Materiality Methodology

Governance and Ethics

We maintain strong governance practices as a foundation for longterm value creation and protection, and given the highly regulated industry in which we operate.

Reputational damage for failing to meet regulators’ or other stakeholders’ expectations

Fines for breaching regulatory requirements 

Lack of integrity and transparency in our operations and work culture

Strong governance practices enable the effective execution of business strategies, while strengthening our ability to be a responsible financial institution

A culture of ethics, integrity and transparency is a critical foundation for CIMB as a high-performing organisation

Allocating resources strategically to reinforce our ability to achieve long-term value creation, while strengthening our value proposition

Reinforcing a healthy culture of ethics, integrity and transparency throughout the organisation

It is critical for us as an ASEAN bank to strengthen business resilience in a continuously evolving market and environmental landscape. Our longterm performance depends on how well we manage financial and business risks while we strive to meet our financial and sustainability goals.

Lack of integrated or systematic processes to understand, measure and manage financial and business risks

Financial losses due to failure to mitigate or limit our risk exposure

Adopting a short-term and reactive approach to emerging risks and trends

Integrated, long-term processes to manage risks and impacts in a holistic way

Strengthened business fundamentals which will enable the effective execution of business strategies and initiatives

Putting in place controls that limit CIMB’s risk exposure, meet regulatory expectations, as well as ensure commercial resilience

Adapting to and integrating emerging risks to maintain business resilience and economic performance in the long term

Banking transactions are increasingly conducted digitally, and cybercrimes are on the rise. In protecting the bank’s credibility, it is critical to protect customers’ data and privacy, and by having strong safeguards from cyberattacks.

Failing to prevent cybersecurity breaches and loss of customers’ data, leading to reputational damage and loss of trust

Business operations can be disrupted

Putting in place robust and transparent cybersecurity and data protection policies and safeguards helps to strengthen customers’ trust

Continued protection of critical data and systems allows for business continuity and resilience

Robust data management practices enable us to be more efficient in catering to stakeholders’ needs and expectations

Robust systems and controls to safeguard CIMB’s data and systems, as well as customers’ data and privacy

Enhanced cyber defences and robust data protection frameworks

Protecting customers from fraud and scams through enhanced security measures and awareness campaigns

Sustainable and Responsible Finance is central to CIMB’s strategy for longterm value creation. By integrating sustainability considerations into our financing and investment decisions, we unlock revenue opportunities in the growing green economy. This approach also enhances our resilience by de-risking our portfolio and future-proofing our business. Our Sustainable and Responsible Finance approach ensures our financial services are not enabling harm to people and planet, aligns with increasing stakeholder demand for sustainable finance solutions and positions CIMB to capture growth in sustainability-driven markets.

Inability to integrate and adapt to rapidly evolving sustainability risks may result in stranded assets and increased default rates among clients financially affected by sustainability-related challenges 

Financing clients and projects that cause harm to people and the environment could result in reputational risks for CIMB

Green and social finance options are increasingly becoming a must-have for a bank to remain competitive

Establish CIMB as a leading ASEAN bank in sustainable finance

Generate long-term value by delivering innovative sustainable finance products and services

Expand transition finance solutions for high-risk sectors as they decarbonise and build climate resilience

Strengthen client relationships by providing advice on potential environmental and social risks in their business

Enhance brand reputation and attract sustainability-focused investors and clients

Deliver products and services that drive positive societal impact across environmental, economic, and social dimensions

Manage risks and potential negative impacts from financed activities, ensuring alignment with global and regional sustainability expectations

As a responsible financial institution, CIMB has a duty to equip individuals and businesses with financial knowledge to help them better manage their finances By providing products like savings accounts, microloans, and digital banking services, we can unlock new revenue streams while empowering underserved segments. Promoting financial literacy enhances customer retention, builds trust, and drives sustainable growth, ensuring longterm value for both CIMB and the communities we serve.

