Introduction
Credit Direct Finance Company Limited (herein refer to as “Credit Direct”, “the Company”, “we”, “us”, “our”) is the Fintech arm of the FCMB Group Plc and duly licensed by the Central Bank of Nigeria since April 2013 to operate as a finance company providing non-bank financial services. The company is one of the leading consumer lending institutions in Nigeria. Our VisionTo be the number one non-bank lending company in Nigeria.
Our Mission
Creating financial solutions that enable peace of mind.
Our DNA
Energy, Excellence, Entrepreneurship, Empathy, Evolution.
1. Background
Credit Direct understands the importance of an Environmental, Social, and Governance framework (“the Framework”, “ESG Framework”) to ensure that it operates responsibly, contributes positively to society, and mitigates risks related to environmental and social issues, ultimately leading to sustainable business success.
We have developed Credit Direct’s ESG framework (“Framework”) to establish our structured approach to integrate sustainability, ethical practices, and corporate responsibility into the company's operations. A focus on ESG issues supports our corporate strategy, ensures adherence to corporate values, demonstrates responsibility in decision-making, and facilitates interactions with internal and external stakeholders.
This Framework provides a revolutionary approach that integrates ESG factors into our lending decisions to ensure a comprehensive risk assessment.This Framework shall apply to all levels of the Company, including board members, management, employees, partners, and customers.
Credit Direct Finance Company Limited (herein refer to as “Credit Direct”, “the Company”, “we”, “us”, “our”) is the Fintech arm of the FCMB Group Plc and duly licensed by the Central Bank of Nigeria since April 2013 to operate as a finance company providing non-bank financial services. The company is one of the leading consumer lending institutions in Nigeria. Our VisionTo be the number one non-bank lending company in Nigeria.
Our Mission
Creating financial solutions that enable peace of mind.
Our DNA
Energy, Excellence, Entrepreneurship, Empathy, Evolution.
1. Background
Credit Direct understands the importance of an Environmental, Social, and Governance framework (“the Framework”, “ESG Framework”) to ensure that it operates responsibly, contributes positively to society, and mitigates risks related to environmental and social issues, ultimately leading to sustainable business success.
We have developed Credit Direct’s ESG framework (“Framework”) to establish our structured approach to integrate sustainability, ethical practices, and corporate responsibility into the company's operations. A focus on ESG issues supports our corporate strategy, ensures adherence to corporate values, demonstrates responsibility in decision-making, and facilitates interactions with internal and external stakeholders.
This Framework provides a revolutionary approach that integrates ESG factors into our lending decisions to ensure a comprehensive risk assessment.This Framework shall apply to all levels of the Company, including board members, management, employees, partners, and customers.
2. Objectives
The aim of this framework is to integrate Environmental, Social, and Governance (ESG) considerations into Credit Direct’s operations, lending practices, and corporate culture, ensuring sustainable growth, ethical business practices, and positive social impact.
This Framework serves as a guiding document for integrating environmental, social, and governance considerations into the operations of Credit Direct, ensuring that the Company contributes positively to the country’s sustainable development while maintaining strong ethical and governance standards.
The aim of this framework is to integrate Environmental, Social, and Governance (ESG) considerations into Credit Direct’s operations, lending practices, and corporate culture, ensuring sustainable growth, ethical business practices, and positive social impact.
This Framework serves as a guiding document for integrating environmental, social, and governance considerations into the operations of Credit Direct, ensuring that the Company contributes positively to the country’s sustainable development while maintaining strong ethical and governance standards.
3. ESG Principles and Philosophy
Credit Direct is committed to incorporating ESG into how we manage our business. The Company is committed to assessing the environmental, social, and governance factors that impact our business, managing the risks associated with such factors, and striving to improve the way the Company operates its business in accordance with these factors. This includes identifying opportunities to reduce the Company’s environmental footprint, enhancing the diversity of the organization, deepening our employees’ engagement and development, and increasing transparency in our service chain, having a positive impact on the communities in which the Company operates, and operating with a strong culture of compliance. However, the Company recognizes that there is not a one-size-fits-all approach to ESG integration; rather, the Company strives to employ best practices and evaluate ESG factors in our decision-making. The following topics are considered ESG areas of focus for the Company. ESG is continuously evolving, therefore the list below is subject to change.
