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Sustainability Report 2019SHARED PROSPERITYSustainability Report 20191
Shared Prosperity2
Sustainability Report 2019TABLE OF CONTENTSAbout This Report05Message From Our Chairman06About Ahli Bank08Sustainability Management11Business Ethics16Responsible Banking22Employer of Choice34Positive Social Impact40Protecting Our Environment46Appendices503
Sustainability Report 2019ABOUT THIS REPORTThis is Jordan Ahli Bank’s (ahli bank) third sustainability report covering the calendar year of 2019 andhighlights the Bank’s activities and sustainability performance. The goal of our annual reporting is topresent the environmental, social and governance (ESG) performance of the bank. We hope this reportcontributes to the adoption of sustainability management and shows our commitment to transparencyand international best reporting practices.This report has been prepared in accordance with the GRI Standards: Core option. It focuses onmaterial sustainability issues to ahli bank and its stakeholders.We welcome your feedback on this reportand our performance through the edIn.com/company/Jordan-ahli-bankConcept of Report DesignIn line with our vision, “shared prosperity” is at the heart of our third sustainability report and is symbolizedby the pomegranate fruit. The pomegranate, with its many small seeds, represents a life of abundanceand prosperity that ahli bank is committed to building. Through our sustainability approach we investin our local communities to make a positive change and work to strengthen society by promotinginnovation, empowering youth and education and safeguarding culture. We promote shared prosperitywith increased financial inclusion to create a better future for our customers and communities.Cautionary MessageThis report contains statements that may be deemed as “forward-looking statements” that express the way inwhich ahli bank intends to conduct its activities. Forward statements can be identified by the use of forward-lookingterminology such as “plans”, “aims”, “assumes”, “continues”, “believes”, or any variations of such words thatcertain actions, events or results “may”, “could”, “should”, “might”, “will”, or “would” be taken or be achieved.ahli bank has made every effort to ensure the report is as accurate and truthful as possible. However, by their natureforward-looking statements are qualified to inherent risks and uncertainties surrounding future expectations thatcould cause actual results to differ materially from these projected or implied statements. Such statements aresubject to risks that are beyond ahli bank’s ability to control and therefore do not represent a guarantee that eventsimplied in these forward-looking statements will occur.[102-53],[102-54]5
Shared ProsperityMESSAGE FROM OUR CHAIRMANOn behalf of the Board of Directors, it is my great pleasure topresent ahli bank’s third annual sustainability report thatcovers our 2019’s environmental, social and governance(ESG) performance. Throughout more than sixty yearsof ahli bank’s history, this national organization hasbeen at the forefront of introducing innovation drivenfinancial services to customers and supporting thesocioeconomic development of Jordan. In recentyears, we have institutionalized our heritage byofficially deploying a new business model for the Bankwhich we have called ‘Shared Prosperity’: a uniquestakeholder focused model that we believe points to thefuture of sustainability and conscious capitalism. We arecurrently implementing and evolving this new business model,but our ultimate objective is clear: to deliver long term value toall stakeholders in a responsible, balanced and sustainable way thatproduces prosperity for all, and sets the stage for a new type of consciouscapitalism that we believe has become a moral imperative for humanity in the 21st century.ahli bank’s mission consists of three strategic objectives: Customer Centricity, Operational Excellence,and Innovation. We are also committed to promoting our corporate values of diversity, transparency,integrity, and accountability in the bank’s operations and business practices. Everything that we do isaligned with our values, and seeks to achieve dramatic improvements in customer service, operationalexcellence, and innovation to chart the way to the future.Our devotion to ‘Exceptional’ Customer Service continues to guide us towards developing cutting-edgeservices and products. Our flagship branch in Abdali serves as one of 2019’s highlights in this domain;which has introduced a paradigm shift in the world of banking where customers not only can transactwith us in a delightful new way, but are also able to use the bank as a platform for Shared Prosperitythrough knowledge transfer, training, idea exchange, networking, advisory services, and much more.This innovative approach is the first of its kind not only in Jordan, but also across the MENA region.In addition, we were the first bank