CSRREPORT2012A question of balancewww.nordea.com/csr
CONTENTS     04     Introducing                                            10                                            C...
26Growing                                      32                                      Governance                         ...
MEET NORDEA     Nordea is the largest financial services group                is right for him or her. Nordea offers a wid...
FACTS & FIGURES                                             NORWAY                                       971,000          ...
Welcome from our CEO     Introducing     Nordea     “             Banks have an important role in             the global e...
Without the trust of the customers, banks cannot              from the present sovereign debt crisis – then itensure the s...
Our impact     on society     For a bank, a year’s performance     is often described in terms of                         ...
â Household lending                                     305,000               Purchases              Mortgages issued in 2...
CSR focus     and ProgreSS     The banking industry is changing fast. Customers are making new     demands and lawmakers a...
Highlights in 2012Moving forward in a downturnFinancially healthy societies need financially healthybanks. Economic stabil...
Investing through                                     Improving ESG in lending     positive screening                     ...
“                                                                          The fact that 31% of                           ...
Lifelong     Relationships     Nordea’s core business concept revolves around relationships.     All our customers are uni...
doing so, we are able to create transparent and no-        AN OPEN EAR TO IMPROVEMENTnonsense products and services. This ...
and contact centres to register complaints                  services. Responding and reacting to customers     In our cust...
to our products. To emphasise this point, all ofour tutoring materials are white-labelled andfree of any bank logos. In 20...
Responsible     lending     Being the largest financial institution in the Nordic region with a     systemic importance fo...
“                                        Integration of environmental, social and                                        g...
location of the business activities as well as the                              field of business of the companies in ques...
Applying                                              The ten                                                             ...
Responsible     value creation                                 Today, Nordea is the biggest                              a...
“                                                     To reduce environmental impact, provide                             ...
Our Process                                               Identifying new stars     The first and one of the most importan...
companies selected on the basis of various indices.         As of end December 2012, Nordea has activeWith the relatively ...
growIng                              together                              Relationships count. That is why Nordea        ...
“                Nordea’s leaders engage                and motivate people to         reach out for our vision and       ...
The Nordea leadership pipeline                                                                                            ...
Internal mobility                                          Starting in 2013, we will offer defined contribution           ...
Equality                                                     Unionisation is low in the Baltic countries and Russia       ...
Running     a responsible     business     Financial institutions today face a complex regulatory     environment. Banks a...
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
Nordea csr report 2012
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Nordea csr report 2012

  1. 1. CSRREPORT2012A question of balancewww.nordea.com/csr
  2. 2. CONTENTS 04 Introducing 10 CSR focus 14 Relationship Nordea and progress banking 05 Nordea facts & figures CSR work is always work in 14 Lifelong relationships 06 Welcome from our CEO progress, a journey that never 18 Responsible lending ends. The goal is to integrate CSR 08 Our impact on society with business. This section tells 22 Responsible value creation Nordea is one of twenty eight how the work is progressing and banks in the world considered what Nordea focuses on to reach Everything we do in Nordea has vital for the financial system, a its goal. The complexity of the task one purpose: to create great systemically important bank. This should not be underestimated customer experiences. Our entails a great responsibility. Read and is constantly scrutinised by customers’ goals are our goals. how Christian Clausen, Nordea’s responsible investors worldwide. The better we know them the President and Group CEO, views more likely it is that we can work responsibility and see how Nordea together with them to realise impacts society. their goals. www.nordea.com/csr02 NORDEA CSR REPORT 2012
  3. 3. 26Growing 32 Governance 40 Reducing ourtogether and compliance environmental footprintAt Nordea we want our people to 32 Running a responsiblegrow. When they grow, Nordea business Minimising our environmentalgrows. Internally we say One 36 Corporate governance footprint is part of everydayNordea Team. Read about working life. It is constantlyNordea’s people and how leaders Identifying risk and preventing financial crime are essential decreasing as a result ofare coached to unfold the potential systematic work. Travel is reducedof others, live the values and help aspects of compliance. Nordea has comprehensive systems in and less paper is used asothers reach out for the common information is conveyed via web.vision. place to ensure that the bank is compliant and works with integrity Suppliers are contractually obliged and responsibility. to follow the treaties to which Nordea is signatory.43About this report 44 Performance 51 Auditors Review indicators Report 44 GRI Index 46 Social data 48 Environmental data NORDEA CSR REPORT 2012 03
  4. 4. MEET NORDEA Nordea is the largest financial services group is right for him or her. Nordea offers a wide in the Nordic and Baltic Sea region with market range of products, services and solutions within capitalisation of approximately EUR 29,3bn, assets banking, asset management and insurance. under management of EUR 218bn and a core tier 1 capital ratio of 13.1%. In 2012 we received Nordea Bank AB (publ), the parent company of the no state subsidies. Nordea has leading positions Nordea Group, is legally registered in Sweden with within corporate merchant banking as well as retail head offices in Stockholm. Christian Clausen is the banking and private banking. It is also the largest Group President and CEO. At the end of 2012 Nordea asset manager in the Nordic region and the leading Group had 31,466 employees*. Nordea’s organisation Nordic life and pensions products provider. strengthens the value-chain-based concept. It consists of three main business areas geared towards increased Nordea has an ambitious vision of becoming flexibility and focus on capital and cost efficiency. a Great European bank, acknowledged for its A detailed organisational chart is available on people, creating superior value for customers and www.nordea.com. Nordea has no major joint ventures, shareholders. The vision is reflected in Nordea’s apart from the IT operations jointly run with IBM. financial targets and supported by Nordea’s values: The Nordea share is listed on NASDAQ OMX Nordic ■■ Great customer experiences Exchange in Stockholm, Helsinki and Copenhagen. ■■ It’s all about people With high market capitalisation and high liquidity, ■■ One Nordea team the share is included in key indices. In the end of December 2012 the three largest shareholders To help us achieve that vision we also: were Sampo Group with 21.4 (20.3)% of the shares, the Swedish state with 13.5 (13.5)% and Nordea ■■ Pursue a strategy that ensures sufficient income Fonden with 3.9 (3.9)%. Nordea has approximately generation to create great customer experiences and 475,000 shareholders who hold 4,049,951,919 long term value. shares. Nordea can trace its roots as far back as to ■■ Aim to be the best relationship bank in the markets 1820. To date 250 banks have been incorporated. where we operate retaining existing customers and attracting new ones. Recognitions ■■ Operate according to one operating model in everything we do in order to free up resources to serve customers Nordea received several awards and recognitions during 2012. Some of the main awards were: We have had our position confirmed as the market leader in the Nordics by being among the ten largest ■■ Bank of the Year in Western Europe by the Banker, universal banks in Europe and defined as the only owned by the Financial Times global systemically important bank in our part of ■■ The best in Private Banking in the Nordic and Baltic Europe. To meet the regulatory challenges, we have Region by Euromoney initiated one of the most ambitious New Normal ■■ The best debt bank in Nordic region by the Global plans for any bank in the world. We have continued Finance Magazine to attract new customers and deepen our relations ■■ The safest bank in the Nordic region by Global Finance in all segments - from households to the largest Magazine. companies in the region. We were appointed the Bank of the Year in Western Europe by the Banker. More information on received awards is available on www.nordea.com. Today Nordea has some 11 million personal customers, approximately 1,000 locations in total and Please see pages 4-8 and 211 of the Annual a leading net-banking position with approximately Report for more detailed information. 6.9 million Netbank customers. Building relationships with our customers is fundamental. That is how * FTEs, full-time equivalent we are able to provide each customer with what04 NORDEA CSR REPORT 2012
