Climate Change

Strategy - Operational Emissions

We have a robust roadmap to reduce our Scope 1 and 2 emissions to net zero by 2030. Our all-encompassing approach has resulted in a four-pronged strategy designed to address current and long-term operational GHG emissions in an effective, responsible, and resilient manner. Our future capex will align with the following levers:

Lever 1: Business Premises Optimisation

Our approach to optimising business premises is rooted in enhancing operational efficiency and aligning physical presence with strategic priorities. While we continue to expand our branch network in high-traffic and growth markets across ASEAN, we are also consolidating and upgrading existing locations to better serve customer needs.

To support evolving ways of working, we are enhancing office environments to promote collaboration, productivity, and employee engagement. This includes optimising layouts and investing in workplace technologies that enable more efficient use of space.

Lever 2: Avoiding and Reducing Energy Consumption

To enhance energy efficiency across our operations, we have conducted pilot projects at selected branches and at CIMB headquarters in Malaysia to better understand energy consumption patterns and identify opportunities for optimisation.

Key measures include the optimisation of chiller operations in our buildings, the installation of LED lighting in office spaces, and the use of enhanced sensors to manage lighting and air conditioning based on occupancy. These initiatives are part of our ongoing efforts to adopt best practices and upgrade mechanical and electrical systems for improved energy performance.

Lever 3: Green Electricity

We are actively transitioning to cleaner energy sources to reduce the carbon footprint of our operations. This includes the installation of solar photovoltaic (PV) systems at selected CIMB buildings, with ongoing solar projects being implemented at additional branches.

In parallel, we are sourcing green electricity through Renewable Energy Certificates (RECs), enabling us to support the growth of renewable energy in the markets where we operate. We are also exploring long-term renewable energy procurement options, including virtual Power Purchase Agreements (VPPAs), to ensure a stable and scalable supply of clean energy across our regional operations.

Lever 4: Carbon Offsets

Our priority is to maximise GHG reductions through Levers 1 to 3. However, some emissions remain unavoidable. To address this, we are closely monitoring developments in voluntary carbon markets and will consider purchasing carbon offsets to achieve net zero Scope 1 and 2 emissions in our operations by 2030.

We aim to prioritise verified carbon offsets from local projects in the countries where we operate, ensuring alignment with our sustainability commitments and delivering positive regional impact. In line with this, we plan to utilise removal-based carbon credits generated from nature-based solutions to further support long-term climate resilience and ecosystem restoration.

Our high-level pathway to net zero 2030 is shown in the diagram below. However, this is a forward-looking projection and we anticipate changes in the future based on advancements in technology, policy changes by the government, or new energy schemes in the market.

Short-Term Initiatives (2022 - 2025)

In the near term, our focus is on implementing energy-saving initiatives that deliver quick and tangible results. These include transitioning to energy-efficient LED lighting, integrating motion sensors, and phasing out outdated single split-unit cooling systems. Additionally, a combination of lighting and cooling system upgrades, along with the installation of electric vehicle (EV) charging stations, is planned for select branches leading CIMB’s sustainability efforts.

Medium-Term Initiatives (2025 - 2027)

Medium-term initiatives involve higher capital investments but offer significant long-term energy savings. Key projects include deploying automated central monitoring systems, replacing chillers, and expanding renewable energy adoption. While we prioritise on-site renewable energy solutions, space constraints at our premises limit these opportunities. However, we have already begun installing solar systems at select headquarters and plan to roll out solar photovoltaic (PV) systems across key offices and branches in the region.

Additionally, we will progressively procure Renewable Energy Certificates (RECs) in each country where we operate. RECs are market-based instruments that certify the environmental benefits of renewable electricity generation. Each REC represents one megawatt-hour (MWh) of electricity generated and delivered to the grid from a renewable source. 

