Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced CO2 emissions by 37%
• Received LEED certification for 14 Nordic office buildings
• Purchased green certificates for all electricity used in the Nordics

Social Achievements

• Initiated pro bono work program for employees in Denmark
• Initiated pro bono seminars on individual finance planning in Latvia
• Improved electronic account statements, reducing paper consumption

Governance Achievements

• Excluded companies involved in the production of cluster munitions from investment portfolio
• Implemented the Equator Principles in project financing

Climate Goals & Targets

Environmental Challenges

• Reducing energy consumption in a large organization
• Standardizing the process for handling CSR responses from suppliers

Mitigation Strategies

• Implemented various initiatives such as automatic shut-off of computers and lights, and an internal environmental guide
• Implemented an e-Sourcing tool to support dialogue with suppliers and integrate CSR into the automated process

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Nordea policies including environment, corporate social responsibility and human rights

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Sustainable energy investments

Reporting Standards

Frameworks Used: GRI G3 Sustainability Reporting Guidelines, Financial Services Sector Supplement (FSSS), UN Global Compact, Equator Principles, UN Principles for Responsible Investments (UNPRI)

Certifications: LEED

Third-party Assurance: KPMG

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Climate funds
• Electronic banking services

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Responsible lending
• Transparency and clear information in financial services and products
• Offering sustainable products (ethical funds)
• Anti-money laundering practices
• Equal opportunities (diversity)
• Greenhouse gas emissions reduction

Environmental Achievements

• Reduced CO2 emissions (on track to meet 2016 target of 18,000 tonnes reduction)
• Reduced energy consumption by 11.7% in office buildings from 2008 to 2010
• Increased use of virtual meetings to reduce travel

Social Achievements

• Launched Financial Education pilot program for schools in Nordic countries
• Participated in Financial Coalition in Sweden to combat sexual exploitation of children
• Supported youth activities in sports and music across Nordic countries

Governance Achievements

• Adopted a new strategy on Responsible Investments in February 2010
• Engaged in dialogues with 16 norm-breaching companies worldwide, successfully ending engagement with Mosaic Company
• Participated in 26 nomination committees and voted at 150 general meetings

Climate Goals & Targets

Environmental Challenges

• Embedding CSR into business strategies and making it a measurable KPI
• Handling media and public attention on credit processes
• Balancing bank secrecy laws with transparency in complex ventures
• Communicating CSR work internally and externally
• Addressing customer habits changing towards digital banking

Mitigation Strategies

• Conducting stakeholder dialogues to understand expectations
• Improving tools for evaluating environmental, social, and political risks
• Reviewing credit processes and Equator Principles application
• Updating sector-specific credit policies
• Improving web pages for better information access

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• All suppliers invited for projects must fill in a supplier profile, including acceptance of Nordea’s CSR principles

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI G3 Sustainability Reporting Guidelines, Financial Services Sector Supplement (FSSS)

Certifications: LEED Green Building certifications

Third-party Assurance: KPMG

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Ethical funds

Awards & Recognition

• Bank of the Year 2010 in Denmark, Norway, and Sweden

Environmental Metrics

ESG Focus Areas

• Responsible lending
• Responsible investments
• Product transparency
• Employee development
• Environmental impact reduction

Environmental Achievements

• Reduced CO2 emissions by 13.77% (Nordic countries only)
• Reduced customer paper consumption by 36%
• Reduced energy consumption in premises by 11%
• Achieved LEED certification for 14 office buildings

Social Achievements

• Launched financial education program for youth
• 90% of employees participated in performance and development reviews
• Maintained relatively stable customer satisfaction index
• Implemented a responsible restructuring process

Governance Achievements

• Established Board Risk Committee (BRIC)
• Issued Anti-bribery and corruption policy
• Improved financial crime prevention measures

Climate Goals & Targets

Environmental Challenges

• Meeting stakeholder expectations on investments in controversial sectors (e.g., nuclear weapons)
• Balancing cost efficiency measures with employee well-being during restructuring
• Maintaining high customer satisfaction in a challenging financial climate

