ESG and the future of banking: Şekerbank
Zeynep Orak Erdemoglu is Sustainable Banking Lead at Şekerbank. In this interview, she discusses how the Turkish bank’s long-standing commitment to inclusive sustainability is evolving—covering its strategic ESG focus areas, transition finance approach, use of emerging technologies, and how it measures real impact beyond compliance.
Zeynep Orak Erdemoglu is Sustainable Banking Lead at Şekerbank. In this interview, she discusses how the Turkish bank’s long-standing commitment to inclusive sustainability is evolving—covering its strategic ESG focus areas, transition finance approach, use of emerging technologies, and how it measures real impact beyond compliance.
Can you provide an overview of your institution and share the key ways ESG is integrated into your long-term strategy?
Founded in 1953 in Eskişehir as a cooperative bank with a mission to support sustainable development, Şekerbank is a pioneering financial institution that continues to align its founding purpose with today’s global sustainability agenda. We view sustainability not merely as a corporate goal, but as an integral and enduring component of our business model. As a pioneer in the field of social and environmental banking in Türkiye, we establish a comprehensive value chain—from mobilizing financial resources to delivering them through sustainable products and services to a broad ecosystem that includes farmers, small businesses, and SMEs. At the heart of our long-term strategy, we regard ESG principles not only as a compliance framework but also as a value-generating and development-driven approach. We develop practices that create tangible impact in areas such as rural development, climate change mitigation, sustainable agriculture, and inclusive economic growth—thereby contributing directly to the real economy.
Our corporate governance and risk management frameworks have been restructured in full alignment with ESG principles. Climate risk management, the preservation of natural capital, and social inclusion are among our strategic priorities. In this context, we continuously enhance our Environmental and Social Management System (ESMS) in compliance with national regulations and international standards. Our ESG strategy and sustainability-related matters are addressed through the Sustainable Banking Committee with the active participation of senior management. Reporting to this committee, the Climate Risk Committee works on risks related to both the bank’s operations and those faced by our clients, while the Diversity and Inclusion Working Group and the Sustainable Supply Chain Working Group focus on key social issues in coordination with relevant departments.
Through global sustainability initiatives, we follow international developments closely and ensure alignment with standards, committing to progress that is in line with global sustainability goals. We also strengthen our internal capacity through technical assistance programs and multi-stakeholder platforms.
We communicate our holistic approach with transparency in our annual reports and sustainability publications in alignment with international reporting standards. Our core objective is to generate long-term, sustainable, and positive impact—not only for our shareholders, but also for the communities we serve and the ecosystems in which we operate.
How do you balance ESG goals with financial performance while ensuring your initiatives drive real impact beyond just meeting compliance?
At Şekerbank, sustainability is not merely a compliance requirement, but a fundamental strategy and a way of doing business aimed at long-term value creation. We take a holistic approach to integrating ESG strategy, social inclusion, and climate action into every phase of our operations, ensuring a strong balance between financial performance and sustainable development objectives.
Thanks to our strong legacy, our widespread branch network in rural areas, field teams with local banking expertise, and our cooperative roots, we continue to fulfill our mission of being Türkiye’s social and environmental bank.
In this context, we have identified four strategic focus areas that contribute to sustainable development:
• Sustainable agriculture
• Financial inclusion and women's banking
• Supporting SMEs and employment
• Energy efficiency and combating climate change
These focus areas form the foundation of our sustainable finance approach and are embedded at the core of our business model. Balancing ESG goals with financial sustainability is only possible by embedding these priorities into our daily operations—not just in strategic documents.
One tangible example of this approach is EKOkredi, launched in 2009 as Türkiye’s first banking product dedicated to financing energy efficiency investments. Through EKOkredi, we accelerate the transition to a low-carbon economy across all customer segments—from individuals to SMEs. Our financing in areas such as renewable energy, waste management, circular economy, clean transportation, and digital transformation enhances both environmental impact and our clients’ repayment capacities. In doing so, we simultaneously reduce carbon emissions and credit risk, delivering environmental benefits alongside financial returns.