Long-Term Initiatives (Beyond 2028)

Looking ahead, CIMB is exploring the procurement of green electricity through market mechanisms such as Virtual Power Purchase Agreements (VPPAs). This approach enables us to indirectly source renewable energy from solar and other renewable providers via the national energy grid on a long-term basis.

To address residual Scope 1 GHG emissions, we anticipate purchasing high-quality carbon credits—tradable instruments that represent the right to offset a specified amount of carbon dioxide emissions. However, given the projected rise in carbon offset costs, we will prioritise all feasible emissions reduction measures before considering offsets as a last resort.

Internal Carbon Price

To encourage our countries and divisions to reduce emissions and integrate the cost of carbon into decision-making, CIMB introduced an Internal Carbon Pricing (ICP) framework in 2021.

This economic incentive charges a penalty for Scope 1 and 2 emissions exceeding divisional caps, fostering accountability across CIMB.

The ICP framework is designed to:

• Help CIMB prepare for GHG regulations, including carbon taxes.
• Embed carbon costs into investment decisions to encourage low-carbon alternatives.
• Improve energy efficiency and reduce reliance on carbon-intensive processes and equipment.
• Fund low-carbon investments and sustainable solutions.
• Assess projects for carbon risks and future regulatory changes.
• Drive internal change by pricing excess emissions to incentivise reductions.

In 2024, CIMB set the ICP at a minimum of RM70 per tonne of CO₂e, benchmarked against our Marginal Abatement Cost (MAC) Curve, as well as regional prices for Renewable Energy Certificates (RECs), carbon credits, and carbon taxes. By 2030, the ICP is expected to rise to RM275–RM355 per tonne, reflecting the anticipated tightening of climate policies and the increasing cost of carbon in global markets.

Funds collected through the ICP are reinvested into decarbonisation initiatives, including:

• Energy-efficient infrastructure and upgrades to reduce electricity and fuel consumption.
• Renewable energy adoption, including the purchase of RECs to support clean energy procurement.
• High-quality carbon offsets to compensate for unavoidable emissions.

Our Approach to Waste Management

Beyond managing our carbon footprint, CIMB is committed to minimising environmental impacts through responsible waste management. Effective waste reduction, segregation, and responsible disposal are key components of our broader sustainability strategy, aligning with our commitments to resource efficiency and circular economy principles.

While the nature of our operations as a financial institution generates relatively low levels of physical waste, we acknowledge the need to minimise waste generation and mitigate any potential negative impacts on the environment.

Our significant waste-related impacts include:

• Office Waste Generation: Paper consumption, electronic waste, and general office waste
• E-Waste Management: Proper disposal and recycling of outdated electronic equipment
• Vendor and Supplier Collaboration: Working with partners who adhere to sustainable waste management practices
• Recycling and Reuse Initiatives: Implementation of recycling programmes and reduction of single-use materials
   

We actively consider waste management strategies that align with the principles of circular economy and resource efficiency. Our approach is designed to prevent waste generation, enhance recycling efforts, and responsibly manage disposal processes.

Our waste management approach covers:

• Waste Prevention and Reduction
  • Transition to digital documentation to minimise paper use
  • Implement energy-efficient systems to reduce electronic waste
     
• Recycling and Reuse
  • Establish recycling bins in high-traffic office premises
  • Partner with certified e-waste recyclers for safe disposal of electronic devices
     
• Responsible Disposal and Compliance
  • Ensure compliance with local regulations and international standards for hazardous and non-hazardous waste
  • Track and report waste generation data for continuous improvement
     
• Employee Engagement and Awareness
  • Conduct regular training sessions on waste reduction practices
  • Encourage sustainable habits among staff through green initiatives and incentives
     
• Collaboration with Stakeholders
  • Engage with suppliers and service providers to promote responsible waste management practices
  • Support recycling and waste reduction programmes

Our GHG Accounting Approach

CIMB is committed to transparently calculating and reporting our greenhouse gas (GHG) emissions, adhering to internationally recognised standards and progressively aligning with IFRS S2 Climate-related Disclosures. Our approach ensures accuracy, completeness, and consistency in reporting as we work towards a low-carbon future.

