As we approach CHARGE Europe (17-18 October), we’ve been asking our top speakers and partners to reveal their approach to branding in energy. In this article, we speak to Aðalheiður Snæbjarnardóttir, Sustainability Manager, Landsbankinn.
The interviewers are, Friðrik Larsen, Founder and Owner of CHARGE and Sonja Sigríður Jónsdóttir, Conference Producer at CHARGE.
What impact does ESG have on brand identity now, and how important will it be in the future?
ESG has become an important measure of organisations’ sustainability. It has been a hot topic in the finance industry for the past few years, with organisations publicising their ESG-related work, their stance on ESG matters and highlighting ESG-related products. This impacts the brand identity of financial institutions who were early to adopt the ESG mindset and apply it within their organisations. There is increasing pressure from shareholders, investors, and stakeholders on financial institutions (as well as other organisations) to deliver on ESG promises. It is not enough to write out reports on how your organisation stands regarding ESG – it is also important to set goals, develop products and not least to deliver tangible and measurable results. With ESG requiring more focused attention within organisations, it is also becoming a bigger part of brand identity. A decade ago, it was a point of difference for an organisation to work towards sustainability to such an extent that it became part of brand identity. Now it is a point of parity to work towards sustainability. As a result, it will become an increasingly important part of brand identity to define each organisation’s ESG approach and translate it into brand identity accordingly.
What specific challenges is your company facing regarding ESG and what is important to focus on to enhance your marketing and stakeholder management?
While we face many challenges regarding ESG, one of the most relevant ones is how to steer clear of greenwashing. Greenwashing is when an organisation claims to be working towards sustainability and furthering ESG goals, labels its efforts as green and reaps the benefit of ESG work without actually doing it. This is a constant challenge, especially since definitions on what falls under the heading of sustainability have been lacking until recently, perhaps most notably in the financial sector. The EU Taxonomy, which defines what is considered sustainable, provides a major tool to avoid greenwashing along with the SFDR, a reporting standard for sustainability in accordance with the EU Taxonomy. Other regulations on sustainability-related matters such as ESG risk rating, sustainable bonds and sustainability reporting are expected from the EU and that will help organisations to avoid greenwashing. There will be a universal set of rules to follow, and auditors will be able to review and verify the ESG-related work of organisations against a common standard. That will not erase greenwashing but will help organisations to avoid accidentally committing greenwashing activities. It will also help stakeholders to distinguish between excellent and subpar ESG work. Landsbankinn aims to be an early adapter of these standards to enhance stakeholder confidence in the organisation.
How are digital innovations now helping to prove a brand’s green/clean/ESG credentials and provide ongoing accountability?
One of the most important things in ESG is data. For quality ESG work you need comparable data – comparable across companies, within industries, and you need to make sure that the data that you are using for your organisation’s ESG work is always consistent and accessible. Digital innovation plays a key role in providing ESG-related data solutions that are consistent, verifiable and readily available.
How is your company using innovation to become more sustainable?
As a bank, our main ESG impact lies in our scope 3 emissions and the biggest part of our scope 3 emissions is from our corporate loans. Part of our sustainability journey is to use innovative solutions and technology to help our customers finance changes that allow their ventures to become more sustainable. We have introduced a variety of incentives for our corporate customers, including Landsbankinn’s Sustainable Financing Label. Customers who fulfil the requirements of our sustainable finance framework can use the Label to communicate their successful sustainability work to the market. We have also cancelled the borrowing charges on EVs and made the terms on EV loans more favourable to support the transition away from fossil fuels.
When you look back on your role, what honest mistakes have you made that you’ve learned from in building your brand and key business relationships?
One such mistake we made in the beginning was to assume that everyone in the organisation knew everything about the bank’s past sustainability work. Of course, some people did know about it, but others did not. To get the best results in sustainability, whether internally or externally, it is vital to make no assumptions. This applies especially to things that can be easily assessed, measured, and then either taught or trained as needed, based on the outcome. In order to remedy this, we have been focused on improving internal knowledge about our sustainability. Building ESG knowledge and competence internally will deliver better results and also functions as an important pre-emptive act against greenwashing.
