Defining what matters

When assessing the most material sustainability topics to NIB, we consider the economic, environmental, and social impacts of our operations. Equally important weight is given to an on-going dialogue with our stakeholders. To better define, understand and respond to the aspects that matter most to us and our key counterparties during 2015, we conducted several actions with different stakeholders to better be able to outline our materiality.

This materiality process was undertaken specifically as part of the report preparation process in line with the requirements of the GRI G4 Reporting Guidelines.

Methodology—Strategy review

It is important to understand that NIB, as an international financial institution, has a purpose to fulfil. This mission—to finance projects that improve competitiveness and the environment of the Nordic and Baltic countries—is given to NIB by its five Nordic and three Baltic owner countries, and therefore guides all our operations and is the single most important thing to take into account in our processes.

Starting from 2014 and continuing in 2015, NIB conducted a strategy review process. For that, NIB’s Board of Directors participated in several seminars and workshops. The Board discussed, among other things, the Bank’s mission and to what extent potential loan projects contribute to fulfilling it, NIB’s capital and stress testing, the financial landscape of the Nordic–Baltic region, and NIB’s purpose and relevance. Also, the year-long strategy process included SWOT analyses to evaluate the strengths, weaknesses, opportunities and threats involved in NIB’s business.

The conclusions of the strategy review are that the mission is strong and the present business model will remain the foundation of NIB’s operations; however, lending activities will be broadened. For instance, NIB will develop and expand its lending to SMEs and mid-sized corporates in the region. The Bank will also be more flexible in its activities outside its member countries and investigate opportunities to increase investments in the Baltics and projects in the Arctic region.

Methodology—External stakeholder survey

Besides the on-going daily communication with its stakeholders (read more about the main activities in 2015), NIB actively and regularly seeks feedback on awareness and reputation among its key target groups. In practice, this is done by conducting a comprehensive stakeholder survey every three years. The goal is to receive feedback on NIB’s reputation, customer relationship strength and value added to the key target groups.

The chosen key counterparties of the 2015 survey were customers, public authorities and investors. As one of the new aspects of the inquiry, all stakeholders were asked about the importance of different sustainability topics. The investors’ interest in and awareness of green bonds was also examined.

The survey showed that NIB is strongly perceived to demonstrate ethical business practices, which is also the  sustainability topic that was given the most importance and the highest rating by all stakeholders. In addition, success in supporting the competitiveness and environment of the Nordic and Baltic countries was considered important, which underlines the relevance of NIB’s mission. When asked about the importance of different sustainability topics related to NIB’s operations, such as anti-corruption and transparency, environmental and social reviews of all loan projects, and the competitiveness of the Nordic–Baltic region, customers particularly remarked that they see NIB’s professional lending experts as a high-level strength of the Bank. Read more about the survey in the Stakeholder survey results 2015.

Importance of sustainability topics according to NIB stakeholders

Stakeholders_survey_sust_v04

 

Methodology—Job satisfaction survey

Every second year, NIB conducts a work engagement survey. In 2015, the survey focused particularly on assessing factors such as job motivation, cooperation and engagement among NIB’s staff. The results show that the employees have high levels of identification with the Bank’s purpose and values, and that they are committed with strong personal motivation. NIB’s employees also consider that they have a relatively high propensity to develop new competences, and to make an effort to help the Bank succeed.

 

Setting up the reporting boundary for NIB

Based on the results of the processes mentioned above, we identified three key aspects that have high priority for both internal and external stakeholders. These will be the main aspects that we report on for 2015.

Outcome of materiality assessment—the top three material aspects:

  • fulfilling our mission to finance projects that improve competitiveness and the environment of the Nordic and Baltic countries
  • transparency and good governance
  • committed, professional staff

We mapped the relevant GRI G4 aspects as closely as possible to these material aspects, and for each GRI G4 aspect we report on all relevant indicators in line with the requirements of the GRI G4 “in accordance” core option.

Economic performance

NIB’s vision is a prosperous and sustainable Nordic–Baltic region. The Bank does this by financing projects that increase productivity, which is the most direct way to strengthen economic competitiveness. In order to do this effectively, NIB needs to be financially strong. The Bank therefore aims to earn a sufficient return from its business operations to build up reserves while providing its owners a reasonable return on capital.

Indirect economic impacts

To improve the well-being of societies, we must continuously seek new ways to improve and strengthen productivity. NIB therefore asks its customers about the extent to which their planned projects can contribute to improving the efficiency and productivity of entire societies and countries.

Environmental impacts

NIB categorises every loan project according to its potential environmental impacts, considering both risks and opportunities. Environmental issues are also inherent in NIB’s daily activities and are therefore integrated into the Bank’s overall management systems.

Labour practices

NIB’s employees are the Bank’s strongest assets. NIB is committed to the development and well-being of its employees and underlines the importance of dedicated employees for the organisation’s performance. Several staff-related GRI indicators are reported.

Human rights and child labour

The Bank does not accept any discrimination, whether it is based on gender, race, nationality, ethnic origin, religion, disability, age or sexual orientation. Further, NIB requires its clients to comply with international standards for the employment of minors. NIB does not accept the use of forced labour. Sound management of the safety and health of workers and communities is essential for the productivity and efficiency of the business, as is respect for their livelihood.

Society and local communities

NIB’s mission has a positive impact on local communities and societies in its member area, as it lends to projects that improve infrastructure, develop human capital, and help to protect the environment and its ecosystem.

Anti-corruption

NIB has adopted a zero-tolerance policy towards fraud and corruption. In terms of prevention, the Bank puts particular emphasis on knowing its customers and training its staff well to prevent the Bank from becoming involved with unethical borrowers and projects, or in money laundering, terrorist financing or tax evasion. All new clients are thoroughly screened in the Bank’s integrity due diligence processes.

Grievance mechanisms

In order to address different concerns regarding its operations, NIB has developed a channel for its stakeholders to comment on projects with potential significant adverse social or environmental impacts. These projects are classified as Category A projects and are made publicly available for commenting before the Bank makes a decision on financing.

Product portfolio and audit aspects (Financial Sector Supplement)

NIB’s main activity is lending, and with its special mission to improve the environment, it is important that the Bank assesses the environmental and social impacts of all loan applications; it therefore has corresponding procedures and policies in place.