Case study: How DNB works with its clients and customers to encourage sustainable practices

Stakeholder identification and consultation

Please describe which stakeholders (or groups/ types of stakeholders) you have identified, consulted, engaged, collaborated or partnered with for the purpose of implementing the Principles and improving your bank’s impacts. This should include a high-level overview of how your bank has identified relevant stakeholders, what issues were addressed/results achieved and how they fed into the action planning process.

The continual process of identifying and engaging stakeholders—and incorporating their feedback into decision-making processes that impact them—is integral to DNB’s operations. In 2023, some stakeholder dialogue took place through a materiality analysis, which examined DNB’s key sustainability themes. For more details, please refer to page 46 of DNB’s annual report for 2023. Additionally, DNB’s document titled ‘Stakeholder dialogue in 2023,’ available in its sustainability library, provides further insights into DNB’s stakeholder engagement.

DNB emphasises that a successful transition to a low-carbon economy relies on collaboration among a variety of societal and economic players. Governments, policymakers, and regulatory entities play a crucial role in fostering an environment that promotes decarbonisation and the expansion of climate solutions. DNB is committed to intensifying stakeholder dialogue and will continue its collaborative efforts with governments, regulatory authorities, industry associations, and global partners. DNB’s goal is to inform decision-makers about the progress of the transition, highlight key dilemmas, and address challenges faced in the pursuit of shared objectives, while also promoting cooperation within the private sector and between the public and private sectors.

How did DNB work with its clients and customers to encourage sustainable practices and enable sustainable economic activities?

In its 2023 PRB Reporting and Self-Assessment Template DNB reports that it works with its clients and customers to encourage sustainable practices and enable sustainable economic activities as follows:

One of DNB’s primary strategic objectives is to create sustainable value by achieving profitable growth and making enduring choices. To realize this goal, DNB will assist its customers throughout the climate transition, manage ESG risks within DNB’s portfolios, and engage proactively with external stakeholders.

A key sustainable ambition of DNB is to finance the climate transition and serve as a catalyst for sustainable value creation. DNB will leverage its expertise and position to actively support its customers in their transitions through advisory services, capital allocation, and clear expectations. DNB is dedicated to achieving net-zero emissions by 2050 across its lending and investment portfolios, as well as within its own operations. DNB believes that the most effective route to net zero is one that it navigates together with its customers, through collaboration and dialogue.

Engaging with customers to facilitate their transitions is crucial for making a meaningful impact. DNB is already providing support to its corporate clients through advisory services and financing, which will continue. DNB is extending loans to corporate customers while aligning the loan pricing with their progress on emissions reduction. DNB’s strategy focuses on partnering with its customers throughout the transition, financing, and advising on real-world decarbonization rather than divesting from carbon-intensive sectors.

Sustainability considerations play a significant role in DNB’s annual customer interactions within its credit activities. DNB raises awareness about the risks and opportunities associated with sustainability, and its ESG assessments at the transaction level provide a solid foundation for discussions with customers on how they can capitalize on opportunities and manage inherent ESG risks within their industries, as well as how these factors may affect their long-term financial health. DNB’s Group guidelines on sustainability in credit activities formalize the integration of sustainability into risk assessments for all credit extensions. They also outline which activities in various sectors are ineligible for credit, and which industries require escalation to a higher authority prior to making credit decisions, regardless of their assessed ESG risk level.

DNB’s Group sustainability policy, which directs DNB’s related efforts, stipulates that DNB must consider climate and environmental concerns, embrace social responsibility, and maintain strong corporate governance across all its activities, including product and service development, advisory services and sales, investment and credit decisions, as well as production, procurement, and operations. You can find additional relevant policies and guidelines for DNB, lending, and asset management in DNB’s sustainability library on its website. DNB also recommends reviewing the annual report to assess its progress in relation to strategy and policy implementation.

Furthermore, in 2023, all customers using DNB’s accounting app, DNB Regnskap, gained access to an integrated, fully automated carbon accounting service through the third-party provider Energi.AI. This service offers customers an efficient tool to translate financial data into their carbon footprint, representing a significant step in DNB’s efforts to enhance customers’ understanding of climate and ESG-related matters, and to establish itself as a trusted advisor in their climate transition initiatives. For its personal customers, DNB provides guidance on the importance and benefits of improving the energy efficiency of their homes through its advisory services.

UN Principles for Responsible Banking: Accelerating a positive global transition for people and the planet

With over 300 signatory banks representing almost half of the global banking industry, the Principles for Responsible Banking are the world’s foremost sustainable banking framework. Through these Principles, the banking community takes action to align core strategies, decision-making, lending and investment with the UN Sustainable Development Goals and international agreements such as the Paris Climate Agreement.

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References:

This case study is based on published information by DNB, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original please revert to the following link:

https://www.dnb.no/portalfront/nedlast/no/om-oss/aarsrapport/en_2023/PRB_Self-assessment_2023.pdf

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