| 64 Annual Report | 2024-2025 Management Discussion & Analysis ESG-DRIVEN VALUE CREATION – EMBEDDING SUSTAINABILITY AT THE CORE OF BUSINESS Arohan Financial Services continues to make meaningful strides in advancing its Environmental, Social, and Governance (ESG) agenda, positioning sustainability as a cornerstone of its long-term business strategy. Rather than treating ESG as a standalone initiative, Arohan has fully integrated ESG principles across its decision-making, operations, and risk management frameworks— driving holistic and resilient growth. In FY 2025, Arohan implemented key initiatives such as the adoption of an ESG exclusion list in loan applications, ESG Gap Assessments, and a refined materiality assessment process, all designed to align operations with long-term sustainability objectives. ESG at Arohan is not a standalone activity—it is deeply woven into the company’s risk management and decisionmaking frameworks, ensuring that environmental and social factors are considered at every level of the business. The company has also invested in employee awareness and training, beginning at the Head Office, to strengthen internal ESG capacity. These actions are complemented by ongoing improvements in data management, disclosures, and reporting systems to meet the evolving expectations of stakeholders. Arohan also continues to drive the social development and inclusive growth through strong governance and impactful Corporate Social Responsibility (CSR) initiatives, aligned with the Company’s priorities. The company’s E&S Policy, introduced in FY 2023, aligns with both international standards and national regulations, reflecting a proactive stance on environmental and social risk mitigation. Through its CSR efforts, Arohan focuses on empowering underserved communities by improving access to healthcare, education, clean water, and sanitation — positively impacting over 8.33 Lakh lives. As the company grows, it remains deeply aware of the social and environmental impact of its operations and those of its stakeholders, committing to responsible finance as a foundation for long-term, sustainable success. Environmental & Community Initiatives 1. Eco-Sustainability: Safe Drinking Water & Sanitation: Arohan Financial Services Limited is deeply committed to promoting eco-sustainability by supporting projects that enhance agricultural productivity while protecting natural resources. Focused on rain-fed and semi-arid regions, the company implements water conservation initiatives that improve access to safe drinking water, restore soil health, and encourage vegetation management. These efforts not only strengthen the resilience of farming communities but also promote sustainable agricultural practices, contributing to long-term environmental stewardship and rural livelihood enhancement. 2. Water Conservation: Arohan’s water conservation strategy is integral to its broader environmental agenda. By investing in initiatives that tackle water scarcity in vulnerable regions, Arohan helps preserve critical water resources while enabling sustainable farming. These projects emphasize soil enrichment, vegetation restoration, and efficient water use, combining ecological preservation with improved agricultural outcomes. Through these actions, Arohan empowers rural communities and reinforces its role in building climate-resilient ecosystems. 3. Disaster Relief & Preparedness: In response to the recurring natural disasters—such as floods and cyclones—that affect many of its operational areas, Arohan has made disaster relief a core pillar of its Corporate Social Responsibility (CSR) efforts. The Company provides timely aid to affected communities through volunteer engagement, resource mobilization, and distribution of essential relief materials. In order to support the communities it serves, Arohan also integrates preventive measures and communitybased preparedness plans, working alongside local stakeholders to reduce vulnerability and enhance response capabilities. In FY 2025, more than 5,000 individuals have received direct assistance during times of crisis, underscoring Arohan’s commitment to protecting and supporting communities when they need it most. Social Initiatives – Driving Impact through Community-Centered Programmes Arohan remains steadfast in its mission to create lasting social impact by addressing pressing community needs and promoting inclusive development. Guided by its commitment to responsible finance and social equity, Arohan actively seeks opportunities to support the wellbeing of its customers and the broader communities it serves. In FY 2025, the company undertook several meaningful initiatives under its social responsibility framework, focusing primarily on health and wellbeing.
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