Mis-selling of our banking products and services

Failing to capitalise on business opportunities to serve the unbanked and underbanked communities and demographics

Increasing customer indebtedness due to inadequate financial literacy or poor credit risk management, potentially leading to higher default rates and affecting portfolio quality

New business opportunities arising from serving the unbanked and underbanked

Support improved financial health through enhanced financial planning and literacy programmes, empowering customers to manage their finances effectively and build long-term security

Strengthen customer trust and loyalty by demonstrating a commitment to improving the financial well-being of small businesses, individuals and communities

Drive inclusive economic development by enabling broader access to financial services and creating more equitable opportunities across ASEAN markets

Provide affordable and inclusive financial services, focusing on underserved and disadvantaged businesses and communities

Enhance financial literacy through targeted education programmes for individuals and businesses

Promote improved financial health and resilience through synergistic efforts across our business

Drive sustainable economic inclusion across ASEAN by empowering communities with better financial opportunities

The banking industry will continue to face digital disruptions. It is critical for the Bank to accelerate digital transformation and offer innovative digital solutions for all customer segments, ensuring superior customer experience, enabling financial inclusion and improving efficiency.

Failing to respond adequately and in a timely manner to digital disruptions in the banking industry, as well as technological innovations

Insufficient investments in digital and innovative capabilities that meet customers’ expectations and needs

Loss of competitiveness

Capture new revenue streams, value creation opportunities and opportunities to improve operational efficiency

Strengthen technological resilience and system reliability

Enhance and differentiate customer experience

Ensure a seamless digital experience for customers that meets and exceeds their expectations and needs

Transform our operations by deploying data analytics capabilities and artificial intelligence tools to be a data-first organisation

Customers are at the heart of what we do as a bank and our reason for existence. Our competitiveness depends on how well we meet their needs, providing value-adding and differentiated products and services.

Inconsistent customer experience levels leading to erosion of trust

Disproportionate focus on high net-worth and Preferred customer segments

Mis-selling of banking products and services

Short-lived customer loyalty due to intense competition for customers in crowded markets

Catalyse the market by creating new benchmarks for excellent customer experience

Build trust with clients by treating customers fairly and meeting their needs

Increase brand affinity and loyalty through differentiated products and services that meet customers’ needs

Engage in responsible marketing and fair dealing practices to strengthen customer trust

Go the extra mile for our customers, and deliver excellent customer experience that builds long-term relationships

Climate change is an existential threat to all, including ourselves, and presents significant risks and opportunities for CIMB. Physical risks, such as extreme weather events, can disrupt operations and impair the creditworthiness of borrowers. Transition risks, including regulatory changes and market shifts, could impact clients in high-carbon sectors. However, these challenges also present opportunities to finance the low-carbon transition, support clients in managing their climate risks, and develop innovative solutions that drive sustainable economic development. By addressing these risks and seizing opportunities through portfolio resilience, sustainable finance, and operational decarbonisation, CIMB facilitates longterm value creation, improves stability, strengthens its competitive position and mitigates potential credit and reputational risks.

Failing to address climate-related risks in our portfolio could lead to increased impairments due to stranded assets, regulatory penalties, or borrower defaults

Insufficient preparation for physical climate risks in our operations and supply chain may cause service disruptions, financial losses, and reputational damage

Expand transition finance solutions for high-risk sectors to support them to decarbonise and build climate resilience

Capitalise on high-growth opportunities in the green economy, supporting our clients in initiatives around renewable energy, energy efficiency, EV and sustainable mobility, green buildings, sustainable agriculture, nature-based solutions and the circular economy

Capture new business opportunities arising from climate risk mitigation and adaptation

Strengthen client relationships and build trust by helping client’s manage their climate risks

Enhance brand reputation and attract sustainability-focused investors and clients

Achieve net zero Scope 1 and 2 emissions by implementing operationaldecarbonisation initiatives, including internal carbon pricing

Establish Paris-aligned targets for highemission sectors in our portfolio

Enhance portfolio resilience by addressing physical and transition risks, ensuring alignment with Net Zero pathways

Protecting nature is crucial for a sustainable economy and for meeting society’s basic needs such as energy, food, and water. As a responsible financial institution, CIMB has a responsibility to ensure that our financing activities do not contribute to the destruction of biodiversity and natural ecosystems. By supporting clients who promote sustainable practices, we can help prevent, mitigate, and reverse nature loss while driving positive environmental and societal outcomes.