  5. 5. FACTS & FIGURES NORWAY 971,000 FINLAND CUSTOMERS 2,630,000 SWEDEN CUSTOMERS 3,389,000 ESTONIA 140,000 CUSTOMERS CUSTOMERS RUSSIA DENMARK LATVIA 72,000 112,000 1,684,000 CUSTOMERS CUSTOMERS LITHUANIA CUSTOMERS 155,000 CUSTOMERS POLAND 668,000 CUSTOMERS International Markets Beijing, Frankfurt, London, Luxembourg, New York, Sao Paulo, Shanghai, SingaporeECONOMIC VALUE GENERATED Million eurosDirect economic value generated: INet sales plus revenues from financial investments and sales of assets 9,303 ntro du cin g N ordeaEconomic value distributed:Payments to suppliers, non-strategic investments, royalties and facilitation payments 1,860Total monetary outflows for employees (current payments, not future commitments) 3,048All financial payments made to the providers of the organisations capital 1,048Gross taxes 991Donations, voluntary contributions 1 NORDEA CSR REPORT 2012 05
  6. 6. Welcome from our CEO Introducing Nordea “ Banks have an important role in the global economic recovery. We can only take on that responsibility by always putting customers first and helping finance their plans and ambitions. That is the engine of growth and the idea behind Nordea’s relationship strategy. The financial crisis shows that financial stability is a prerequisite for strong customer relations. Only if we can generate the capital needed to provide new loans and maintain capital buffers, can we serve customers and contribute to society. This is the core of our CSR thinking. Nordeas long term goal is to fully integrate CSR and business.” Christian Clausen, President and Group CEO Great customer experiences criticisms levelled against the financial sector are justifiable. There were banks that exhibited weak and financial stability and unclear values, banks that had buffers that were The global financial sector has been under strong too small or governance systems that were poor, pressure for five years. First, the financial crisis and there were banks that distanced themselves paralysed large parts of the industry as trust from the rest of the societies where they operate. between banks disappeared and liquidity became scarce. It became obvious that many banks had These various malpractices have led to far too small capital buffers to run sustainable criticism of the entire industry that affects all banking models. Today, many banks are struggling banks. Also Nordea has faced challenges. to adjust to new regulations aimed at preventing future financial crises. At the same time, the Customers first recession in Europe is causing economic activity and demand for banking services to slow. The conclusion from the past five years is that every bank has to put the customers first and ensure Through all these phases banks have lost the a business model that provides financial stability, public’s trust and appreciation. In many cases, the good funding access and healthy profitability.06 NORDEA CSR REPORT 2012
  7. 7. Without the trust of the customers, banks cannot from the present sovereign debt crisis – then itensure the stability and development that 21st will mark a historic, collective accomplishment forcentury banking requires. For Nordea, this translates politicians, authorities and banks. Certain calibrationsto our value: Great Customer Experiences. By still await and some complex regulatory work needsconstantly maintaining strong relationships with to be finalised, but significant steps have been takenboth corporate and household customers, doing to make the economy less volatile in the future.our utmost in each customer situation and strivingto add value with every advice we give, we want to Other industry-wide initiatives are of equalhelp our customers shape their future. Thereby we importance. They establish clear norms by whichalso shape the future of our relationship bank. we can navigate the road ahead. One example is the United Nation’s Environmental PrinciplesIt is equally important to recognise that banks must for Financial Institutions, which Nordea signed ingenerate a profit above the cost of capital. Without 2001 and has served as a guiding star for us everthis, banks will not be able to provide long term stability since. The Equator Principles, the Global Compactor the ability to support growth and development and the United Nations Principles for Responsiblein the societies where it is mostly needed. Investment provide a similar signposting role for us.Through the crisis, Nordea has delivered. Since 2007, However, signing documents is easy; translatingwe have welcomed 700,000 new household customers them into practice is what makes a change. Itto a close relation with us. Today more than three is necessary to break them down into tangiblemillion people do their daily banking business and get policies and practices. Nordea does this. We actfinancial advice from Nordea. Over this period, our on the principles in our day-to-day tasks.monthly performance figures have been consistentlypositive as well. In fact, we have managed to reach Moreover we aim at shaping Nordea’s future culture,a return on equity above 8 % in each single quarter where every employee lives out our values – Greatsince the crisis started. Nor has our return on equity Customer Experiences, It’s All About People and Oneever dropped below 11% any year since. Instead Nordea Team – in everything we do. There is no moreof reducing credits and lending, we are generating forceful way for us to take our responsibility than toadditional business with our customers. Instead convert these values into action – for our customers,of leaving customers and markets behind, we are our employees and the societies where we operate.increasing the number of households and companiesthat we serve. Instead of scaling down on development,we are introducing new products and channels forour customers. Today, Nordea has close to one millionfrequent mobile bank users and almost all of ourhousehold customers access their services on-line. Christian Clausen President and Group CEOThis is the core of our contribution to society.Instead of causing problems, we want to bepart of the solution – by supporting growth, byhelping find good regulatory structures for thefuture, and by taking difficult measures to adjustour bank to the emerging environment. I Christian Clausen re-electedKeeping on course Chairman of European ntro du cin g N ordeaAs chairman of the European Banking Federation, Banking FederationI have had the opportunity to participate in thework of reshaping the global financial regulation. In November 2012, Christian Clausen wasThe over-arching aim of the regulation is to ensure re-elected to a second term as Chairmanthat banks have the profitability and financial of the European Banking Federation.stability to avoid new financial crises and insteadbecome buffers that protect society from the The European Banking Federation is basedeconomic effects of asset price bubbles. in Brussels and has 4,500 members from 31 countries. Christian Clausen is also ChairmanIf this objective can be achieved – at a level and pace of the Swedish Bankers Association.that does not hurt the ability for Europe to recover NORDEA CSR REPORT 2012 07 07
