Sustainability through Engagement, Empowerment, & Mobilisation
regTech product CBD (Compliance by Design) for Corporate & Investment banks
CBD (Compliance by Design) is the regTech product for the corporate and investment banks that further enable them to deliver towards their purpose more powerfully. It makes the bank more robust, clean, purposeful and sustainable for the long term. Its' technical part sits outside of the standardised Just & Resilient NetZero Transition Plans, though a part of its' deployment is through the standardised movement in CTM and thus these transition plans include a part of it. CBD is a key part of Corporate & Investment banks' entity-level systemic change and other FIs' who leverage its reusable features on holistic ratings and quantified underwritings. It is instrumental in these entities' Just & Resilient NetZero Transition for their longterm sustainability, achievement of their fair share of dir/indirect climate goals and all other SDGs by 2030 and ultimately provide blended sustainable finance at scale and speed including in EMDEs mobilising private capital. They will thus indirectly help in the deployment and disclosure of their universal ESG metrics, including sustainability performance as part of their standardised just & resilient netZero transition plans. The comparability of their sustainability performance will need a third party verification too. CBD is also a result of the digital transformation through the initial version of the standardised Transformation Methodology CTM created in 2018. It also helped the bank in its culture shift ultimately contributing to its longterm sustainability. The current version of CTM has evolved ever since and is the standardised Transformation Methodology for leading FIs and real-economy large corporates (also applicable to medium enterprises) have evolved. A simplified version of CTM is also applicable to small and micro enterprises.
CBD solves these bank’s challenges in complying with regulations, solves their core issues of data silo, measures credit and compliance risk more accurately and discretely at each transaction level that can be rolled-up to any level and finally to the bank's balance sheet level, integrates corporates' universal ESG data alongside their financials and others in measuring their creditworthiness, brings more agility in banks' responses to its own business requirements, creates a bank-wide MIS etc. and thereby makes the banks more robust, clean, purposeful and sustainable for the long term. The bank becomes more robust through enhancement in its risk management practices wherein it has rolled up views of its risk data at various levels leading to the bank’s balance sheet level that is collated from its accurate and discrete risk data at the transaction level arrived at through Data Science models. This decision-worthy risk data’s availability at various levels shifts the culture and makes it more risk-focused. Also, the compliance risk data is available at the click of a button, and continuous online monitoring of transactions enables the bank to act in time against any suspicious activity. The ESG data coming from various data points can be integrated into the DS models alongside the financial information and others for more accurate predictions of the creditworthiness of corporates. Business processes with embedded risk data and other information they need, enhance their agility to service their business requirements. All these lead to the bank becoming more robust, clean, purposeful and sustainable for the long term.
Further to this, its re-usable features around holistic ratings and quantified underwritings are accessible to anyone.It can enable asset managers to finance MSMEs at scale and speed in EMDEs and anywhere else with drastically reduced cost and enhanced efficiency in underwriting activities. Thus leading FIs are better prepared to respond to their responsibility and power to steer the economy towards one that is climate-friendly, inclusive and sustainable for the long term.