SEB Norge

Innspill levert på e-post 14. mars 2023 til sekretariatet fra Ben Powell, Head of Sustainable Banking, SEB Norway

1. Når og hvordan opplever dere naturrisiko som vesentlig for deres virksomhet? Hva er mest vesentlig, avhengighet av natur, påvirkning på natur eller andre forhold?
Relevant nature risks: We identified sectors in our credit portfolio with the highest materiality based on literature and expert dialogues, directly through own operations or indirectly through supply chain impact on biodiversity. The selection is based on our credit exposure combined with sector specific land-based biodiversity impact.
Direct impact: Forestry, agriculture, mining, Energy generation from wind and hydropower, infrastructure and power transmission
Indirect impact: construction, pulp & paper and retail.

2. På hvilke måter kan deres virksomhet bli påvirket av endringer i naturen og ressursgrunnlaget i Norge eller i andre land? Hva er mest vesentlig, kobling direkte til egen virksomhet eller indirekte via verdikjeder?
Physical risk: Medium materiality
Transition risk: High materiality
Liability risk: Medium materiality

3. På hvilke områder bør deres virksomhet være forberedt på å møte endringer i myndighetenes regelverk? Hva med andre rammevilkår, inkludert markedsforhold, teknologi og holdningsendringer?
SEB is preparing for or working on the implementation of ESRS, EU Taxonomy, CSDDD and SFDR which all cover biodiversity and ecosystem services in different ways. SEB is also a member of the EU Platform on Sustainable Finance providing the EU Commission with advice on development of the EU Taxonomy, in particular the remaining 4 environmental objectives.

4. Håndterer deres virksomhet naturrisiko i dag? Er dette i så fall formalisert eller håndteres det på annet vis? Hvordan er det i så fall koblet til klimarisiko og andre former for bærekraftsrisiko?
We have a policy that includes our position on Biodiversity (Environmental policy on climate change, freshwater and biodiversity). Expectations within biodiveristy on customers/transactions are further stated in our sector policies. For certain projects, the Equator Principles are applicable which refers to the IFC Performance Standard 6 on Biodiversity. To report on nature-related topics, we are currently using PRB (principles for responsible banking) and CDP (biodiversity and water questions).
SEB is actively participating in research and knowledge sharing projects such as the BIOPATH initiative as well as Business@Biodiversity Sweden, where we are discussing the implementation of biodiversity-risks in financial decisions together with other participants from the industry and academia. Furthermore, SEB Investment Management became a member of the TNFD Forum in 2022, an international consultative group dedicated to increasing knowledge about financial risks coupled to environmental issues such as land and water use, biodiversity, and other ecosystem services. We are also part of the UNEP FI TNFD pilot project for Forestry and Offshore wind parks.
Currently, we are working on establishing a method to measure nature risks in our credit portfolio. We have identified high biodiveristy risk sectors as well as the most significant impact drivers. ENCORE has been used to make a first screen of our credit portfolio. We have used our own advisory tool Impact metric tool to perform an impact analysis of our credit portfolio to be used in the PRB impact analysis. We have also tested application of QGIS and are currently analysing how we can use other external tools (for example Biodiversity Footprint for Financial Institutions, grospatiale dataset, Globio).
Certain sector specific expectations regarding biodiversity are already included in our sector policies. Programs or guidelines to manage these include our sustainability framework (thematic and sector policies with specific restrictions, requirements and expectations. This includes our Environmental policy on climate change, freshwater and biodiversity which is implemented through sector policies.
We have set expectations on Clients and Portfolio Companies in sectors with potential high direct and indirect (supply chain) negative biodiversity impact on land-based nature.
Expectations on companies in sectors with direct impact: Develop a biodiversity baseline and target by 2025, Commit to no deforestation / no net deforestation, Have no material negative impact in sensitive environmental areas
Expectations on companies in sectors with indirect biodiversity impact (supply chain): Develop a biodiversity baseline by 2027, Commit to no deforestation / no net deforestation in supply chain, Have processes to ensure no material negative impact in sensitive environmental areas of the supply chain
Expectations on new Projects and capacity expansion: Conduct an Environmental Impact Assessment, Apply the mitigation hierarchy
We have has also set restrictions on sensitive environmental areas and will avoid providing financial services to Clients, or make Investments in Portfolio Companies or projects with material negative impact, such as land conversion, on sensitive environmental areas such as: UNESCO World Heritage sites, Wetlands covered by the Ramsar Convention, Land-based Natura 2000 areas, National parks and nature reserves, High conservation value forests (HCVF), International Union for the Conservation of Nature Red List Species. SEB will also not trade in, or contribute to trade in, endangered plant and animal species that are on the CITES32 unless it is authorized through CITES licensing system.
We have also set targets to reduce our fossil fuel exposure, increase our sustainability activity and classify our customers’ sustainability performance.
Compared to climate risks, nature risks/biodiversity varies between sectors, clients, locations etc. therefore, we are trying to develop a way to manage these risk in the most efficient way. However, data, such as companies’ asset locations, biodiversity driver performance and dependency reporting is limited. That combined with more complex modelling makes biodiversity risk less mature compared to climate (TCFD) related strategy, risk management and metrics/modelling.

5. Hva slags styringsverktøy og datagrunnlag trenger dere for å vurdere naturrisiko bedre enn i dag? Hva kan myndighetene gjøre for å sette dere bedre i stand til å vurdere naturrisiko?
SEB would like better knowledge on invasive species, which currently has a lack of available information, as well as methodologies for integrating biodiversity risk in credit rating assessments, and methodologies to measure biodiversity impact and dependencies.

6. Hva slags dilemmaer møter dere i beslutninger som berører natur og naturrisiko?
Like many, there is a lack of quantitative data and methodologies for capturing Biodiversity risks in detail. And that there may be a lack of coordination across jurisdictions about agreeing on the correct metrics.

7. Hvilke planer har dere om å ta mer hensyn til naturrisiko? I så fall, hvordan og hvorfor?
Develop knowledge and use of NCFA’s ENCORE tool, in addition to WWF geospatial data as a tool for company engagement and identifying risk. SEB will continue our work with TNFD and other nature related initiatives.

8. Har dere dokumentasjon som kan være relevant for utvalget?