Mitigation Strategies

• Froze investments in companies producing nuclear weapon components pending further analysis
• Negotiated staff reductions through voluntary agreements and internal mobility
• Proactive support for customers during financial turbulence

Supply Chain Management

Responsible Procurement

• Clear environmental requirements in sourcing and purchasing processes
• Ensuring suppliers adhere to Nordea’s CSR principles

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI G3 Sustainability Reporting Guidelines, Financial Services Sector Supplement (FSSS)

Certifications: LEED

Third-party Assurance: KPMG AB

Awards & Recognition

• Joint fourth place in the Carbon Disclosure Project’s (CDP) report
• Best private banking service provider in the Nordics by Euromoney Magazine
• Best bank for payments and collections in the Nordic region by Global Finance Magazine
• Biggest and safest bank in the Nordic region by Global Finance Magazine

Environmental Metrics

ESG Focus Areas

• Relationship banking
• Responsible lending
• Responsible value creation
• Environmental footprint reduction
• Corporate governance
• Compliance

Environmental Achievements

• Reduced total greenhouse gas emissions by 5.8% to 51,297 tonnes

Social Achievements

• Conducted almost 2 million advisory sessions with customers
• Introduced a new Sustainability Policy
• Improved ESG assessment in lending
• Achieved 81% score for being an Equal opportunity employer in the annual employee survey
• Maintained customer satisfaction scores above the average scores of peers despite a negative trend in the industry

Governance Achievements

• Established a new Sustainability Policy
• Strengthened compliance systems
• Introduced mandatory e-learning modules on information security and preventing bribery and corruption
• Implemented a formal whistle-blowing system

Climate Goals & Targets

Environmental Challenges

• Economic downturn impacting demand for banking services
• Need to adapt to new regulations
• Maintaining financial stability while supporting customer growth
• ESG risks in lending, particularly in certain industries and countries
• Managing the environmental impact of air travel and paper consumption

Mitigation Strategies

• Developed enhanced internal tools for ESG risk assessment in lending
• Implemented a risk-based approach to identify and focus on higher-risk ESG cases
• Introduced a supplier management system to promote supplier compliance with ESG values
• Implemented efficiency measures in office buildings (LEED certification)
• Introduced Lync audio conference call system to reduce air travel
• Installed new printers to improve printing behavior and reduce paper consumption
• Increased communication with customers electronically

Supply Chain Management

Supplier Audits: 6-10 per year, initially focusing on the 50 largest suppliers

Responsible Procurement

• Nordea Supplier Guidelines
• Annual CSR reviews of suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI G3 Sustainability Reporting Guidelines, Financial Services Sector Supplement (FSSS)

Certifications: LEED (for 14 office buildings)

Third-party Assurance: KPMG AB

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Bank of the Year in Western Europe (The Banker)
• Best in Private Banking in the Nordic and Baltic Region (Euromoney)
• Best debt bank in Nordic region (Global Finance Magazine)
• Safest bank in the Nordic region (Global Finance Magazine)
• Best Nordic Bank in CDP for the 2nd year

Environmental Metrics

ESG Focus Areas

• Customer relationships
• People
• Community engagement
• Products and processes
• Risk & governance
• Environmental impact

Environmental Achievements

• Recognized as a Nordic leader in disclosing climate change data for the third year in a row in the CDP Nordic Climate Change Report, scoring 93 out of 100 points.
• Implemented a new environmental data management system, Credit360, to improve the quality and quantity of environmental data collected and reported.
• Reduced total CO2 emissions by 33% from 2012 (largely due to divestment of Nordea Bank Polska).

Social Achievements

• Conducted more than 700,000 meetings with household customers (130,000 more than in 2012) and created almost 800,000 individual financial plans.
• Increased interaction with small and medium-sized corporates, conducting almost 290,000 advisory meetings (compared to 230,000 in 2012).
• Launched initiatives to increase the number of women in leading positions.
• Financial literacy program reached approximately 15,000 students.

Governance Achievements

• Launched a project to further improve anti-money laundering and counter-terrorism work.
• Implemented efficient e-learning modules on compliance and Know Your Customer issues with approximately 90% employee participation.
• Introduced a group-wide whistleblowing system.

