A clear division of responsibilities and a focus on ownership control, corporate governance and ethics shall help the Group to comply with the laws, regulations and rules applicable to the operations. The Code of Conduct highlights the importance of professionalism and good business practices.
Kommuninvest comprises two parts: The Society manages membership and matters of ownership issues and its Board of Directors consists of politicians from municipalities and regions. The financial operations, including funding, liquidity management and lending are conducted by the Company. Its Board of Directors consists of individuals with expertise in areas such as public administration, capital markets and business development.
There is a clear division of responsibilities, with the day-today operations of the credit market company being separate from the membership organisation and with annual ownership directives from the Society charting the Company’s course. Governance and control are designed to meet the requirements both of the ownership directives, as well as the laws, regulations and other rules to which the operations are subject. Risk appetite is low and professional conduct, strict ethical requirements and good business practices are to permeate the operations.
Anti-corruption and anti-money laundering measures
Both the Company’s Code of Conduct and its Sustainability Policy emphasise the importance of transactions and relationships being pervaded by good business ethics. The Company’s employees shall adhere to the legislation, regulations and rules applicable to the operations and shall always behave in an ethically correct manner, with transparency, integrity and honesty. Zero tolerance of all forms of corruption applies. The Company is required to identify and manage possible conflicts of interest.
A risk-based approach is applied to ensure that the Company’s products and services are not used for money laundering or terrorist financing. Suspicions of serious irregularities that could entail or lead to a breach of law are to be reported. Such violations can also be reported anonymously via a whistleblower function handled by an external party. No matters related to corruption or guidelines on money laundering were investigated during the year.
Kommuninvest’s environmental work takes into account both the direct environmental impact of the office operations, purchases and services, as well as the indirect environmental impact of the financial operations. The latter is described in the preceding section on sustainable financing.
Direct environmental impact arises as a consequence of the Group’s operations, including energy consumption in its premises, purchases of office supplies and equipment, meetings and conferences, etc. The greatest direct impact by far derives from business travel, which accounts for over 80 percent of the Group’s climate impact. Naturally, emissions reduction efforts focus on air travel, which has the greatest climate impact. As shown in the graph on page 23, emissions from business travel have decreased continuously over the past five-year period. The main explanation is the reduced number of long-haul flights.
In our office operations, we work in various ways to reduce their environmental impact by means of environmentally labelled electricity, motion-controlled lighting and plumbing fixtures, micro-flush toilets, and a high level of recycling/sorting of waste. Total energy consumption, however, is increasing and an analysis of potential improvement measures was initiated in 2019. A plan of action for sustainable IT is being developed, and measures have been initiated to increase the recovery and reuse of obsolete equipment.
Kommuninvest compensates for the greenhouse gas emissions remaining after its own climate work. In accordance with the conditions that apply to municipalities and regions, we climate compensate internally, that is, for investments made locally/in Sweden. Earmarked funds set aside either to finance initiatives supporting the sustainability efforts of the Society’s members or helping reduce Kommuninvest’s own impact.
During 2019, climate compensation funds of TSEK 262 (0) were used for the Group’s participation in the project “Climate requirements at a reasonable cost”, together with Public Housing Sweden and IVL. The project seeks to develop an industry standard allowing public housing organisations to calculate climate impact, including the construction process, and to set climate requirements for new production.
To increase the impact of our sustainability work and to respond to stakeholder expectations, we engage in relevant social issues, often in partnership with others. For example, we are participating in SNS’s three-year research project, Community Building, which focuses on community planning, a functioning housing market and investments in infrastructure and public services. Kommuninvest contributes with its expertise in financing welfare and in collaboration between municipalities.
The Society is also a co-founder of the Axel Prize, which draws attention to people who, in their work, help to secure and developing confidence in the social contract and its democratic values. Through a collaboration with the Centre for Municipal Strategic Studies at Linköping University, we support the Vadstena Forum, an annual symposium for researchers and representatives of civil society, business or the public sector. In our research and analysis, the economic development of the municipal sector is continuously monitored and reported via reports, seminars, etc.
We do not work with sponsorship in traditional terms, but seek cooperation with partners who have a pronounced social commitment, with an emphasis on ventures in Örebro, where the Company has its head office. The focus lies on activities in education, culture and inclusion. Initiatives include helping immigrant upper-secondary pupils with their homework, support for artistic endeavours within OpenArt, opportunities for football and horse riding for people with disabilities, as well as initiatives for young immigrant women in the district of Vivalla.
Young politicians debated challenges in welfare
During the year’s Almedalen week (an annual democratic forum in Sweden) Kommuninvest and Society Lab* invited leaders of the political parties’ youth associations to participate in panel debate on welfare in three fictional municipalities. The topics discussed were largely based on Kommuninvest’s Welfare Challenges report.
The first fictitious municipality, the sparsely populated Municipality of Astridsås, facing problems such as population decline, unemployment and substantial need of welfare staff provoked discussions on the possibilities of digitisation, but also on how an improved integration policy could help resolve Astridsås’s welfare problems.
“If we can succeed with integration, immigration is something that could rebuild communities like Astridsås. But we must have systems to accommodate recent arrivals, and to help them find homes and jobs – in that way aiding the rejuvenation of the municipality’s population,” reasons Romina Pourmokhtari, Deputy Chairman, Liberal Youth of Sweden (LUF).
In the larger Municipality of Bokhamn, a town characterised by substantial differences in terms of security and school results in its various districts, questions of town planning were in focus and how underprivileged areas could be eradicated by means of planning and development.
“A problem I have seen up close in Uppsala is that people always talk about densification, with taller buildings and small apartments. We ought to build for the longer term instead, fitting in smaller houses and different types of housing from the outset,” says Sarah Havneraas, Secretary General of the Young Christian Democrats (KDU).
The third and final discussion revolved around the challenges of the rural municipalities, manifested as Alexanderberg, a medium-sized town with high unemployment and few opportunities for further education.
“I believe Alexanderberg is in great need of more business-friendly politics. This partly involves establishing additional new employers, but also ensuring that dealing with the municipality is easy when it comes to administrating permits,” says Helena Nanne, First Deputy Chairman, Moderate Youth League (MUF), mentioning farm sales and tax cuts as examples of how the municipality can become more attractive.
* The block-independent Society Lab network, with Kommuninvest as its initiator, is a platform for young politicians and officials on issues of welfare and its funding.