Climate Change Data

Environmental Metrics

ESG Focus Areas

• Higher education
• Community relations (including environment)
• Stakeholder relations

Environmental Achievements

• Started Banco Santander energy efficiency plan, resulting in a 4% saving in electricity consumption per employee.
• Headquarters of Banco Santander Brazil awarded LEED certification.
• Reduction of CO2 emissions per employee by 17%.
• 18% of energy consumed came from renewable sources.
• 812 tons of CO2 absorbed by restoration projects.

Social Achievements

• Invested EUR 170 million in corporate social responsibility projects.
• Invested EUR 117 million in Santander Universities, supporting over 990 universities and awarding 21,799 scholarships.
• Launched Santander Committed Volunteers program.
• Supported over 250,000 micro-entrepreneurs through microcredit programs.
• Implemented a three-year grace period on mortgage principal repayments for customers experiencing financial problems in Spain.

Governance Achievements

• Reduced all directors’ remuneration by 8%.
• Maintained a stable staff in principal markets.
• Implemented a corporate policy on human rights.
• Included in DJSI and FTSE4Good indexes.

Climate Goals & Targets

Environmental Challenges

• The global economic crisis.
• Combating climate change.
• Minimizing consumption and emissions.
• Job instability.
• Ensuring supplier compliance with UN Global Compact principles.

Mitigation Strategies

• Implemented a sustainable business model based on prudent risk-taking, a strong balance sheet, geographical diversification, and corporate governance focused on sustainable value creation.
• Created a climate change office.
• Implemented energy efficiency improvement programs.
• Maintained stable employment levels and invested in attracting and retaining talent.
• Launched a verification process of the compliance of the Global Compact principles by some of its main suppliers.

Supply Chain Management

Responsible Procurement

• Most contracts include a commitment to respect the UN Global Compact principles.

Climate-Related Risks & Opportunities

Opportunities

• Financing renewable energy projects and investing in energy efficiency.

Reporting Standards

Frameworks Used: GRI G3, Global Compact, AccountAbility AA1000

Certifications: LEED (Banco Santander Brazil headquarters)

Third-party Assurance: Deloitte S.L.

Sustainable Products & Innovation

• Microcredit programs
• Socially responsible investment products
• Energy efficiency financing

Awards & Recognition

• The Greenest Bank in the World (Bloomberg Markets)
• One of the 50 greenest global brands (Interbrand/Deloitte)
• 17th on Newsweek’s Global 2011 Green Rankings (Banco Santander Brazil)

Environmental Metrics

ESG Focus Areas

• Corporate Governance
• Sustainable Activity (Customers, Quality & Satisfaction, Products & Services, Social & Environmental Risk Analysis, Sustainable Processes)
• Social Investment (Universities, Communities & Environment)
• Employees
• Shareholders and Investors

Environmental Achievements

• 20-20-15 energy saving plan launched in ten main countries, aiming to reduce electricity consumption and carbon emissions by 20% each compared to 2011 levels by 2015.
• Launched Group’s environmental footprint portal.
• Implemented paperless banking in Spain, Poland, and Brazil.
• FSC certification required for Brazilian furniture suppliers.
• Offset emissions in Brazil, Spain, and Chile.

Social Achievements

• Invested over EUR 130 million in higher education through Santander Universities.
• Launched microcredit programs in Brazil and Chile, aiming to extend to Mexico.
• Offered a three-year moratorium on mortgage capital repayments in Spain.
• Launched Santander grants for university student internships in SMEs in Spain and other countries (EUR 13.5 million investment).
• Santander UK launched Breakthrough program to boost SME growth.

Governance Achievements

• Sustainability committee chaired by the CEO, with local committees in most countries.
• Updated general code of conduct, including a confidential complaints channel.
• Implemented a system for the prevention and control of criminal risks in Spain.
• Applied Equator Principles to project finance operations.

Climate Goals & Targets

Environmental Challenges

• Difficult economic times experienced by many customers (individuals and companies).
• Integrating sustainability into the business.
• Managing reputational and regulatory risks.

Mitigation Strategies

• Concrete initiatives to support SMEs and private customers (e.g., credit lines, moratoriums).
• Well-defined governance structure (sustainability committee, local committees).
• Robust compliance and reputational risk management systems (general code of conduct, committees, training).

