Climate Change Data

Environmental Metrics

ESG Focus Areas

• Good debt collection practices
• Ethics
• Corporate governance
• Compliance
• Data privacy
• Information security
• Gender equality
• Diversity
• Environmental footprint
• Financial crime prevention

Environmental Achievements

• Started measuring and reporting on emissions.
• Initiatives to reduce energy consumption, travel, and waste.

Social Achievements

• Developed digital solutions like QuickPay and debtor portals to ease access to information and ability to pay.
• Offered payment plans and postponements to debtors facing difficulties due to the pandemic.
• Provided extensive awareness trainings on data privacy and information security.
• Implemented a common HR system improving human capital development metrics.
• Established an employer branding project to attract and retain talents.
• Increased the number of courses offered by Axactor Academy.
• Assessed parameters to ensure equality and diversity.

Governance Achievements

• Assessed and strengthened policies and processes to prevent and detect unethical behavior, fraud, corruption, money laundering, and terrorist financing.
• Internal audit thoroughly investigated systems, reporting, accounting, and processes.
• Implemented procedures for complaints and whistle-blower reports.
• Approved new policies regulating trade sanctions, antitrust, and anti-money laundering; updated Code of Conduct and policies regulating legal & compliance and anti-fraud & anti-corruption; updated Insider policy.

Climate Goals & Targets

Environmental Challenges

• Defining consistent boundaries for sustainability reporting due to the complexity of ownership and operational arrangements in six different countries.
• Inconsistent year-over-year reporting on incidents and HR data.
• Increased number of complaints from debtors claiming breach of GDPR.
• Higher employee turnover rate in 2020 compared to 2019 due to efficiency measures and organizational changes.
• Difficulty in achieving equal pay for equal work short-term due to contractual obligations and cost challenges.
• Not all offices have systems for recycling or environmentally friendly destruction of used electronic office equipment.

Mitigation Strategies

• Implementation of common reporting system and development of common definitions and reporting standards.
• Ongoing work on developing a job framework across all countries to support fair and equal pay.
• Mitigation plan for minor deviations in Spain (postponed due to Covid-19 pandemic).
• Planned improvements in information security processes, early detection and root-cause mitigation, automation of tools and workflows, and continuous awareness.
• Planned implementation of a tool for monitoring vendors and requesting them to close identified gaps.
• Mitigation plans for 2021 to address gaps in recycling and waste handling in some offices.

Supply Chain Management

Responsible Procurement

• Structured purchasing processes and sourcing strategies to ensure ethical and high-quality services and goods.
• Requirement that suppliers involved in the debt collection process commit to Axactor’s code of conduct and implement sufficient information security measures.
• Use of collection agents only through the acknowledged organization LIC for international collection.
• Know-your-customer procedure before entering contracts with new customers.
• Warranties of compliance to relevant laws and regulations in all contracts.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Global Reporting Initiative (GRI)

UN Sustainable Development Goals

• Goal 5: Gender equality
• Goal 8: Decent work and economic growth
• Goal 16: Peace, justice and strong institutions

Axactor contributes to these goals through its daily operations, including promoting gender equality in the workplace, generating positive economic effects through debt collection, and implementing policies to prevent financial crime and corruption.

Sustainable Products & Innovation

• QuickPay
• Debtor portals

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Ethical Business Conduct
• Data Security & Privacy
• Financial Crime Prevention

Environmental Achievements

• Reduced number of company cars by 29
• Paper waste reduction initiative in Spain (12,920 kg recycled)
• Initiated development of a GHG emissions tool

Social Achievements

• Strengthened understanding of company purpose for all employees
• Increased focus on sustainable payment plans
• Established cooperation with Great Place To Work to measure employee satisfaction
• Implemented a new group-wide recruitment tool
• Launched more courses through Axactor Academy
• Continued focus on gender equality and diversity
• Improved debtor complaint management
• Ethical committee established
• Improved vendor management and introduced a Supplier Code of Conduct

Governance Achievements

• Improved vendor management and introduced a Supplier Code of Conduct
• New Group risk and compliance tool implemented
• Improved anti-money laundering processes
• New intranet launched: The People Hub
• Improved information security and data privacy governance
• Individual policies established on anti-fraud, anti-corruption, anti-money laundering, anti-trust, and trade sanctions
• Whistle-blower channel made available to suppliers
• Signed UN Global Compact

Climate Goals & Targets

Environmental Challenges

• Defining consistent boundaries for sustainability reporting across six countries with different regulatory requirements
• High employee turnover (31.3%) due to organizational restructuring
• Need to improve internal information sharing and employee involvement in decision-making

Mitigation Strategies

• Implementation of common reporting systems and development of common definitions and reporting standards
• Thorough analysis and continuous improvement of the different elements of the employee journey at Axactor
• Implementation of a new intranet, the “People Hub”, to improve internal information sharing

Supply Chain Management

Supplier Audits: All key suppliers verified compliance with Axactor’s Supplier Code of Conduct in 2021.

Responsible Procurement

• Supplier Code of Conduct
• Structured purchasing processes and sourcing strategies

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards: Core option

UN Sustainable Development Goals

• SDG 5: Gender equality
• SDG 8: Decent work and economic growth
• SDG 13: Climate action
• SDG 16: Peace, justice and strong institutions

Axactor's initiatives contribute to these goals through responsible business practices, ethical debt collection, diversity and inclusion programs, climate action, and compliance with laws and regulations.

