Developments in the Sustainability Ecosystem

A DENSE SUSTAINABILITY AGENDA
IN THE WORLD

Global Sustainability Agenda

The 29^th Conference of the Parties (COP29) to the United Nations Framework Convention on Climate Change took place in November in Baku, the capital of Azerbaijan. This conference, the largest in its history, attracted over 65,000 participants from more than 200 countries. Key topics discussed included climate finance, carbon markets, fossil fuel reduction, and the needs of developing nations.
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The rising frequency of extreme weather events and their devastating impact on economies highlight the urgent need for increased financing to combat climate change. At COP29, participants acknowledged that current financing mechanisms are inadequate. They emphasized that annual funding must rise to at least USD 300 billion by 2035 to adequately support the adaptation and mitigation needs of developing countries.
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Another significant outcome of COP29 was the agreement on new regulations for carbon markets, aimed at establishing a global incentive mechanism for their functioning. However, COP29 concluded without a consensus on reducing fossil fuel use, underscoring the necessity for stronger policies to achieve the goal of limiting global temperature rise to 1.5°C. Additionally, the conference stressed the importance of enhanced international cooperation to ensure that the developing countries most affected by climate change can access the financial resources they require.
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Ziraat Bank participated in the finance days at the Türkiye pavilion during the COP29 summit, showcasing an effective program and contributing to sectoral discussions. The panel titled “Financial Challenges for a Nature Positive Economy,” organized by the Institute of International Finance and featuring the President of Ziraat Bank’s Project Finance and Company Analysis Group, evaluated strategic financial opportunities and challenges faced by the sector. The panel focused on the challenges and sustainable development opportunities arising from climate risks for developing countries, as well as the role of environmental investments in economic growth. It emphasized the need for cooperation between the public and financial sectors to develop effective policies. Ziraat Bank shared its sustainability goals in the agriculture and energy sectors, highlighting its commitment to increasing biodiversity and contributing to food security. The Ziraat Farmer Platform was presented as an example of good practice.
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In alignment with the UN’s Paris Agreement on climate change, countries have pledged to achieve net-zero carbon emissions within 30 years. Achieving this ambitious goal necessitates global cooperation and economic transformation. Meanwhile, through the European Green Deal, the European Union has established environmental goals that include climate change mitigation, adaptation, transitioning to a circular economy, pollution prevention and control, and protecting biodiversity and ecosystems, and corresponding environmentally sustainable economic activities. The Carbon Border Adjustment Mechanism (CBAM), which complements the Green Deal Action Plan, requires EU Member States and their trading partners to implement measures to prevent carbon leakage. Following a transition period that initially involves only reporting obligations, the CBAM will enforce verification and pricing requirements starting January 1, 2026, imposing a carbon tax on carbon emissions exceeding specified limits for exports of cement, electricity, aluminum, iron, steel, and fertilizer.
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The EU Taxonomy guides the financial sector, which is crucial for financing the green transformation. It offers a methodology that prioritizes investments in sustainable activities by classifying them accordingly. One of the key performance indicators for the banking sector, as determined by the European Banking Authority (EBA), is the green asset ratio. This ratio measures the proportion of assets allocated by credit institutions to activities deemed green under the taxonomy compared to their total assets within that framework.

Türkiye’s Sustainability Agenda

Through its renewable energy investments, Ziraat Bank contributes to Türkiye’s 2053 Net Zero Emissions Target.

