We began our journey toward greater sustainability more than 10 years ago because we believe that sustainability is important to remaining competitive in the medium-to-long term. Only by establishing lasting relationships based on trust and transparency with its stakeholders can a business retain its place in the market, generating value for the communities in which it operates.
UniCredit was among the first banks to publish a sustainability report according to GRI guidelines. We have since also adopted the principles laid down by numerous international organizations, including the United Nations (the UN Global Compact, UNEP FI and UN PRI) and the International Finance Corporation (Equator Principles), and have adopted the London Benchmarking Group (LBG) model to ensure transparent reporting, which includes our contributions to the communities in which we operate.
Since 2014 we have adopted the IIRC reporting framework to describe our value creation over time.
The Group Sustainability unit, within Group Identity & Communications, reports directly to the CEO. This direct line of communication strengthens our capacity to develop and fine-tune initiatives to contribute significantly to the long-term viability of our business. The unit's main activities are outlined on the Sustainability Governance page.
Our approach has developed through a long process of internal discussion, taking into account both the characteristics of our organization and best sustainability practices. We have identified three broad categories of activity that characterize the way we operate, each requiring the application of different mechanisms:
- core banking activities;
- corporate citizenship;
For further details, see Our approach as a sustainable bank
We have conducted a materiality analysis to establish which sustainability issues our stakeholders consider priorities. It has also enabled us to identify issues that call for strategic vision and to monitor emerging trends with a view to minimizing risks and maximizing opportunities. The results of the analysis can be seen in our materiality matrix.
At UniCredit, we are conscious of the important role we play in the economy, so we focus our efforts on how to anticipate economic trends and adapt our services to the current and emerging needs of our customers. By adopting this approach, we believe we can transform today's challenges into growth opportunities for our customers, for our bank and for the entire economic system.
UniCredit has long been committed to instituting a culture of sustainability among employees, developing awareness of the fundamental role that they play every day in making the bank stronger, more secure and more responsible in social, economic and environmental terms. Educational programs such as the Risk Academy or courses on sustainability at UniCredit demonstrate our commitment in this area.
Our communities are one of the cornerstones of our approach to sustainability. We are fully aware of our responsibilities as a commercial bank, so we work to encourage financial inclusion, as well as to promote social inclusion in the communities in which we operate. While we pride ourselves on our ability to serve the international needs of our customers, we take our role as a local financial institution every bit as seriously.
At UniCredit, we are working every day to minimize the environmental impacts of our operations, both direct and indirect. This applies especially to our carbon footprint and our efforts to mitigate climate change. We also finance technologies related to the development of renewable energy sources, and we actively seek out solutions to minimize our role in financed emissions.
The guidelines adopted for the preparation of the sustainability information included in the 2017 Integrated Report, including the Supplement, are the "G4 Sustainability Reporting Guidelines" and the "Financial Services Sector Disclosures," both issued in May 2013 by the Global Reporting Initiative (GRI). The principles contained in the International <IR> Framework, published in December 2013 by the International Integrated Reporting Council (IIRC), were also used as reporting framework.
Choosing effective sustainability indicators is an important undertaking, especially for a company like UniCredit, which considers sustainability integral to its business. We currently use GRI indicators, all of which the GRI considers to be material core indicators for banks, and which are communicated in a transparent way in our reporting. They enable us to measure the effectiveness of some of the actions we undertake, increasing awareness of the importance of certain objectives. Growing interest from investors in sustainability performance serves as an additional incentive to continue our efforts to make good use of available indicators.
The contents of the Group Integrated Report are made available to the various stakeholders according to a clear plan of communications. The reports also serve as "communications on progress" (COPs). These documents describe sustainability initiatives, their results and how they apply the UN Global Compact's 10 universal principles, which relate to human rights, labor, the environment and anti-corruption measures. Since 2017 the Group Integrated Report is also a consolidated non-financial statement pursuant to Legislative Decree 254/2016.
Challenging market conditions and the decline in the reputation of the financial sector have undermined confidence in the ability of banks to adequately support the economy. The result is an sharper focus on the role of banks and how they operate. UniCredit has a long history in the field of sustainability, and the financial crisis and subsequent challenges have prompted us to invest even more heavily in this area.
We have sought to make sustainability an integral part of our daily operations and believe that it brings real benefits - not just in terms of our image, but in terms of competitiveness and differentiation in the marketplace. It clearly factors into a company's reputation, which is of great importance, particularly in the financial sector. But to avoid thinking of it merely as a way to improve the company's image, we consider it essential to align sustainable behavior with our business objectives. At UniCredit, among our many sustainability initiatives, we have refined and improved our incentive system. This has enabled us to measure and reward sustainable results and to put sustainability at the center of our business activities.