  8. 8. Our impact on society For a bank, a year’s performance is often described in terms of Deposits â net interest income, return on equity and operating profit. But as 124 bn€ of deposits* important is the impact we have on society in our home markets. OUR IMPACT STARTS Shareholders â WITH CUSTOMERS We have an impact on society when we meet our 447,000 customers. We need to stand by our customers and shareholders* help them in realising their plans. This requires that we know them thoroughly. In 2012 we conducted almost 2 million advisory sessions with household and corporate 29 bn€ market cap* customers. Each working day, more than 5,000 people visited a Nordea branch and received a comprehensive overview of their personal finances and a clear view on how 1 bn€ to make their ambitions possible. We met with more than dividends 300,000 small and medium-sized corporate customers and were able to help many entrepreneurs adjust to both sluggish demand and the effects of new banking regulations. We supported over 270 large and multinational companies in finding financing on the bond market through bond issues in the amount of almost EUR 50bn. In addition, we enabled over EUR 70bn syndicated loans to be issued. Debt securities in issue â In order to provide long-term stability and to support growth and development wherever we operate we must be financially stable, have good funding access and healthy 184 bn€* profitability. Financial strength is a prerequisite for funding, in the eyes of both equity and fixed income investors. We must also be perceived as a safe bank for customers’ deposits. In return we pay interest on deposits and fixed income investments, and dividends to our shareholders. In our role as a corporate citizen we also keep the wheels of society rolling through tax payments, buying services and goods as well as employing 31,466 people.*  ■ * Based on 31 Dec 2012 * FTE, full-time equivalent Other figures are based on full year 20120808
  9. 9. â Household lending 305,000 Purchases Mortgages issued in 2012 2 bn€ 130 bn€ 1,000 contractors* Mortgages ã 29 bn€ Consumer lendingGross Taxes â Corporate lending 991 m€ 183 bn€ corporate lending ã 120 bn€ bondS and SYNDICATED LOANS issued in 2012 â Wealth management 218 bn€ assets under mANAGEMENT* 2,567,051 Number of fund unit holders* â Advisory 750,000 ”360 degree” meetings 312,000 meetings with small & medium corporates 770,000 FINANCIAL PLANS ã I â Transactions Employees 248,000,000 ntro du cin g N ordea netbank transactions 31,466 24,000,000 employees* branch office transactions 1,300,000,000 3 bn€ card transactionssalaries AND OTHER CONTRIBUTIONS 883,000 RELATED TO EMPLOYEES new cards 123,000,000 MOBILE log-ins 09 NORDEA CSR REPORT 2012 09
  10. 10. CSR focus and ProgreSS The banking industry is changing fast. Customers are making new demands and lawmakers are setting new rules. In 2012, our focus was on further embedding CSR with our core businesses. We strengthened our compliance, developed our lending practices, introduced a new Sustainability Policy and continued to reduce our ecological footprint. All with one goal: to continue carrying out responsible relationships with our customers and other stakeholders and to contribute to the societies in which we work.10 NORDEA CSR REPORT 2012
  11. 11. Highlights in 2012Moving forward in a downturnFinancially healthy societies need financially healthybanks. Economic stability is Nordea’s fundamental.Our customers as well as all our shareholders needto know that we are there in the long-term. This is ourprimary social responsibility. To fulfil that vision, weneed to go about our business in a responsible way. ESG assessment in lendingKeeping ahead also means having to adapt. Nordeamonitors our changing economic environment very Going forward we will focus onclosely, as well as listening to the emerging concerns of identifying potential risk casesour stakeholders. We respond to these variables both and concentrating our efforts onquickly and effectively. This ensures that our economic them. The work to develop ourperformance remains strong despite challenging times. credit assessment processes, tools and guidelines continues.New sustainability policyIn 2012, Nordea’s Board of Directors established anew Sustainability Policy. Before, we had two parallelpolicies: our Environmental Policy and our CorporateCitizenship Principles. The purpose is to clarify whatwe mean with sustainability. In the year ahead, weintend to launch a mandatory e-learning modulefor all Nordea employees including new recruitsso as to familiarise them with the new policy. Changing by engagingThe Group Executive Management approves the CSRstrategy and goals each year. In addition to that, the Head We actively engage with theof CSR participates in Group Executive Management companies in which we invest.meetings regularly during the year. Strategic oversight Emerging Stars and Swedishand direction sits with our CSR Stakeholder Board Stars funds performance has(see list below). The Board met three times in 2012. proven that we can combine sound financial rationality with ESG.Our CSR Stakeholder Board CSR f ocus and■■ Chairman: Ari Kaperi, Chief Risk Officer and member of Group Executive Management■■ Henrik Priergaard, Head of HR and CEO Office■■ Jorma Timonen, Chief Credit Officer, Head of Group Credit■■ Olli-Petteri Lehtinen, Head of Corporate Merchant Banking, Finland■■ Topi Manner, Head of Retail Banking, Finland■■ Tapio Saarelainen, Head of Group Services■■ Rune Kibsgaard Sjøhelle, Head of Brand Management Standards for suppliers■■ Hans Christian Riise, Union representative We work with our suppliers to prog■■ Rodney Alfvén, Head of Investor Relations identify and plan actions to improve■■ Sasja Beslik, Head of Responsible Investment their sustainability performance. Our supplier management■■ Liisa Jauri, Head of CSR system guides us in this work. Lena Höglund Rosén, CSR Manager ress■■ NORDEA CSR REPORT 2012 11
  12. 12. Investing through Improving ESG in lending positive screening During 2012 we have continued to develop the Emerging Stars, the funds with positive screening assessment of environmental, social and governance launched by Nordea’s Responsible Investment (ESG) risks in our credit process. The main change team in 2011, continued in a positive direction is that we will focus on identifying potential higher in 2012 outperforming their benchmark indexes. risk cases and focus our efforts and analyses on Traditionally, responsible investment has meant these. For example, certain industries and countries excluding companies, so called negative are more prone to ESG risks than others. On these screening. It is a shift in mind set we believe in. higher risk cases we will use enhanced tools, both internal and external databases as well as ESG As the largest asset manager in the Nordics, with analyses. In 2012 we have developed an enhanced over 200 bn EUR assets under management during internal prototype tool that combines current 2012, we want to promote responsible investment. internal ESG tools. The new tool will be piloted That is why Nordea was the first Nordic bank to going forward. This development does not preclude sign the Principles for Responsible Investment in lower-risk areas, which remain within the scope. 2007. Five years on, we now have a wide range of socially responsible products and solutions. Working with suppliers Illegal and nuclear Nordea’s concern about ESG issues goes beyond weapons divestment our immediate operations and extends to our supply chain. As a signatory to the Global Compact, we In 2012, we took the decision to sell all commit to engage with our suppliers on their ESG our holdings in companies that produce or performance. Nordea recently introduced a supplier develop illegal and nuclear weapon systems management system to promote supplier compliance or technologies. Following our decision to with our values. This includes a call for ad-hoc divest our holdings our position in terms of CSR reviews. Our initial efforts focus on our forty lending to or offering credit to these companies largest suppliers. These account for over half our came under scrutiny from some quarters. procurement spend of EUR 1,9bn per year. Nordea’s BEST NORDIC BANK IN CDP for the 2nd year For the second consecutive year, Nordea topped the Nordic banking sector in the Carbon Disclosure Project’s annual survey. In fact, our score puts us among the best performing companies for the whole Nordic region. CDP is an industry-led initiative that registers the direct and indirect carbon emissions of leading companies. For Nordea, this includes the carbon impacts of our investments and lending in addition to those from our own operations. CDP serves as a leading benchmark for analysts interested in identifying environmentally responsible companies. Currently, 655 investors with 78 trillion USD in assets under management use the CDP database.12 NORDEA CSR REPORT 2012
