HDFC brings glory to public sector at the ACCA awards

HDFC Bank won the prestigious award for sustainability reporting at the seventh annual presentation of the ACCA Sri Lanka award for sustainability reporting for the year 2010. The award ceremony was held on Thursday the 24 February 2011 at the Cinnamon Grand Hotel in Colombo.

In a statement through the special supplementary messages issued in this regard, the Association of Charted Certified Accountants (ACCA) states that ACCA rewards Sri Lankan Companies who reports and disclose environmental, social or full sustainability information accountably and transparently. The awards held in over 30 countries, is based upon judging guidelines established by ACCA worldwide. The awards are open to any type of organisation encompassing all business sizes.

With this prestigious award, HDFC is  benched marked against global best practices and criteria aligned to Global Reporting Initiatives (GRI) guidelines and also joins the ranks of companies around the world who all work on a common mission of increasing accountability of responsiveness to stakeholders.

Being a housing finance institution, the achievement by HDFC at the ACCA award ceremony marks a greater leap forward by a government institution dedicated to empower citizens towards socio-economic development of Sri Lanka.  HDFC had earlier presented its Sustainability Report for the year 2009 on the theme of 'Making a difference to the lives of the people and the development of the country.'

The sustainability report by HDFC had also recorded as comprehensively as possible the initiatives employed by HDFC towards sustainability issues for the period 1 January to 31 December 2009.  This is the third attempt at a sustainability report by HDFC and each year the institution has striven to improve upon their imperatives and be more inclusive in the approach to their stakeholders.

The initiation of the Corporate Plan for HDFC emphasises its commitment to implementing transparency, accountability and governance tenets into the daily operations while ensuring that the institution creates an enabling environment to meet its vision. The Corporate Plan quantitatively and qualitatively charts a course for the Bank.

HDFC is a Licensed Specialised Bank and a Listed Company above Rs.5 Billion market capitalisation and 25 per cent market share in the lower and middle income groups, while holding substantial percentage in the entire housing finance market.

HDFC’s primary objective has always been to serve lower and middle income groups to meet their needs of housing finance and allied services.  With the majority of the population in Sri Lanka coming under these income categories, there’s a palpable lack of supply to meet the demand for housing. According to Sri Lanka Development Policy Review 2002 by World Bank,  55 per cent of the rural population and eight per cent of the urban population live below the poverty line and on average, 15 per cent of the total population survive below the universal poverty line, with an income that’s totally insufficient to meet the cost of housing. The majority of the population coming under this category has to contend with restricted access to credit facilities offered by commercial banks or financial institutions due to inadequate collateral and proof of income.  

To fulfill the gap, more than 75 per cent of the approved loans are granted by HDFC to low and middle income groups, while about 44 percent of the loans approved is for less than Rs.200,000.  Loans between Rs.200,000 and Rs.500,000 are accounted at 32 per cent.  The emphasis on this distribution of the loan portfolio reflects our broadened view of social responsibility toward servicing the needy groups of the country.

Commenting on the achievement of the HDFC at the ACCA awards, D.V.Pathirana the Assistant General Manager (Business development and Marketing) of HDFC bank said that housing, being a basic need for everyone, needs a large amount of capital and natural resources including electricity and water which are unavoidable in anyway.

“When we acquire these resources from the environment continuously to set -up human settlements, it causes huge damage to the environment. Therefore, our objective and our sustainability approach in this co-business of housing finance are to minimise this negative impact on environment and house-hold economy. Simultaneously, to address these issues, we also educate our customers on sustainable housing and resource efficiency that make them aware of the importance of going for an affordable house that does not interrupt with the customer's cash flow,” he said.

He added that the wrong implementation of house designing and construction would directly result in the livelihood of the residents.

“That is why we strongly encourage our customers to comply with local development and construction regulations. When we plan a house properly, we unanimously contribute towards an environment friendly township as well. Through proper designing and planning therefore, we cater to maintain bio diversity, the eco system, climate and the physical environment in their proper orders. When a family gets a proper house, it largely contributes to seize domestic crime and promotes better living standards in the areas of health, education, better neighbourhoods and other social requirements. Our concerns in this regard also includes minimising exploitation of natural resources, to reduce emissions induced and improve productivity and efficiency through which we would be able to contribute to our national economy and its well being.

The process will also minimise our impact on environment. Through the latest developments and introductions of e-banking procedures, we have taken due measures to reduce paper work.  Through sustainable reporting, we communicate what we are doing in these capacities. Finally, when we take these economic, environment and social components together in the triple bottom line management, the proper implementation of the process enhances productivity, efficiency as well as the shareholder's value, and that is what we are geared for,” Pathirana added.

Prof. Mohan Munasinghe - Co-Winner, 2007 Nobel prize for Peace, also the Vice Chair, IPCC - AR4 attended as the Chief Guest of the event while Mark Gold - the President of the Association of Charted Certified Accountants attended as the Guest of Honour. Siromi Wickramasinghe - the Chairperson of HDFC, Suresh Amarasekara - CEO / GM of HDFC, the staff of its Senior Management and a large number of professional bankers and officials of financial institutions were also present at the occasion.