Banco Santander, S.a. · BME:SAN
Banco Santander — ESG Presentation (2023)
47 slides from Banco Santander's sustainability presentation, Nov 21, 2023
Slide 1: Towards a more sustainable world
H1 2023 ESG Towards a more sustainable world 1
Slide 2: Index
Index 01 02 03 04 05 06 ESG Decarbonization Financing the Financial Corporate External strategy ambition green transition Inclusion, Governance engagement Empowerment & Recognition & Community support 2
Slide 3: ESG strategy
ESG strategy > Santander
Slide 4: ESG strategy | Our approach: What makes us different
ESG strategy | Our approach What makes us different Financial Inclusion Green Finance Awarded Best Bank for Financial #1 worldwide Bank in the Inclusion in 2022 by Euromoney financing Renewable Energy¹ Decarbonization Governance Net-zero decarbonization Best practices and robust targets as founding
Slide 5: ESG strategy | Our approach
ESG strategy | Our approach As a responsible bank we place sustainability at the centre of our core Founding activities to deliver on our purpose of helping people & business prosper Member 2021 Best bank for Financial Inclusion 2022 Principles for Responsible Banking, Founding Member 2019 Our visio
Slide 6: ESG strategy
ESG strategy Overarching goal: Focus on most material items Ambition Goals Priority action plans SDG’s Set targets in our portfolios to align with pathways to net zero, while Support the Deliver our Net zero taking into consideration other environmental goals as Nature transition to a low ambition b
Slide 7: ESG strategy | Our journey
ESG strategy | Our journey Creation of a Our journey over the past Set an ambition Global Green Became carbon to be net zero Finance Team years highlights Santander’s Responsible neutral in our by 2050 and and Risk team Banking reporting ongoing commitment to fight Commitments own operations became
Slide 8: ESG strategy | Responsible Banking ambition
ESG strategy | Responsible Banking ambition From…to… Accumulated Target achieved We have set targets in those areas where we have the greatest potential impact. We have been making progress towards the targets we set back in 2019 and highlight below the volution under our climate & environmental goa
Slide 9: ESG strategy | Our achievements
ESG strategy | Our achievements We want to make a positive impact with actions that reflect our sustainability strategy and commitment 12,2 mn >€559 mn People financially empowered in microcredits provided within LATAM as of since 2019 H1’23 #1 bank worldwide 88% by number of deals in of electricity
Slide 10: ESG strategy | Commitment from our Top Management
ESG strategy | Commitment from our Top Management By delivering on our purpose to help people Ana Botín Héctor Grisi Checa and businesses prosper, Executive Chairman CEO we grow as a business and continue to help “As a responsible bank, our approach to ESG "We believe in the importance of building a
Slide 11: ESG strategy | Main challenges
ESG strategy | Main challenges Our group strategy focuses on supporting global initiatives to tackle climate change and promote sustainable growth that is accessible for everyone Different drivers Challenges Initiatives Paris Agreement Decarbonization: Working to hold a 1.5 °C scenario 02 › Internal
Slide 12: Decarbonization ambition
02 Decarbonization ambition 12
Slide 13: Decarbonization Targets | Our net zero journey
Decarbonization Targets | Our net zero journey In order to be aligned with the Paris Agreement and with the aim of limiting global temperature increase to 1.5°C, we have committed to be net zero in carbon emissions by SAM target to halve net emissions for 50% of in-scope AuM2 2050 also as part of th
Slide 14: Decarbonization Targets | What do we want to achieve?