  13. 13. “ The fact that 31% of Nordea’s shares are ownedapproach is one of ‘carrots’ rather than ‘sticks’. Wework alongside suppliers to identify where their by responsible investors providesweaknesses lie and to agree joint action plans. We impetus to our CSR ambitions, butbelieve this is a more effective way of bringing about it is also a huge responsibility.”continuous improvement than imposing sanctions. Liisa Jauri, Head of CSRStakeholder dialogueConsulting our stakeholders and acting on their Listening torecommendations is a cornerstone of Nordea’s responsible investorsresponsibility strategy. We believe this practice makesus a more trusted and more sustainable bank. In 2012 Nordea’s CSR Secretariat conducted its second survey to gage how many of Nordea’sNordea conducts an annual survey of our shareholders are responsible investors. The criteriacustomers and employees. The results of these used was whether the investors had signed thesurveys form our Customer Satisfaction Index Principle for Responsible Investment. At year’s end 31(CSI) and the Employee Satisfaction Index (ESI). per cent of Nordea’s shares were owned by responsibleIn addition, we created an online forum to allow investors. The average in European and Northemployees space for dialogue and discussion. American companies is between 10 and 15 per cent.As part of our responsible banking strategy, Nordea From the CSR Secretariat’s point of view this entails aundertakes regular stakeholder consultations to great responsibility that we convey to our colleaguesensure that we are addressing the most material throughout Nordea. It gives impetus to our CSR effortsissues for our business. In the third quarter of and proves that it is essential also to our share price.2012, we carried out two such consultations. Besides these specific surveys, we communicate withThese comprised an online discussion board and shareholders, analysts, employees, customers anda stakeholder survey. As well as providing us with civil society organisations through a range of formalmany vital insights, the outcomes of this consultation and informal channels such as Investor Relationsprocess influenced the framing of this report. road shows and responses to csr@nordea.com.  ■ CSR f ocus and prog ress NORDEA CSR REPORT 2012 13
  14. 14. Lifelong Relationships Nordea’s core business concept revolves around relationships. All our customers are unique. They have unique business needs, unique life situations, and unique aspirations for the present and for the future. Through good relationships, we can understand these factors better – and offer better advice and support as a result. RELATIONSHIP BANKING that we have with customers, whether it is through automated transactions or personal contact. Every working day, approximately 5,000 private and 1,000 business customers meet with Nordea people for financial Following Nordea’s recent introduction of 24/7 advice. Engaging with our customers on a face-to-face customer services in Finland, customers in all basis is an essential part of our relationship banking our Nordic countries can now get help and approach. This is a key pillar on which our bank is built. advice whenever they like – day or night. Every individual requires individual advice. It’s essential RESPONSIBLE AND CLEAR ADVICE for us to understand the individual customers’ needs to add value and give the right advice. There is no We aim for clarity and simplicity in all our communi­ better way to secure this by really getting to know cations with customers. Our goal is to communicate our customers. At Nordea, customers participating in our products and services as clearly as possible. our relationship banking program have an appointed This is not always easy in the finance industry and relationship contact whose job it is to acquire a requires a balance between clarity and regulatory holistic view on the customers financial affairs. We requirements. We apply the same principles with our wish to be our customers’ lifetime financial partner. own employees. The objectives and incentives we set with our employees are always simple and clear. At Nordea, we have a core value that guides everything we do. We call it “Great Customer We extend the principles of clarity and simplicity Experiences”. This principle governs every interaction to our product development process as well. By14 NORDEA CSR REPORT 2012
  15. 15. doing so, we are able to create transparent and no- AN OPEN EAR TO IMPROVEMENTnonsense products and services. This enables usin turn to advise our customers clearly and in a way Customer feedback is essential to help us understandthat is most relevant to their financial situation. our customers’ expectations and improve our services. Nordea Sweden was the first bank toEnsuring that our customers can manage their appoint a customer ombudsman in 2003. The otherpersonal finances is an important part of being a Nordic countries followed and in 2012 Estoniasocially responsible bank. By the same token, it is did as well. In all home market countries we haveimportant for Nordea to keep a watchful eye over our designated people to handle customer feedback.risks as a lender. This involves striking a balance. Onthe one hand, we naturally wish to fulfil our customers’ It is not only the ombudsmen who gatheraspirations. On the other hand, we wish to do this in customers’ opinions. In Nordea it is mandatorya way that is responsible and in line with our values. for all our employees who work in our branches Rela tions h ip bank in g NORDEA CSR REPORT 2012 15
  16. 16. and contact centres to register complaints services. Responding and reacting to customers In our customer management system. feedback is handled with highest priority. Nordea’s system for gathering, reporting and In 2012 we had one substantiated complaint regarding monitoring customers’ comments is in place in all of breaches of customer privacy or losses of customer the Nordic and Baltic countries. These comments data. We did not receive any significant fines for emerge in many different settings, from meetings non-compliance with laws or regulations relating to and telephone calls to e-mails and letters. Some the provision or use of our products and services. may be positive, others negative. All count and all are registered in our customer management SHARING OUR KNOWLEDGE system. We ran a communications campaign among our employees in 2012 to emphasise Nordea’s financial expertise is fundamental to the the importance of this registration process. advisory services that we offer our customers. We are mindful that this knowledge could serve Our local Ombudsmen gather all the feedback registered the public good as well. Nordea is keen to share. in our system. They forward this to the relevant business The main way we do this is though our Private units on a monthly basis, together with suggestions for Economists who provide information on relevant improvements. The Ombudsmen’s role also includes topics via the media and through our website. Among talking to customers and coaching employees on the topics they addressed during 2012 were: how to handle feedback. The Ombudsmen in the four Nordic countries present a quarterly report to senior ■■ Financial concerns, such as unexpected expenses, tax management in each of these markets. The reports declarations and thefts focus especially on what Nordea can do to practically ■■ Specific issues for certain groups, such as students, address the issues raised by our customers. teenagers and retirees. ■■ Financial considerations for those in relationships, such In 2012, Poland, Estonia and Latvia, had designated as “who pays what” and consumption loans. individuals in charge of handling customer complaints. In Lithuania, a Customer Complaints Committee Nordea has a particular commitment to young people fulfilled this same function. In Russia, this role and their education. Financial literacy represents a falls to the Customer Compliance department. key life skill, yet it is a topic that is often overlooked or not adequately taught in schools. Our employees are In 2012 the amount of feedback received increased well placed to help correct this. For this reason, many with 28% on year-on-year basis. A likely cause is share their knowledge on a voluntary basis as Financial the many changes that occurred during the year: Education Ambassadors in schools. This is all about fewer branches, less branches offering manual equipping today’s youth for tomorrow. It is in no way cashhandling and a substantial increase in the use about marketing. In their role as Ambassadors, our of digital solutions that lead to instability of these employees make no reference to the Nordea brand or Challenging discussions give me energy “ Financial Educa- next generation expects from sity students, subjects range tion Ambassadors banking services.” from investments to employ- work with students We visit with all levels of ment opportunities. on a voluntary basis, but I students, from the primary “I greatly appreciate the see it as part of my job. It is grades to university stu- challenging discussions we taking responsibility for oth- dents. At the younger levels have with students, they ers in society by sharing my we discuss practical matters give me a huge amount of knowledge. Young people such as cards, accounts, fi- energy. are open-minded and give nancial difficulties and loans. Heli, Keränen, us a glimpse of what the With vocational and univer- Sales Manager, Oulu16 NORDEA CSR REPORT 2012