3.1 Environmental
➢ Energy Management
➢ Climate change risk
➢ Ecological conservation
➢ Recycling and waste management
➢ Water management
3.2 Social
➢ Customer experience
➢ Access and affordability
➢ Responsible selling practices
➢ Customer Privacy
➢ Community engagement
➢ Diversity, equity and inclusion
➢ Training and development
➢ Health and safety
3.3 Governance
➢ Governance of ESG
➢ Board composition, accountability, and executive compensation
➢ Business ethics
➢ Compliance
➢ Government relations and partnerships
➢ Risk management
➢ Business continuity
➢ Cyber security
➢ Third-party risk management
➢ Incorporation of ESG in risk analysis
Credit Direct is committed to incorporating ESG into how we manage our business. The Company is committed to assessing the environmental, social, and governance factors that impact our business, managing the risks associated with such factors, and striving to improve the way the Company operates its business in accordance with these factors. This includes identifying opportunities to reduce the Company’s environmental footprint, enhancing the diversity of the organization, deepening our employees’ engagement and development, and increasing transparency in our service chain, having a positive impact on the communities in which the Company operates, and operating with a strong culture of compliance. However, the Company recognizes that there is not a one-size-fits-all approach to ESG integration; rather, the Company strives to employ best practices and evaluate ESG factors in our decision-making. The following topics are considered ESG areas of focus for the Company. ESG is continuously evolving, therefore the list below is subject to change.
3.1 Environmental
➢ Energy Management
➢ Climate change risk
➢ Ecological conservation
➢ Recycling and waste management
➢ Water management
3.2 Social
➢ Customer experience
➢ Access and affordability
➢ Responsible selling practices
➢ Customer Privacy
➢ Community engagement
➢ Diversity, equity and inclusion
➢ Training and development
➢ Health and safety
3.3 Governance
➢ Governance of ESG
➢ Board composition, accountability, and executive compensation
➢ Business ethics
➢ Compliance
➢ Government relations and partnerships
➢ Risk management
➢ Business continuity
➢ Cyber security
➢ Third-party risk management
➢ Incorporation of ESG in risk analysis
4. Environmental Responsibilities
The environmental component of ESG refers to how the company’s business practices affect the environment and vice versa. The scope of environment includes energy use, consumption of resources, waste disposal, water management, and climate risk. Credit Direct policies and programs strive to achieve sustainable operations and minimize impact on the planet. The Company shall seek to minimize the environmental impact of its operations and promote sustainable practices among stakeholders by doing the following:
4.1 Sustainable Practice
➢ Environmental Risk Assessment: The Company shall integrate environmental impact assessments into the credit evaluation process to avoid financing projects that harm the environment.
➢ Sustainable Investments: The Company shall ensure that its investments align with environmental sustainability, prioritizing projects that contribute to Nigeria's environmental goals.
➢ Green Financing Products: Develop and offer products that finance environmentally sustainable projects, such as renewable energy, energy efficiency, and sustainable agriculture.
4.2 Internal Environmental Management
➢ Energy Efficiency: Implement energy-saving measures across all Credit Direct offices, including the use of energy-efficient lighting, equipment, and promoting remote work to reduce carbon emissions.
➢ Waste Management: Establish waste reduction and recycling programs, minimizing paper usage through digital documentation and ensuring responsible electronic waste disposal.
➢ Sustainable Procurement: Prioritize the procurement of environmentally friendly and sustainable products and services.
The environmental component of ESG refers to how the company’s business practices affect the environment and vice versa. The scope of environment includes energy use, consumption of resources, waste disposal, water management, and climate risk. Credit Direct policies and programs strive to achieve sustainable operations and minimize impact on the planet. The Company shall seek to minimize the environmental impact of its operations and promote sustainable practices among stakeholders by doing the following:
4.1 Sustainable Practice
➢ Environmental Risk Assessment: The Company shall integrate environmental impact assessments into the credit evaluation process to avoid financing projects that harm the environment.
➢ Sustainable Investments: The Company shall ensure that its investments align with environmental sustainability, prioritizing projects that contribute to Nigeria's environmental goals.
➢ Green Financing Products: Develop and offer products that finance environmentally sustainable projects, such as renewable energy, energy efficiency, and sustainable agriculture.
4.2 Internal Environmental Management
➢ Energy Efficiency: Implement energy-saving measures across all Credit Direct offices, including the use of energy-efficient lighting, equipment, and promoting remote work to reduce carbon emissions.
➢ Waste Management: Establish waste reduction and recycling programs, minimizing paper usage through digital documentation and ensuring responsible electronic waste disposal.
➢ Sustainable Procurement: Prioritize the procurement of environmentally friendly and sustainable products and services.