Supply Chain Management

Supplier Audits: 372 suppliers analyzed (36% of authorized suppliers)

Responsible Procurement

• Requirement for suppliers to respect the Ten Principles of the UN Global Compact.
• Online negotiation processes.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Financing renewable energy projects
• Investing in energy efficiency

Reporting Standards

Frameworks Used: GRI G3, AA1000 APS

Certifications: ISO 14001

Third-party Assurance: Deloitte S.L.

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Microcredit programs
• Socially responsible investment products
• Financial solutions for climate change

Awards & Recognition

• Bloomberg Markets World’s Greenest Bank
• Newsweek Green Ranking (Santander Brazil top ranked)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Financial Inclusion
• Green Finance
• Diversity & Inclusion
• Ethical Conduct
• Customer Experience
• Responsible Procurement
• Governance

Environmental Achievements

• Reduced CO2 emissions by 39%
• 75% of electricity from renewable sources
• Mobilized €32.3 billion in green finance in 2021 (€65.7 billion since 2019)
• Carbon neutral in own operations since 2020
• Set first decarbonization targets to reduce thermal coal exposure to zero and align power generation portfolio with the Paris Agreement by 2030

Social Achievements

• Financially empowered 10 million people since 2019 (7.5 million in 2021)
• Supported 1 million micro-entrepreneurs in 2021 (€571 million credit disbursed)
• 26.3% women in senior leadership positions (+2.6pp from 2020)
• Ranked among the top 10 companies to work for in 6 geographies
• Improved NPS scores in 8 markets, reaching top 3 in several

Governance Achievements

• 66.7% independent directors on the board
• ESG criteria included in short-term variable remuneration for employees and approved for inclusion in long-term incentives for senior executives
• Implemented Canal Abierto ethical channel in core geographies
• Enhanced ESG disclosure, including Stakeholder Capitalism Metrics
• Improved scores in key ESG ratings (DJSI, MSCI, CDP, Sustainalytics, FTSE4Good, BGEI)

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions
• Climate-related risks (physical and transition)
• Data limitations in measuring financed emissions
• Maintaining high customer satisfaction in a changing market
• Ensuring consistent ESG implementation across diverse geographies

Mitigation Strategies

• Developed alternative sourcing strategies
• Embedded climate and environmental risks in risk management processes
• Developed quantitative metrics for risk appetite statement
• Implemented stricter risk policy on sensitive sectors
• Developed Sustainable Finance Classification System (SFCS)
• Enhanced customer service through digital channels and initiatives
• Created global and local CX training courses and certifications
• Strengthened ESG governance structure and reporting

Supply Chain Management

Supplier Audits: ESG review of top 200 high-risk suppliers; plan to expand to top 1000

Responsible Procurement

• Third-party certification policy
• ESG standards in procurement
• Ethical channels for suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events, droughts

Transition Risks

• Regulatory changes, market shifts towards decarbonization

Opportunities

• Growth in green finance, development of energy-efficient products and services

Reporting Standards

Frameworks Used: GRI Standards (comprehensive option), SASB 2018-10 industry standards, Stakeholder Capitalism Metrics, TCFD recommendations, UN Principles for Responsible Banking, EU Taxonomy

Certifications: ISO 14001

Third-party Assurance: PricewaterhouseCoopers Auditores, S.L. (limited assurance on non-financial information)

UN Sustainable Development Goals

• Goal 8 (Decent Work and Economic Growth)
• Goal 13 (Climate Action)
• Goal 16 (Peace, Justice and Strong Institutions)
• Goal 1 (No Poverty)
• Goal 4 (Quality Education)
• Goal 5 (Gender Equality)
• Goal 7 (Affordable and Clean Energy)
• Goal 10 (Reduced Inequalities)
• Goal 11 (Sustainable Cities and Communities)
• Goal 12 (Responsible Consumption and Production)
• Goal 17 (Partnerships for the Goals)

Santander's activities and initiatives contribute to these goals through various programs and strategies detailed in the report.

