Triodos Bank’s Executive Board provides a perspective on the wider world it operates in, its impact and activity in 2016 and its prospects for the future.
Our Stakeholders and Why They Matter So Much
Triodos Bank’s resilience is bolstered by engaging proactively with our stakeholders. We have benefited from open discussions with our stakeholders for many years and in varied ways from client days connecting hundreds of customers in all the countries where we work, to depository receipt holder meetings and surveys. But while some organisations ask their stakeholders what they think they should do, and then do it, Triodos Bank takes a different approach.
Our starting point, for everything we do, is our essence. It is about who we are and is, therefore, one of our stakeholders too. And it is key to our conversations with the wider stakeholder community.
In this context, and in addition to numerous interactions with stakeholders during the year, we follow a formal process to create an analysis of the issues that are most important both to our stakeholders and ourselves. This approach follows the Global Reporting Initiative’s Standards guidelines. These guidelines are mandatory in 2018 but Triodos Bank has chosen to adopt them in this 2016 report.
Increasingly companies are encouraged to focus their sustainability reporting on the issues that are material to it, rather than report on a wide range of issues, some of which will be relatively unimportant to an institution’s overall impact. We support this focus and our material issues are highlighted in a materiality analysis below following structured discussions with our stakeholders and consideration from Triodos Bank itself.
From our engagement activities it is clear that our stakeholders and Triodos Bank find many of the same issues important, as they did in 2015. The most significant change is the increased importance of protecting client data to both our stakeholders and Triodos Bank itself. Additionally, notable attention was paid to diversity in the organisation particularly in the Depository Receipt Holders’ meeting, but that did not lead to a shift in perceived importance. Furthermore, we cannot identify any issues that are of very high importance to one party and very low importance to another. This leads us to conclude that Triodos Bank and our stakeholder’s areas of interest are aligned. At the same time, among our stakeholders there is consistently more interest in what we ‘do’ as an organisation than how we behave in a responsible way as an institution.
Triodos Bank’s three stakeholder groups are defined as the following:
- Those that engage in an economic relationship with the business (e.g. customers, depository receipt holders, co-workers and suppliers)
- Those that don’t engage in economic transactions, but who maintain a close interest in Triodos Bank (e.g. NGOs, governments, the media and the communities who benefit from our finance) from a societal perspective
- Those that provide new insights and knowledge (e.g. advisors and inspirers), prompting us to reflect, rethink and explore new territory.
This year’s materiality analysis includes the results of a depository receipt holder survey distributed in all the countries where we work and a stakeholder meeting, with representatives from Triodos Bank’s three stakeholder groups, hosted at Triodos Bank’s Head Office. In addition the analysis is supplemented by learning from a number of stakeholder events during the year including sector specific events in various countries.
The results suggest Triodos Bank’s stakeholders want and expect Triodos to continue to be a leader in sustainable finance, with a strategy that reflects and supports its mission. In addition, impact investments (in this sense combining both lending and investing in sustainable enterprises), and delivering sustainable financial services, continue to be considered to be very important both by Triodos Bank and its stakeholders. This year’s engagements also highlighted the importance of increased awareness about the enhanced scope of responsibility in the suppliers’ own supply chains. We share some of our stakeholders’ interest in adapting our approach to risk, where appropriate, to increase our impact overall. Our focus on innovation is, in part, a response to this shared goal.
Materiality Matrix 2016
The analysis shows our stakeholders think it is important that Triodos Bank acts as a thought leader in values-based banking. We also believe Triodos Bank should play a role in this way, acting as a reference point for the banking sector because this can amplify our impact, by influencing the debate about how to improve the banking system for example. We also share the priority that our stakeholders give to helping our borrowing clients to become even more sustainable. You can find examples, including interviews with borrowers, in the impact chapter.
Unlike larger mainstream banks, remuneration continues to be a relatively low priority for our stakeholders and the bank. This may reflect satisfaction with the prevailing approach to remuneration at Triodos Bank and suggests that its policy is well understood. Triodos Bank does not offer bonuses and has a relatively low difference between its highest and lowest salary, for example. Stakeholders continued to find Triodos Bank’s efforts to maximise its social return very important. For more details of our remuneration policy, our role as a responsible employer and a more in-depth analysis of the results, please see the .
We will use the results of this stakeholder engagement activity, as well as the examples detailed here, directly in the development of our strategic objectives. The results will also inform our work more generally throughout the year, as a reference for new ideas and the development of existing activity. Longer-term we intend to deepen our stakeholder engagement activity in general. This had been planned in 2016 but limited progress was made. We intend to do more in 2017, in particular further aligning the engagements and outcomes of the branches and Head Office. We will use this year’s work as a basis from which to progress further.