Climate Goals & Targets

Environmental Challenges

• Low economic growth and record-low interest rates.
• Complex regulatory environment.
• Small amount of women in leading positions.
• Need to reduce air travel.
• Swedish Financial Supervisory Authority issued a penalty for insufficient governance and internal control relating to anti-money laundering regulation.

Mitigation Strategies

• Developed advisory services to discuss retirement plans and savings with customers.
• Developed tools and processes to simplify complexity and support financial planning.
• Initiated an analysis to identify barriers to increasing the percentage of women in leading positions and created a plan to ensure equal opportunities.
• Implemented a new activity-based work concept (Nordea Unlimited) to reduce energy consumption and improve efficiency.
• Changed AML governance from a national to business area focus and established a group-wide program to track, coordinate, and report on AML-related activities.

Supply Chain Management

Supplier Audits: 6 on-spot reviews

Responsible Procurement

• Nordea CSR Supplier Guidelines based on the UN Global Compact’s ten core principles.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI G3 Sustainability Reporting Guidelines, Financial Services Sector Supplement (FSSS)

Certifications: Null

Third-party Assurance: KPMG AB

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Safest bank in the Nordic region by Global Finance Magazine
• Best Banking Group Nordics by World Finance Banking Awards
• Best bank in Nordic region by Global Finance magazine
• Best Bank in the Nordics and Baltics by Euromoney
• Me & MyCity recognized by the European Enterprise Promotion Awards 2013

Environmental Metrics

ESG Focus Areas

• Compliance
• Community involvement
• Environmental footprint
• Responsible lending
• Holistic advice
• Accessibility
• Responsible investments
• Leadership & talent management
• Diversity
• Responsible procurement
• Economic performance

Environmental Achievements

• Reduced CO2 emissions by 5.7% from 2013 (6% measured in CO2/FTE).
• Reduced energy emissions (excluding offset Nordic electricity) by 3% from 2013.
• Reduced travel emissions by 8% from 2013.
• Reduced internal paper (kg/FTE) by 6% from 2013.
• Reduced total waste by 11.6% from 2013.
• New head office in Stockholm received two Platinum level LEED certifications.

Social Achievements

• 90,000 new relationship customers chose Nordea.
• Assets under management grew to an all-time high of EUR 262bn.
• Improved immediate manager score by one point in employee satisfaction survey.
• Initiated Compliance Culture Programme to increase compliance awareness.
• Introduced new holistic customer service model for large corporate customers.
• Launched Nordea Next for co-creation of digital services.
• Held Nordea Innovation Challenge to generate ideas for new digital banking solutions.
• Partnered with JA-YE Europe to improve economic education in Norway.

Governance Achievements

• Established a new CSR Committee.
• Reorganized CSR governance model.
• Implemented a revised 'Raising your concern' mechanism.
• Operational Risk & Compliance Awareness Programme with 94% participation rate.
• Compliance Awareness Programme for Senior Management.
• Introduced Responsibility Declarations on mutual funds to increase transparency.

Climate Goals & Targets

Environmental Challenges

• Difficulty in measuring societal impact beyond direct financial benefits.
• Balancing the need for personal contact with customers and the increasing use of digital channels.
• Addressing gender imbalance in senior leadership positions.
• Managing the risks of cybercrime.
• Ensuring responsible lending practices.
• Integrating ESG considerations into lending and investment decisions.
• Reducing air travel while maintaining international operations.

Mitigation Strategies

• Initiated efforts to better understand and report on economic and social impact.
• Strengthened remote channels while maintaining a strong branch network.
• Implemented initiatives to improve gender balance, including setting requirements and raising awareness.
• Implemented a layered security approach to combat cybercrime.
• Developed ESG tools and processes for corporate customers.
• Established a Sustainable Financing unit to focus on ESG matters.
• Promoting virtual collaboration tools and behavioral change to reduce air travel.

Supply Chain Management

Supplier Audits: 3 supplier CSR reviews conducted in 2014.