Sustainable Products & Innovation

• Green Book products
• Sustainability-linked loans
• Sustainability-linked swaps
• Sustainability-linked supply chain finance

Awards & Recognition

• Top Employers 2021
• Best Bank for Financial Inclusion and Best Bank for Sustainable Finance in Latin America (Euromoney)
• Inclusion in DJSI, S&P Sustainability Yearbook, FTSE4Good Index, BGEI

Environmental Metrics

ESG Focus Areas

• Climate transition
• Positive societal returns
• ESG integration across the organization

Environmental Achievements

• 100% of energy supplied to Nordic offices came from renewable sources.
• 13.9% market share of new Battery Electric Vehicles (BEVs) financed in the Nordic market.

Social Achievements

• Launched new brand concept “When it feels right” to encourage responsible consumption.
• Published inaugural Transparency Act Statement on human rights and decent working practices.
• Donated NOK 250,000 to humanitarian aid.

Governance Achievements

• Adopted the Santander Responsible Banking Framework.
• Rolled out mandatory ESG training for all employees.
• Incorporated Responsible Banking updates into the Board of Directors’ agenda.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to climate events (implicitly mentioned)
• Increased inflation, central bank rate increases, and the war in Ukraine impacting green bond issuances.
• Deficiencies in routines and systems for risk assessment, reporting, and follow-up, and control of the customer portfolio (resulted in a fine).

Mitigation Strategies

• Implementing the groupwide Santander Sustainable Funding Framework for future green bond issuances.
• Migrating to a central business travel portal for better emissions tracking.
• Conducting an employee survey to estimate GHG emissions from staff commuting.
• Adopting the Santander Sustainable Finance Classification System (SFCS).
• Addressing deficiencies highlighted in corrective orders from the NFSA (Norwegian Financial Supervisory Authority).

Supply Chain Management

Supplier Audits: Due diligence performed on all active supply chain vendors (Transparency Act compliance).

Responsible Procurement

• Outsourcing and Third-Party Agreements Corporate Framework

Climate-Related Risks & Opportunities

Physical Risks

• Potential damage to collateral due to natural hazards
• Impact on households’ credit affordability due to energy price changes
• Extreme weather events causing damage to office premises

Transition Risks

• Customers’ inability to adapt business models
• Changes in EV technology impacting residual values
• Regulatory changes related to sustainable finance
• Changes in consumer behavior impacting financing activities
• Wholesale shift in mobility models

Opportunities

• Growth in renewable energy financing
• Green auto loans
• Financing of EV charging stations
• Carbon offset programs
• Green deposits and green funding
• Growth in green bonds

Reporting Standards

Frameworks Used: GRI 2021 Universal Standards, TCFD

Third-party Assurance: PricewaterhouseCoopers AS (limited assurance)

UN Sustainable Development Goals

• SDG 12
• SDG 13
• SDG 3
• SDG 5
• SDG 16

See Annex V

Sustainable Products & Innovation

• Eco card
• Green bonds
• Sustainable financing options for EVs, solar panels, green heating systems, bicycles, and e-bikes

Environmental Metrics

ESG Focus Areas

• Empowering people and businesses
• Fostering inclusive communities
• Supporting the green economy

Environmental Achievements

• 91% electricity from renewable sources
• 100% carbon neutral in own operations (achieved through emission reduction and offsetting)
• Elimination of unnecessary single-use plastics in facilities (since 2021)
• $4.8B in sustainable structured finance underwritten (majority wind and solar, some energy-efficient data centers)

Social Achievements

• $33.3M charitable giving
• 68,000+ volunteer hours
• 51,000+ individuals counseled with financial education
• 20,000+ people financially included (unbanked, underbanked, in financial distress, or with difficulty accessing credit)
• $859M in small business lending
• Nearly 41% of jobs filled internally
• Launched Santander Essential Checking to simplify banking for customers

Governance Achievements

• Improved information security controls
• Expanded sustainable and social finance guidelines and taxonomies
• Enhanced ESG data collection and governance

Climate Goals & Targets

Environmental Challenges

• Volatile market conditions, unprecedented industry events, and elevated geopolitical tensions
• High interest rates and inflation creating pressures for consumers
• Constraints on real estate lending due to market factors

