New ESG targets
UniCredit announces new ESG targets as part of a long-term commitment to sustainability: Do the right thing!
Sustainability Matters. It is a key lever for our future business strategies and a critical component of our bank's success.
"Sustainability is part of our Group's DNA and a key component of our business model. UniCredit is committed to protecting our natural capital, including the environment. Every company has to do more than 'business as usual' - it is now the time to act and make an impact. Building a sustainable future is an important challenge for both people and businesses. These new measures are part of our wider sustainability strategy, to make sure that we always: Do the right thing!"
Jean Pierre Mustier, UniCredit Group CEO
New targets set for 2023
UniCredit has set new sustainability targets to further reduce both its direct environmental impact through specific energy choices and its loan portfolio exposure to controversial sectors businesses.
We have already cut our greenhouse gas emissions by half since 2008. We are on target to reach a 60% reduction by 2020 and an 80% reduction by 2030. All electricity consumption in the bank's buildings in Italy, Germany and Austria will come from renewable energy sources by 2023, compared to 78% in 2018.
Plastic free by 2023. The bank is distributing re-usable metal drinking bottles across the Group. Plastic bottles have been removed from break areas and plastic items from canteens. All single-use plastic will be removed from all UniCredit buildings by 2023.
UniCredit is also reducing the use of paper. In 2018, around 60% of the bank's copy paper had an environmental label certifying its sustainable credentials. The Group is using technology to further limit the use of paper through projects like the Paperless Branch Program in Italy, which led to the scanning and digital storage of around 9 million documents last year.
Partnering with our customers in the shift to a low-carbon economy
UniCredit is partnering with customers in the shift to a low-carbon economy. It is assessing its portfolio exposure to climate risk through projects like the Paris Agreement on Capital Transition Assessment (PACTA) in partnership with 2 degrees investments initiatiative.
UniCredit has committed to fully exiting thermal coal mining projects by 2023. Our new Coal policy prohibits lending to new projects in thermal coal mining and coal fired power generation. We are setting strong commitments in terms of reducing reliance on coal for corporate finance customers. A new Oil and Gas (O&G) policy covers the Arctic area, prohibiting the financing of new projects in Arctic oil and offshore Arctic gas. It also prohibits shale oil and gas and related fracking, tar sands oil, and deep-sea mining O&G. Corporate financing for clients active in these areas will only be allowed if their share of revenues from non-supported activities is under 25%.
UniCredit has committed to increasing its lending to the renewable energy sector by 25% by 2023 (to over €9bn). It will also increase energy efficiency loans to customers by 34% for SMEs in Western Europe and by 25% for individuals in Western Europe. The new origination of energy efficiency loans in CEE will represent over 6% of total loans.
UniCredit has been active in sustainable finance since 2007 and is currently among the Top 10 banks in ESG-linked loans. UniCredit aims to be among the top five players in EMEA league tables for both Green Bonds and sustainability-linked loans by 2023. It will achieve this goal with help from a new customer-facing Sustainable Finance Advisory Team, which combines sustainability expertise with our internationally-recognised excellence in capital markets execution to deepen customer dialogue on ESG topics and facilitate access to Europe's green financing market.
External monitoring and recognition
As part of our ongoing commitment to sustainability, UniCredit has joined key institutional organisations and international agreements, joining forces with other businesses to achieve the same goals. We support the Task Force on Climate-Related Financial Disclosures (TCFD), Principles for Responsible Banking (PRB) and the OECD Business for Inclusive Growth Coalition (B4IG).
UniCredit is monitored by international agencies to assess its commitment to ESG topics and its progress on meeting targets. We have been recognised by the FTSE4Good Index Series. In particular, FTSE Russell assigned an ESG rating to UniCredit of 5.0, the top score on its ESG rating scale. This positions UniCredit in the 99th percentile, among Diversified Banks peers.
Similarly, Standard Ethics, an independent sustainability rating agency, identified UniCredit as the only bank in Italy with an EE+ rating, strong compliance and the ability to manage reputational risks linked to the United Nations, OECD and EU agenda on sustainability and corporate governance. The agency commended UniCredit for our fast and convincing implementation of our sustainability model, with a good integrated report.
Committed €1bn by 2023 to supporting projects with a positive social impact
Social Impact Banking has successfully disbursed over €100 million in support of social and micro companies and entrepreneurs in Italy. It is now being rolled out in 11 additional markets. UniCredit has committed to approving €1 billion of total financing by 2023.
We also provide financial education: in 2018, around 6,000 students were supported in 270 schools and around 2 million hours of financial training were provided by UniGens1.
Our Art4Future project2 is reallocating wealth stored in the bank's 60,000-piece art collection through the sale of selected pieces. Funds raised will support Social Impact Banking, buying the same number of artworks from emerging artists and supporting other socially relevant initiatives.
UniCredit also promotes culture by partnering with associations including the Filarmonica della Scala and Arena di Verona in Italy, the Bavarian State Opera in Germany and the Musikverein in Austria.
Among other projects promoting positive social impacts, the UniCredit Foundation contributed over €3.2 million in 2018 for social needs, including study and research. For example, our Gift-matching Programme doubles annual donations made by bank employees. One million meals are provided to the World Food Programme. During natural disasters, UniCredit suspends private mortgage repayments and provides subsidised loans to impacted communities.
1 A network of retired UniCredit employees
2 Approximately 314 works will be sold in global sales across 2019 and 2020, which we are looking to replace with works of young and emerging artists. The total works currently owned by UniCredit are around 60.000.
UniCredit employees presented over 1,200 new ideas on how to protect our climate
At UniCredit, sustainability is a goal shared from headquarters to branches, across all our markets. The entire UniCredit team joined this year's Global Week of Climate Action. Employees across the Group worked together to come up with over 1,200 ideas on how to protect our climate. They suggested proposals ranging from recycling and waste to mobility, to further raising awareness, more energy efficiency, pollution prevention and changes in eating habits. These suggestions will be reviewed by our Millennial Board3 (made up of employees ranging from 22 to 32 years of age) and presented to top management in December 2019. The Board is fully supported by the Group's management team.
3 The UniCredit Millenial Board consists of employees ranging from 22-32 years of age, working to challenge pre-conceived patterns and raise awareness on the views of new generations (on banking topics), proposing innovative ideas and solutions.
Leading European banking sector Diversity & Inclusion industry initiative
Creating sustainable value over time starts with the environment, but encompasses the way the bank works with its stakeholders. We are proud of our Diversity & Inclusion efforts.
The result in higher team member engagement and motivation, as well as enhanced risk mitigation and management, which creates a more sustainable organisation and long-term profitability. Creating a positive and inclusive workplace is key to innovation and growth, by strengthening the company's reputation, helping to attract and retain key talent. UniCredit will work with different associations to launch a Diversity & Inclusion initiative for the European banking sector, to set and monitor specific objectives so that banks increase the proportion of women and minorities.
This is fully in line with the two core values of UniCredit: Ethics and respect. That's why we have created the role of Chief Ethics Officer, within the Group Institutional Affairs and Sustainability team. UniCredit is working with staff and the industry to make sure that banks always: Do the right thing!