With our products and services aimed at improving financial inclusion, we strive to enhance the economic strength of all segments of society—including disadvantaged groups—while supporting their active participation in the economy. Beyond financial impact, we continue to support our clients with non-financial solutions such as financial literacy training and capacity-building programs.
To ensure that we generate real and measurable impact, we have implemented strong monitoring and evaluation systems and integrated ESG criteria into our risk assessment processes. Through ESG evaluation questions embedded in our core banking systems, we assess our clients’ sustainability maturity. The resulting environmental and social risk assessments are also incorporated into our decision-making processes. At Şekerbank, ESG is not treated as a separate concept but as an essential component of our strategy, business model, and sustainable growth. By aligning our financial products and services with environmental and social priorities, we ensure that sustainability is not only ethical but also economically viable.
How is your bank evolving in terms of using ESG data to guide decision-making, particularly in areas like lending, risk management, and investments?
Şekerbank is undergoing a comprehensive and strategic transformation aimed at placing ESG data at the core of its decision-making processes. This transformation not only supports sustainability but also enhances the bank’s risk resilience and resource efficiency. We are taking concrete steps to integrate ESG criteria into key operational areas such as credit allocation, portfolio management, and risk analysis. By revisiting our risk management framework through an ESG lens, we are working closely with our risk management team to assess our loan portfolio in detail with regard to both physical climate risks and transition risks. The resulting climate risk heat maps provide visibility into sectoral and regional exposures, enabling us to reduce concentration in high-risk sectors and shape our portfolio diversification in a risk-informed manner.
To create real and measurable impact, we apply robust monitoring and evaluation systems and embed ESG criteria into our risk assessment processes. Using ESG evaluation questions integrated into our banking systems, we assess our clients’ sustainability maturity. The risks identified through the Environmental and Social Management System assessments are also incorporated into our credit decisions.
We position ESG data not only as a monitoring and reporting tool but also as a strategic decision-support mechanism. This approach strengthens our bank’s long-term resilience, enables proactive risk management, and reinforces our mission to finance sustainable development.
In an era of heightened scrutiny, how do you ensure your bank’s ESG initiatives are creating tangible, lasting impact rather than merely fulfilling compliance requirements?
At Şekerbank, our foremost priority is to ensure that our sustainability initiatives go beyond mere compliance and deliver genuine, lasting impact on the ground. For us, measuring impact is not limited to metrics; it also involves observing meaningful changes in the communities we serve.
To this end, we place great emphasis on field-level monitoring of the practices implemented by our clients who receive sustainable financing. From the outset of implementation, we closely track progress in key focus areas such as sustainable agriculture, energy efficiency, and women entrepreneurship. Through feedback mechanisms established with our clients, we regularly analyze outcomes and evaluate performance based on predefined KPIs. Through our Sustainable Finance Framework, which has been developed in line with international standards, we classify green and social loans based on defined eligibility criteria. We ensure transparency and accountability by sharing both financial and environmental-social impact indicators with the public through our annual reports and sustainability disclosures.
In doing so, we not only meet the expectations of regulators, but also gain the trust of investors, stakeholders, and society at large through a performance that is both measurable and authentic. In summary, we view “impact” not as a goal on paper, but as a transformation lived in the field, and we adopt this approach across all our sustainability practices.
How are emerging technologies like AI and fintech impacting the ESG role as such—particularly in areas like data management, portfolio decarbonization, customer evaluation, and reporting?
Artificial intelligence (AI) and financial technologies (fintech) have emerged as powerful tools that are transforming ESG both in terms of strategic decision-making and operational execution. These technologies are ushering in a new era of sustainability management by enabling the rapid, accurate, and scalable collection, analysis, interpretation, and reporting of ESG data. AI enhances risk prediction and opportunity identification by analyzing large and complex ESG datasets in real time. Fintech solutions facilitate emissions reduction, support the design of sustainability-driven investment strategies, and simplify the development of ESG-aligned financial products. Through digital platforms, environmental and social impacts of both individual and institutional clients can be assessed more effectively—making ESG an integral part of customer relationship management.