GHG Accounting Standards and Methodologies

We calculate and report our GHG emissions in accordance with the Greenhouse Gas Protocol, a widely recognised international standard. Our approach follows the operational control method, meaning we account for 100% of emissions from operations over which we have control.

Our GHG emissions are categorised into three scopes as defined by the Greenhouse Gas Protocol and progressively aligned with IFRS S2 requirements:

• Scope 1: Direct emissions from sources that we control, including on-site fuel combustion for electricity generation, fuel use in company vehicles and mobile generators, and fugitive emissions from refrigerants used in air-conditioning systems.

• Scope 2: Indirect emissions from purchased electricity, heat, or steam. We report both location-based and market-based emissions:
  • The location-based method reflects the average emissions intensity of the power grid supplying our electricity.
  • The market-based method accounts for the specific energy sources we purchase, such as renewable electricity through green energy programmes.
     

• Scope 3: Other indirect emissions from our value chain. Our operational Scope 3 reporting includes the following seven categories:
  
  
  • Category 1 – Purchased Goods and Services: Emissions associated with goods and services procured by CIMB to support our business operations, including office supplies, IT equipment, and professional services.
  • Category 5 – Waste Generated in Operations: Emissions from waste disposal and treatment, including paper waste, electronic waste, and other operational waste streams.
  • Category 6 – Business Travel: Emissions from business travel, including flights, accommodation, and other transport-related activities.
  • Category 7 – Employee Commuting: Emissions from employees travelling to and from work, including personal vehicles and public transportation.
  • Category 8 – Upstream Leased Assets: Emissions from leased office spaces and buildings where CIMB operates but does not own the assets.
  • Category 9 – Downstream Transportation and Distribution: Emissions related to the transportation and distribution of products and services downstream in our value chain.
  • Category 13 – Downstream Leased Assets: Emissions from properties and other assets leased out to tenants or customers.
    
  • Category 15 – Investments (Financed Emissions), which covers emissions from CIMB’s financing activities, please refer to the Financed Emissions section on our website.

For information on the Scope 3 categories that we have not disclosed and reasons for exclusion, please refer to our GHG accounting approach. 

Data Collection, Emission Factors, and IFRS S2 Alignment

We collect energy, fuel, and refrigerant consumption data from electricity bills, fuel invoices, and facility management records. Recognised standard emission factors are used to convert energy consumption into CO₂ equivalent emissions, sourced from reputable organisations such as the Intergovernmental Panel on Climate Change (IPCC) or relevant national authorities.

To enhance data accuracy, we employ a combination of top-down and bottom-up approaches based on data availability and reliability. As part of our alignment with IFRS S2, we are improving our climate-related disclosures by:

• Enhancing granularity and transparency in emissions data reporting.
• Disclosing climate-related financial risks and opportunities.
• Strengthening governance and internal controls over GHG accounting and reporting.

Transparency, Continuous Improvement, and Restatement Policy

CIMB is committed to transparency in our GHG emissions reporting and continuously enhances our methodology to align with best practices and evolving industry standards.

• We periodically review and update our approach to improve data accuracy and completeness.
• Given inherent limitations in data collection, our GHG emissions calculations may include some level of uncertainty.
• We have established a materiality threshold of 5% for our GHG emissions inventory. If any emission source exceeding this threshold is identified but was not previously accounted for, we will restate our GHG emissions for the affected period.

For more information on our GHG accounting approach, please refer to our GHG Calculation Methodology - Public Methodology Document. 

Current and Anticipated Effects of Climate-Related Risks and Opportunities

In line with IFRS S2, CIMB is assessing the current and future impacts of climate-related risks and opportunities across all three GHG scopes:

The table below indicates current and anticipated effects of climate-related risks and opportunities to our business model and value chain based on our operational Scope 3 emissions by categories.