to introduce automated customer service through WhatsApp forBusiness, a new channel that offers 24/7 service in a secure and private way from a customer’s mobilephone. It is another example of our commitment to providing exceptional customer service. This andmany other initiatives have improved our customer experience (CX) index score to 79%. Our target is tocontinue to increase our CX score as we seek to establish ourselves as the most customer friendly bankin the region.We cannot fully serve our customer base without our dedicated team. As such, developing andsupporting our local workforce is pivotal for achieving our sustainability ambitions. As such, we haveoffered 365 career development programs for our full time employees, as well as received over 11,000applications through our ahli777 program; (an internship and part time work program that is dedicatedto train university students and graduates on leadership skills and to prepare them for the job market).[102-14]6
Sustainability Report 2019Furthermore, as part of promoting diversity and inclusion, we are proud to report that we continueto maintain a 40% female labor participation rate in ahli bank. In addition, we became the firstorganization in MENA to complete a full review with Freedom House (a US based human rights NGO)to audit and improve the working environment for women, and ensure gender equity in all of ourpolicies, procedures and practices.On the critical issue of the environment, ahli bank continues to reduce its ecological footprint byadopting more sustainable and environmentally friendly solutions. In 2019, we reduced our electricityconsumption and paper usage by 15% and 4.4%, respectively. It is also worth noting that 75% of ahlibank’s energy consumption is green and is produced with our own solar energy farm.As we look towards the future, we will ensure that ahli bank will continue to operate responsiblyand to further enhance our sustainability and performance. The upcoming year will indeed be adifficult one, as the world wrestles with the impacts of coronavirus and its health and socioeconomicconsequences. Most if not all organizations will be affected as economies slow down and consumerspending and labor productivity decreases. At this stage it is impossible to predict the short- andmedium-term economic impact of this crisis. However, we are confident that our committed team,governance frameworks, and regulatory bodies will help us weather the storm with success, especiallyas we invest in enhanced risk management practices and policies, and credit support programs andpolicies for customers.I would like to thank the ahli bank family, most notably the board of directors, our customers, ouremployees, our shareholders and many supporters for their loyalty, dedicated efforts and contributionsto the success we registered in 2019. We remain committed and hopeful, especially as we implementour Shared Prosperity strategy to advance holistic stakeholder capitalism, and as we continue toinvest in innovation and sustainability.Sincerely yours,Mr. Saad Nabil MouasherChairman of the Board of Directors[102-14]7
Shared ProsperityABOUT ahli bankFor more than 64 years, ahli bank has contributed significantly to the growth and development of thefinancial sector in Jordan, developing strategies based on our ambitious vision of leading Jordan’sbanking industry towards sustainable socio-economic development. We focus on providing a widerange of banking services and products that deliver added value and efficiency to achieve the highestlevel of customer satisfaction, and meet the changing needs of our retail, SME and corporate clients.ahli bank strives to provide high-quality products and services to customers. We have a variety of servicesthat focus on supporting local communities to help customers manage their money safely and offerconsultancy and advisory when needed. Our services include loans, debit and credit cards, inbound andoutbound transfers, currency exchange and more comprehensive services to serve customers from allsegments. We also provide a variety of non-banking solutions, services, and products.We recently upgraded our T24 core banking system from R13 to R18 and upgraded its infrastructure toaccommodate any future upgrade releases to improve automation and support employees and customervalue proposition.Within our framework, ahli bank strives to embody the values of “Excellence” and “Specialization”,which apply to all of our products and services, and of “Creativity” and “Innovation,” which drive thecompany’s strategy of adapting and growing to meet and shape the changing needs of our clients.8[102-2]
