Risks, Opportunities and our Response

Risks and Opportunities		Our Commitments and Targets
The state of the economy, i.e., macroeconomic stability and sustainable GDP growth; impact of the Euro Zone debt crisis and weak growth in Europe and the US which account for over 50% of our export market		Achieve medium term targets as per our Corporate Plan and Budget (Refer Section on ‘Financial Goals and Achievements’)
Middle East tensions and rising oil prices; with upside prospects for further investments in renewable energy projects		Apply the Bank’s SEMS for project financing, with 2012 targets that include: Enhanced lending for renewable energy and energy savings projects Training for Bank officers Awareness programmes for customers
Changes in laws and regulations in the countries in which the Bank operates, and the consequent new compliance requirements		Due diligence at entry points and evaluation of risks of non-compliance on an ongoing basis through effective monitoring and evaluation; periodic reports to the Board Integrated Risk Management Committee
Maintaining customer satisfaction in the face of stiff competition		Add satisfaction-enhancing products, features and practices by conducting periodic surveys. Follow innovations and developments in the industry, and adapt accordingly
Attracting and retaining the best of talent		Talent management, staff relation and welfare policies, productivity enhancement, business partnering, improved compensation and benefits. Periodically measure employee satisfaction through surveys; improve satisfaction level in 2012
Establishing closer linkages between the activities of the Bank’s CSR Trust and national priorities		The Bank commits up to 1% of its Profit after Tax to the CSR Trust. The target for 2012 is to complete 100 projects that will include: IT Labs for less-privileged schools to enhance IT literacy Support for English language education Support for improving health care and well-being of local communities

External Verification and Validation

Our inaugural report for 2009 carried a self-declared GRI Application Level ‘C’. In our second report, we progressed to Application Level ‘B’ and the Report was also subjected to an independent assurance by Ernst & Young, Chartered Accountants. This year we are producing a Sustainability Report to Application Level ‘B+’, subject to external verification and assurance by Det Norske Veritas AS (DNV), in addition to assurance of Ernst & Young. Their Independent Assurance Reports are found here.

The Bank does not have any relationship with DNV or Ernst & Young apart from the latter’s function as an Independent Auditor to the Bank. The Bank expects to continue with the practice of seeking independent external assurance for its Sustainability Reports in the future as well.

Scope and Boundary of the Report

The Report covers all operations and activities of the Bank only. The activities and performance data of the Bank’s three subsidiaries - Commercial Development Co. PLC, ONEzero Co. Ltd. and Commex Sri Lanka S.R.L. - and the operations of its two associates - Equity Investments Lanka Ltd. and Commercial Insurance Brokers (Pvt) Ltd. - are therefore excluded.

We are of the opinion that the operations and results of these subsidiary and associate companies are not material in terms of their contribution to the profits and the assets of the Group, as evident from the Audited Financial Statements. However, we intend including the operations of these entities in our future sustainability reports in the event the disclosure of such information becomes material to our stakeholders.

Further, we have not also considered the performance data and other disclosures concerning the Bank’s operations in Bangladesh, except for the economic performance indicators drawn from the Financial Statements of the Bank which includes the banking operation in Bangladesh as well, purely to facilitate the reconciliation of these data with the Audited Financial Statements of the Bank. However, it is our expectation to include full disclosure (including social and environmental performance indicators) in respect of activities of our Bangladesh Operation in our future Sustainability Reports.

Inquiries and Suggestions

The Bank is happy to answer any inquiry and/or provide clarification on any material contained in this Report. Your contact point at the Bank is:

The Central Accounts Department

Commercial Bank of Ceylon PLC,
‘Commercial House’,
21, Sir Razik Fareed Mawatha
(formerly known as Bristol Street),
Colombo 01, Sri Lanka.
email@combank.net

Defining Report Content

We present below the Bank’s material issues identified by the Bank in relation to sustainability. These issues have been identified by considering the expectations and perceived opinions of stakeholders and in relation to the Bank’s policies and practices.

In order to facilitate tracking these material and significant issues, they have been demonstrated in the grid shown below in a way that correspond to the main sections of this Sustainability Report.

The above diagram portrays the Bank’s significant impact towards the people, planet and profit that would substantively influence the assessments and decisions of stakeholders.