As a universal bank with a strong presence in FEM, EFG Hermes Holding is committed to leveraging the power of finance to create sustainable progress for present and future generations. This commitment is reflected in our efforts over the years to weave sustainability into the very fabric of our operations. In 2014, we launched our Social Purpose initiative to ensure that our products and services generate value for all stakeholders while addressing global, social, economic, and environmental challenges, and in 2015, we expanded our core principles to include “Public Responsibility” in addition to our original “5Ps”, People, Products, Positioning, Presence, and Profitability.
This was followed by the issuance of our ESG policy in 2017, which aims to align our operations with ethical and sustainable business practices. The CSR department spearheads these initiatives and also oversees the work of the EFG Hermes Foundation for Social Development, which collaborates with policymakers and partners on projects that promote sustainable development and economic growth, with a focus on supporting underprivileged members of the community. Hence, we strive to create positive change and meaningful impact on society and the environment while delivering innovative financial services to our clients.
Moreover, as signatories of the United Nations Principles for Responsible Investment (UN PRI) since 2018, we remain committed to responsible investment in FEM, with a particular emphasis on climate change and the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). We also prioritize clean energy financing and deployment, and our ground-breaking renewable energy investment platform, Vortex Energy, has been instrumental in financing the transition to clean energy. Beyond clean energy, our investment portfolio is designed to address the fulfillment of other SDGs, including investments in socially critical sectors that include health, education, and pharmaceuticals. To support and enrich these sectors, we are continuously expanding our product and service offering across our foothold while also updating our reporting and disclosure procedures and policy environment. This year, we expanded our ESG policy to address our growing NBFI platform, submitted our fourth transparency report as part of our commitment to the UN PRI, and renewed our commitment to the United Nations Global Compact (UNGC).
EFG Hermes Holding has made significant strides toward embedding sustainability across its operations, with a strong focus on responsible investing, climate action, and social impact, and is well-positioned to support its clients in building a solid financial foundation while addressing global challenges, such as climate change and social inequality. Going forward, the Group remains committed to sustainability and will continue to innovate and invest in sustainable solutions to support its clients and communities.
Awards received by EFG Hermes Holding and its subsidiaries:
Awards received by executives at EFG Hermes:
At EFG Hermes Holding, we recognize the importance of not only identifying profitable business opportunities but also investing in impactful ventures that are paving the way for a more sustain- able future.
Vortex Energy is a renewable investment platform and a core pillar within the Private Equity division of EFG Hermes, and it has been significantly contributing to the goal of sustainable development through its investments in clean energy opportunities. Since its establishment in 2015, Vortex Energy has been committed to sustainable and responsible investing, and its business practices are formulated, evaluated, and executed in accordance with a robust sustainability and ESG strategy that supports the UNGC and upholds the UN PRI.
Vortex Energy has been focused on deploying capital across its four fund vehicles to maximize its social and environmental impact. Over the years, Vortex I, II, and III acquired operational renewable energy plants across Spain, Portugal, Belgium, France, and the United Kingdom, generating 822MW of net capacity from individual assets. These assets were optimized for maximum clean energy production and operated in line with the latest industry standards, resulting in the delivery of 4.6 terawatt hours (TWh) of clean energy and the avoidance of approximately 4.5 million metric tons of carbon dioxide equivalent (MTCO2e). These assets are still operational and will continue to save 1.5 million MTCO2e annually over the coming years.
Vortex Energy’s latest development was the launch of its fourth investment vehicle and flagship fund, “Vortex IV”, in July 2021 to further its efforts at delivering on its strategy to support and play a role in the ongoing global transition to cleaner and more sustainable sources of energy. Shortly after, Vortex IV successfully completed its first investment in October 2021 with Spain-based Ignis Energy Holdings (Ignis), which will see Vortex IV inject over EUR 475 million to fund Ignis' ambitious plans to build a >20 GW platform and transform it into a fully- fledged IPP across Spain and other regions.
The EEP was established in 2019 by regional and global institutional investors, including EFG Hermes' Private Equity and the Sovereign Fund of Egypt (TSFE), and it has allowed us to play role in growing and enhancing Egypt’s educational space. The platform currently operates 19 assets in Cairo, Alexandria, and the Red Sea, including 11 schools and eight pre-school branches with a combined capacity of approximately 20,000 and 1,000 students, respectively. Moreover, the EEP operates under five different brand names and verticals, including GEMS International Schools, Hayah Schools, Prime International Language Schools, and Trillium Preschools. The platform also boasts a portfolio of investments in complementary services, such as education content development through EEP’s majority owned Selah El Telmeez, and provides premier transportation services to students through Option Travel.
