Case study: How LABORAL Kutxa identifies and works on strategic business opportunities to increase positive and reduce negative impacts

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.

LABORAL Kutxa has established various dialogue mechanisms with different stakeholders to address sustainability topics. The insights gained from these conversations are used to conduct a materiality analysis, which helps prioritize the ESG aspects that the organization must focus on and informs the reporting in its annual Sustainability Report. To support this process, 300,000 surveys are distributed to stakeholders, who are categorized into the following groups:

• Customers: primarily those with strong ties to the organization, such as clients from the Premium Banking, Personal Banking, TOP, and KIDE segments.
• LABORAL Kutxa employees: all staff members.

These dialogues also encompass topics related to business operations and sustainability. For the materiality analysis, the summary of the Sustainability Report is shared with over 300,000 customers and employees, resulting in approximately 2,100 responses. A key stakeholder group is the staff, who are members and owners of the bank, enjoying multiple communication channels and participation in decision-making processes. Like customers, employees are also informed about the Sustainability Report summary and are invited to complete the sustainability survey.

In 2022, a materiality analysis was initiated incorporating the concept of double materiality, complementing the existing Materiality Matrix developed with stakeholders. This dual approach considers not only impact materiality—assessed through stakeholder consultations—but also financial materiality, which examines how sustainability issues could influence the bank’s financial performance. At LABORAL Kutxa, these aspects are reviewed by both the Board of Directors and the Governing Board.

How did LABORAL Kutxa identify and work on strategic business opportunities to increase positive and reduce negative impacts?

In its 2024 PRB Reporting and Self-Assessment Template LABORAL Kutxa reports that it identified and worked on strategic business opportunities to increase positive and reduce negative impacts as follows:

LABORAL Kutxa has implemented a series of measures to restrict certain business sectors that may conflict with sustainability goals and to support others in their transition. At the same time, LABORAL Kutxa is committed to promoting sectors and investments that align with sustainable development through its business model. To this end, a Sustainable Financing Framework (SFF) was established in 2022, accompanied by the development of a product catalogue aligned with this framework. This catalogue includes products with sustainable characteristics in both financing and insurance, as promoting these products is considered the most effective way to encourage customers’ sustainable activities. The SFF adheres to ICMA guidelines, the SDGs, and taxonomy standards, and is structured into 11 sections—five related to environmental issues and six to social aspects:

• Environmental sections:

1. Renewable energies
2. Green housing and energy efficiency
3. Clean mobility
4. Organic farming and biodiversity
5. Circular economy

• Social sections:

6. Affordable housing
7. Social inclusio
8. Social economy
9. Public funding
10. Economic inclusion
11. Depopulated and disadvantaged areas

LABORAL Kutxa aims to increase financing in these sectors annually. To support this goal, it is developing a catalogue of ESG-linked products associated with these sections, which are offered at preferential rates. These products include both financing and insurance solutions, such as:

• Financing:

• ECO loan
• DispON ESG
• Loans for solar panels for self-consumption by companies
• Home renovation loans
• Building renovation loans

• Insurance:

• Electric/hybrid vehicle coverage
• Home insurance for vulnerable groups

Additionally, regarding financial advisory services, customer surveys have been conducted to understand their sustainability preferences. Based on the results, a broad range of investment funds and sustainable pension plans—classified as Article 8 funds under the SFDR regulation—are offered to support clients’ sustainable investment choices.

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.

FBRH Principles for Responsible Banking (PRB) Assurance:

First class PRB assurance services: The result of solid, hands-on ESG/ Sustainability experience

• • • FBRH is a GRI Certified Training Partner (Global), ISEP Training Centre and a member of CPD.
    • FBRH builds trust. Over 200 reviews from top professionals from around the world demonstrate our ability to build strong, trusting business relationships.
    • FBRH possesses a unique skill set that combines ESG/sustainability certified training, experience in advisory services and report preparation, and ESG/sustainability report assurance.

The combination of all the above empowers FBRH to provide first class Principles for Responsible Banking (PRB) assurance services.

References:

This case study is based on published information by LABORAL Kutxa, 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://corporative.laboralkutxa.com/src/uploads/2024/09/PRB.2024_EN-1.pdf

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