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DNB sees growing environmental expectations

This is how they are meeting them – with the help of Entelios.

Globally, companies in the commercial and industrial sectors are responsible for two thirds of the world’s energy consumption (IRENA). If these sectors start to demand increasing amounts of renewable energy, they could accelerate the transition to a low-carbon global energy system.

RE100 was launched as a global collaboration between businesses committed to using one hundred percent renewable power within an agreed deadline. Over one hundred companies have chosen to sign up to the initiative, and one of them is DNB, Norway’s largest financial services group, which aims to rely entirely on renewable energy to power its operations by 2020 – with the help of Entelios.

On the “A” list for climate reporting

“We won’t solve the global climate crisis by signing up to RE100, but it’s really important for our own sense of security and for raising awareness. It means we’re setting a good example and can inspire others to be more sustainable”, says Anne Margrethe Platou, adviser on corporate responsibility and public affairs at DNB.

Platou is encountering strong expectations with respect to how they integrate sustainability into their future plans. From investors, customers, employees and last but not least – from their biggest shareholder: the Norwegian state.

“The new generations entering the DNB Group have higher expectations in terms of our own environmental footprint. Our experience is that young people want to be a part of something that is helping the environment, and we mustn’t forget this very important group”, she says.

DNB’s climate change accounts and climate change guidelines are reported to the Carbon Disclosure Project (CDP), which is a partner of RE100.

“In order to ensure and document that the energy we use ourselves comes from renewable sources, we buy guarantees of origin. Entelios is helping us with that. It means we can talk about CDP, RE100 and how we are trying to influence our customers”, she says.

Just a few days ago, CDP presented a list of 126 companies that had secured a place on their “Climate Change A list”. DNB was the only bank in the Nordic region to feature. The list recognises companies that make a positive contribution in areas such as climate change, water security, deforestation and building a future economy that works for both people and the planet.

Want to influence people

DNB manages large amounts of capital in new and existing loans to the business community, which gives it a lot of leverage.

Anne Margrethe Platou says that providing loan capital gives DNB both power and responsibility, and enables it to do a great deal for the climate through its credit decisions.

“We must demonstrate corporate responsibility in our lending policy, and sustainability is therefore increasingly integrated into our credit scoring. By mapping out the climate-related risks and financial opportunities in various industries, we can help to push things in the right direction. After all, we want our customers to be the success stories of the future”, says Platou.

To highlight sustainability expectations with respect to both DNB’s internal operations and its customers, the group has drawn up a variety of guidelines on the environment, social issues and corporate governance, which are all available in its “sustainability library”.

“We want to be a credible interlocutor, and the guidelines are a way of establishing the ground rules. Then we can help our customers to adapt, discuss how to meet stricter regulations in the future and talk about dilemmas in various industries”, she says.

“In some cases, such as commercial buildings, there are standards covering the various factors that affect their sustainability. That allows us to put a premium on sustainable buildings, because we think they represent better long-term investments.”

But sustainability isn’t black and white for DNB, so the company looks at the whole value chain.

“Corporate social responsibility goes beyond the question of environmental footprints; we’re also concerned about the personal finances of retail customers, equal opportunity and diversity, and preventing financial crime. In certain sectors it can be difficult to demand sustainability, particularly if it has a big impact on jobs.”

Platou believes that the most important thing a company can do to promote sustainability is to identify where it can make most difference. That involves analysing where your footprint is biggest and, even more importantly, where you can profit, which makes it easier to prioritise. It is also important for companies to integrate sustainability reporting into their financial reporting, to show the strategic direction the company is taking.

“Employees are also a very important part of the equation. It can be a challenge for companies to build up a joint understanding of what sustainability involves, and what it means to them, but if you succeed there are big knock-on benefits”, she says.

Optimistic about the future

At DNB they are working systematically to keep ahead of the coming changes, including how climate risks will affect the market. They don’t believe they have all of the answers, but they do believe that having a good understanding of climate risk puts them in a better position to pick tomorrow’s winners.

“The EU has established clear rules requiring all companies to report on climate-related disclosures, and we’re ahead of the competition, but our job isn’t finished and we need to continue improving.”

Platou says that DNB above all learns from its customers, but it is also benefiting from its customer relationship with Entelios.

“We attended Entelios’s energy forum in November, which was really interesting. Their network and forums give us a different perspective on the electric power industry, and on issues that will be important to the energy industry in the future”, says Platou.

Jan Atle Liodden, EnteliosJan Atle Liodden in Entelios says they have also learned from having DNB as a customer.

“We are helping DNB to demonstrate that it is carbon neutral at all of its global locations, by documenting that it is using renewable energy. It is exciting to be part of the global market, and we are beginning to get enquiries from other companies that want to follow DNB’s example.”

The pace of change is speeding up and more and more companies want to contribute to the transition to renewable energy. That makes me optimistic about the future”, says Liodden.