Sustainability Report 2019OUR CHARTEROur ValuesOur VisionOur Mission We are committed to buildinga prosperous society andeconomy with increasedfinancial inclusion. We seek toserve our customers throughinnovation and excellence, topromote belonging and loyaltyamong our employees, andto achieve balanced growthand sustainable returns for ourshareholders.To be a financial institutiondedicated to providingexcellent services throughcustomer centricity,operational excellence andinnovation.Shared prosperityTransparency and credibilitySuperior customer experienceUpholding world-class corporategovernance standards Embracing on results focused,innovation driven culture Superior employee experienceOur Strategic ThemesOur strategicobjectives are alignedwith our mission,vision and values, andare guided by threestrategic themes:First Theme:Second Theme:CustomerCentricityOperationalExcellenceThird Theme:InnovationOUR OWNERSHIP10.381%ahli bank is a PublicLimited Company(PLC). We haveincluded - in the sidechart - the majorshareholders, using“Other Shareholders”for the remainingmajority:10.001%67.608%Major Shareholdersn Byblos Bankn Social Security Corporationn Jordan Investor Centern Jordan Worsted Mill Co.n Other Shareholders5.558%6.452%2017Dividendsto shareholders[102-5], [102-16]5% as cash dividends,equivalent to JOD 9.19million, and 5% asbonus shares.201820196% as a cashdividends, equivalentto JOD 11.6 million,and 4% bonus shares,equivalent to JOD 7.7million.The Central Bank of Jordan issued circularNo. 1/1/4693 dated 9 April 2020, in whichthe central bank of Jordan decided topostpone the Jordanian banks’ distributionof dividends to shareholders for the year2019.9
Shared ProsperityOUR MARKET PRESENCEHeadquartered in Amman, ahli bank is proud toalso be present in Palestine and Cyprus. The bankcurrently operates 52 branches in Jordan, 9 branchesin Palestine, and 1 branch in Cyprus. Additionally, wehave installed over 122 ATMs in Jordan and Palestine.IrbidJineenAl TafilahOUR SUBSIDIARIESThe following companies are fully owned by ahli TECHAHLIFINANCIALLEASINGOffers financial brokerageservices. Repeatedlyranked among topbrokerage firms, thecompany trades alltypes of financial marketsecurities in the AmmanStock Exchange.The first microfinancecompany in the privatesector in Jordan, offers creditfacilities to micro and smallbusinesses, supportingthe economic and socialdevelopment of the Kingdomof Jordan. The company’smission is to provideresponsible and innovativefinancial and non-financialservices to individuals tohelp them grow their ownprojects and achieve a betterquality of life.The company develops FinTechtalent through various activitiesand initiatives, including fintechevents, conferences, workshops,and training sessions. Thecompany offers fintech innovatorsthe opportunity to acceleratetheir business models, offeringup to USD 200k in startupcapital, access to the banksglobal networks of advisors andmentors, free workspace, andaccess to over 200 applicationprogramming interfaces ( APIs)on the Bank’s virtual testingenvironment, providing theability to create customer-facingapplications through the openbanking API AHLI SANDBOXenvironment (ahlisandbox.com).Once innovators pass compliancereviews and verifications,they begin running their ownapplications live with the bank’scustomers, becoming part of theahli fintech.comProvides a comprehensiverange of banking productsand non-traditionalalternative financingsolutions in order to caterto the various needs of ing/[102-2], [102-4], [102-6], [102-7]
Sustainability Report 2019SUSTAINABILITY MANAGEMENTAt the start of our journey of integrating sustainability across our operations, ahli bank’s senior leadershipand board members highlighted the importance of demonstrating our commitment to sustainabilityand disclosing details of the Bank’s environmental, social and governance (ESG) performance. In linewith the recommendations of our leadership, we began fully integrating sustainability into our businessstrategy in 2017.In 2019, we changed the name of the Corporate Social Responsibility (CSR) department to “CSR &Sustainability Programs” to ensure the intentional integration of sustainability into our business strategyand underpin the Bank’s long-term sustainability strategy. We believe in the ability of the banking sectorto address the economic, social and environmental challenges that the world is currently facing. Weare committed to fostering diversity and inclusion to help create a better future for our customers andcommunities.We believe that sustainability is essential to our business strategy and long-term objectives. We arecommitted to integrating sustainability in our business operations, conducting responsible bankingactivities, and creating greater value for our stakeholders. Through our sustainability approach, wedemonstrate our commitment to the environment and socioeconomic development of Jordan. The Bankis committed to supporting local suppliers and businesses to help create more jobs and investing inour local communities to make a positive change in people’s lives. Moreover, our approach focuses onstrengthening our society by promoting innovation, empowering youth and education and safeguardingculture and the environment.Stakeholder EngagementWe believe that our success as a financial institution is achieved by continuously pursuing maximumvalue for our stakeholders.By engaging with all of our stakeholders, we can continue to ensure that our operations and sustainabilityapproach is holistic and inclusive. We consistently review and update our stakeholder engagementstrategy, which is based on a value system that aims to build trust, and subsequently fortify ourrelationships with all our stakeholders. After we identify our stakeholders’ needs, we work to ensure thatwe serve them to exceed their expectations.[102-42], [102-43]11