Mitigation Strategies

• Partnership with the FDIC for a $9B portfolio of rent-stabilized multifamily real estate assets (maintaining affordable housing)
• Shifting resources to engage in a joint venture and investment with the FDIC for affordable housing
• Utilizing fee waivers, short balance waivers, and loan maturity date modifications to support auto customers

Supply Chain Management

Responsible Procurement

• Supplier diversity program

Climate-Related Risks & Opportunities

Physical Risks

• Increased losses from extreme weather events

Transition Risks

• Collateral value degradation
• Litigation risk
• Regulatory changes
• Market shifts
• Technological innovations

Opportunities

• Development of energy-efficient products
• Sustainable finance opportunities

Reporting Standards

Frameworks Used: GRI Standards (GRI 1: Foundation 2021, GRI 2: General Disclosures 2021, GRI 3: Material Topics 2021, GRI G4: Financial Services Sector Supplement), SASB 2018-10 Industry Standards (Commercial Banks, Consumer Finance, Asset Management & Custody Activities, Investment Banking & Brokerage), TCFD recommendations

Certifications: WELL Health-Safety (corporate offices and branches in progress)

UN Sustainable Development Goals

• Goal 1
• Goal 2
• Goal 3
• Goal 4
• Goal 5
• Goal 7
• Goal 8
• Goal 9
• Goal 11
• Goal 12
• Goal 13
• Goal 15
• Goal 17

Santander US aligns to these goals through its sustainability strategy and initiatives.

Sustainable Products & Innovation

• Santander Essential Checking
• Sustainable finance products

Awards & Recognition

• World’s Most Sustainable Banks (Dow Jones Sustainability Indices)
• World’s Most Admired Companies™ and Change the World Top 50 Companies (Fortune Magazine)
• Highest Ranked Among Banks (Bloomberg Gender-Equality Index)
• Best Global Brands (Interbrand)
• Best Bank in the World (Euromoney Awards for Excellence)
• Bond Awards (GlobalCapital)
• Best Finance Companies for Women (Fairygodboss)
• Campus Forward Award for Excellence in Early Career Hiring (RippleMatch)
• Best Places to Work Awards (Built In)
• Early Talent Awards (Handshake)
• America’s Deal of the Year Award (The Banker)
• Community Collaboration Award (Boston Business Journal)
• Corporate Partner of the Year Award (Institute for Entrepreneurial Leadership)
• Listed on 2023-2024 Corporate Equality Index (Human Rights Campaign Foundation)
• Nonprofit & Corporate Citizenship Award, Corporate Partner of the Year (D CEO)
• 2023 Impact Partner Award (Impact Ventures)
• Corporate Innovation Partner Award (Social Venture Partners)
• Corporate Supporter of the Year 2023 (The DEC Network)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Financial Inclusion
• Governance
• Green Finance

Environmental Achievements

• 97% of electricity used from renewable resources
• €115.3 bn of Green Finance mobilized since 2019
• €6.5 bn in the financing of electric vehicles in 2023
• Reduced emissions intensity in several sectors (power generation, energy, aviation, steel, auto manufacturing)

Social Achievements

• 1.8 million people financially included
• €1.1 bn disbursed to support microentrepreneurs in 2023
• €174 mn invested in communities, helping 2.2 mn people

Governance Achievements

• 66.6% of independent directors and 40% women representation at Board level
• Executive variable remuneration linked to ESG metrics

Climate Goals & Targets

Environmental Challenges

• Fostering sustainable activities
• Tackling global challenges to support inclusive growth
• Increase transparency and efficiency through governance

Mitigation Strategies

• Green value proposition
• Supporting clients in the transition
• Financial inclusion initiatives
• Risk management
• Portfolio alignment
• Board’s alignment contribution
• Internal Policies and corporate culture
• External engagement

Supply Chain Management

Responsible Procurement

• Monitoring of suppliers for illegal deforestation (Brazil)

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD, UN Sustainable Development Goals, EU Taxonomy, Principles for Responsible Banking

Sustainable Products & Innovation

• Green mortgages
• Green consumer loans
• Financing for electric vehicles
• Sustainable finance proposition for corporates and individuals

Awards & Recognition

• World’s best bank for financial inclusion (Euromoney)
• World’s best bank for SMEs (Euromoney)
• World’s best bank for emerging markets (Euromoney)