What is ESG?

A company’s approach to ESG factors helps investors and other stakeholders understand how it creates long‑term value. Companies that manage environmental, social and governance issues well are often better positioned to manage risk, adapt to change and deliver stable returns.

Is ESG the same as sustainability?

No, it is not the same. Sustainability is a broad term which covers the long-term success of a company's operations, considering its environmental, social and economic impacts. 

ESG describes a set of specific criteria used to evaluate a company’s performance and behaviour in three key areas: environmental, social and governance. Examples could be how a company works to reduce carbon emissions, sources raw materials or upholds labour rights.

How does Nordea work with ESG factors?

At Nordea, ESG factors are integrated into our core business and risk management. This means we consider environmental, social and governance aspects alongside financial factors when assessing customers, investments and portfolios. 

ESG factors are included in our investment strategies. When customers decide to invest their money with us, they can choose from a broad selection of ESG-screened funds. Moreover, we actively engage with the companies in which we invest. Each year, we vote at over 3,500 annual general meetings to support sustainability-aligned initiatives, including initiatives related to climate action, biodiversity and human rights.

ESG factors are also taken into consideration in our financing activities. We have sector targets and guidelines where we set boundaries for the activities we finance, and we offer a wide range of sustainable finance products for corporates. These include green and sustainability-linked loans, as well as support for customers seeking access to capital markets through green, social, sustainable and sustainability-linked bonds.

In our own supply chains, we work with a sustainability framework which is mandatory for all our contracted suppliers. 

We have recently updated our business strategy and connected strategic sustainability priorities. We now have four prioritised themes guiding our ESG-related work: climate and energy, nature, financial well-being, and inclusive and safe societies.