Nordea Bank has branch here and is gorging monopolizing the trade!
Nordea beats expectations in strong third quarter
Published: 25th October 2007 12:45 CET
Online: thelocal.se
Nordic banking group Nordea posted Thursday a 13 percent rise in third quarter net profit to €761 million ($1.08 billion dollars), beating analysts' forecasts amid strong business volumes.
Nordea's total operating income rose to €1.91 billion, up 10 percent from the same quarter a year ago and exceeding analysts expectations of 1.87 billion
Nordea: CSR in practice
Nordea is a banking group created through mergers of banks and insurance companies from Denmark, Sweden, Norway and Finland with domestic operations also in Poland, the three Baltic States and Russia. In early 2003 it announced its corporate citizenship principles and code of conduct.
Lars Thalén - Sonja Lohse
Lars Thalén (LT), Strategic Advisor, developed and coordinated the Nordea CSR and sustainability system. Sonja Lohse (SL) is Group Compliance Officer and responsible for CSR. Sarah Burton asked them about Nordea?s CSR values and how their principles are put into practice.
What are your corporate citizen principles?
LT: The name Nordea is an abbreviation of Nordic ideas. We belong to a Nordic heritage, where freedom, equal opportunities, care for the environment and good citizenship are very important. For us, honesty and sincerity in implementing these values are vital. Together, these make up our basic principles, which we describe further in our corporate citizenship principles.
SL: They are the same set of principles, guidelines, and policies and the same set of values for us to live by in everything we do. They form our company?s DNA. It is what we do that goes beyond complying with the law.
How did you create your principles?
LT: The original companies from which Nordea was created had various expressions of their values, which we have integrated into our principles. The core, our Nordic values heritage, was written into the corporate mission statement, vision, values and core strategies when the Nordea Group was
formed. In order to find out what should be the practical expressions of such principles in our business, we consulted material from around 120 stakeholders, and compiled over 50 pages, listing more than 1000 demands, from which we had to choose what to focus on. The process was based on desk research. We considered formal dialogue processes but found that being a member of CSR Europe and of the Nordic Partnership [a sustainability network of Nordic businesses, we had enough live input. We did not want to create any false expectations by running formal dialogue sessions. Having established our principles we made a very brief declaration to explain what we meant and what international commitments we would abide by.
How do you implement your principles?
SL: The next step has been to work in detail on each principle to evaluate how key performance indicators (KPIs) can be created and integrated into the management system with strategies and initiatives to ensure they are met. Nordea uses a balanced scorecard system where such key performance indicators fit into the regular management process.
Our code of conduct is integrated into management culture by providing detailed information on how to implement the code and using tools such as dilemma studies. The results are followed up by the Nordea Group compliance team. Special tools are used when necessary, particularly when dealing with environmental issues. These measures ensure CSR becomes a management responsibility like other issues in running a business.
LT: We could have started a number of programmes in order to show that we had a social conscience, but instead of looking for more projects, we felt it was more important to meet our stakeholders? demands. Summing up all the demands in one phrase was actually quite easy. Stakeholders expect us to be ?a decent company?.
Our research indicated a clear trend in how companies move from concentrating on separate CSR projects to integrating CSR principles into the way they do business.
We do work on projects, but they vary by market. In Sweden, we work with Jobs and Society, supporting small and mediumsized enterprises as they start their business. It is in our interest to be the bank that offers advice and support to new business in Sweden through Jobs and Society. The cooperation has grown organically at local level and our bransches support local Jobs and Society offices and new entrepreneurs.
Part of the implementation has ?Stakeholders expect us to be ?a decent company??. also been to write a code of conduct for the Nordea Group as a further articulation of the corporate governance principles. This was done in January and we are introducing the codes in spring.
What incentives do you build in to the management system to ensure the principles are carried out?
SL: CSR-related performance is just another aspect of performance measurement. There will be no special incentives. When will you produce your first report based on your new principles?
SL: Our aim is to make CSR an integral part of our business, so we decided not to go for stand-alone reports on aspects of CSR, such as environment or social projects. Instead, we aim to give a continuously updated overview on our website supported by formal reporting in our annual report and annual review. The work on formulating detailed reporting policies is going on right now.
What do trust and risk mean to your business? How do they link to your corporate citizenship principles?
SL: Money is worth virtually nothing if people don?t have trust in it as a means of exchange. The whole banking system is based on trust.
All the research we have done shows that our customers? trust in us has increased since we became Nordea. Emphasising our link to Nordic ideas and values has leveraged trust in us and has helped build our reputation.
We need to be sure that this trust and reputation is sustained and we want our investments to be sustainable. Companies we lend money to must be profitable so that we can be confident of having our loans paid back. We need to be sure that their activity today will be acceptable to the public in the future. Our staff need to have the skills and tools to help them assess environmental or ethical risks, and that needs to be part of their day to-day job. For us, building and retaining trust, and managing risk make perfect business sense.
Essentially, CSR at Nordea is market driven. Investors and customers increasingly demand this and are willing to pay a premium for a company or a service that is ?decent?.
Are you involved in socially responsible investing?
LT: This is on our agenda - we are working on it. At the moment, in Sweden, socially responsible investment services are demanded by large clients such as pension funds, the Swedish church or trade unions. Our investment managers implement their ethical requirements on pension funds or savings. Demand in the retail market for ethical investment is quite low, but we anticipate that it will grow and we are preparing for it.
What impact will the accession of the Baltic states to the European Union have on Nordea and the way you do business? How will you ensure your principles are implemented across your whole business?
SL: The CSR principles and the code of conduct serve their own purpose but they also help integrate our businesses across borders by setting the same standards for behaviour towards customers, as employees and in the communities where we operate. As to our operations in the Baltic States in particular, we have no special rules or requirements. They belong to the same Nordea Group and follow the same instructions and policies. In young market economies it is even more important to set standards, but the standards need to be the same across the Group. That is how we ensure that we are a decent company wherever we do business.
What advice would you give to a company going through a reorganisation or merger on how to set up and implement corporate social responsibility principles?
LT: In any merger, it is tempting to focus on cost synergies. Experience shows, however, that in tumultuous situations, vision and values are even more important than in calm environments. A clear mission ? why the company exists ? and an understandable vision ? what the company aspires to achieve - combined with compelling values are cornerstones of successful mergers. Obviously clarity on corporate social responsibility comes from such fundamentals and can be of great help in making employees and customers ? and thereby investors ? believe in and support the merger.
SL: In all mergers, everybody has the opportunity to learn from new colleagues. Fostering a culture of tolerance and learning is essential. Again, this supports CSR work because it is all about respect for differences.
Are there any resources you found helpful?
SL: Support from people who have been through the same process before is of great help. But for any CSR programme to succeed, involvement is key. In our case, a large reference team met several times to evaluate research and to discuss proposals. By using that process, we now have committed people all over the Nordea Group who take part in the implementation. We aim to have a very lean organisation with just one Group CSR officer supported by this team of committed employees. CSR should gradually become as fundamental to and integrated in managing a company as marketing, human resources, communications or strategy.
More information
Read more about the Nordea principles and code of conduct: www.nordea.com/About us
Nordea is a founder member of the Nordic partnership: www.nordicpartnership.org working on sustainable development from a Nordic perspective |