Responsible Procurement

• CSR Supplier Policy and Guidelines based on UN Global Compact.
• CSR self-assessment questionnaire for suppliers.
• CSR reviews of selected suppliers.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Regulatory changes

Opportunities

• Green bonds market

Reporting Standards

Frameworks Used: GRI G4

Certifications: LEED Platinum (Stockholm head office)

Third-party Assurance: KPMG AB

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Responsible investment funds (Emerging Stars, Swedish Stars).

Awards & Recognition

• WISE Awards Winner for Me & MyCity (2014).

Environmental Metrics

ESG Focus Areas

• Compliance
• Climate Change
• Diversity & Inclusion
• Responsible Investment
• Tax Compliance
• Sustainable Procurement
• Human Rights
• Stakeholder Engagement

Environmental Achievements

• Reduced air travel (though not to the 30% target)
• Reduced internal paper use (ongoing process)

Social Achievements

• Launched a new People Agenda focusing on a high-performing culture, future-fit competencies, and diversity
• Established a group-wide whistleblowing system
• Launched Nordea Start-up Accelerator program
• Engaged in My Dream Now project

Governance Achievements

• Established the Business Ethics & Values Committee
• Appointed a new Head of Sustainability, Chief Compliance Officer, and Chief People Officer
• Updated Code of Conduct based on UN Global Compact principles
• Established a Tax Board and enhanced tax policies

Climate Goals & Targets

Environmental Challenges

• Data limitations due to insufficient systems in some countries
• Reputational damage from “Panama Papers” incident
• Insufficient ESG due diligence processes
• Gender pay gap
• Lack of sector-specific guidelines and policies

Mitigation Strategies

• Implemented a Financial Crime Change Programme
• Strengthened compliance culture and efforts to combat financial crime
• Internal investigation following “Panama Papers”
• Analysis of gender pay gap and plans to address it
• Extensive stakeholder dialogues and materiality analysis
• Updating necessary policies and Code of Conduct

Supply Chain Management

Supplier Audits: 13 sustainability dialogues with high-risk suppliers in 2016, 3 resulting in CAPs

Responsible Procurement

• Sustainability questionnaires for all new suppliers
• Extended questionnaires for medium and high-risk suppliers
• Sustainability dialogues with high-risk suppliers
• Third Party Risk Management process

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI G4 (Core level, third-party assured)

Third-party Assurance: Öhrlings PricewaterhouseCoopers AB

UN Sustainable Development Goals

• SDG 13 (Climate Action)
• SDG 1 (No Poverty)
• SDG 4 (Quality Education)
• SDG 10 (Reduced Inequalities)
• SDG 17 (Partnerships for the Goals)

Nordea's initiatives contribute to these goals through responsible investment, digital financial inclusion, and multi-stakeholder partnerships.

Sustainable Products & Innovation

• Green bonds

Awards & Recognition

• Various awards received by Nordea Transaction Banking

Environmental Metrics

ESG Focus Areas

• Climate change
• Human rights
• Sustainable finance
• Community engagement
• Diversity & Inclusion

Environmental Achievements

• Issued first green bond (EUR 500m)
• Committed to being a carbon-neutral company
• Purchased 100% renewable electricity for Nordic operations, Poland and Russia

Social Achievements

• Launched new community engagement strategy and volunteering policy
• Engaged 1,569 employees in community engagement
• Improved customer satisfaction scores in Commercial and Business Banking

Governance Achievements

• Implemented a new compliance governance structure
• Established a dedicated board committee for conduct, compliance, sustainability, and operations
• Strengthened sustainability governance

Climate Goals & Targets

Environmental Challenges

• Workforce reduction due to digitalization
• Lack of established methods to create science-based targets for financial institutions including Scope 3 emissions
• Insufficient data for some ESG metrics

Mitigation Strategies

• Established a job mobility team to support employees
• Working to find a way to include Scope 3 emissions in science-based targets
• Improving data collection and verification processes

Supply Chain Management

Supplier Audits: 15 suppliers engaged in 2017

Responsible Procurement

• Nordea Supplier Sustainability Policy mandatory for large suppliers (EUR 250,000 or more)

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI G4, core level

Third-party Assurance: PwC

UN Sustainable Development Goals

• SDG 3
• SDG 8
• SDG 13
• SDG 16

Focus on materiality and areas where Nordea can have the greatest impact.