Decarbonization Targets | What do we want to achieve? Align our portfolios to the Paris Agreement As one of the world’s while delivering on our decarbonization targets largest banks, we and setting new ones have a clear role to play in financing the Additional targets on transition to a other materi
Slide 15: Decarbonization Targets | Sectorial policies
Decarbonization Targets | Sectorial policies Oil & Gas Mining & Metals Power Generation Soft commodities New oil upstream clients, except Project-related financing for new, From 2030, any entities with Extraction of native tropical for transactions for the specific or the expansion of thermal coal m
Slide 16: Decarbonization ambition | Fossil fuel financed
Decarbonization ambition | Fossil fuel financed Ranking by fossil fuels financed Fossil fuels financed in 2022 Fossil fuels financed over total Rank Mandated Arranger (Billion $) financing 2022 1 Bank 1 40,626 13% Our ratio of financed 2 Bank 2 39,240 5% Santander’s fossil fossil fuels to total 3 Ba
Slide 17: Decarbonization ambition | New targets
Decarbonization ambition | New targets 2019 2020 2030 Sector Scenario Emissions Metric baseline progress targets Power IEA Net Zero Scope 1 tCO₂e/MWh 0.21* 0.17 0.11 (-46%) generation 2050 We have decarbonization targets for five climate Energy IEA Net Zero Scope mtCO₂e 23.84 22.58 16.98 (-29%) (Oil
Slide 18: Decarbonization ambition | Examples of some Country and Unit efforts
Decarbonization ambition | Examples of some Country and Unit efforts Net zero actions and targets in Wealth Management & progress in our decarbonization strategy in Poland Wealth Management road to Net Zero Poland strategy Committed to support the Coal phase-out Net Zero Actions Alignment with Helpi
Slide 19: Financing the green transition
03 Financing the green transition 19
Slide 20: Green Finance | Our global reach
Green Finance | Our global reach Finance is a key enabler of the transition towards a low-carbon economy. We are contributing to a more sustainable economy by managing climate-related risks and opportunities, building a comprehensive sustainable and green finance proposition. We are currently workin
Slide 21: Green Finance | Our global reach
Green Finance | Our global reach The greenfield renewable energy projects we financed or advised on in 2022 have a total installed capacity of 15.6 GW and prevent the emission of 152 million tons of CO2A.We also helped expand, enhance and sustain renewable energy brownfield projects with a total ins
Slide 22: Green Finance | Our #1 global franchise
Green Finance | Our #1 global franchise Global Renewable Energy Project Finance Volume Europe & Americas Energy Project Finance Volume and Transactions by MLA FY 2012-22 and Transactions by MLA FY 2012-22 Rank Mandated Arranger Vol. (€m) Nº Rank Mandated Arranger Vol. (€m) Nº 1 Santander 38,153 663
Slide 23: Green Finance | Green solutions for our individual, SMEs and Corporate customers
Green Finance | Green solutions for our individual, SMEs and Corporate customers What we finance Our customers needs… Key geographies Building on our current offering of green products, we continue to strengthen Purchase, construction and refurbishment Developer loans, private solar panel our sustai
Slide 24: Green Finance | Examples of some Country and Unit efforts
Green Finance | Examples of some Country and Unit efforts Providing sustainable solutions to our customers in Consumer Finance & Santander España Santander Consumer Finance Green proposition already a reality Santander España Sustainable product proposition Products for SME’s Non-financial offer 174
Slide 25: Green Finance | Protecting the Brazilian Amazon
Green Finance | Protecting the Brazilian Amazon We believe protecting the Amazon rainforest is key to tackle climate change. Santander was the first private-sector Brazilian bank to develop in 2002 credit analysis that considered environmental and social risks, and in 2016, we were the first to form
Slide 26: Financial Inclusion, Empowerment & Community support
04 Financial Inclusion, Empowerment & Community support 26
Slide 27: Financial Inclusion, Empowerment & Community support | Global approach
Financial Inclusion, Empowerment & Community support | Global approach People financially empowered since 2019, At Santander we seek to provide tailored finance 12,2 mn exceeding our 10 mn target before 2025 to those facing difficulties while trying to access credit, by Disbursed microcredits design
Slide 28: Financial Inclusion & Empowerment - Global approach
Financial Inclusion, Empowerment & Community support Financial Inclusion & Empowerment - Global approach Santander Finance for All We continue to help people access the financial system and set up micro-businesses while we provide them with the appropriate tools to manage their Access Finance Financ
Slide 29: Financial Inclusion & Empowerment - Key initiatives
Financial Inclusion, Empowerment & Community support Financial Inclusion & Empowerment - Key initiatives Prospera is the largest microfinance We are proud to programme offered by a private bank >718 mn in Brazil. Created in 2002, it helps have developed € of funding people without access to formal d