Parallel to this, the EEP is committed to providing high-quality education and has maintained accreditation by leading global and regional bodies. The platform also supports student athletes by being affiliated with organizations that help them achieve their educational and sporting goals and awards scholarships to students who excel academically. Additionally, the EEP is a member of the Global Schools Program, an initiative of the UN Sustainable Development Solutions Network (SDSN), promoting Education for Sustainable Development (ESD) within schools and classrooms.
valU, the MENA’s leading lifestyle-enabling fintech platform, was established in 2017 as a constituent element of EFG Hermes Holding’s wider strategy to promote nationwide financial inclusion and bolster the regional fintech ecosystem through its innovative digital financing solutions. valU aims to alleviate financial burdens and empower the lives of Egyptians by offering convenient and inclusive financing plans with 6-to-60 month tenors and granting customers access to its expansive network of merchants across the retail, service, and e-commerce sectors.
Established as a joint venture between PayTabs and EFG Hermes, PayTabs Egypt is a leading digital payment solutions provider that offers innovative fintech solutions that cater to various consumer segments in Egypt. Through the company’s innovative offering, PayTabs Egypt is able to extend a range of online payment processing solutions to merchants across the nation through its state-of-the- art hybrid digital payment platform, ultimately supporting Egypt’s overarching digital transformation and its drive toward strengthening financial inclusion and contributing to the move toward a cashless society.
A flagship subsidiary of EFG Hermes Holding’s NBFI platform, EFG Hermes Corp-Solutions’ primary offering focuses on providing businesses with leasing and factoring services. EFG Hermes Corp-Solutions aims to provide businesses — especially those with clearly outlined social impact mandates — across various sectors that play a key role in supporting long-term economic stability, including healthcare and education, with tailored financing solutions that best address their needs and support their continued growth and development.
aiBANK was acquired by EFG Hermes Holding and TSFE in 2021, and it has successfully positioned the Group as a universal bank operating in FEM. aiBANK provides financing solutions to a variety of customer segments and has a clear focus on providing credit facilities to support SMEs in Egypt. In 2022, aiBANK launched a campaign titled “Financing That Moves You 100 Strides Forward”, which aims to deliver on its financial inclusion strategy by providing SMEs with financing facilities of up to EGP 10 million with the aim of supporting job creation and driving economic growth.
One of the key components of our sustainable investment strategy is promoting responsible investment practices by providing a platform where ESG-conscious individuals can invest in companies that prioritize sustainable and responsible business operations.
EFG Hermes One is a state-of-the-art trading platform that was rolled out by the Group in 2021 in two of our key markets, Egypt and Kenya. It provides users with seamless access to multiple MENA markets and global exchanges, allowing users to trade multiple asset classes across some of the world’s most compelling markets. The app also features real-time market intelligence insights offered by EFG Hermes Research and incorporates a full suite of research products that leverage the global-award-winning insights of an international team. As part of EFG Hermes Holding’s commitment to sustainability, EFG Hermes One promotes several exchange-traded funds (ETFs) with themes that support impact investment. This allows socially mindful investors to be certain that their money is invested in companies that are committed to tackling key ESG issues.
The Women in Leadership ETF is comprised of companies from North America, Europe, and Asia Pacific (developed markets) with a market cap larger than USD 5 billion. The companies present in the ETF all have a larger percentage of women in executive leadership positions relative to other companies within their respective regions.
The General ESG ETF is comprised of 20 companies with market caps larger than USD 10 billion andhave low ESG risk ratings.
Companies included in the Renewable Energy ETF are those who generate the majority of their revenues from operations revolving around the production of renewable energy sources, including solar power, wind, hydropower, biomass, and geothermal energy.
Companies included in the Green Transformation ETF are those that operate in green industries, such as electric vehicles and EV charging, carbon-neutral packaging, recycling, sustainable farming, green food, and carbon capture technologies.
We are firm believers that investing in our people and society is key to ensuring the sustainable development of our economy and the environment. Not only do we support the growth of our employees, but we also develop impactful projects that make a tangible difference for the people across the communities where we live and work.