Sustainable Products & Innovation

• Green bonds
• Green loans

Awards & Recognition

• Corporate Knights’ 2018 Global 100 Most Sustainable Corporations

Environmental Metrics

ESG Focus Areas

• Climate action
• Human rights
• Responsible supply chain
• Well-being at work
• Diversity and inclusion
• Community engagement

Environmental Achievements

• Reduced travel for internal meetings by more than 7%, contributing to lower carbon emissions from business travel activities by 11%
• Internal operations run on 100% renewable electricity
• Reduced water consumption
• Aimed to completely phase out single-use plastics, plates, and cutlery in offices
• Transition from paper to digital saved 4,028 trees, reduced CO2e emissions by 1,000 tonnes, and saved 176 million liters of water

Social Achievements

• Launched a CO2 tracker embedded in digital banking services
• Improved customer satisfaction in internal and external surveys with a 17% reduction in customer complaints
• Increased Assets under Management (AuM) in Sustainable Selection by almost 87%
• More than 5,400 Nordea employees spent almost 22,000 hours on volunteering in 2019
• Provided over 10,000 senior citizens with guidance in the use of digital services

Governance Achievements

• All employees completed annual training in the Code of Conduct
• Climate risk was included in the risk taxonomy and embedded in the formal risk management process
• Nordea became a signatory to the UN Global Compact, Principles for Responsible Banking (PRB), and Poseidon Principles
• Published sector guidelines for the fossil fuels, real estate, and forestry industries

Climate Goals & Targets

Environmental Challenges

• Challenges in developing a strategy for how to work towards the Paris Agreement in terms of both investments and lending
• Absence of established market norms on how to include investments and financing in science-based targets to lower emissions

Mitigation Strategies

• Piloted climate scenario analysis methodology focusing on carbon-intensive industries
• Continued efforts in 2020 to align investments and financing with the Paris Agreement with a clearer focus on granularity and measurability
• Participation in a pilot to develop tools and frameworks for financial institutions to set science-based targets aligned with the 1.5°C target

Supply Chain Management

Supplier Audits: Three in-depth sustainability reviews in 2019

Responsible Procurement

• Supplier Code of Conduct
• Pre-screening of potential suppliers
• Sustainability questionnaire for high-risk suppliers
• Integration of sustainability into the tendering process

Climate-Related Risks & Opportunities

Physical Risks

• Flooding
• Rising sea levels

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products and services

Reporting Standards

Frameworks Used: GRI Standards: Core option, TCFD, UNGC, Principles for Responsible Banking

Third-party Assurance: PricewaterhouseCoopers Oy

Sustainable Products & Innovation

• Green corporate loans
• Green mortgages
• Sustainability funds
• Green bonds
• Sustainability bonds
• Sustainability-linked loans
• Green car loans
• Green car leasing

Awards & Recognition

• Nordea Global Climate and Environment Fund awarded as one of the year’s best funds

Environmental Metrics

ESG Focus Areas

• Financial strength
• Climate action
• Social responsibility
• Governance and culture

Environmental Achievements

• Reduced total CO2e emissions by 62% from 2019 to 2020 (mainly due to travel policy changes related to the COVID-19 pandemic).
• 8% decrease in energy consumption compared to 2019.
• 29% reduction in total water consumption compared to 2019.

Social Achievements

• Maintained gender balance in the total workforce (51% women).
• Improved gender balance in the Group Leadership Team to 36% women.
• 22% reduction in customer complaints from 2019 to 2020.
• Launched online financial skills workshops for over 4,500 pupils and teachers in Finland.

Governance Achievements

• Established the Sustainability and Ethics Committee (SEC) to oversee sustainability integration.
• Revised ESG risk definitions in the risk taxonomy.
• Updated the Code of Conduct in June 2020.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting operations and customer needs.
• Data limitations in retrieving information from branch offices for carbon footprint calculations.
• Challenges in integrating climate-related risks into all financial risk frameworks.