Sustainable Products & Innovation

• QuickPay and debtor portal (digital solutions)

Environmental Metrics

ESG Focus Areas

• Ethical debt collection
• Fair debtor treatment
• Data privacy and information security
• Sustainability
• Governance
• Employee well-being

Social Achievements

• Implemented technical solutions for measuring debtor treatment, achieving an average satisfaction score above the internal target of 4.0.
• Increased the number of payments made through self-service debtor portals by 8% and the collected amount by 21%.
• Increased the number of debtors logging into self-service portals by 75%.
• Several initiatives to ease the negative consequences of home office for employees (digital social events, competitions promoting physical exercise, one-to-one conversations).

Governance Achievements

• Created a stronger in-house information security team and established a governance structure to secure collaboration between relevant units.
• Reduced the default e-mail retention period and performed a risk assessment presented to the Board of Directors.
• Implemented local Security Committees in all countries.
• Board of Directors approved new policies regulating trade sanctions, antitrust and anti-money laundering, and updated the Code of Conduct and policies regulating legal & compliance and anti-fraud & anti-corruption.
• Updated sustainability report published alongside the 2020 annual report.
• Axactor’s standard contracts were reviewed to ensure compliance with all bank and finance regulatory outsourcing requirements.

Climate Goals & Targets

Environmental Challenges

• Reduced volumes of debt collection cases received from customers due to the Covid-19 pandemic and low default rates in banks.
• Lack of volumes in the 3PC segment.
• Longer sales processes due to government-imposed restrictions.
• Reduced debt refinancing by Nordic banks in January.
• Legal authorities spending time to resume operations after the holiday break in January.

Mitigation Strategies

• Cost reduction program aiming to realize annual savings of EUR 4.8 million.
• Restructuring of operations in Spain, closing three offices and moving operations to larger centers.
• Homeshore process in Finland, moving back office operations from the Baltic countries to Finland.
• Focus on improving performance on older vintages of NPL portfolios.
• Strong pipeline for new 3PC business and final discussions with several potential customers.

Supply Chain Management

Climate-Related Risks & Opportunities

UN Sustainable Development Goals

• Goal 16

Commitment to UN global development goal #16

Environmental Metrics

ESG Focus Areas

• Ethical business behavior
• Ethical collection by treating debtors fairly
• Data security
• Debtor privacy
• Preventing financial crime and corruption
• Diversity, non-discrimination and equal opportunities
• Talent attraction and retention
• Responsible selection of clients and portfolios
• Working conditions
• Responsible value chain and partnerships
• Relationships with regulators and organizations
• Innovative and efficient product offering
• Sound economy for our clients
• Increase financial literacy in society
• Environmental footprint
• Climate change mitigation
• Climate change adaptation

Environmental Achievements

• Continued group-wide awareness campaigns, addressing environmental issues and the Group’s impact
• Improved quality of data collected in the GHG inventory
• Increased emphasis on making sure that services and goods acquired are provided from suppliers with acceptable environmental standards
• Axactor Spain obtained the ISO 27001 information security certification

Social Achievements

• Fully certified as a Great Place To Work across all countries of operation, with improved overall results from 2022
• Improved gender balance at managerial level, and an overall reduction in pay-gap between genders
• Reduced sick-leaves despite reorganization initiatives
• Increased use of machine learning to both boost efficiency within operations and to improve portfolio valuation
• High customer satisfaction with increased score to 8.8/10 and upheld net promoter score of 62

Governance Achievements

• Updated its Code of Conduct, and all employees were required to sign the updated code
• Updated its group-wide procurement procedures
• Rolled out a new group-wide complaints and deviations management system
• Fully compliant with all sections of the Norwegian Code of Practice for corporate governance

Climate Goals & Targets

Environmental Challenges

• Difficult macroeconomic climate
• Increased inflation and interest rates
• Reduced number of large settlements and debtors opting for longer payment plans
• Government imposed payment deferrals and increased reservation amounts
• Insufficient willingness to pay for high-quality collection services in Finland and Sweden
• Lower market prices for NPL portfolios
• Lower monthly payments coming from the bailiff systems
• Cash flow delays

Mitigation Strategies

• Further streamlined organization through increased cross-border cooperation
• Increased use of business intelligence and machine learning tools
• Refinanced both bank facility and one of the outstanding bond loans
• Closed down 3PC operations in Finland and Sweden
• Investments in training and education of employees
• Investments in efficient tele-/video conferencing equipment
• Efforts to lower the travel ratio and choose less emission intensive travels
• Efforts to reduce the use of paper through opportunities for electronic communication

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI

Certifications: ISO 27001 (Spain and Italy)

Third-party Assurance: PricewaterhouseCoopers AS

UN Sustainable Development Goals

• Goal 5
• Goal 8
• Goal 13
• Goal 16

Axactor’s values and corporate policies support these goals.

Environmental Metrics

ESG Focus Areas

• Gender balance and equality
• Ethical business conduct
• Compliance with EU’s Digital Operational Resilience Act (DORA)
• Compliance with EU’s Corporate Sustainability Reporting Directive (CSRD)

Social Achievements

• Improved gender balance (36% men, 64% women); 50% men and 50% women at management level. Improved base salary pay-gap between men and women.
• Updated Code of Conduct and conducted annual compliance trainings focused on data privacy, anti-fraud, anti-corruption, conflict of interest, working with debtors, and gifts and invitations.

Governance Achievements

• Ongoing internal controls and internal audits throughout the year, focusing on HR, Operations, IT, and information security. Internal audits focused on compliance with the Group’s delegation of authority policy, NPL discounts procedure and access management procedure.

Climate Goals & Targets

Environmental Challenges

• Difficult collection environment driven by unfavorable macroeconomic factors (increased inflation and interest rates limiting debtors’ ability to settle debts).
• Increased interest expenses putting pressure on results through increased funding cost.

Mitigation Strategies

• Continuous work to further improve efficiency and cost base to cushion challenges from external factors.
• Site consolidation in Italy to reduce costs and generate efficiency improvements.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: CSRD