5.Social Responsibilities
The social component of ESG refers to how our organization’s operations affect our people, our customers, and the communities where we live and work. Our social policies and practices strive to build a healthy corporate culture and positive relationships with our stakeholder.
To contribute positively to society by promoting social equity, financial inclusion, and community development.
5.1 Financial Inclusion
➢ Inclusive Financial Products: Credit Direct offers financial products that cater to underserved populations, including low-income individuals, women, rural communities, and small businesses.
➢ Digital Lending Platforms: The Company shall adopt the use of technology to enhance financial access for remote and underserved areas in Nigeria.
5.2 Responsible Lending
➢ Transparent Loan Terms: The Company shall ensure that all loan products have transparent terms, fair interest rates, and clear repayment schedules to avoid predatory lending practices.
➢ Debt Management Support: As part of our financial literacy programs to customers, the Company shall educate the customers on how to manage their finances effectively and prevent over-indebtedness.
5.3 Diversity and Inclusion
➢ Diverse Workforce: The Company shall always promote diversity by ensuring representation across gender, ethnicity, and disability in hiring and promotions.
➢ Equal Opportunity Employment: The Company has set down policies that prevent discrimination and harassment in the workplace, fostering an inclusive and supportive work environment.
5.4 Customer Empowerment
➢ Customer Education: Provide educational resources and training for customers on financial management, helping them make informed decisions and improve their financial well-being.
➢ Customer Feedback Mechanism: Establish channels for customers to provide feedback on our services, ensuring continuous improvement and responsiveness to customer needs.
The social component of ESG refers to how our organization’s operations affect our people, our customers, and the communities where we live and work. Our social policies and practices strive to build a healthy corporate culture and positive relationships with our stakeholder.
To contribute positively to society by promoting social equity, financial inclusion, and community development.
5.1 Financial Inclusion
➢ Inclusive Financial Products: Credit Direct offers financial products that cater to underserved populations, including low-income individuals, women, rural communities, and small businesses.
➢ Digital Lending Platforms: The Company shall adopt the use of technology to enhance financial access for remote and underserved areas in Nigeria.
5.2 Responsible Lending
➢ Transparent Loan Terms: The Company shall ensure that all loan products have transparent terms, fair interest rates, and clear repayment schedules to avoid predatory lending practices.
➢ Debt Management Support: As part of our financial literacy programs to customers, the Company shall educate the customers on how to manage their finances effectively and prevent over-indebtedness.
5.3 Diversity and Inclusion
➢ Diverse Workforce: The Company shall always promote diversity by ensuring representation across gender, ethnicity, and disability in hiring and promotions.
➢ Equal Opportunity Employment: The Company has set down policies that prevent discrimination and harassment in the workplace, fostering an inclusive and supportive work environment.
5.4 Customer Empowerment
➢ Customer Education: Provide educational resources and training for customers on financial management, helping them make informed decisions and improve their financial well-being.
➢ Customer Feedback Mechanism: Establish channels for customers to provide feedback on our services, ensuring continuous improvement and responsiveness to customer needs.
6.Governance
The governance component of ESG refers to how we operate, govern, and manage risk in a way that promotes sustainability and the longevity of the organization. Our governance policies and practices outline the way in which we make decisions, set business strategy and goals, comply with applicable laws and regulations, and communicate our progress.To ensure strong governance practices that uphold transparency, accountability, and ethical conduct across all aspects of Credit Direct’s operations.
6.1 Board Oversight
➢ Sustainability begins with the Board. The Board sets the tone at the top for responsible business practices and our commitment to ESG.
➢ The Board shall oversee the implementation and progress of ESG initiatives.
➢ The Board shall ensure that ESG metrics and performance are regularly reported during Board meetings and shared with relevant stakeholders.
6.2 Ethical Business Practices
➢ Code of Conduct: Develop and enforce a comprehensive code of conduct that outlines ethical business practices, anti-corruption measures, and compliance with Nigerian and international regulations.
➢ Whistleblower Policy: Implement a whistleblower policy that protects employees who report unethical behavior, fraud, or violations of company policies.
6.3 Implementation and Monitoring
➢ Goal Setting: Set clear, measurable ESG goals that align with the Company’s strategic objectives and contribute to Nigeria’s sustainable development.
➢ Employee Training Programs: The Company provides training for employees on ESG issues, equipping them to contribute to the successful implementation of the framework.
➢ Leadership Development: Ensure that management staff are trained to drive ESG initiatives and foster a culture of sustainability and ethical governance within the Company
➢ Feedback Mechanism: Establish internal and external channels for feedback on ESG initiatives, enabling the Company to make informed adjustments and improvements.
➢ Regular Review: Conduct periodic reviews of the ESG framework to assess its effectiveness and adapt to emerging trends, challenges, and opportunities in the Nigerian and global markets.
The governance component of ESG refers to how we operate, govern, and manage risk in a way that promotes sustainability and the longevity of the organization. Our governance policies and practices outline the way in which we make decisions, set business strategy and goals, comply with applicable laws and regulations, and communicate our progress.To ensure strong governance practices that uphold transparency, accountability, and ethical conduct across all aspects of Credit Direct’s operations.
6.1 Board Oversight
➢ Sustainability begins with the Board. The Board sets the tone at the top for responsible business practices and our commitment to ESG.
➢ The Board shall oversee the implementation and progress of ESG initiatives.
➢ The Board shall ensure that ESG metrics and performance are regularly reported during Board meetings and shared with relevant stakeholders.
6.2 Ethical Business Practices
➢ Code of Conduct: Develop and enforce a comprehensive code of conduct that outlines ethical business practices, anti-corruption measures, and compliance with Nigerian and international regulations.
➢ Whistleblower Policy: Implement a whistleblower policy that protects employees who report unethical behavior, fraud, or violations of company policies.
6.3 Implementation and Monitoring
➢ Goal Setting: Set clear, measurable ESG goals that align with the Company’s strategic objectives and contribute to Nigeria’s sustainable development.
➢ Employee Training Programs: The Company provides training for employees on ESG issues, equipping them to contribute to the successful implementation of the framework.
➢ Leadership Development: Ensure that management staff are trained to drive ESG initiatives and foster a culture of sustainability and ethical governance within the Company
➢ Feedback Mechanism: Establish internal and external channels for feedback on ESG initiatives, enabling the Company to make informed adjustments and improvements.
➢ Regular Review: Conduct periodic reviews of the ESG framework to assess its effectiveness and adapt to emerging trends, challenges, and opportunities in the Nigerian and global markets.
7.Environmental and Social Risks and Impacts
The environmental and social risks and impacts, which the Company will take into account in its due diligence are project-related and include the following:
7.1 Environmental Risks and Impacts
The environmental risks and impacts, including:
➢ those identified in the World Bank Group Environmental, Health, and Safety Guidelines (EHSGs) such as pollution, resource depletion, climate change, biodiversity loss, and environmental disasters such as oil spills or chemical leaks Climate change risk
➢ those related to community safety (including cultural heritage, etc.)Recycling and waste management➢ any material threat to the protection, conservation, maintenance and restoration of natural habitats and biodiversity; and
➢ those related to ecosystem services and the use of living natural resources, such as fisheries and forests
7.2 Social Risks and Impacts
Social risks and impacts, including:
➢ threats to human security through the escalation of personal, communal or interstate conflict, crime or violence;
➢ risks that project impacts fall disproportionately on individuals or groups who, because of their particular circumstances, may be disadvantaged or vulnerable;
➢ any prejudice or discrimination toward individuals or groups in providing access to development resources and project benefits, particularly in the case of those who may be disadvantaged or vulnerable
➢ negative economic and social impacts relating to the involuntary taking of land or restrictions on land use;
➢ risks or impacts associated with land and natural resource tenure and use, including (as relevant) potential project impacts on local land use patterns and tenurial arrangements, land access and availability, food security and land values, and any corresponding risks related to conflict or contestation over land and natural resources;
➢ impacts on the health, safety and well-being of workers and project-affected communities; and
➢ risks to cultural heritage
7.3 Governance Risks and Impacts
➢ Reputational damage from environmental controversies or social conflicts.
➢ Legal and regulatory penalties for non-compliance with environmental and labour standards.
➢ Financial repercussions due to poor governance practices such as unethical behaviour or ineffective oversight.
➢ They can lead to diminished investor confidence.
➢ Poor governance may lead to difficulty accessing capital markets, and increased operational costs.