Slide 30: Community support - Higher Education
Financial Inclusion, Empowerment & Community support Community support - Higher Education We believe education is the bedrock of financial inclusion and customer protection, that is why it sits at the core of our Responsible Banking agenda, and it is fostered through different initiatives Main lines
Slide 31: Corporate Governance
cD) rw) ie S (Ss = cD) > {e) UO Corporate « Santander,
Slide 32: Corporate Governance | Our strengths
Corporate Governance | Our strengths As a responsible bank we have a clear, robust governance. Best practices on governance are channelled to all our subsidiaries, as part of our global Governance Model Commitment to maximise the disclosure and quality of information High participation in our Genera
Slide 33: Corporate Governance | Our strengths
Corporate Governance | Our strengths We strive to have a clear and robust governance with well-defined accountability and a prudent management of risks and opportunities to ensure: Respect for A balanced Board Maximum transparency shareholders’ rights composition regarding remuneration Be at the for
Slide 34: Corporate Governance | Board composition
Corporate Governance | Board composition Our Board composition ensures an ongoing effective supervision supported by a well-balanced committee structure Number of Geographical Independent Women Directors diversity Board members on Board 15 6 66,6% 40% Directors appointed for Spanish, US, 4.05 averag
Slide 35: Corporate Governance | Executive variable remuneration
Corporate Governance | Executive variable remuneration Aligned with our Aligned with strategic goals shareholder interests › Annual bonus determined by A B › 50% of variable remuneration is in both financial and non-financial instruments (25% in shares and 25% metrics, with 70% of them being in shar
Slide 36: Corporate Governance | ESG in Reward
Corporate Governance | ESG in Reward Weights Equally weighted ESG action lines included 2022-2024 2023-2025 RoTE 40% Women in senior positions Women in senior positions Financially empowered people Financial inclusion LTI RTSR 40% Green finance mobilized Green finance mobilized and Setting decarboni
Slide 37: External engagement & Recognition
06 External engagement & Recognition 37
Slide 38: External engagement & Recognition | Partnerships & initiatives
External engagement & Recognition | Partnerships & initiatives We drive our responsible banking agenda through a number of local and international initiatives and working groups, which include among others: World Business Council for Sustainable United Nations Global Compact. We've been part of UNEP
Slide 39: External engagement & Recognition | ESG Ratings
External engagement & Recognition | ESG Ratings Rating Agcy. 2022 2021 Evol. We engage with ESG ratings to signal our progress MSCI index AA MSCI index AA = and keep improving with their feedback * 22.4 23.9 Highlights in 2022 A A- We maintained our positioning on the MSCI World Index. And we’ve
Slide 40: Annexes
Annexes 40
Slide 41: ESG in Investor Relations | Main contact details
ESG in Investor Relations | Main contact details Begoña Morenés Global Head of Investor Relations [email protected] Fernando Donoso Equity & ESG [email protected] Tosin Iduh ESG & Market Intelligence [email protected] 41
Slide 42: Transparency & Disclosure | Reports and additional information
Transparency & Disclosure | Reports and additional information Please click on the below images to consult public details highlighted in this presentation Climate Finance report 2022 Annual report Corporate Governance presentation www.santander.com 42
Slide 43: ESG strategy | Responsible Banking ambition
ESG strategy | Responsible Banking ambition From…to… Accumulated Target achieved We have set targets in those areas where we have the greatest potential impact. Thanks to the progress we have made towards some of the targets we set in 2019, we are considering revising our ambition in a few of them.
Slide 44: Santander Climate strategy and four Pillars
Santander Climate strategy and four Pillars Public targets Group wide ambition to be Net Zero carbon emissions by 2050 Aligning our portfolio to meet Supporting our customers Reducing our Embedding climate into the Paris agreement goals in their green transition environmental impact risk management
Slide 45: Environmental footprint | Ensuring we have the lowest possible impact on the environment
Environmental footprint | Ensuring we have the lowest possible impact on the environment 2022 Environmental footprint YoY Change 2020-2021 (%) Comparative with pre-covid: 19-22 (%)1 1,887,857 m³ YoY Change 2021-2022 (%) 134,419 t CO₂e Water consumed 4.4% total emissions (market-based) -58.1% 843.24
Slide 46: Decarbonization Targets | Current exposure
Decarbonization Targets | Current exposure We have enhanced the materiality assessment with scenario analysis to calculate quantitative heatmaps December 2022, Credit risk (before mitigants) EUR billion TR PR SCIB Other segments Low Moderately low Power (Conventional) 27 2 of which, power generation
Slide 47: Thank You.
Thank You. Our purpose is to help people and businesses prosper. Our culture is based on believing that everything we do should be: 47