  17. 17. to our products. To emphasise this point, all ofour tutoring materials are white-labelled andfree of any bank logos. In 2012, the volunteersvisited a total of 515 lessons and spent 1,037hours with young people across the Nordiccountries discussing financial matters in life.100,000 FACEBOOK LIKESIn 2012 communication with customers viasocial media increased sharply. Nordea isactive on Facebook, Linked-in and Twitter.More than 50% of the adult population in theNordics now use Facebook. Our intention isto be present with an open mind, answeringquestions whenever the customers havethem and providing interesting content.In November 2012, Nordeas Facebookpages in Norway, Denmark, Sweden andFinland passed the 100,000 likes mark. Thequestions that come in through Facebook Customerlargely resemble those that are received bythe Contact Centre by phone or e-mail.CARDS or CASH?The vast majority of our customers Satisfaction Surveyvisit a branch when they need advice.Otherwise, they prefer managing their Our annual Customer strong interest in the surveyday-to-day banking with their cards Satisfaction survey since customer satisfac-or through electronic payments. This measures our ability to tion is a relevant part ofis safer than using cash because: deliver great customer the strategic steering of experiences. It also meas- the group. Both “Customer■■ it reduces the risk of individual thefts or branch ures our performance Satisfaction” and "Deliv- robberies compared to our peers. ery Satisfaction Index” are■■ bank cards will be replaed by Nordea if lost or Some 95,000 customers Nordea’s key performance stolen voiced their opinion on indicators. GEM decides■■ customers will not be held responsible for Nordea and gave valuable actions on Group level. The transactions made with a stolen or lost card, input for improvements. A results are analysed in detail other than in very rare exceptions. sample of customers of per customer segment and other banks were asked the finally also on branch regionOn the other hand, we recognise that cash is same questions. All cus- level. The survey is con- Relastill the preferred option for many of our older tomer segments, Corporate, ducted in such a way thatcustomers. Over half of our branches still offer Household and Private each region can see wherecash withdrawal service over the counter. Banking, were included. they stand. Follow-ups and The main focus area in the action plans are mandatory.Cash is also available from our widespread 2012 survey was cus-network of ATMs. We are also increasing tomer loyalty and drivers for In 2012 there was a tions h ip bank in gthe possibilities to withdraw foreign loyalty, evaluation of main negative trend in customercurrencies in ATMs as well as increasing product areas as well as satisfaction and loyalty forthe functionalities to deposit money in activeness and customer most banks across marketsthe ATMs in many of the countries. service in various channels. and segments with very few exceptions. Our resultsIn addition, customers can now withdraw The main results of the were from stable to slightlycash from supermarkets with which survey are first discussed in negative but we maintainedNordea has special agreements in Group Executive Manage- our scores above the aver-all of the Nordic countries.  ■ ment (GEM). GEM has a age scores of peers.  ■ NORDEA CSR REPORT 2012 17
  18. 18. Responsible lending Being the largest financial institution in the Nordic region with a systemic importance for the global financial system our responsibility towards the society goes beyond strict commercial objectives. To safeguard that we take our social responsibility as a major lender requires that environmental, social, political, labour and other related issues are properly taken into account when granting loans to our customers in our daily work.18 NORDEA CSR REPORT 2012
  19. 19. “ Integration of environmental, social and governance issues into the business and credit processes is an essential part of the risk assessment of corporate customers.” Jorma Timonen, Head of Group CreditSustainability at the core least two of the following criteria are fulfilled:Nordea´s commitment to sustainability is evidenced by ■■ Significant weight in the Nordea loan portfoliobeing a signatory to several international agreements ■■ High cyclicality and/or volatility of the industryrelated to CSR and we are continuously working ■■ Special skills and knowledge requiredto incorporate these treaties and integrate them inour business and credit processes when deciding Nordea currently has Industry Credit Policiesabout to whom and which projects to finance. in place for the following industries:Nordea’s long-term strategic CSR goal is to integrateresponsible lending with business, in core strategies, ■■ Shipping, Oil and Offshorepolicies, procedures, products and services. ■■ Energy ■■ Leveraged buy-out (LBO)As the largest bank in the Nordic countries, ■■ Hedge Fundmany of the leading Nordic companies are our ■■ Commercial Real Estatecustomers. They have many large projects bothwithin their home region as well as on a global Industry Credit Principles apply to:scale. It is clear to us that an environmental, socialor political risk may also entail a credit risk. ■■ Forestry ■■ TelecomsFramework for ■■ Aircraftcredit decisions The industry policies include instructionsWe have a framework including instructions for of specific issues e.g. how to manageenvironmental, social and political risks. There are two CSR risk assessment within lending.high level Group directives adopted by the Board ofDirectors: Credit Policy and Strategy for the Nordea All industry credit policies are approved by theGroup and Credit Instructions for the Nordea Group. Executive Credit Committee and confirmed annually by the Board Risk Committee. TheThe first directive establishes the overall principles Industry Credit Principles are approved by Groupsuch as that the granting of credit within the Credit Committee of Wholesale Banking andGroup is based on sound banking practice confirmed by the Executive Credit Committee.and high ethical standards. It also establishesthat the Group should in no way compromise Development of Relagenerally accepted ethical and legal principles, risk assessmentnor should it have dealings with counterpartsthat we suspect to be of questionable morality. At present we are using two tools to analyse environmental, social and governance (ESG) risks inThe Credit Instructions define practical guidelines lending; ERAT, Environmental Risk Assessment Tooland processes for evaluating and granting and SPRAT, Social and Political Risk Assessment Tool. tions h ip bank in gcredits in general. The directive includes detailedinstructions for business units on how to define, During 2012 we have continued the work to integratemeasure, execute and report on specific issues. CSR into business and credit processes. It has been decided to develop our credit risk assessmentFor monitoring the distribution of a portfolio, improving regarding the analyses of ESG risks. The mainrisk management and defining a common strategy, change is that we use a risk based approach tothere are specific industry credit policies and principles identify potential risk cases and focus our effortsin place that establish requirements. Industry credit and analyses on these. The main criteria whenpolicies are established for industries where at evaluating the potential risk will be the geographical NORDEA CSR REPORT 2012 19