Our employees have the ability to shape and contribute to our purpose, strategy, and performance and form the bedrock of EFG Hermes Holding’s success. As part of our ongoing efforts to promote the health and professional development of our people, our HR department is constantly developing initiatives and programs aimed at supporting the growth and development of our people.
We are fully committed to the development of our people and ensure that they have clearly outlined paths for growth. Since 2019, our DNA Open House has encouraged employees to take an active role in mapping out their development path and provided managers with a platform to support their people in exploring new opportunities within their respective departments and across the entirety of the Group.
EFG Hermes Holding has a history of promoting from within, and we are firm believers that everyone across our organization has significant potential for growth and to pursue managerial and executive positions in the Group. On this front, we introduced a new and improved succession planning strategy, which allows us to better identify and prepare internal candidates for senior level positions across the Group.
We believe that everyone deserves the right to access quality healthcare services to ensure their physical and mental wellbeing. At EFG Hermes Holding, we not only provide comprehensive healthcare insurance plans but also provide a discretionary healthcare fund that can be accessed by our employees who require critical medical services that are not covered.
We designed a program to provide EFG Hermes Holding’s non-officer employees with the knowledge that will empower and better position them to manage their personal finances in a manner that allows them to save and avoid incurring debt. Although EFG Hermes Holding employs a loan policy for the people that need it most across the Group, we believe that this program provides a more long- term and sustainable solution with regards to personal finance management.
Over the years, the project has had a number of achievements in the development of Naga’ El Fawal, including the renovation of a health unit in the village, the establishment of a water treatment plant, and the rebuilding of 94 houses with the long-term aim of eliminating rural co-living. Additionally, the project has also seen the development of a fully equipped community center, including a Montessori preschool, a center catering to children with disabilities, and a training facility, all of which are powered by solar energy.
The Clean Energy for Schools Project The EFG Hermes Foundation for Social Development signed a partnership agreement with the Ministry of Education and Technical Education, represented by the General Authority for Educational Buildings, to transition over 100 schools in Luxor and Aswan to clean solar energy
Hayah Karima The Foundation signed an MoU with the Ministry of Social Solidarity to participate in the Hayah Karima initiative and build on the extensive progress made by the Naga’ El Fawal and El Deir Village Integrated Development Project. The MoU will see the Foundation rehabilitate 120 housing units in El Deir village and build a sewer line connecting housing units to the pumping station and wastewater treatment plants previously developed by the Foundation and is anticipated to benefit over 15,000 residents in the area.
Education and Training In 2022, the Young Scholars Academy saw 14 children graduate, including two graduates with special needs. Additionally, Montessori training, as well as training for special needs, was provided to 26 women from Luxor with the aim of growing their skill sets and empowering them to pursue better employment prospects.
In line with our commitment to funding vital healthcare initiatives in Egypt, the EFG Hermes Foundation for So- cial Development partnered with aiBANK and the Magdi Yacoub Foundation to sponsor heart surgeries at the Aswan Heart Centre.
EFG Hermes Holding’s robust governance framework plays an essential role in managing key risks and ensures that we remain aligned with our commitment to sustainable business operations.
Effective governance is a critical component of building sustainable business practices that deliver on our ESG agendas, and EFG Hermes Holding is committed to fostering the integration of ESG policies across the Group to ensure the long-term sustainability of its operations. In this endeavor, and as a member of the UNGC and signatory of the UN PRI, EFG Hermes Holding prioritized developing the frameworks that allow us to best manage our risks and deliver on our ambitious growth strategies while maintaining our commitment to the sustainability of the environments we operate in and ensuring that our business practices are guided by the ESG principles.
At EFG Hermes Holding, our Compliance, Risk, and HR departments consistently monitor our operations to ensure our compliance with all regulatory requirements, including those relating to ESG. On this front, EFG Hermes Holding is compliant with the regulations outlined by Egypt’s FRA, as well as the FRA’s regulations regarding ESG disclosures, which requires responding to 51 indicators and questions across two types of disclosures; ESG indicators, and the recommendations of the TCFD.
For a more comprehensive review of the Group’s corporate governance frameworks and compliance with ESG-related requirements, please refer to the “Corporate Governance” section outlined in this annual report.
