While climate change poses a serious threat to society and the global economy, it also presents a commercial opportunity for businesses that develop solutions to transition to the green economy. And the banking sector, as a financier, plays an important role in scaling new technologies that will decarbonize other sectors. As Yapı Kredi, we have taken significant steps in our environmental, social, and governance actions, prioritizing the effects of the climate crisis. Yapı Kredi is dedicated to supporting our customers in their transition to carbon-neutral operations, managing their climate-related risks, and committing to organizations that work to prevent the global climate crisis. We are committed to reducing emissions in our operations and those we finance, and to supporting the transition to a net-zero economy. We guide to our customers on their journey to net zero, not only as a financier but also as an advisor and partner.
As Yapı Kredi, we have taken significant steps to provide financing for green investments in the real sector. To that end, we have supported numerous pioneering international initiatives and proven our commitment to net zero transformation. In 2019, we became one of the founding signatories of the UN PRB. In line with the climate risk action plan provided for under the Paris Climate Agreement, we committed to the Science Based Targets Initiative (SBTi) to reduce our emissions in 2021. Moreover, we became the first and only institution in Türkiye to commit to setting emission reduction targets within the framework of the "Business Ambition for 1.5°C". We became a member of the NZBA (Net Zero Banking Alliance) in 2023 to further reinforce our position in the transition to a net zero economy. We also became a supporter of the "Task Force on Climate-related Financial Disclosures" (TCFD) to provide clear and consistent information regarding the risks and opportunities presented by the climate crisis.
In line with our commitments, we launched a new project within the scope of the Carbon Transformation Program initiated by our main shareholder, Koç Holding, in 2021. Under this project, we completed the measurement and analysis of financed emissions for the first time in 2022. These emissions, which constitute almost all of the banking sector’s greenhouse gases, were measured using the PCAF methodology. In 2023, we conducted a modeling study of interim net zero emission reduction targets in accordance with the guidance provided by SBTi. In the same year, we also conducted a financial feasibility study to achieve the set targets. During this study, we developed decarbonization strategies for priority sectors and identified action sets to achieve these strategies. After the feasibility and strategy study, we submitted our modeled targets to SBTi for approval. Furthermore, at the beginning of 2024, we completed the work initiated to improve the data quality and methodology for calculating financed emissions, which plays a pivotal role in the implementation of the strategy.