Shared ProsperityStakeholder GroupOur CustomersOur ShareholdersOur EnvironmentOur Regulators andOfficial AgenciesOur EmployeesOur Local CommunityHow ahli bank Engages with Stakeholders Branches ahli online ahli mobile Website Social media (includingWhatsApp For Business) ATMs Relationship managers ahlibot Events and activities Contact Center General assembly meetings Investor relations function Investor conferences Annual reports Facilities for environmentally friendly projects Supporting projects that promote environmental stewardship Solar energy farm Reports to organizational and regulatory bodies Compliance with laws and regulations Regulatory reviews Best practice corporate governance standards Learning and capacitydevelopment programs Clear KPIs and periodicperformance reviews Human Resources services Employee Experience programsand initiatives Code of Conduct Internal meetings Town hall meetings Internal committees Volunteering programs Moments that matter Organizational Culture project Annual reports Sustainability reports Corporate Social Responsibility activities Training, advisory programs and workshops Procurement policy Invitations to biddingsOur Suppliersahli bank Memberships:Union of Arab Banks Association of Banks Jordan Strategy Forum (JSF)National Committee for Financial Inclusion Jordan Securities Commission Securities Depository Center Amman Stock Exchange Financial Services Companies Association Endeavor Jordan 12[102-13], [102-21], [102-40], [102-42], [102-43]
Sustainability Report 2019Materiality AssessmentAs part of our sustainability strategy, we have focused on public disclosure and reporting for 16 materialissues that are considered most important to achieve sustainability across the Bank’s operations. Externaland internal stakeholders identified these as the issues that matter most in our most recent materialityassessment in 2018.ahli bank 201912539710812144613151116Rank IssueRank Issue1Financial and economic performance102Systematic risk management11Responsible lending and investment3Market presence12Diversity and equal opportunity4Governance, transparency, and compliance13Sustainable procurement practices5Customer privacy and data security14Community investment and socioeconomic6Customer Satisfaction7Talent attraction, development, and retention15Financial literacy and education8Financial inclusion16Direct environmental impact of operations9SME growth[102-44], [102-47]Digital innovationopportunity13
Shared ProsperityThese material issues have been identified through the consultation of national, international andsector visions, including the GRI, SASB, SDGs and Jordan National Vision 2025.GRISASB Market presence Governance, transparency andcompliance Customer privacy and data security Material TopicsFinancial and economic performanceSystematic risk managementPRIEquatorPrinciplesSDGs Customer satisfactionTalent attraction, development andretention Financial inclusionSME growthDigital innovationSustainable procurement practices Community investment andsocioeconomic opportunity Financial literacy and education Direct environmental impact ofoperations Responsible lending and investmentDiversity and equal opportunityJordanNationalVision 2025 *GRI: Global Reporting InitiativeSASB: Sustainability Accounting Standards BoardPRI: Principles for Responsible InvestmentSDGs: Sustainable Development Goals14[102-44]
Sustainability Report 2019OUR SUSTAINABILITY FRAMEWORKWe have arranged these material issues into five pillars to create ahli bank’s sustainability framework:Business Ethics, Responsible Banking, Employer of Choice, Positive Social Impact andEnvironmental r ofChoiceWe are committedto implementingan exemplaryenterprise riskmanagementand compliancesystem, ensuringtransparency andaccountability tostakeholdersOur mission is toprovide an excellentand responsiblebanking servicesto our clients,ensuring that weconduct businessresponsibly andup to the higheststandardsWe truly believethat our workforceis the bank’s mostvaluable asset,which is why wecontinually supportour employees,motivating themto give their bestembodying ourvalues0401Financial & EconomicPerformance02Systematic RiskManagement03Market Presence05Customer Privacy & DataSecurity06Customer SatisfactionPositiveSocialImpactWe are committedto playing akey role instrengtheningthe communityand supportingnational efforts toidentifying andcontributing tosocial challengesEnvironmentalProtectionWe are committedto conducting ouroperations andbusiness activitiesresponsibly, usingtechnology tohelp reduce ourimpact on theenvironmentGovernanceBusiness Ethics &Compliance0709SME Growth10Digital Innovation11Responsible Lending &Investment1213SustainableProcurement PracticesAttractingDeveloping &Retaining Talent08FinancialInclusion14CommunityInvestment &SocioeconomicFactors15Financial Literacy &EducationDiversity & EqualOpportunity16Direct EnvironmentalImpact of Operations15[102-44]