Financing clients who harm natural habitats or contribute to biodiversity loss can result in reputational damage and regulatory backlash

Failing to address nature-related risks in our portfolio increases exposure to financial risks, including physical, transition, and systemic risks, that may impact the long-term viability of our portfolio

Finance clients who contribute to a “nature-positive” economy, supporting initiatives that protect biodiversity and ecosystems

Strengthen our sustainability due diligence processes to integrate naturerelated risk considerations, enhancing the resilience and impact of our financing activities

Unlock potential value from biodiversity protection, contributing to climate mitigation while fostering long-term value creation

Secure client commitments to No Deforestation, No Peat Expansion, and No Exploitation (NDPE)

Integrate biodiversity and ecosystem considerations, including waste and water management, into financing and business decisions, driving positive environmental outcomes

Set realistic targets for nature conservation, balancing ambition with feasibility in the face of evolving scientific understanding

Employees are key to the successful execution of our business strategies. As a responsible employer, we aim to provide our people a safe, fair and fulfilling work environment and to support their career development and personal wellbeing. Amid the global transition to a more sustainable economy and the limited talent pool with both banking and sustainability expertise, we will face increasing competition to attract and retain the right talent.

Failing to anticipate and act on emerging trends, resulting in a lack of suitably skilled employees and leading to loss of competitive advantage

Lower productivity and performance due to disengaged employees

Inability of employees to fully contribute due to lack of skills, knowledge and tools

Become the “employer of choice” among the top talents in the region, enhancing our value proposition through regional exposure

Leverage our regional footprint to attract top talent

Enhance organisational agility and effectiveness with highly skilled, wellequipped and motivated talent

Embed a sense of purpose in day-to-day work, making careers more meaningful and fulfilling

Attract and nurture the right talent to future-proof the organisation and its business

Implement effective mechanisms to develop our employees’ careers and retain talent for business continuity, productivity, performance, and competitiveness

Create a work environment that promotes employees’ physical, mental, and emotional wellbeing, including initiatives related to work-life balance, health, safety and professional development

Diversity across the organisation can foster innovation, inclusive growth and participative leadership, and serve to remove barriers to communication, productivity and performance

Lack of diverse ideas, skills and motivation for innovation

Inability to attract talented individuals from diverse markets and communities, and with different world-views

Encourage diverse ideas and views for innovative solutions across customer segments and markets

Promote local employment by supporting overlooked high-potential talent

Provide a conducive work environment for people of different backgrounds and abilities

Implement mechanisms to provide and promote equal, fair and inclusive opportunities regardless of gender, age, background, beliefs, ethnicity, skill and different abilities

 Association with human rights violations can harm reputation, lead to regulatory scrutiny, and result in credit risk and financial losses

Failure to address human rights issues may expose CIMB to reputational, legal and compliance risks

Failure to uphold fair labour practices and fair treatment of employees can lead to talent attrition

 Promote awareness and adherence to global human rights standards among clients and partners

Deliver products and services that cater to minority and vulnerable customer segments, enhancing financial inclusion

Strengthen brand reputation by championing ethical practices and fair treatment

Uphold international human rights laws and standards in all operations

Integrate human rights due diligence into our sustainability assessment processes

Promote fair labour practices and the equitable treatment of communities through our financing activities

Our purpose is to build a high-performing, sustainable organisation to help advance customers and society. This can only be achieved when we embed a sense of belonging, accountability, and purposeful communications within our organisation and with the communities we operate in.

Being perceived as insensitive to the local environment and communities can result in reputational damage and financial losses

Loss of trust from regulators and being seen as unsupportive of national initiatives

Meaningful corporate citizenship initiatives can enhance our reputation as a responsible financial institution

Engage with communities and local governments to bring important business insights and build trust

Involve our employees in volunteerism to improve their understanding and ability to serve our customers better, as well as increase motivation and loyalty

Support regional and national policies to reduce social and economic inequalities and build resilient communities and economies

Implement initiatives that contribute to economic, environmental and social wellbeing while addressing the needs of our diverse stakeholders

Encourage employees and stakeholders to actively participate in community causes and serve as agents of change through volunteering efforts