Focus of sustainability efforts
Behaving ethically and taking responsibility for economic, environmental and long-term sustainable social development are fundamental elements of Kommuninvest’s sustainability efforts. We also seek to promote a dynamic dialogue and communications with stakeholders about this work.
Kommuninvest has relationships with a range of stakeholders who, in different ways affect – and are affected by – our operations. It is very important that we listen to our stakeholders to identify the economic, social and environmental issues that Kommuninvest’s activities affect and that stakeholders consider essential.
Kommuninvest’s stakeholder dialogue involves, for example, systematic meetings with customers and owners, discussions with personnel representatives and representatives from central government ministries and authorities. In addition, Kommuninvest conducts regular surveys among owners, customers, employees and investors. As a basis for our sustainability work in 2017 and beyond, a survey on key sustainability issues was conducted among the Company’s key stakeholders at the end of 2016. The intention is to repeat the survey every two years.
Municipalities and county councils/regions are our most important stakeholders
Kommuninvest’s members – municipalities, county councils and regions – own and control our operations – but are also our customers when they choose to borrow from us. The dialogue with our members, in their capacity as owners, is mainly conducted with elected politicians. In dialogue with our members, in their role as customers, we mainly interact with finance specialists from municipal and county council/ region offices/bodies.
These dialogues with the elected officials and civil servants are conducted on an ongoing basis in both informal and more formal, established contexts. Such important forums for elected officials include the Annual General Meeting of the Society and the member consultations held at the beginning of each year. In 2017, member consultations were held in 18 locations around Sweden with 315 partipants. For customers, annual financial seminars are held across the country, but also meetings with various customer constellations. The 2017 financial seminars were held in eight locations with a total of 227 participants.
The ongoing dialogue with other societal actors – central government ministries, regulatory bodies and supervisory authorities – takes place largely through meetings in person and the exchange of information. The dialogue with investors and the capital market takes place through meetings in person and presentations, both nationally and internationally. The dialogue with employees is also conducted in both formal and informal formats, between managers and employees and at regular information meetings.
Through the stakeholder dialogue, Kommuninvest forms an idea of which sustainability issues the Company should work with. In the stakeholder survey on sustainability conducted in late 2016, external and internal stakeholders were asked to prioritise which initiatives Kommuninvest should prioritise. Environmental aspects of lending and borrowing are the issues considered most important by stakeholders.
Governance of sustainability work
The Sustainability Manager is responsible for managing, developing and reviewing Kommuninvest’s sustainability work in close cooperation with the Executive Management Team and the department heads, who are responsible for taking sustainability aspects into account within their respective areas of responsibility. Guidelines for sustainability work are detailed in a Sustainability Policy adopted by the Company’s Board of Directors, and are further specified in supplementary policies and instructions relating to occupational and personal safety, IT security, equality and diversity, competence supply, bribery and hospitality, and regulatory compliance.
Sustainability risk is the risk that Kommuninvest’s operations will directly or indirectly affect their surroundings negatively in terms of business ethics and corruption, including money laundering and terrorism financing, climate and environment, as well as human rights, including working conditions. Kommuninvest considers itself primarily exposed to sustainability risks related to ethics, IT security and so-called green-washing, that is, the risk that environmental and climate-related investment projects that it funds fail to meet sustainability requirements.
Kommuninvest’s actions to address sustainability risks are largely governed by national and international regulations and guidelines alongside the Society’s Ownership Directive, internal instructions and policies. With regard to “green financing”, the Company’s sustainability risk is managed through a Green Bond Framework, including the expert committee responsible for evaluating and approving investment projects for green financing.
Stable and cost-effective financing solutions Kommuninvest’s basic mission is ensuring that Swedish municipalities and county councils/regions are able to access loan financing on favourable terms, including during periods of unease in the financial markets. Accordingly, as the dominant lenders, we help foster conditions for welfare investments that are both cost-effective and sustainable.
Green Loans and Green Bonds
Kommuninvest is encountering increasing demand for financial instruments allowing both borrowers and investors to express their sustainability ambitions in concrete terms.
Kommuninvest currently offers Green Loans for the financing of local government investment projects with clear environmental and climate benefits. Kommuninvest funds its Green Loans by issuing Green Bonds.
A culture characterised by diversity, gender equality and committed employees is essential if Kommuninvest is to successfully perform its mission. Kommuninvest works proactively in all of these areas and has a high proportion of women in management positions, a high proportion of employees with a foreign background and a strong commitment to employees.
Review inspired by GRI
The review of Kommuninvest’s internal sustainability work is detailed by means of a selection of indicators on this and the following pages. This selection is inspired by the GRI framework (Global Reporting Initiative), a standard for sustainability reporting that is used widely.