Shared Prosperity01BUSINESS ETHICSMaterial Issues Covered Governance, transparency, and complianceSustainable Development Goals16
Sustainability Report 2019CORPORATE GOVERNANCECorporate governance is the system of rules, policies and procedures which govern, direct and controlthe Bank. Our Board of Directors and auditors are responsible for ensuring that appropriate governancestructures are in place and maintain the balance between the Bank’s interests and of its all stakeholders.We believe a well-developed corporate governance structure helps us achieve our strategic objectives bypromoting responsible business practices that ensure high standards of transparency and disclosures.This ensures sustainable and trustworthy operations and ensures honest and open relationships with ourvarious stakeholders. Therefore, over the past few years, we have adopted numerous new best practicesto elevate governance standards and comply with regulatory guidelines issued by the Central Bankof Jordan and other international regulators. We are also committed to implementing requirements inaccordance with the legislative framework governing the banking sector.In 2019, ahli bank employed Deloitte to conduct a third party assurance review of the board’s oversightfunctions including audit, compliance, and risk management. The review took place over a full year andconcluded with detailed recommendations on further enhancing our oversight capabilities to globalbest practices. We aim to implement nearly all recommendations by end of 2020.Code Of ConductAs the basis for controlling our day-to-day activities and guaranteeing our employees conduct businesspractices responsibly, the ahli bank’s Code of Conduct document is developed to reflect our work ethics,values, and controls. Its purpose is to align the Bank’s activities with the expectations of our stakeholders.Topics covered in the Code include privacy of information, improper practices that may lead to a conflictof interest, and a set of procedures that regulates interactions with stakeholders.Conflict Of InterestMoreover, we have a Conflict of Interest policy that protects the integrity of the Bank. This policyconsiders the Bank’s interests when contemplating a situation of a transaction or arrangement thatmight benefit the private interest of one of its officers or directors, or might result in a possible excessbenefit transaction that exploit a professional or official capacity in some way for their personal benefit.It also entails disclosures of any identified incident that may lead to a conflict of interest.[102-25], [102-26], [103-1], [103-2], [103-3], [205-1], [205-2]17
Shared ProsperityORGANIZATIONAL STRUCTUREBoard SecretaryStrategy & IT Governance CommitteeGeneral ManagerMohammad Mousa DawoodInternal AuditAhmad Awad Al - HusseinRiskStrategy & ProjectCompliance and Anti Money LaunderingInternal ControlBusiness SectorCredit SectorCorporate Bankingand Projects FinanceCredit ReviewInformation TechnologySmall and MediumBankingCredit ExecutionOperations and SharedServicesConsumer BankingServicesRemedialLogisticsTreasury &InvestmentSupport SectorProcurement &ContractsOrganization &ProceduresInnovationHuman ResourcesFinanceCorporate SocialResponsibility &SustainabilityProgramsCompanyAhli Brokerage CompanyCommittees of the Executive ManagementAhli Financial LeasingCompany- Group Executive Committee (GEXCO)- Joint Credit Committee 2 (JCC 2)Ahli Fintech Company- Asset & Liability Management Committee (ALCO)- Crisis Management Committee- High Procurement Committee- Remedial Committee- Treasury, Investment & Financial Institutions Committee- Real Estate Committee- IT Steering CommitteePalestine BranchesCyprus Branch18[102-7]
Sustainability Report 2019BOARD OF DIRECTORSThe responsibilities of our Board of Directors include identifying the strategic objectives of ahli bank,establishing clear plans to ensure accountable and responsible organizational behavior, overseeingoverall performance, and monitoring control frameworks implemented in the Bank. By law, the Boardof Directors must include a minimum of 11 members elected by the General Assembly and all membersare non-executive members. Currently, there are 13 members of the board, 4 of which are independent.Our Board members form 6 committees. These are the Corporate Governance Committee, the AuditCommittee, the Nominations and Remuneration Committee, the Risk and Compliance Committee, theCredit Committee, and the Strategy and IT Governance Committee.Board of Directors201720182019Percentage of independent directors in the Board31%31%31%131313Female221Male111112Total members of the Board19[102-7], [102-18], [102-22], [102-26], [405-1]