  20. 20. location of the business activities as well as the field of business of the companies in question. For identified risk cases we will use enhanced tools i.e. internal and external databases as well as ESG analyses. In 2012 we have continued the development work that started 2011 and have introduced a Group Risk Management level strategic initiative “Responsible lending”. The target is to renew the tool and the process how to use the tool. In 2012 we have developed a tool that combines ERAT and SPRAT. This new enhanced test tool will be piloted going forward. The aim is to start the implementation of the new way of working by the end of 2013. Project finance requires special guidelines and tools Societies need infrastructure. Constructing motorways, ports, bridges and damns are large and long-term projects. In the Nordic area the majority of large investments are financed with general corporate or municipality borrowing. Project finance is a specific form of financing single, often large projects such as power plants, pulp and paper plants, ports, mines or transportation infrastructure. Usually there are several parties involved in the financing and project development. When project finance is used the focus is in identifying and mitigating all project related risks. If the risks materialise, they can impose significant practical, financial as well as reputational consequences. It is essential to have a holistic view of the project risks. The Export and Project Finance (EPF) unit is responsible for project finance in Nordea. In 2007 Nordea adopted The Equator Principles (EP), a global, voluntary standard for commercial lenders to identify and address social and environmental risks in project financing based on the International Finance Corporation’s (IFC) guidelines for environmentally and socially responsible financing. Analysts and other relevant personnel have been trained in using the routines and tools. Internal seminars are held annually to provide staff with updates and the opportunity to knowledge share. The EP is currently being reviewed. Nordea has participated in this review of the scope of application of EP. We have supported that EP should be applied to projects/corporate lending cases over 50M USD (this threshold indicates a bank’s individual initial commitment). We also support that the wording and the principles should be as clear as possible in order for homogenous implementation. We have also voiced that common documentation libraries would be beneficial.20 NORDEA CSR REPORT 2012
  21. 21. Applying The ten 1. Initial project reviewthe Equator Principles principles contained in 2. Project appraisal 3. Project negotiation,As a signatory Nordea will only provide loans the EP areto projects that confirm to the EP. Nordea has organised into commitment and monitoringproduced its own EP Manual (toolkit) for use four workflowin training and in the decision making process.The toolkit is updated as the EP develops. steps: 4. External reporting.Nordea evaluates the borrower’s capacity toadequately identify, mitigate and manage keysocial and environmental risks and impacts of The steps match the Nordea project finance cycle andthe project based on documentation provided are integrated with the general credit evaluation andby the borrower, independent environmental decision workflow. Each project finance case is presentedand social consultants and possibly site visits. to Nordea’s EP Advisory Group for recommendation andNordea uses independent experts in category classification. If the recommendation is positive, the termsA projects. Due to our relationship strategy and conditions to participate in the project are established,and Nordic focus the number of projects including environmental and social representations andsubject to the EP tends to be small. The toolkit covenants. The borrower will provide annual social andprovides guidance on how to apply the EP in environmental monitoring reports usually verified bythe day-to-day business of Nordeas project an independent expert. In case of any non-compliance,finance deal managers (DM). In practice the Nordea will determine an appropriate course of actioninternal environmental specialist carries out together with the other lenders. Increasingly, corporateEP reviews of projects - including review of loans involving projects are reviewed according to the EPreports by independent environmental and methodology due to their environmental and/or socialsocial advisers - and helps the DMs in issues impact. There is more flexibility in the process. The reviewsrelated to covenants and monitoring of projects. are seen as risk management tool in these transactions..  ■Nordea workflow for the Equator PrinciplesThe steps match the Nordea project finance cycle and are integrated12 34with the general credit evaluation and decision workflow RelaInitial project Project Project negotia- Externalreview appraisal tion, commitment reporting and monitoring tions h ip bank in gNordea reviews Nordea evaluates the Nordea reportsand categorises the borrower’s capacity Nordea negotiates publicly on the levelproject with regard to adequately identify, with the borrower and of application ofto its location and mitigate and manage selects appropriate the EP during themagnitude of the the key social and covenants concerning past year, and theexpected social and environmental risks and EP compliance. performance of EPenvironmental impacts. impacts of the project. projects financed. NORDEA CSR REPORT 2012 21
  22. 22. Responsible value creation Today, Nordea is the biggest asset manager in the Nordics. With more than 200 bn euros under management and with a client base of more than 10 million people from all layers of society, Nordea has a duty to support international norms and to be responsible investors on behalf of the clients. As the first bank in the Nordic region, Nordea signed the UN Principles for Responsible Investment in 2007 and since then has developed its policies, procedures and investment products, not only to meet the growing demand of global shareholder activism but also to strive to set a new set of positive standards in the financial sector.22 NORDEA CSR REPORT 2012
  23. 23. “ To reduce environmental impact, provide good working conditions and adhere to ethical standards should not be seen as a cost but as a necessity for future revenues.” Sasja Beslik, Head of Investments & GovernanceSound business strategy to suggest that it is in their interest to invest in and encourage a company to destroy the environmentand ownership approach and mistreat people working for these companies.The past couple of years have been shaped byfinancial crisis as well as growing macro changes Identifying companiesall over the world. Imbalances disclosed have performing wellin many ways demonstrated crisis of activeownership as such in the financial sector. The core of our Responsible Investment (RI-) strategy is in-depth environmental, social and governance (ESG)The market economies dominating world markets are analysis and engagement activities. Throughout ourtoday facing significant pressure from civil societies, ESG analysis companies’ overall management practicesclients and interest groups. Questions are being raised regarding key ESG issues are assessed together withas to how shareholders could and will continue to their governance structure for these issues. Based Relaenjoy right of ownership without taking responsibility on the analysis, companies are selected for proactivethat comes with that ownership. As investors we engagements dialogues. The focus is on transferringare continuously striving for higher standards knowledge and active participation in the developmentof transparency, disclosure and accountability process. In 2010, we initiated our in-house environmental,from the companies we invest in. We believe that social and governance (ESG) analysis and developedindustries we operate in as well as our actions need our own criteria and methodology. Our analysis is based tions h ip bank in gto move from a culture of formalistic ownership on a positive approach with the aim to identify bestentitlement to a culture of responsible ownership. practices and those companies that manage their risks, opportunities and/or develop sustainable products. OurOur activities in realm of responsible ownership in-house analysis focuses mainly on Nordic companieshave increased over the last couple of years and and on analysing companies for our enhanced RI fundsresults achieved have improved our ability to provide Swedish and Emerging Stars. We have thus analysedclients with long-term responsible investment a wide range of companies on the Swedish marketsolutions. Most investment managers have millions of and emerging markets to find companies performingbeneficiaries, mainly ordinary people, so it is unwise well environmentally, socially as well as financially. NORDEA CSR REPORT 2012 23