The Paris Agreement has spurred sustainability initiatives in Türkiye, mirroring global trends. The 2022-2025 Sustainable Banking Strategic Action Plan, developed by the Banking Regulation and Supervision Agency (BRSA) as part of the Green Deal Action Plan released in 2021, aims to establish a sustainable banking infrastructure in the Turkish banking sector. It outlines the procedures banks will follow in their sustainability efforts, focusing on effectively managing financial risks associated with climate change in accordance with international standards and practices, promoting sustainable finance, and enhancing collaboration with relevant stakeholders in the field of sustainable finance.
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The Draft Communique on the Green Asset Ratio has been prepared by the Banking Regulation and Supervision Agency (BRSA) in accordance with international regulations and practices, drawing on the EU taxonomy. Its objectives are to assess the Turkish banking sector’s contribution to environmental sustainability, analyze and manage climate-related financial risks, improve the accuracy and transparency of climate finance data, provide industrial and commercial enterprises with criteria for green transformation, enable comparisons of organizations’ sustainability performance, direct domestic investments toward green sectors, and channel international green financing resources into the transformation of Türkiye’s real sector. The regulation is anticipated to take effect in 2025.
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Meanwhile, efforts to establish a national taxonomy are being coordinated by the Climate Change Directorate of the Ministry of Environment, Urbanization, and Climate Change, with input from relevant ministries and a technical expert group. In 2024, the Ministry published the Draft Regulation on Türkiye Green Taxonomy, aimed primarily at financial institutions, and it has been submitted for public consultation. The Draft Regulation on Türkiye Green Taxonomy establishes principles and procedures to align economic activities with sustainable development goals. It aims to facilitate financing for sustainable investments and combat greenwashing in the market. The regulation includes a voluntary reporting process until December 31, 2026, transitioning to mandatory reporting starting January 1, 2027.
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The Public Oversight Authority has introduced the Turkish Sustainability Reporting Standards (TSRS), which include TSRS 1: General Provisions on Disclosure of Sustainability-Related Financial Information, and TSRS 2: Climate-related Disclosures, effective in 2024. By implementing TSRS-compliant sustainability reporting, initially targeting large enterprises and financial institutions, Türkiye aims to become the preferred destination for international investments and to position itself among the world’s leaders in global capital allocation, particularly in accessing green finance.
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Ziraat Bank has developed the Carbon Reduction Support Loan Package in accordance with the Draft Communiqué on Green Asset Ratio. This loan package offers long-term funding to support the green transformation needs of companies and organizations, primarily within the corporate and commercial sectors. The lending process is designed by Ziraat Bank with the guidance of consultants, incorporating sector-specific and technical analyses. Additionally, Ziraat Finance Group will publish annual reports compliant with TSRS for 2024, having completed the necessary infrastructure for the reporting process in line with the Turkish Sustainability Reporting Standards.
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The 2025 Presidential Annual Program aims to create a structure that enhances the diversity of energy resources for a sustainable and secure energy supply. This initiative is grounded in the Net Zero Emission Target for 2053 and focuses on utilizing domestic and renewable energy resources.

Additionally, the program seeks to improve energy efficiency, prioritize the localization of energy technologies, integrate innovations, and strengthen Türkiye’s strategic position in international energy trade. In alignment with the Net Zero Emission Target, the goal is to increase electricity generation from renewable sources and ensure grid integration to meet the rising demand for electrification with cleaner energy options.
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In October, the Minister of Energy and Natural Resources, Mr. Alparslan Bayraktar, publicly presented the Renewable Energy 2035 Roadmap, which aligns with Türkiye’s energy policies and introduces a new energy architecture. This roadmap focuses on ensuring energy supply security, reducing foreign dependency, and achieving the 2053 Net Zero Emission Target. It outlines ongoing reform processes to meet the growing electricity demand. Through investments in wind and solar energy, Türkiye aims to achieve an installed capacity of 120,000 megawatts by 2035.

Ziraat Bank guides its sustainability initiatives by closely monitoring international trends and fully adhering to local regulations in alignment with national objectives. To minimize the environmental impact of its operations, the Bank plans to meet the annual electricity needs of its entire domestic organization through three Solar Power Plants with a combined installed capacity of 64 MWp, scheduled to be operational in Kayseri by 2025. This investment supports Türkiye’s 2053 Net Zero Emission Target. Additionally, Ziraat Bank develops its lending policies to align with national goals, implementing selective lending practices in accordance with relevant legislation.

2025 and Beyond

The banking sector must take a more active role in providing green financing for the investments necessary to achieve Türkiye’s Net Zero targets.

In the short and medium term, sustainability significantly influences both financial performance and reputation management in the banking sector, in addition to its environmental and social impacts. It is crucial for banks, as the key drivers in the financial sector, to enhance their sustainability strategies early on and spearhead this transformation.
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In this context, the banking sector must take a more active role in providing green financing for the investments necessary to achieve Türkiye’s Net Zero targets. Banks are expected to foster awareness of green investments and collaborate with public and private sectors to develop innovative, long-term financing models.
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In conclusion, to deepen and expand current efforts in the banking sector and effectively promote green transformation, additional tools and regulations are necessary. The Green Asset Ratio application and TSRS reporting should be recognized as key instruments to help the sector attain its sustainability objectives and accelerate this transition.

Ziraat Bank’s Agenda for Combating Climate Change

Ziraat Bank closely monitors the global and national sustainability agendas.

Ziraat Bank closely monitors both the global and national sustainability agendas, aligning its sustainability initiatives with international standards, guidelines, and framework agreements that are pertinent to the banking sector’s essential role in green transformation. Additionally, the Bank adheres to local regulations, thereby contributing to national sustainability targets.

The Bank adheres to international standards (such as GRI, SASB, TSRS, TCDF) to transparently report the environmental and social impacts of its operations.
It integrates sustainability strategies into its long-term business plans in alignment with Türkiye’s 2053 Net Zero Goals.
The Bank develops and offers products and services that promote green financing and carbon reduction for its customers.
It creates specialized financing models for energy transformation projects and sustainable infrastructure initiatives.
Climate risks are incorporated into the Bank’s assessment processes by considering ESG criteria during lending evaluations.
To minimize its carbon footprint in internal operations, the Bank optimizes energy efficiency in its branches and operational centers, invests in renewable energy transitions, and promotes paperless transactions through digital transformation.