Shared ProsperityINTERNAL AUDITWe are committed to ensuring the compliance of the Bank and its internal policies with all laws,regulations, and global best practices issued by both domestic and international regulators. Our InternalAudit department complies with the latest international standards issued by the Institute of InternalAuditors (IIA), the Attribute Standards (1000) and Performance Standards (2000). We conduct structuredand periodic internal audits to assess and monitor the implementation of any environmental or socialpolicies.We also have a Whistle-Blowing policy, where reporting is made through multiple communicationchannels. Such reports are received and dealt with by the Chairman, CEO and/or Audit Manager andwith complete confidentiality and protection of the reporter’s identity, be it from external or internalreporters.In 2019, an external quality assurance was conducted to evaluate our internal audit department andensure that it operates in compliance with the regulations of the Central Bank of Jordan and internationalstandards. As a result, we acquired - and plan to deploy - the Audit Command Language (ACL) System.Its primary usefulness lies in its ability to perform analysis and audit tests on 100% of available datarather than merely through sampling. In addition, we have initiated and are utilizing ‘TeamMate’: acomprehensive audit management system to manage all aspects of the audit process. This empowersdepartments and allows auditors to spend less time documenting and more time providing value. Wealso implemented a cyber security policy and procedures to address cyber security challenges.AHLI BUSINESSINTELLIGENCE (BI)DASHBOARDS20The current market is customer-centric and highly digitized, andso it is of utmost importance for business management to basedecisions on objective and scientific methods. To achieve thehighest levels of precision when taking strategic decisions, the ahli BIproject aims to translate ahli bank’s data into meaningful, actionable,real-time business intelligence data. The ahli BI platform includes keyintelligence data and interactive dashboards covering functional areassuch as risk, credit, finance, retail banking, SME and corporate banking.[103-1], [103-2], [103-3], [205-1], [205-2]
Sustainability Report 2019COMPLIANCE AND ANTI - MONEYLAUNDERINGFinancial crimes are a significant issue for banks and financial institutions around the globe. ahli bankdevotes significant efforts to protect its business, customers, and employees from the consequencesof potential financial crime.The Compliance and Anti-Money Laundering (AML) department adopts all available measures to ensurethe Bank complies with all laws and regulations and aligns itself with global best practices issued by bothdomestic and international regulators. Therefore, we implement compliance policies and proceduressuch as - but not limited to - due diligence policies and procedures supported by documentation toprevent money laundering, terrorist financing and other financial crimes.RegulatoryCompliancePolicyForeignAccount TaxComplianceAct (FATCA)PolicyKnow YourCustomer (KYC)PolicyMain policies theBank abides by:Sanctions &ExclusionsPolicyAnti-Money Launderingand Terrorism Financing(AML/CFT) ManualIn addition to reviewing our major policies in 2019, we also accomplished the following:Managed theexecution of theproper classificationof our clients asper the Risk BasedApproach.Deployed RegulatoryComplianceManagement (RCM)Systems in Cyprusand Palestine.Adopted updatesfor our ATMs andwebsite to betterserve our clientswith disabilities, andfully meet the relatedCentral Bank ofJordan requirements.Conducted severaltraining sessions foremployees, aimedat raising awarenessregarding differenttopics related tocompliance, such asregulatory compliance,Anti-Money Launderingand terrorist financing,sanctions, andrequirements of theForeign AccountTax Compliance Act(FATCA).There were no incidents of Non-Compliance with Laws and Regulations or legal or exemplary casesover the past few years and we are always working towards maintaining this clear record.21[103-1], [103-2], [103-3], [205-1], [205-2]
Shared Prosperity02RESPONSIBLEBANKINGMaterial Issues Covered2019 Performance Highlights Financial and economic performanceSystematic risk managementCustomer privacy and data securityCustomer satisfactionSME growthResponsible lending and investmentSustain
segments. We also provide a variety of non-banking solutions, services, and products. We recently upgraded our T24 core banking system from R13 to R18 and upgraded its infrastructure to accommodate any future upgrade releases to improve automation and support employees and customer value proposition.