  24. 24. Our Process Identifying new stars The first and one of the most important parts of the A reassessment of Swedish companies was conducted ESG-analysis process is to identify key issues for during the beginning of 2012. Swedish companies each sector and for the company we are assessing. are often described as mature companies that are Our aim is to identify key issues that are of material well aware of their environmental and social risks and relevance for the company to address, today but also in companies who are in the forefront of developing the future. NGO’s, external research providers, unions new sustainable technologies. Results from our and media are important sources for information. assessment show that this is true for some of the The assessment is then based on the key issues companies but not for all. In our ESG analysis both where we search public information and meet the leaders and laggards have been identified. Leaders company to identify if and how the company is have a good structure to manage environmental managing identified issues. We search for concrete and social risks but are increasingly integrating their actions and results that indicate that the company commitment to sustainable business development has established policies and practices to manage with group visions, mission statements and strategies. identified key issues. The company is informed about Our analysis has also identified companies that our rating but also about what improvements we are not top performers in this area today but that need to see in order to rate the company differently. demonstrate a positive momentum and that have a strategy on how to further improve, our future stars. Emerging Stars The policy framework described is based on international norms and conventions such as: The first investment product based on positive screening was introduced in the spring of 2011. The Emerging ■■ United Nations Global Compact Stars Fund makes us constantly look for the actual ■■ OECDs guidelines for multinational companies Emerging Stars, companies from the global emerging ■■ International Labour Organization’s Declaration markets that have the star potential to be a global on Fundamental Principles and Rights at Work leader in their industry both in traditional industry and ■■ Universal Declaration of Human Rights financial terms as well as from ESG point of view. The ■■ Rio Declaration on Environment and fund invests solely in Emerging Markets countries such Development as Brazil, India and China. Its portfolio is considerably ■■ United Nations Convention against Corruption smaller than those of other Emerging Markets funds. ■■ Convention on Cluster Munitions The portfolio of the Emerging Stars fund typically comprises 40-60 companies, while a more traditional Emerging Markets fund typically invests in about 25024 NORDEA CSR REPORT 2012
  25. 25. companies selected on the basis of various indices. As of end December 2012, Nordea has activeWith the relatively low number of companies in the dialogues with 14 companies with the purpose ofportfolio Nordea is able to constantly monitor and changing the companies’ norm breaching behaviorassess the performance of the individual companies. – and thereby enabling Nordea to create long-termThe fund picks the companies to invest in on the value by steering clear of an often risky and short-basis of Nordea’s own ESG analysis, which scores term behavior in the companies we invest in.potential investment candidates based on an evaluationof how they handle ESG risks and opportunities. Nordea also exercises active ownershipOnly the companies that demonstrate an ability to through participating in general meetings.handle both risks and opportunities and that have apositive approach to ESG issues will be selected. Excluded companies If a company is not showing true will to changeCompany engagements its norm breaching behavior, Nordea’s committee– a cornerstone in for Responsible Investments can decide to divestshareholder activism these investments from all fund portfolios. In 2012 Nordea excluded companies which contribute toNordea acts as active owner on behalf of its clients the production or development of nuclear programs.in companies and sectors across the globe. All funds Nordea sees nuclear weapons and their potentialmanaged by Nordea are screened for companies use as controversial, given their indiscriminateverified for violation of international norms regarding effect on human populations. This decision was inenvironmental protection, human rights, labour line with Nordea policy of illegal weapons (clusterstandards and business ethics. The results of the munitions etc.) which was implemented in 2010.screening, conducted twice a year, are reviewedand assessed by Nordea’s Responsible Investment Nordea does not offer household customersCommittee. The committee decides on the level of financial products where basic food commoditiesengagement with companies verified for violations. are used as underlying asset.  ■nordea’s way toward responsible investments2007 2008 2009 2011 2012 RelaUNPRI (Principles Agreement Exclusion of The first ESG Companiesfor Responsible with Hermes illegal weapons enhanced funds involved inInvestment) regarding from Nordea’s were launched nuclear weaponswas signed company portofolios were excluded dialogues Nordea decided from Nordea’s tions h ip bank in gAgreement with not to offer holdingsthe service provider investmentEthix to monitor productsour portfolios based on soft commodities NORDEA CSR REPORT 2012 25
  26. 26. growIng together Relationships count. That is why Nordea believes in putting people first, especially our employees. When they grow, we grow. It is their skill and dedication that keep us ahead and make Nordea great. Investing in their success makes perfect sense. We look for leaders that can unfold potential.26 NORDEA CSR REPORT 2012
  27. 27. “ Nordea’s leaders engage and motivate people to reach out for our vision and have the ability to create the right team to make it happen.” Henrik Priergaard, Head of Group HRLeadership builds cultureand drives performanceWe believe that by living our values and workingtogether as One Nordea Team our employees andour business can best grow together. To achievethis, we need to treat each other with respect andsupport one another’s development. Values andleadership give direction and impetus to Nordea’sgrowth and performance. Great leaders look tobuild those around them, not just themselves.This is the standard Nordea sets for our leaders.Developing the capacities of others, unfoldingtheir potential and providing constructive feedbackare true leadership qualities. Our latest ESI givesour managers a 79 approval rating, showing thatNordea has above industry average managers.Ensuring our people are well-informed and well-trained is vital if they are to feel confident and goodabout their work. This is an important first step.Being a great employer requires more besides.All our employees receive personal development,competitive compensation as well as a positiveworking environment (physical and psychological).Unfolding potentialNordea adopts a ‘blended’ approach to learning.Much of our training occurs on the ‘shop floor’. On-the-job learning is shown to be a highly effectiveway to keeping training relevant to our employees.We supplement this with classroom teaching, aswell as new techniques such as e-learning and Growin g Tog eth ervirtual workshops. Helping our employees achievetheir full potential is critical. That is why we go forstretched targets. In 2012, Nordea employeesreceived on average 1.9 days of training, includinge-learning and classroom training.We are careful notto neglect our leaders’ own personal developmentneeds. In that respect, Nordea leaders underwent anaverage of 1.5 days classroom training in 2012. NORDEA CSR REPORT 2012 27
  28. 28. The Nordea leadership pipeline Individual development Next level training Strateg ic lead er Next level training g le aders Leadin Next level training Leadin g othe rs Next level training ial l eader Potent On Boarding Taking leadership responsiveness through our Employee Satisfaction Index to the next level (ESI) and our Performance & Development Dialogue (PDD) process. The one on one PDD-talk between In 2012, Nordea introduced a Leadership Pipeline employee and manager is fundamental accelerating Framework to take our leaders to the next level. growth and ratifying the performance culture. We assess The programme seeks to educate our managers performance, plan short and long term career and decide in the skills and perspectives required at different on development initiatives/activities. In 2012, 97% stages as they progress through the bank. reported to have participated in this review process. The programme targets all our managers and comprises classroom and work-based learning. The ESI survey is a check point for Nordea as an employer. It shows us what our employees think Feedback culture about our employment practices, our governance standards and our values. In 2012, 94% responded Nordea prioritises open dialogue in our relationship with to the ESI. This exceptionally high response rate our employees. We know that people feel valued when indicates a commitment to improve operations they feel heard. Regular feedback is also essential to together. We follow up on the feedback from their on-going development. We create this culture of the ESI both at local and on group level. esi results 2012 2011 2010 Satifaction and motivation 71 72 73 Development 73 71 73 Considered a good workplace 74 74 79 Proud to tell others where I work 76 76 82 Recommend others to start working at Nordea 72 72 78 Living the values 79 78 79 Great Customer Experiences 81 80 81 Its all about People 75 75 75 One Nordea team 79 79 7828 NORDEA CSR REPORT 2012