Agricultural Mission

Ziraat Bank is the leading bank in Türkiye’s agricultural sector, dedicated to sustainability with a mission to ensure food security and improve agricultural resilience. The Bank supports agricultural projects and practices that protect biodiversity, address environmental risks, and align with climate change initiatives. This commitment is reflected in its products, which offer subsidized loans regulated by national legislation and adhere to global frameworks like the Taskforce on Nature-related Financial Disclosures (TNFD) and the EU Taxonomy.

Agriculture, being highly sensitive to climate change, plays a crucial role in the sustainable management of natural resources, safeguarding agricultural productivity, and raising farmer awareness. Therefore, it is essential to promote climate-smart investments in agriculture and increase financial resources as part of the Climate Change Adaptation Strategy and Action Plan.
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Ziraat Bank offers consultancy, financing, training, and awareness-raising support to help its agricultural customers adapt to climate change.

Consultancy

Data and methodology for emission understanding and comparison
Connecting with the ecosystem and engaging with customers to measure, manage, and reduce emissions
Facilitating customer access to technology

Education and Awareness Initiatives

Raising customer awareness of climate change and its impacts
Offering training on sustainable agricultural practices
Promoting the adoption of green technologies and practices (Agricultural Farmer Platform)

Financing Solutions

Funding projects and technologies for decarbonization (carbon mitigation support loan package)
Investing in new green technologies

By providing services aligned with environmental sustainability principles, Ziraat Bank aims to ensure food security, protect biodiversity, and enhance climate resilience in the agricultural sector, thereby strengthening national food systems.

Micro Waste Management

As part of its sustainability initiatives, Ziraat Bank is committed to reducing carbon emissions through the advanced recycling of micro-wastes, such as coffee beans. Through its established cooperation, the Bank has implemented a weekly collection of coffee waste, ensuring that the process is reported in accordance with ISO standards and the GHG Protocol. The carbon report details the carbon emissions produced during the process, the emissions saved, the amount of alternative raw materials generated, and provides a comparative analysis of the emission data.
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In 2024, Ziraat Bank’s micro-waste management activities utilized 1,747.28 kg of coffee waste, preventing the emission of 1,982.69 kg CO2e greenhouse gases into the atmosphere. This reduction is roughly equivalent to the carbon footprint of the following activities:

848.59 liters of gasoline consumption
735.58 liters of diesel consumption
989.36 kg of coal consumption
361,619.51 phone charges*
4,340.12 kWh of electricity consumption*

*Calculations were made taking into account the emission factor of the Türkiye’s grid electricity.

The 1,982.69 kg CO₂e reduction also corresponds to the following benefits:

Reforesting 8,029.91 m² of land
A 33.71% decrease in the time it takes for a seed to grow into a 10-year-old tree as a carbon sink
Achieving 85.26% recycling of oversized household waste
A 116.98% reduction in emissions by replacing an incandescent bulb with an LED bulb over a year.

TBB Sub-Working Groups (SWGs)

A comprehensive assessment of the agricultural sector was conducted in collaboration with a stakeholder bank as part of the development of the Heat Map Methodologies Guidelines.

SWG for Heat Map Development - Agriculture Sector Heat Map Studies

As part of the guidelines for developing heat map methodologies—designed to analyze sector-specific climate risks related to banks’ assessments of climate change transition and physical risks—a comprehensive evaluation of the agriculture sector was conducted in collaboration with a stakeholder bank. The resulting guide is available at Isi_Haritasi_Metodolojileri_Olusturulmasina_Iliskin_Rehber.pdf (tbb.org.tr).

Türkiye Green Taxonomy Studies

In line with the Türkiye Green Taxonomy, which was submitted for feedback by the Climate Change Presidency, studies were conducted to establish a unified perspective from the banking sector. Consequently, our Bank contributed to the opinion document that the Banks Association of Türkiye (TBB) will submit on behalf of the banking sector.

Climate Transition Finance Technical Sub-Working Group - Cement Sector

As part of the Climate Transition Finance Technical Sub-Working Group’s activities, a comprehensive assessment of the cement sector was conducted in collaboration with a stakeholder bank. This assessment identified key activities across the sector—including upstream, midstream, and downstream—and evaluated the decarbonization of the industry. The study culminated in the preparation of a white paper, set for completion by the end of 2024. In 2025, the group plans to publish the Climate Transformation Finance Document, which will encompass all sectors.