In Ringkjøbing Landbobank we focus closely on implementing the Forum for Sustainable Finance’s recommendations on how the financial sector can accelerate the sustainable transition of the economy. Not least, this is true in the area of investments and loans. For the first time, we publish portfolio-level carbon emissions from discretionary asset management, pooled schemes and the bank’s own securities portfolio in this report. In addition, we are preparing portfolio-level calculations of carbon emissions from the bank’s loans as at 31 December 2022 for publication in the ESG report for 2022. We also got more new sustainable investment products to offer and look forward to applying the EU sustainability taxonomy to both investment and lending.
Strong drivers of the bank’s green transition work are the business opportunities deriving from this work. For more than 25 years we have successfully cultivated niches that fit well into the green agenda. The distinctive feature of a niche in Ringkjøbing Landbobank is that we have studied the area in detail. This enables us to show responsiveness, integrity and expertise in our advice.
Initially we financed wind turbines, which have developed into an important business area for the bank and today account for a handsome part of our total loans. Later we built expertise in lending to solar energy and biogas plants, and our lending to personal customers for energy-efficient renovation of their homes and purchases of sustainable vehicles is considerable.
Sustainability is increasingly becoming a part of our advice to personal customers, where we place a strong emphasis on improvement of energy efficiency. One way we do this is by giving our personal customers access to Totalkredit’s energy calculator. We see increasing customer interest in sustainability, and new home owners often give higher priority to improving energy efficiency than, say, installing a new kitchen.
In the area of investments, Ringkjøbing Landbobank works closely with BankInvest, of which we own 22%. In 2021, BankInvest launched one more Nordic Swan Ecolabelled fund – Danske Aktier Bæredygtig – and now offers three funds with that label. Interest has been overwhelming – including from the bank’s customers. At the end of 2021, investments in the three funds totalled DKK 18 billion. In addition, BankInvest is working to present the sustainability impact, in terms of the UN Sustainable Development Goals and the fund’s carbon emissions and ESG score. Sustainability impact reports are now available for 39 of a total of 45 public funds. BankInvest has a total of DKK 149 billion under management.
Ringkjøbing Landbobank also works with Letpension. This cooperation enables us to sell PFA’s investment and annuity products to our personal customers. In 2021, we launched a particularly climate-friendly annuity via Letpension, which was very well received by our customers. The even more climate-friendly annuity emits 80% less carbon than the world equity index. The goal is to reach carbon neutrality for the product by 2025.
In light of the disruption caused by Covid-19, the bank’s job satisfaction scores in 2021 were remarkably positive. The job satisfaction ratings given by 82% of the bank’s employees are ‘very satisfied’ or ‘extremely satisfied.’ This is an increase of 3.7 percentage points compared to 2020. Voxmeter’s annual image analysis shows that Ringkjøbing Landbobank has the best image of any Danish bank. Nordjyske Bank is in fourth place. Results like that are not achieved without a very great effort from our employees and I want to say thank you for that.
One of the Forum for Sustainable Finance’s 20 recommendations is that we should focus on education and training in the finance sector. This has always been a high priority to the bank. Accordingly, we have not set a cap on our education and training budget. We offer our employees education and training in our own academy and in collaboration with Aalborg and Aarhus Universities, the Financial Sector’s Training Centre and local vocational education institutions. In addition, we provided training to 48 young people in 2021, and generate a substantial number of knowledge-based jobs in our local areas.
The bank wants to be carbon-neutral. We own Sæbygård Skov forest, which captures more carbon dioxide per year than the bank emits. However, carbon sequestration in forestry is only accepted if the forest is certified under a UN-approved standard. We have therefore decided also to offset our CO2 scope 1 and scope 2 emissions by buying climate credits.
As a strong local bank in West, Central and North Jutland, we are of great importance to local communities. We have always been conscious of this responsibility and are happy to accept it. We finance investments in local business development and are proud to support more than 1,400 local clubs, associations, initiatives and events.
At national level, the bank has expended more resources in 2021 than ever before on combating money-laundering and financing of terrorism. We are also one of Denmark’s top 100 taxpayers and contribute to society by handling a range of other imposed tasks, e.g. in tax reporting and digitalisation. In addition, the Danish parliament, the Folketinget, has passed a proposal to levy a surtax on the financial sector which means that we will pay a higher income tax rate than other private-sector businesses from 2023.
Ringkjøbing Landbobank’s business model must be robust and sustainable for all stakeholders. This is a precondition for generating a satisfactory return on our shareholders’ investments. We believe we are on the right track and look forward to continuing working in this direction.
The bank supports the 15 ESG key figures defined by Nasdaq Copenhagen, the Danish Finance Society and FSR – Danish Auditors to make data comparable across industries and sectors.
You will find the status of these key figures for 2021, and much more about sustainable banking operations, in Ringkjøbing Landbobank’s ESG report and our report on the Ten Principles of the UN Global Compact and the UN Sustainable Development Goals for 2021.