In first part of 2025, Romanian banks achieved a significant milestone by publishing their inaugural sustainability reporting under the Corporate Sustainability Reporting Directive (CSRD) and the new European Sustainability Reporting Standards. This development marks an important step towards enhanced transparency and accountability within the banking sector, reflecting a growing commitment to sustainability and responsible banking practices.
The CSRD requires all large EU companies, including banks, to disclose audited sustainability statements for the year 2024, aligning corporate transparency with the European Green Deal and extending the previous Non-Financial Reporting Directive (NFRD). EY has recently performed an analysis of the first wave of CSRD-compliant sustainability statements issued by a sample of seven major Romanian banks. The key observations reveal that climate change is universally recognized as material together with own workforce, with 100% of the banks flagging them as a priority. This collective recognition underscores the urgency for banks to develop actionable strategies that align with global sustainability goals and enhance resilience in the face of climate risks.
Overview of material sustainability topics
Climate change, employee working conditions, consumer rights, and business conduct emerged as the most common material topics identified by Romanian banks, consistent with trends observed in other EU banks. Following this, most banks will need to focus on developing clear transition plans, including measurable targets.
Massimo Bettanin, Partner in Climate Change & Sustainability Services, EY Romania: “The data reveal a clear industry-wide consensus on addressing climate change as a priority, with 100% of institutions recognizing its materiality. Banks are expected to translate awareness into robust transition plans that align with the objectives of the Paris Agreement.”
Razvan Pirnac, Partner in Financial Services Risk Management, EY Romania: “Over the past year, we’ve seen increased climate variability and a growing number of extreme weather events. In this context, banks and other major companies may find it beneficial to accelerate and refine their transition planning, both to mitigate emerging risks and to capitalize on opportunities in a changing climate.”
In terms of social and governance matters, all banks identified their own workforce, consumers and end-users, and business conduct as material topics. Notably, 29% extended their materiality assessments to include workers in the value chain and affected communities, respectively, reflecting a growing awareness of the broader impact of the banks’ value chain.
Environment-related metrics
Greenhouse gas emissions profile: The analysis confirmed that 99.8% of total greenhouse gas emissions (GHG) reported by the Romanian banks were represented by Scope 3 – Indirect emissions across the value chain, including financed emissions.
On average, banks covered 66% of their portfolios when calculating financed emissions, underscoring the imperative to expand portfolio coverage and refine data-collection processes.
The average GHG emissions intensity of the financed portfolio was 29 tCO2e per 1 million RON financed.
Green Asset Ratio: Another environmental performance metric is the Green Asset Ratio (GAR), which measures the share of a bank’s covered assets financing activities that are environmentally sustainable under the EU Taxonomy. For 2024, the Romanian banks reported an average Turnover-based GAR of 0.41% and CapEx-based GAR of 1.11%
Social-related metrics
Social metrics provided insights into workforce diversity, employee turnover, and training efforts. The average percentage of female employees was noted as 74.8%, while the employee turnover rate averaged 12.7%. Training initiatives were robust, with an average of 46.4 yearly training hours per employee, indicating a proactive approach to employee development and engagement. While women make up a substantial share of the total workforce in the banks analyzed, an average pay gap of 27.8% exists between male and female employees. Men predominantly occupy revenue-generating positions, whereas women are assigned to support functions that are customarily compensated at lower levels than core banking roles.
Governance-related metrics
Romanian banks maintain diverse boards, with an average of 54% independent members and 40% female representation in the Supervisory Board. This diversity is crucial for fostering innovative thinking and ensuring that a wide range of perspectives are considered in decision-making processes.
The prevention of corruption and bribery was highlighted as a critical component of governance policies, with an impressive 95.3% of at-risk functions covered by respective training programs, reflecting the banks’ commitment to ethical operations.
Furthermore, 71% of banks have integrated sustainability-related aspects in the remuneration of their board members, demonstrating early integration of ESG performance into the compensation framework.
Conclusions
Overall, these insights and observations illustrate that Romanian banks are laying a strong foundation for responsible banking. As regulations evolve, notably through the European Commission’s upcoming EU Omnibus simplification package, which proposes targeted amendments to the CSRD, Corporate Sustainability Due Diligence Directive (CSDDD) and EU Taxonomy Regulation, banks will still need to enhance their data collection and management systems, refine methodologies on climate-related risks, to ensure full compliance with the EU’s Capital Requirements Regulation (CRR) and Directive (CRD) and deliver on their sustainability commitments.
About EY Romania
EY is one of the world's leading professional services firms with 392,995 employees in more than 700 offices across 150 countries, and revenues of approx. US$51.2b in the financial year that ended on 30 June 2024. Our network is the most integrated worldwide, and its resources help us provide our clients with services allowing them to take advantage of opportunities anywhere in the world.
With a presence in Romania ever since 1992, EY provides, through its more than 1000 employees in Romania and the Republic of Moldova, integrated services in assurance, tax, strategy and transactions, and consulting to clients ranging from multinationals to local companies.
Our offices are based in Bucharest, Cluj-Napoca, Timisoara, Iasi and Chisinau. In 2014, EY Romania joined the only global competition dedicated to entrepreneurship, EY Entrepreneur Of The Year. The winner of the national award represents Romania at the world final taking place every year in June, at Monte Carlo. The title of World Entrepreneur Of The Year is awarded in the world final. For more information, please visit: www.ey.com
About the report
This report analyzes the key sustainability disclosures presented by a group of seven Romanian banks in their 2024 annual reports. These seven financial institutions represent the first wave of Romanian banks required to publish CSRD-compliant sustainability statements.
This report focuses on both quantitative metrics and qualitative insights on material environmental, social, and governance matters.
