NIB develops its sustainability reporting based on the requirements set out in the GRI G4 Reporting Guidelines. The Bank aims to report on the most crucial economic, environmental and social impacts of its operations. Equal importance is given to maintaining an ongoing dialogue with our stakeholders. NIB’s reporting also includes indicators from the GRI’s Financial Sector Supplement.
In order to define and respond to the sustainability aspects that matter most to the Bank and its key counterparties, the methodology of the materiality process is based on three different stakeholder interactions conducted during 2015 and 2016:
Methodology: Strategy review and implementation
As an international financial institution owned by the Nordic and Baltic countries, NIB has a mission to finance projects that improve competitiveness and the environment of the Nordic–Baltic region. This mission guides our operations and is the single most important aspect in all our processes.
In 2015, NIB thoroughly reviewed its strategy. During the year-long process, the Bank’s Board of Directors participated in several seminars and workshops to discuss NIB’s mission, capital and stress testing, the economic landscape of the Nordic–Baltic region and NIB’s purpose and relevance.
The process concluded that the Bank’s mission is strong and that the present business model is to remain the foundation of NIB’s operations. However, it was decided to broaden lending activities.
Based on the decisions of the Board of Directors, NIB’s operations in 2016 were, in many ways, dedicated to implementing the key areas of the reviewed strategy.
The Bank increased its lending to small and medium-sized corporates and mid-caps, and launched an Arctic Financing Facility. A further aim is to increase NIB’s lending activities in the Baltic countries and in non-member countries.
In 2016, NIB also started purchasing green bonds issued by companies or municipalities in its member countries to finance environmental projects.
Methodology: External stakeholder survey
Every three years, NIB conducts a comprehensive stakeholder survey to collect feedback on the perception of the Bank and the levels of awareness among key target groups. The aim is to gather information on NIB’s customer relationship strengths, reputation, its added value and the importance of different sustainability topics to our stakeholders. It also examines investors’ interest in and awareness of green bonds.
The most recent survey was conducted in 2015. The chosen key counterparties included customers, investors and public authorities. The survey included a total of 123 interviews and was conducted by TNS Gallup Oy.
The 2015 survey showed that NIB is strongly perceived to demonstrate ethical business practices and transparency, which was also the highest-rated sustainability issue among all stakeholder groups in the survey.
The importance of conducting environmental and social reviews of all loan projects and success in supporting the competitiveness and environment of the Nordic and Baltic countries were considered of equal importance.
This underlines the relevance of NIB’s mission. Further, customers remarked that NIB’s professional lending experts were regarded as a high-level strength of the Bank.
With regards to the importance of ethical business practice, NIB’s Board of Directors approved three new policies under the Compliance and Anti-Corruption Framework in February 2016 after a thorough review process.
These include the Compliance, Integrity and Anti-Corruption Policy; the Investigation and Enforcement Policy, and the Speaking-up and Whistleblowing Policy. Read more about Ethics and integrity.
Methodology: Work engagement survey
Every two years, NIB conducts a work engagement survey to periodically collect employee feedback on issues related to the work environment, management and well-being at work.
The results of the most recent survey, which was conducted in cooperation with the Finnish Institute of Occupational Health (FIOH) in 2015, show that employees report high levels of job motivation and engagement, and identify with the Bank’s purpose and values.
Further, the survey highlighted that NIB’s employees have a relatively high disposition to developing new competencies and skills and aim for high levels of professionalism.
Setting up the reporting boundary for NIB
Based on the stakeholder interactions outlined above, we identified three key aspects that are of high importance for both internal and external stakeholders. These will be the main aspects we report on in 2016.
The top three aspects defined in the materiality assessment are:
- The fulfilment of our mission to finance projects that improve competitiveness and the environment of the Nordic and Baltic countries
- Anti-corruption, transparency and ethical business practice
- The development of the Bank’s working culture to maintain a committed and professional staff
The relevant GRI G4 aspects were mapped as closely as possible to these material aspects, and for each GRI G4 aspect, all relevant indicators are reported on, in line with the requirements of the GRI G4 “in accordance” core option.
Further, we have identified the operations that have a direct or indirect sustainability impact in the following aspects:
NIB’s vision is a prosperous and sustainable Nordic–Baltic region. The Bank pursues this vision 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 society as a whole.
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.
NIB’s employees are the Bank’s strongest assets. NIB is committed to the development and well-being of its staff and underlines the importance of dedicated employees for the performance of the organisation. Several staff-related GRI indicators are reported.
Human rights and child labour
The Bank does not tolerate 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 on 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 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.
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.
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. The Bank’s Investigation and Enforcement Policy includes the procedures for handling complaints regarding non-compliance with NIB’s policies.
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.