The environmental and social risks and impacts, which the Company will take into account in its due diligence are project-related and include the following:
7.1 Environmental Risks and Impacts
The environmental risks and impacts, including:
➢ those identified in the World Bank Group Environmental, Health, and Safety Guidelines (EHSGs) such as pollution, resource depletion, climate change, biodiversity loss, and environmental disasters such as oil spills or chemical leaks Climate change risk
➢ those related to community safety (including cultural heritage, etc.)Recycling and waste management➢ any material threat to the protection, conservation, maintenance and restoration of natural habitats and biodiversity; and
➢ those related to ecosystem services and the use of living natural resources, such as fisheries and forests
7.2 Social Risks and Impacts
Social risks and impacts, including:
➢ threats to human security through the escalation of personal, communal or interstate conflict, crime or violence;
➢ risks that project impacts fall disproportionately on individuals or groups who, because of their particular circumstances, may be disadvantaged or vulnerable;
➢ any prejudice or discrimination toward individuals or groups in providing access to development resources and project benefits, particularly in the case of those who may be disadvantaged or vulnerable
➢ negative economic and social impacts relating to the involuntary taking of land or restrictions on land use;
➢ risks or impacts associated with land and natural resource tenure and use, including (as relevant) potential project impacts on local land use patterns and tenurial arrangements, land access and availability, food security and land values, and any corresponding risks related to conflict or contestation over land and natural resources;
➢ impacts on the health, safety and well-being of workers and project-affected communities; and
➢ risks to cultural heritage
7.3 Governance Risks and Impacts
➢ Reputational damage from environmental controversies or social conflicts.
➢ Legal and regulatory penalties for non-compliance with environmental and labour standards.
➢ Financial repercussions due to poor governance practices such as unethical behaviour or ineffective oversight.
➢ They can lead to diminished investor confidence.
➢ Poor governance may lead to difficulty accessing capital markets, and increased operational costs.
APPENDIX
Exclusion listCredit Direct will not provide its lending and non-lending services to any organization or individual involved in any of the following activities:
1. Production or trade in any product or activity deemed illegal under host country laws or regulations or international conventions and agreements.
2. Production or trade in pharmaceuticals, pesticides/herbicides, ozone depleting substances, polychlorinated biphenyls (PCBs) subject to international phase outs or bans.
3. Trade in wildlife or wildlife products regulated under Convention on International Trade in Endangered Species (CITES).
4. Production or trade in weapons and ammunitions.
5. Production or trade in alcoholic beverages (excluding beer and wine)
6. Production or trade in tobacco
7. Pornography and/or prostitution.
8. Gambling, casinos and equivalent enterprises.
9. Racist and/or undemocratic and or neo-nazi media.
10. Production or trade in radioactive materials. This does not apply to the purchase of medical equipment, quality control (measurement) equipment and any equipment where Credit Direct considers the radioactive source to be trivial and/or adequately shielded.
11. Cross-border trade in waste and waste products, unless compliant to the Basel Convention and the underlying regulations.
12. Production or trade in or use of unbonded asbestos fibers.
13. Drift net fishing in the marine environment using nets in excess of 2.5km in length, electric shocks, or explosive materials.
14. Production or trade in wood or other forestry products other than from sustainably managed forests.
15. Production or activities involving forced labor or child labor
16. Any activities involving significant degradation or conversion of natural, and/or critical habitats,and/or any activities in legally protected areas.
17. Activities involving live animals for scientific and experimental purposes, including the breeding of these animals.
18. Military or police equipment or infrastructure.
Exclusion listCredit Direct will not provide its lending and non-lending services to any organization or individual involved in any of the following activities:
1. Production or trade in any product or activity deemed illegal under host country laws or regulations or international conventions and agreements.
2. Production or trade in pharmaceuticals, pesticides/herbicides, ozone depleting substances, polychlorinated biphenyls (PCBs) subject to international phase outs or bans.
3. Trade in wildlife or wildlife products regulated under Convention on International Trade in Endangered Species (CITES).
4. Production or trade in weapons and ammunitions.
5. Production or trade in alcoholic beverages (excluding beer and wine)
6. Production or trade in tobacco
7. Pornography and/or prostitution.
8. Gambling, casinos and equivalent enterprises.
9. Racist and/or undemocratic and or neo-nazi media.
10. Production or trade in radioactive materials. This does not apply to the purchase of medical equipment, quality control (measurement) equipment and any equipment where Credit Direct considers the radioactive source to be trivial and/or adequately shielded.
11. Cross-border trade in waste and waste products, unless compliant to the Basel Convention and the underlying regulations.
12. Production or trade in or use of unbonded asbestos fibers.
13. Drift net fishing in the marine environment using nets in excess of 2.5km in length, electric shocks, or explosive materials.
14. Production or trade in wood or other forestry products other than from sustainably managed forests.
15. Production or activities involving forced labor or child labor
16. Any activities involving significant degradation or conversion of natural, and/or critical habitats,and/or any activities in legally protected areas.
17. Activities involving live animals for scientific and experimental purposes, including the breeding of these animals.
18. Military or police equipment or infrastructure.
