centers.

Its plan is to make mobile application All One Bank a representative platform compatible with all services offered by the financial group and its affiliates.

At the same time, All One Bank will serve as a reliable financial secretary in a customer’s hand that offer all financial services including asset management, insurance, payment, and investment.

For example, All One Bank will allow customers to use NH Investment & Securities’ stock investment and analysis services and consult with insurance experts of NongHyup Life Insurance about insurance policies.

To this end, NH NongHyup Financial Group will unify six banking apps into two – smart banking apps for individuals and corporate customers.

NH NongHyup Bank has utilized artificial intelligence (AI) technology through the AI Research Center of NH Digital Innovation Campus to monitor incomplete sales of fund products since October 2020.

It also applied the AI technology to the detection of abnormal transactions of corporate customers’ credit cards.

Unlike other financial holding companies, NH NongHyup Financial Group is planning to offer digital financial services by considering technology-based fintech and big-tech partners for win-win growth rather than competitors.