  29. 29. Internal mobility Starting in 2013, we will offer defined contribution pension schemes for all employees, whereMobility is key for competence development. We applicable. We see this as a sound and responsibleadvertise our vacancies internally and strive to find way of supporting modern work life balance.candidates among our colleagues. Our HumanResources team also organises career days to Well-being at workencourage job enlargement or rotation acrossbusiness areas. Over 2.000 people have attended As a responsible employer, Nordea seeks tosuch events since they started in 2009. As a result of provide a healthy working environment. Healththese initiatives, more than 3,000 Nordea employees and safety legislation in the Nordic countries istook up new positions internally last year. While our comprehensive but varies*. In some cases theinternational assignments are popular, most career collective bargaining agreements stipulate themobility takes place within the same country or content of Nordea’s health and safety services.between the Nordic countries. Nordea’s Graduate The ambition is to support well-being by preventiveProgramme plays an important role in bringing new measures promoting health and supporting activetalents into the bank. In 2012, 62 young people ageing. Activities can include e.g. non-smokingjoined Nordea, predominantly directly from university. or nutrition classes, access to on-site or externalRetention among these graduate recruits is very health clubs. We provide health screening, medicalhigh. Of the 700 new Graduate entrants since 2000, examinations and/or health insurances additional towell over four-fifths still remain with Nordea today. government provision and depending on location.Competitive remuneration Working in banking can be high pace and high pressure. That is the nature of our in-dustry. It makesNordea aims to be competitive with our market the job exciting. However, it may also cause occasionalpeers in terms of remuneration. We acknowledge the undue stress if not managed appropriately. Nordeaimportance of being well-balanced in our approach has a Work Related Stress policy. We believe thatto remuneration. At the same time, we need to be providing open channels for dialogue and feedbackflexible. As an international bank, we operate in is particularly important in this regard. We trackmultiple markets. As local business and market needs the wellbeing and satisfaction of our employeesdiffer, so too must our remuneration packages. That through formal questionnaires, such as our annualsaid, we insist on absolute consistency in the area of employee survey, where “Talking about stress andrisk management. We place an absolute priority on welfare is natural”, a score that increased to 73 inNordeas long term interests. As a consequence, we 2012. We also employ more informal tools, suchensure that our remuneration policy promotes sound as coaching sessions and development talks.risk management and in no way encourages excessiverisk taking. Nordea’s criteria for sharing profits among * In Denmark, we provide our employees with health insurance. In Finland, Norway and Sweden occupational health careemployees are twofold: Return On Equity (ROE) and is closely regulated. In Estonia, Latvia, Lithuania, Poland,relative customer satisfaction supporting our one and Russia, the scope of Occupational Health Caretrue mission; creating Great Customer Experiences. services provided vary depending on local legislation. Growin g Tog eth er NORDEA CSR REPORT 2012 29
  30. 30. 30 NORDEA CSR REPORT 2012
  31. 31. Equality Unionisation is low in the Baltic countries and Russia hence we don’t have a party to negotiate/ co-operateDiversity is the cornerstone of an inclusive and creative with. Being domiciled in Sweden, the group is subjecthigh performing workplace. Women currently make to Swedish corporate governance standards andup 58% of our workforce and 46% of our managers. we share common values, policies and processes.Nordea is continually looking for ways to safeguardequality and the annual employee survey score 81 In 2012 we initiated training for all employees infor Nordea being an Equal opportunity employer. For the Baltics and Russia to refresh awareness andexample, we seek to have at least one woman among confirm our commitment to the ILO standards onfinal three candidates for any management position. We Labour and Human Rights. We also included theachieved this in 84% of cases until end Q3 2012. Of information in the introduction programmes for newthese female candidates, 57% went on to fill the post. recruits. Our employment policy reflects differences in collective agreements and national legislation.Nordea adopts a zero-tolerance stance against Terms of notice vary from 1-6 months, also indiscrimination of all kinds. We encourage employees cases of operational changes, subsequent to setto report any incidences that they come across. Should collaboration procedures and local legal requirements.regular line manager contacts be found insufficientwe have the Whistleblowing procedure. The Group RESPONSIBLE RESTRUCTURINGPolicy confirms our commitment to prudent bankingand safeguards against retaliation. Nordea did not The financial turbulence and new global requirementsregister any alleged discrimination cases in 2012. regarding capital, liquidity and cost have resulted in a need to continue on-going cost and capital efficiencyAGREEMENTS & COLLABORATION measures in the whole financial industry. In 2011, Nordea announced a restructuring programmeNordea respects the right of freedom of association. in the Nordic countries. It was not a step we tookOver 80% of our employees around the world lightly, but it was critical for the bank’s future. Thishave contracts based on collective agreements. has led to approximately 2.700 people on groupWe follow collective agreements in all our level being reduced since the second quarter infinancial markets where it is standard practice. 2011. Reductions made so far have come about mainly from natural turnover and internal mobility,Nordea seeks good and constructive collaboration combined with very careful external recruitment andenhancing influence and comprehension on all levels. not extending temporary employment contracts. InRepresentatives are elected among employees for local the Nordics more than 300 people made careerlevels and for Business Area Consultative Committees moves within the bank due to our internal Peoplethat deal with change initiatives. The Group Council is a Matching Process. Equally, people chose to leavehigh level collaborative body that raises strategic issues Nordea with mutually agreed redundancy packagesto collect feedback from employee representatives. with possibilities for outplacement support.  ■ Growing in Nordea – My journey Tanja Bache works in bined with moving towards and international Diploma Copenhagen in Group new opportunities. Looking in Compliance. My motto is Compliance. She is Russian, back I have never taken a to be open and honest with Growin g Tog eth er born and raised in Estonia. safe path but always new managers – this is valid for Her working languages are challenges and chances. all situations regardless of Russian, English, Finnish Through my entire career in whether you are happy or or Danish depending on Nordea I have worked and sad, motivated or would the situation. “My career is studied. Supported by the like to experience new formed by hard work com- bank I earned a MBA, CIA challenges.” NORDEA CSR REPORT 2012 31
  32. 32. Running a responsible business Financial institutions today face a complex regulatory environment. Banks also play an important role in combatting international criminal activities such as terrorism. New laws and norms are appearing all the time. Nordea’s comprehensive governance and management systems aim to ensure that we remain compliant with all these requirements. Legal compliance is just the minimum. We aspire to build a compliance culture in which every employee lives out our values of integrity and responsibility in all our operations. This approach is especially evident in our corporate governance and risk management approach.32 NORDEA CSR REPORT 2012