Mitigation Strategies

• Deployed digital solutions to serve customers safely.
• Offered instalment-free periods for loans.
• Provided liquidity for companies in need.
• Developed bespoke methods to classify sectors vulnerable to physical hazards.
• Developed a bespoke approach to classify economic activities according to their impact on the climate.

Supply Chain Management

Supplier Audits: 80 suppliers assessed for environmental and social impacts in 2020.

Responsible Procurement

• Supplier Code of Conduct aligned with UN Global Compact.
• 99% compliance ratio for the Supplier Code of Conduct in new vendor agreements.

Climate-Related Risks & Opportunities

Physical Risks

• Flooding
• Landslides

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products and services
• Green financing opportunities

Reporting Standards

Frameworks Used: GRI Standards: Core option

Certifications: Null

Third-party Assurance: PricewaterhouseCoopers Oy

UN Sustainable Development Goals

• Goal 4 (Quality Education)
• Goal 5 (Gender Equality)
• Goal 7 (Affordable and Clean Energy)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 10 (Reduced Inequalities)
• Goal 12 (Responsible Consumption and Production)
• Goal 13 (Climate Action)
• Goal 14 (Life Below Water)
• Goal 15 (Life On Land)

The report details how Nordea's initiatives contribute to these goals through various programs and strategies.

Sustainable Products & Innovation

• Green bonds
• Sustainability-linked loans
• Green corporate loans
• Green mortgages
• Green car loans/leasing
• Sustainability-enhanced funds

Awards & Recognition

• "Sponsorship of the Year" award in Finland.

Environmental Metrics

ESG Focus Areas

• Climate Change
• Biodiversity
• Good Governance
• Human Rights

Environmental Achievements

• Launched Global Climate Engagement Strategy targeting high-emitting companies for engagement to reduce emissions.
• Initiated methane engagement campaign with 15 oil and gas companies, resulting in Petrobras joining OGMP 2.0.
• Continued engagement with Top 200 emitters to achieve Paris alignment.

Social Achievements

• Launched Global Social Bond Strategy and Global Social Solutions Strategy.
• Increased capabilities with the launch of a new ESG hub in Singapore.
• Engaged with companies on human rights, including digital rights and participation in the Corporate Human Rights Benchmark.

Climate Goals & Targets

Environmental Challenges

• Geopolitical and economic turmoil, including energy and inflation crises.
• Supply chain disruptions.
• Some investors de-emphasized long-term sustainability goals due to short-term gains from higher energy prices.

Mitigation Strategies

• Focused on core mission of delivering returns and responsibility.
• Launched innovative ESG thematics, including Climate Investing 2.0.
• Expanded ESG STARS family of solutions.

Supply Chain Management

Responsible Procurement

• Engagement with companies on human rights and labor standards; participation in Pharmaceutical Supply Chain Initiative.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Investment in companies crucial for energy transition.

Reporting Standards

Frameworks Used: SFDR, TCFD, SASB, UNPRI

Sustainable Products & Innovation

• ESG STARS and Thematic strategies; Global Climate Engagement Strategy.

Awards & Recognition

• European ESG Manager of the Year
• Sustainable Asset Manager of the Year
• Best ESG Asset Management Company
• Best Sustainable Range (ESG STARS)
• Best Sustainable European Equity Fund
• Best ESG/Sustainability Fund

Environmental Metrics

ESG Focus Areas

• Decarbonization
• Engagement activities
• Diversity & Inclusion
• Biodiversity
• Good Governance
• Human Rights

Environmental Achievements

• 9 companies joined the Oil and Gas Methane Partnership (OGMP) 2.0 in 2023 to reduce methane emissions; 81% of top 200 carbon footprint contributors were aligned or engaged to become aligned with Paris Agreement.
• Developed a Forward Decarbonization tool to provide a forward-looking view of potential decarbonization trajectory of companies.

