AI and Transition Finance: How Emirates NBD Is Building Sustainable Banking that Scales
Emirates NBD is pushing hard on digitisation to make sustainable finance workable at scale. The bank's ESG process spans up to 500 data points across Scope 1, 2, and 3, with 600-800 KPIs in play. As Vijay Bains, Chief Sustainability Officer and Group Head of ESG, put it, automation helps the team "see the wood from the trees" and stops counter-sustainable habits like printing.
The strategy is simple: automate fast, partner where it helps, and remove manual bottlenecks. On the lending side, financed emissions analysis feeds directly into portfolio decisions, tilting credit toward sectors on credible decarbonisation paths and away from exposure that could drag returns or raise capital costs.
Automating the ESG data grind
Collecting and assuring hundreds of ESG fields by hand doesn't hold up under regulatory deadlines or internal reporting cycles. Emirates NBD is digitising data intake, validation, and reporting to reduce cycle times and error rates. That frees risk and coverage teams to focus on material questions: sector pathways, capex plans, and client credibility.
AI that answers and learns
The bank's public-facing AI chatbot already fields roughly 500 sustainable finance queries a month. It delivers instant responses after hours and, more importantly, surfaces demand signals: what clients ask about, where explanations fall short, and which products need clearer positioning.
Next up: using AI to translate the ESG "alphabet soup" for staff and clients. Relationship managers will be able to ask plain-English questions and get fast guidance on applicable structures, discounts, covenants, and reporting asks-without combing through hundreds of KPIs.
Infrastructure and electricity footprint
AI needs compute, and compute needs energy. Emirates NBD has built a new data centre and is offsetting its emissions with nuclear and renewable sources. It's a pragmatic way to get the benefits of AI while managing the associated emissions profile.
Where the lending is going: transition finance
Green Bonds dominate issuance today-roughly 70% of the sustainable bond market-but transition finance is the next theme to watch. The focus is on decarbonising conventional sectors like oil and gas, steel, and aviation. No one goes from 100% emissions to zero in a straight line; transition structures accept that reality and put milestones on paper.
Transition bonds, much like Green Bonds, help issuers align corporate strategy with capital plans and give investors a transparent five-year pathway. Expect more Blue Bonds (water and ocean use) and Orange Bonds (gender diversity) as issuers segment impact areas and investors seek clarity.
Standards are catching up
Market groups have moved to define what "good" looks like. See the ICMA transition finance guidance and the LMA transition finance principles. For bankers, that means clearer diligence checklists, fewer grey areas in structures, and better comparability across deals.
ESG isn't just long-term: it's changing near-term returns
Bains pushed back on the idea that ESG only pays off over decades. Climate signals are already moving markets. Look at futures for cocoa, oranges, and coffee-shifting precipitation patterns have driven spikes that, in some months, outperformed gold.
There's also a credit angle. Transition plans are now tied to short-term liquidity and revolving credit facilities through sustainability-linked loan updates. That means KPIs, margin ratchets, and disclosure can move funding costs inside the current planning cycle.
Carbon markets are back in focus
Most clients won't get to net zero without high-quality offsets after genuine abatement. That's pushing banks to re-activate carbon trading desks and tighten criteria for what "credible, science-based" means. Standards and scrutiny have improved, giving finance teams firmer footing to integrate offsets without reputational drag.
What finance teams can do now
- Consolidate your ESG data layer: define the 500-ish fields that matter, centralise collection, automate QA, and retire spreadsheets and printing.
- Hardwire financed emissions into credit: set sector pathways, risk flags, and covenant triggers that move exposure in line with decarbonisation.
- Give RMs an ESG "translator": deploy an internal chatbot trained on your policies, frameworks, and product menus; log queries to guide product design.
- Stand up a transition finance playbook: map use-of-proceeds vs. transition structures, adopt ICMA/LMA guidance, and lock in five-year KPI frameworks.
- Set a house view on offsets: define accepted standards, due diligence steps, and treatment in pricing and portfolio reporting.
- Plan for AI energy use: capacity planning for compute, procurement of low-carbon electricity, and transparent reporting of the footprint.
- Upskill the team on AI-in-finance workflows. A practical starting point: AI tools for finance.
The takeaway
Emirates NBD's approach is straightforward: digitise the ESG workload, apply AI where it speeds up good decisions, and shift capital toward credible transition. That's not a marketing story-it's risk, return, and execution. The banks that operationalise this fastest will price better, win mandates, and avoid stranded exposure.
Your membership also unlocks:
