Corporate Social Responsibility at Nordea. Building trust every day

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1 Corporate Social Responsibility at Nordea Building trust every day

2 Building trust every day What does Corporate Social Responsibility mean? Corporate Social Responsibility (CSR) is the commitment of a business to consider its impact on society and the environment, and to operate in a responsible way. It s not about being perfect, but about continually striving to become better. CSR can involve a range of activities and priorities, depending on the company and the sector. People are increasingly concerned about how businesses function, and it is now generally accepted that companies have a responsibility to explain their actions and approaches, not only to their shareholders but also to their other stakeholders people who are affected by the business. At Nordea, we are first and foremost committed to acting ethically in our everyday business. We want to go much further than that, however, and we see CSR as an opportunity to use our skills, expertise, knowledge and relationships to make a positive difference to individuals, society and the environment. Building trust, being open and approachable, and acting with integrity are vital to achieving this objective. We approach CSR as we approach our business in general in a well-planned, structured, measurable way. We decide which areas to focus on based on input from all our stakeholders - customers, colleagues, suppliers and shareholders. How do we contribute to society? Helping businesses prosper Providing loans & expertise for companies to: invest in developing their business Ensuring 24/7 access for them to: buy merchandise pay bills process cards transactions Building the economy Providing loans & expertise for large corporations to: utilise international payment services cash management expertise make long-term plans be predictable Running a profitable and sustainable business Contributing to society by: paying corporate income tax witholding and remitting taxes on dividends and interests for customers paying dividend to shareholders paying salaries to employees purchasing products and services 2

3 Making a difference to people s lives A bank s main role in society is to provide financial services to help people and businesses achieve their goals and reach their potential. So we lend money to people to buy a new home or help them save for their future. We facilitate payment transactions and make loans to businesses so they can employ more staff or invest in new equipment. Enabling our customers and thus the economy to thrive is our core purpose and contributes significantly to a healthy, well-functioning society. Another measure of our social contribution is the taxes we pay, which include corporate income tax, salary taxes (social security contributions) and bank levies. In fact, the income tax bill paid by Nordea is one of the largest among companies in the Nordic region. We pay our taxes responsibly on time and in accordance with the local regulations wherever we operate. We can also make a positive difference to people s lives by ensuring that our business activities including our lending and investment practices, human resources and supply chain activities place the highest regard on people s human rights. In each of these areas, we make every effort to ensure that we always act legally and ethically. Finally, banks have a key role to play in counteracting financial crime such as money laundering, fraud and the financing of terrorism. We treat this extremely seriously, and our efforts to prevent financial crime are threefold: managing the risks, having clear policies and instructions in place, and raising awareness among our staff. Supporting our local communities We also make a difference through active involvement in our communities. Our numerous community programmes focus mainly on improving financial education and entrepreneurship, and our employees get involved by volunteering their time and skills. As well as benefiting the community, these activities help us to better understand and relate to our customers. By choosing partners who have the same goal as us, we can reach a large number of young people and focus on topics where our employees are well equipped to contribute their skills and expertise. This way, we can make a real difference. We help all young people on the programmes to earn and save, be productive members of society and build a successful life for themselves. Employees benefit hugely from the experience too. Participants say they return to work with greater motivation as well as enhanced communications skills, all of which improves how they engage with and relate to our customers. Supporting financial security Offering services and products to: help make savings & pension plans give the possibility to invest in sustainable companies offer the insurances needed Supporting people in managing personal finances Ensuring mobile 24/7 access to: advisory deposits payments mortgages consumer loans investments Supporting our communities Offering our competencies and support to managing one's personal finances and life skills. Bringing young people together with bank employees which makes basic banking easier to understand. 3

4 Long-term relationships are built on trust We are committed to engaging with our customers from four main perspectives: listening to our customers, keeping on top of changing customer behaviour and providing responsible investment and lending decisions. This enables us to deliver great customer experiences. First, serving our customers is about giving them opportunities to tell us what they think and responding to their feedback. With this in mind, we have a Customer Ombudsman in all the Nordic countries, whose role is to liaise Actions speak louder than words In 2014, our corporate customers asked us to develop an app for them, and one customer offered to help. She was delighted when we asked her to help test the product with the development team, and felt this demonstrated a real willingness to listen to our customers and take action. Customer expectations 24 x 7 availability Fair and competitive pricing Security 4 Reliability Second, it s important that we keep on top of our customers changing needs and behaviour. Above all, this means responding to their increasing reliance on technology and making our services more accessible, so that all our customers whatever their age or preferences can use our online and mobile channels for their banking needs. Third, serving our customers is also about responsible lending and investment practices. When it comes to lending money to customers, it s vital that we give sound advice and market our products responsibly to ensure that anyone who takes out a loan with us can cope with their repayments. We also want to help our customers make sound investment decisions. We believe companies that take environmental and social considerations seriously represent better long-term investments. We therefore make sure we invest our customers money in companies that can demonstrate clear Service channels Branch network Personalised service and advice Suitable products between the consumer authorities, customers and employees. In short, we can sum up their task by saying: Their job is to listen. Physical and remote meetings Contact centre Mobile bank Netbank

5 Designing tomorrow s banking today Digital banking people and businesses using computers, tablets and mobile phones to manage their finances is changing the way we operate. To ensure great customer experiences, we know we need to offer our customers easy-to-use, practical and secure digital tools for their banking. We also recognise that this is a rapidly evolving area full of exciting potential. We therefore partner with leading creative thinkers and developers in the field, while also checking in with our customers that these new ideas meet their needs. policies and responsible practice in areas such as human rights, working conditions, ethics and environmental issues while also focusing on strong financial performance. While we screen all our actively managed investments to ensure that the companies we invest in act responsibly, customers who wish to go further can also choose one of our three Responsible Investment funds, which invest only in the most environmentally and socially responsible companies. Fourth, we ensure that our customers have a positive experience in all their dealings with us and that we meet their requirements and exceed their expectations. This is our top priority. In practice, this begins with building relationships of mutual trust. We want our customers to know they can rely on us to give sensible advice, keep our promises and meet their needs. To ensure that we can support them appropriately, we take the time to get to know our customers, their circumstances and goals before we offer any service, advice or product. In short, we make sure they have all the information they need to make decisions about their finances. To give customers the best advice, we make sure that we understand their needs and that they understand our products and the risks related to them. We are also obliged by law to take steps to prevent money laundering and fraud. For example, we may need to ask customers about the origin of funds deposited in their account. We treat any information we gather with the strictest confidence. We take compliance with these regulations very seriously and undergo regular training so that we all know what is expected of us. Our offering Deposits Payments Savings Advisory Mortgages Consumer loans Insurance coverage Household customers Corporate customers Our impact Advice for individuals on their financial plans: buying an apartment or house savings insurance pension plans Help in creating financial security Avoiding financial stress Cash management Foreign exchange & hedging Financing Advisory Fixed income and equity issuance Corporate finance Tailor-made products Helping companies with all their financial issues: efficient cash management investments trade finance products raising equity and capital Helping businesses to expand Enabling growth Enabling job creation 5

6 Being a good employer Recruiting, developing, motivating and retaining the best people is the only way to ensure we get things right for our customers. Our three company values Great customer experiences, It s all about people and One Nordea team are our guiding principles. Studies show that diverse leadership teams make better and more innovative business decisions, leading to improved business performance. Diversity among our employees is important to us and gender balance is one of our top priorities. This is a challenge across the entire financial services sector. In particular, there are too few women in leadership positions. Our objective is to increase the number of female senior leaders at Nordea. This issue is so important that we launched a Gender Diversity Initiative in It promotes gender balance in a range of ways, including supporting managers, highlighting the importance of the issue in our communications, and making it easier for women to return from parental leave. It also sets out minimum obligations, including a requirement for both men and women to be among the last three candidates for all managerial positions. To enable Nordea to perform at its best, we make sure that our colleagues know what is expected of them and receive the support they need to do their jobs well. A large part of the development of competencies happens on the job, either through feedback and coaching, or through problem solving in one's everyday work. As it is important for us to secure a continuous flow of talent toward our key positions and the continuity of our relationships with customers, we wish to be perceived as an attractive employer, offering interesting career opportunities for managers and employees. A healthy environment supports performance We also ensure that we provide a healthy working environment that promotes our employees wellbeing, and that we take the time to listen to their views. Almost all our employees took part in our recent employee satisfaction survey, which showed that the overwhelming majority of colleagues experience strong job satisfaction and are proud to work for Nordea. All teams create action plans to develop those areas which need to be improved. Leadership matters Other areas of focus include developing strong leaders from among our workforce. How they perform affects how our employees perform, which in turn affects the quality of the customer s experience. We thus invest heavily in training our leaders and identifying people who will lead our business in the future. Our objective is to increase the number of female senior leaders at Nordea, as we believe that diverse leadership teams make better business decisions.

7 Protecting the planet CSR at Nordea includes a commitment to caring for the environment, and reducing negative and increasing positive environmental impacts. This includes impacts caused by our own operations, as well as those that arise from our supply chain and our core business activities of investments and lending. A few years ago we set up our Ecological Footprint Programme to address the environmental effects of our operations. This concentrates mainly on energy and air travel our biggest impacts with a secondary focus on paper, waste, buildings and procurement. We set ambitious targets for improvement, and report progress each quarter. Many of our head office buildings are now certified to the international environmental standard Leadership in Energy and Environmental Design (LEED). Our new head office in Lindhagen in Stockholm, where the energy consumption will be at least 50% lower than the existing requirements in Sweden, is one of the most environmentally friendly office buildings in the Nordic region. Clear requirements for our partners Managing the impacts that arise from our supply chain and our investment and lending activities is equally important. We expect our suppliers to run their businesses responsibly and take steps to reduce their own environmental impacts. We have strict guidelines that our major suppliers have to follow, as well as a long-term strategy to help them make improvements. On the other hand, we wish to engage with our suppliers for a positive impact, so we also have reasonable expectations based, for example, on their size and location. Investing and lending responsibly We also have an indirect environmental impact through our decisions about who to lend money to and which companies to invest in. So we check that the companies we invest in are managing their environmental impacts. We also take environmental factors into account when we lend money to companies, in particular by requiring those in certain sectors to have a clear strategy for addressing their contribution to climate change. Striving for continual improvement We have established ambitious commitments across all CSR areas. In this way we believe we will steadily improve not just our financial impact, but our social impact too, and make an increasingly positive difference to the lives of individuals and society at large. Because when they succeed, so do we. We would love to hear your views, so please contact us at csr@nordea.com. 7

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