Climate Change Data

Environmental Metrics

ESG Focus Areas

• Governance
• Anti-corruption
• Sustainability
• Social Impact

Environmental Achievements

• Reduced carbon emissions by 1000 ton/year at Klarna HQ through energy efficiency improvements (70% reduction to 35 kWh/m2)
• Klarna HQ office powered with 100% renewable electricity
• BREEAM Excellent certification for Klarna HQ
• Recycling initiatives across offices, with donations from recycled materials to charity (49,202 SEK in 2018)
• Use of eco-labeled paper and environmentally-friendly recycling routines

Social Achievements

• Launched Klarna Check-In, a three-day introduction program for new hires (828 employees completed in 2018)
• Implemented a 60-day buddy program for new employees
• Implemented a new operating model to optimize agility, quality, and speed
• Gender Diversity Initiative with targets for female representation in management positions
• Sports & Wellness Committee organizing various activities for employees
• Matching employee charity donations
• Participation in the Swedish Financial Coalition Against Commercial Sexual Exploitation of Children

Governance Achievements

• Clear remuneration policies, instructions, and processes
• Established a policy for suitability assessment and diversity for Board members
• Strong risk management framework with internal control functions
• Compliance with ISO 27001, PCI DSS, and SOC 3 certifications
• Clear ethical guidelines for merchants, actively monitored by a dedicated team

Climate Goals & Targets

Environmental Challenges

• Increased number of printouts in 2018 due to increased employee count and changes in meeting structure
• Managing the environmental impact of employee travel
• Combating financial and cybercrime

Mitigation Strategies

• Internal travel guidelines to decrease environmental impact
• Encouraging use of technology for meetings instead of travel
• Use of eco-labeled paper and environmentally-friendly recycling routines to minimize the impact of increased printouts
• Analytics division responsible for fraud prevention
• Financial Crime Unit for anti-money laundering and counter-terrorist financing
• Compliance Function responsible for Klarna’s Anti-Corruption Program
• Investment in internal resources and capabilities for proactive and reactive cyber security measures
• Information Security Management System based on ISO 27001

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Extended agreement with a coffee supplier who ensures ethical responsibility and sustainable practices in their supply chain

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: BREEAM Excellent (Klarna HQ), ISO 27001, PCI DSS, SOC 3

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Swedish Green Building Award 2012 (Klarna HQ)

Environmental Metrics

ESG Focus Areas

• Climate change
• Financial wellness
• Data security & privacy
• Circular Economy
• Personal Data Sovereignty
• Diversity, Inclusion and Equity
• Employee Learning and Development

Environmental Achievements

• Launched in-app CO₂ Emissions Tracker with 3.5 million unique users.
• Contributed over USD 1m to the Climate Transformation Fund, supporting 11 climate projects.
• Introduced an internal carbon tax, generating USD 1.67m in FY21, channeled into climate projects.
• Achieved 80% renewable energy of total energy use.

Social Achievements

• Launched Pink Standards in Sweden, reducing late invoice payments by over 50%.
• Donated USD 4.5m in free services to 100 US SMEs.
• Launched a GBP 3m Small Business Support Package in the UK, aiding 100 SMEs.
• Improved employee engagement survey response rate to 84%.

Governance Achievements

• Conducted first materiality assessment.
• Developed a comprehensive sustainability approach with clear targets.
• Revisited sustainability governance framework.
• Launched Security Academy for Security Champion community.

Climate Goals & Targets

Environmental Challenges

• 33% increase in GHG emissions from 2020 due to global expansion and increased sales volume.
• Potential impact of increased carbon emission pricing and reporting obligations on costs and operations.
• Potential impact of changing consumer behavior due to increased climate change awareness on business metrics.
• Potential disruption of operations due to extreme weather events impacting Klarna or its retailers.

Mitigation Strategies

• Implementing plans to reduce emissions, including internal carbon tax and renewable energy use.
• Monitoring and mitigating the risk of increased carbon pricing through ongoing activities and monitoring.
• Informing consumers of the environmental impact of their purchases through initiatives like the CO2 emissions tracker.
• Leveraging global diversification to limit the impact of extreme weather events.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events impacting operations and retailers' capabilities.

Transition Risks

• Increased carbon emission pricing and reporting obligations impacting costs.

Opportunities

• Increased demand for services from climate-forward customers; increased retail partner adoption.

Reporting Standards

Frameworks Used: TCFD

Environmental Metrics

ESG Focus Areas

• Planet Health (Climate Change)
• Financial Wellness
• Diversity & Inclusion

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities