Union Bank of India (UBI) has been assigned a ‘Leadership’ ESG rating of CareEdge-ESG 1+, achieving an overall score of 81.3, significantly surpassing the industry median of 61.7. The rating reflects strong performance in Governance (82.3) and Social (84.2) pillars, driven by robust compliance, ethical conduct, and effective grievance redressal. Environmental performance, while improving, remains a key area for future scaling of green financing.
Union Bank Secures Leadership ESG Rating
Union Bank of India (UBI) announced that Care ESG Ratings Limited has assigned the bank an ESG rating of CareEdge-ESG 1+, based on performance as of February 17, 2026. This rating signifies a ‘Leadership position’ in managing ESG risk through best-in-class disclosures, policies, and performance, resulting in an overall score of 81.3 against an industry median of 61.7.
Pillar Performance Analysis
The bank’s strong overall score is supported by high ratings across the three pillars:
- Social Score: 84.2 (Industry Median: 73.3)
- Governance Score: 82.3 (Industry Median: 63.7)
- Environment Score: 70.4 (Industry Median: 30.2)
Social Stewardship Highlights
UBI’s high social score reflects strong stewardship underpinned by comprehensive regulatory compliance and inclusive workforce policies. Key contributors include:
- A consumer complaint resolution rate exceeding 98%, with a CSAT score of 96.10 in FY25.
- A commitment to workforce inclusion, with differently abled employees comprising 3.57% of the total workforce.
- Progress in inclusive lending, with the share of women borrowers rising to 46.93% in FY25.
- A female-to-male pay ratio of 86.5 per 100, showing progress in narrowing the gender pay gap, although slightly below the industry median.
Robust Governance Framework
The governance score of 82.3 is substantially higher than the industry median (63.7), reflecting sound oversight and ethical conduct. Strengths include:
- Robust internal policies covering business ethics, anti-corruption, and anti-bribery (ACAB), extended to suppliers.
- Demonstrated transparency via a strong Enterprise Risk Management system and adherence to ISO 31000 protocols.
- 100.00% of Key Managerial Personnel (KMPs) trained on the Business Responsibility and Sustainability Reporting (BRSR) framework.
Environmental Efforts and Transition Risk
The bank achieved an environmental score of 70.4, substantially surpassing the industry median. UBI shows proactive climate risk integration:
- UBI is the first major Indian bank to join the Partnership for Carbon Accounting Financials (PCAF) for measuring financed emissions.
- Commitment to achieve net-zero emissions in its own operations by 2035.
- Renewable energy consumption reached 1.82% of total energy use in FY25, significantly higher than the median of 0.53%.
Identified Weaknesses and Opportunities
The rating notes specific areas where UBI can enhance its ESG profile:
- Adverse Transition on Emissions Intensity: Scope 1 and Scope 2 emission intensities per employee increased during the period.
- Human Rights Policy Gap: Absence of a standalone, formally articulated human rights policy or strategy limits strategic alignment.
- Gender Diversity in Leadership: Lacks female representation in senior management and on the Board, which is considered a structural weakness impacting governance best practices.
Key Rating Drivers Summary
Positive factors supporting the high rating include proactive climate risk integration, effective grievance redressal resolving over 98% of complaints, and strengthened ethical governance policies extended to the supply chain. Negative factors mitigating the score include the elevated GHG emission intensities and the noted gaps in gender diversity at senior levels.
Source: BSE