Social Achievements

• Expanded the scope of the Global Diversity Engagement Strategy beyond gender representation to reflect evolving changes in D&I.
• Committed to a new chapter of Diversity Project Europe (DPE) to promote a diverse and inclusive European asset management industry.

Governance Achievements

• Received the highest possible score of 5 stars in the Policy, Governance and Strategy (PGS) module of the PRI bi-annual assessment.
• Continued to engage with companies on responsible tax practices, filing shareholder proposals for improved transparency and country-by-country reporting.

Climate Goals & Targets

Environmental Challenges

• Global market challenges including persistent inflation, political turmoil, and the effects of climate change leading some investors to retreat to defensive positions.
• Limitations in qualitative human rights data.

Mitigation Strategies

• Continued decarbonization efforts through the Global Climate Engagement Strategy and development of new tools.
• Joined collaborative investor engagement targeting data service providers and proxy advisors to address human rights data limitations.
• Developed methodologies to assess sustainability among covered bonds, government bonds, and labelled bonds.

Supply Chain Management

Responsible Procurement

• Engagement with companies on responsible procurement practices and sustainable product offerings, including the reduction of PFAS.

Climate-Related Risks & Opportunities

Physical Risks

• Physical impacts of climate change

Transition Risks

• Policy changes
• Changing consumer behavior

Opportunities

• Investing in companies with attractive valuations and potential to become relevant in a low-carbon future.

Reporting Standards

Frameworks Used: UN Principles for Responsible Investment (PRI), TCFD, EU SFDR

Certifications: LuxFLAG ESG Label, Label ISR, Towards Sustainability Label

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)
• Goal 8 (Decent Work and Economic Growth)
• Goal 15 (Life on Land)

Thematic strategies align with the UN’s Sustainable Development Goals (SDGs) to tackle social and environmental challenges.

Awards & Recognition

• European ESG Manager of the Year
• Active Manager of the Year
• ESG Fund Manager of the Year
• Best ESG Team Europe
• Global pollution reduction initiative of the year
• Best ESG Investment Fund awards for several funds
• Equity Funds Sustainability awards for several funds
• Best Impact Fund
• Best Sustainable Fund Launch
• Social Fund of the Year
• Infrastructure Fund of the Year

Environmental Metrics

ESG Focus Areas

• Climate Change
• Human Rights
• Good Governance
• Biodiversity/Water

Environmental Achievements

• Public commitment to aligning investment strategies with the Paris Agreement objectives (reducing GHG emissions, increasing climate-related investments, ensuring portfolio resilience to climate risks).
• Implementation of Paris-aligned Fossil Fuel Policy (PAFF) excluding companies without Paris Agreement-aligned emissions reduction strategies.

Social Achievements

• Active engagement with investee companies to improve ESG practices.
• Offering a wide range of ESG solutions across all asset classes.
• Support for UN Sustainable Development Goals (SDGs).

Governance Achievements

• Establishment of Responsible Investment Committee (RIC) and ESG Committee to oversee ESG integration and decision-making.
• Adherence to PRI, SASB, IIGCC, CDP, TPI, Finance for Biodiversity Pledge, and Investor Alliance for Human Rights.

Climate Goals & Targets

Environmental Challenges

• Balancing engagement and exclusion in addressing ESG issues.
• Data availability limitations in monitoring PAI indicators.
• Managing conflicts of interest arising from shareholder engagement.

Mitigation Strategies

• Using a combination of engagement and exclusion based on severity and effectiveness.
• Utilizing internal and external ESG data providers, continuously assessing data quality.
• Implementing policies and procedures to prevent and manage conflicts of interest.

Supply Chain Management

Responsible Procurement

• Expectations for investee companies to comply with international human rights principles and manage their impact on human rights throughout their supply chains.

Climate-Related Risks & Opportunities

Physical Risks

• Physical impacts of climate change

Transition Risks

• Regulatory changes, market shifts related to low-carbon transition

Opportunities

• Climate-related investment opportunities

Reporting Standards

Frameworks Used: PRI, SASB, TCFD

Certifications: ESG4Real (select funds)