Our ESG vision

Our Impact

We are a Signatory of

Policies

Frequently asked questions

• What is Kinara Capital’s approach to ESG?

  Kinara Capital integrates environmental, social, and governance (ESG) principles into its mission by promoting sustainable practices, fostering economic inclusion, and upholding transparency and accountability.

• Why is ESG important to Kinara Capital?

  ESG is central to our mission of driving positive change for MSMEs and local economies, ensuring our growth is sustainable, inclusive, and aligned with ethical practices.

• What governance practices does Kinara Capital follow?

  Kinara Capital has a formal ESG Committee in place to introduce new ESG initiatives, ensure transparent reporting processes, and ensure alignment with relevant standards and guidelines. We share relevant updates on new standards, certifications, or other relevant ESG developments with all stakeholders, including our Board, and investors as well.

  We demonstrate ESG governance through the implementation of a comprehensive Environmental, Social, and Governance Management System (ESG-MS) that is aligned with the national laws and international guidelines for customer protection and organizational excellence standards. This system is designed to identify, assess, manage, and monitor ESG risks at the customer level.

  In addition, governance practices include giving the opportunity to customers, employees, and others to raise their concerns via established processes such as the Customer Grievance Redressal Mechanism, Employee Grievance policy, Vigil Mechanism (Whistleblower) policy, Prevention of Sexual Harassment (PoSH) policy which is applicable to our employees and customers, Gender-based Violence & Harassment (GBVH) policy, Fair Practices Code, Non-Discrimination policy and more.

• How does Kinara Capital ensure compliance with ESG standards?

  We proactively comply with global ESG benchmarks and guidelines to ensure that we prioritize the wellbeing of our customers, employees, and other stakeholders, some of these include the following:

  Our approach to environmental risk mitigation is primarily formulated based on guidance from :

  • International Finance Corporation Performance Standards (IFC PS)
  • British International Investment (BII) Fossil Fuel policy,
  • European Development Finance Institutions (EDFI) Harmonized Exclusion List,
  • Greenhouse Gas (GHG) Protocol
  • United Nations Sustainable Development Goals (UN SDGs)

  Our commitment to human rights and customer protection is based on:

  • International Labour Organisation (ILO) Conventions
  • CERISE+SPTF The Universal Standards for Social and Environmental Performance Management
  • CERISE+SPTF Client Protection Pathway (CPP) Principles
  • United National Women’s Empowerment Principles (UN WEPs)
  • United Nations Sustainable Development Goals (UN SDGs)

  Our good governance practices are based on:

  • Organization for Economic Co-operation and Development (OECD) Responsible Business Conduct
  • European Code of Good Conduct (COGC)
  • European Union 5th Directive on Anti-Money Laundering (EU 5AMLD)
  • United Nations Global Compact (UNGC)
  • United Nations Principles for Responsible Investment (UN PRI)
  • United Nations Sustainable Development Goals (UN SDGs)
  • Wolfsberg Group Anti‐Money Laundering (AML) Principles

• What are some ESG certifications you currently hold?

  We currently hold the following certifications:

  • CERISE+SPTF Client Protection Pathway (CPP) Gold Level – Indicates a thorough implementation of Client Protection policies and practices across all aspects of operations
  • MFR SER Rating “A” – Signifies a high level of social and environmental performance, indicating we are effectively managing our social and environmental impacts, aligning well with their mission, and demonstrating strong practices in areas like client protection and responsible lending.
  • Orange Seal – Demonstrates principal commitment to Gender Inclusion, Highly Suitable for Gender-Lens Investment.
  • AICPA SOC 2 Type 2 Certification – Verifies internal controls and systems related to security, availability, processing integrity, confidentiality, and privacy of data.
  • ISO 27001 (Information Security Management Systems) – Demonstrates that we have met global security standards and are committed to managing information security risks.

• How does Kinara Capital measure its ESG impact?

  Kinara Capital tracks and analyzes positive changes in our customers’ lives, including impact on jobs, income and business growth. We track key metrics such as the number of jobs supported, new jobs created, new jobs created for women and for first-time wage earners, average business turnover change, average net income change, proprietor salary change, etc thus ensuring that we have up-to-date insights on the direct impact of our financial inclusion work.

• How does Kinara Capital ensure that ESG is incorporated into loan-decisioning for MSMEs?

  Kinara Capital emphasises environmental risk mitigation by adhering to a stringent exclusion list and actively tracking environmental risks in compliance with International Finance Corporation (IFC) standards. We mostly serve micro-MSMEs located in urban and semi-urban areas, where the risk of customer activities contributing to environmental degradation is minimal to negligible. In terms of due diligence measures, a Special Know Your Customer (KYC) process is employed, which includes a mandatory requirement of clearances such as Pollution No Objection Certificate (NoC), Forest Department Clearance, Food Safety and Standards Authority of India (FSSAI), etc for relevant sectors.

• What measures does Kinara Capital take to ensure ESG compliance and promote sustainable practices among its MSME customers before and after loan disbursement?

  Kinara Capital conducts ESG monitoring both before and after loan disbursement for every applicant/customer. For sectors with higher sensitivity, we conduct additional monitoring on a half-yearly or on an annual basis to ensure compliance with environmental standards and best practices.

  While most of our MSME customers fall into lower-risk categories with minimal emissions, we are committed to ensuring that our customers adhere to lowering environmental impact by giving them guidance and information on best practices and corrective measures they can adopt. This systematic approach reinforces our dedication to promoting sustainable development and minimising adverse impacts on the environment.

• What initiatives does Kinara Capital undertake to support MSME clients in enhancing their business practices and knowledge-building, especially related to ESG and WASH?

  Through the Grow with Kinara (GWK) series, we conduct free workshops for our MSME customers on a variety of topics, including Udyam registration, financial management, and business digitization tips. Our GWK attendees are made aware of certifications they can obtain, such as MSME ZED Certification, or qualify the business as WASH friendly, which can be useful to gain a competitive edge by building sustainable practices. These efforts are aimed at helping clients understand how their business can be classified as green, and the certifications that are available to them.

  Additionally, as part of our ESG efforts to raise awareness about climate change and environmental sustainability, we disseminate information related to good environmental and workplace safety practices via our field officers and WhatsApp & social media.

  The GWK workshops are held in vernacular languages, ensuring that the content is easily understandable and accessible to all our customers.