At Şekerbank, we are committed to being among the pioneers of this transformation by embedding technology into our ESG processes. In 2024, we launched CarbonMAP, a digital platform designed to help our SME clients measure their carbon footprints, increase their environmental awareness through sectoral comparisons, and guide them on their low-carbon transformation journeys.
Leveraging AI-powered analytical tools, we have strengthened our data-driven decision-making by integrating ESG criteria into our risk segmentation processes.
Moreover, we have digitized our ESG reporting processes through automation systems, ensuring more transparent, timely, and auditable data flows. This not only facilitates compliance with regulatory requirements but also helps us build trust-based relationships with international stakeholders. New technologies are not only making ESG management more efficient but are also significantly enhancing the effectiveness, inclusiveness, and measurability of our sustainability strategy.
How is your institution approaching transition finance—particularly when supporting carbon-intensive sectors on their path to decarbonization? What frameworks or tools guide your decision-making in these cases?
At Şekerbank, we approach transition finance not only as a component of environmental sustainability but also as a strategic tool that promotes inclusive development. In this regard, we prioritize support not only for environmentally friendly projects but also for those with strong transformation potential that aim to become greener, particularly within carbon-intensive sectors.
Rather than excluding such sectors, our bank adopts an inclusive sustainability approach by financing actors that have concrete and measurable transition goals. We offer tailored financial solutions based on the decarbonization roadmaps of clients operating in high-emission sectors such as energy-intensive industries, agriculture, construction, and transportation. We follow a holistic approach based on internationally recognized taxonomies and frameworks when shaping our transition finance strategy. We rely on guidance from the EU Taxonomy, Climate Bonds Initiative (CBI) criteria, and International Finance Corporation (IFC) Performance Standards to technically classify transition projects and make financing decisions accordingly. Key parameters in these evaluations include the project’s potential to reduce emissions, the traceability of environmental impacts, the feasibility of implementation, and the alignment with the company’s overall transition strategy.
To monitor the impact of our transition-related financial products and services, we are developing dedicated impact measurement and monitoring mechanisms. We regularly assess both the environmental and economic performance of the financed projects and disclose this information transparently through our sustainability reporting.
Furthermore, we provide technical assistance and advisory services to clients in transition-intensive sectors, supporting them throughout their green transformation journey. In doing so, we position ourselves not only as a financial provider but also as a solution-oriented stakeholder that facilitates transition. With this inclusive and facilitative strategy, Şekerbank aims to offer sustainable solutions that align with climate goals while enabling meaningful transformation in the real economy—accelerating the decarbonization of high-emission sectors and contributing to overall economic resilience and environmental sustainability.
Looking ahead to 2030, what major trends or regulatory shifts do you anticipate will influence ESG practices in banking, and how is your institution preparing for them?
As we approach 2030, we anticipate that key trends shaping ESG practices in banking will include green taxonomies, climate-related financial disclosures, decarbonization strategies, and the integration of nature-related risks into financial systems. The global regulatory landscape is moving swiftly toward standardization especially in the identification and management of physical and transition risks, while frameworks such as IFRS S2 are expected to mandate greater transparency in the disclosure of climate-related risks and opportunities.
At Şekerbank, we are continuously updating our sustainability strategy in preparation for this transition. Our focus areas include climate risk management, nature-positive practices, and the development of transparent ESG data infrastructures. We are conducting taxonomy-alignment assessments of our loan portfolio and systematically evaluating the environmental impact of our products and services. Moreover, we believe that banks must play a facilitative role—not merely that of a financial intermediary in enabling the green transition. To this end, we are focused on providing technical assistance and capacity-building tools that help our clients, particularly SMEs, navigate the transition to a low-carbon economy.
We foresee that ESG will continue to evolve within a framework of more stringent regulations, digitalization, and impact-oriented approaches. At Şekerbank, we are preparing to meet these changes proactively by enhancing our capabilities and aligning our operations with emerging expectations.
ESG community
With Qorus memberships, you gain access to exclusive innovation best practices and tailored matchmaking opportunities with executives who share your challenges.