Rethinking finance for a sustainable world
As Intesa Sanpaolo releases its new 2022-2025 business plan with a major focus on ESG, we speak to Elena Flor about the bank’s commitments
"ESG has already been a large part of previous business plans. But this plan for the first time has one of its four pillars based solely on ESG"
Elena Flor, Head of ESG and Sustainability, Intesa Sanpaolo Group
During the Covid-19 emergency, Intesa Sanpaolo Group acted quickly. It donated €100m to Italy’s national health system to support the service at the peak of the crisis.
Furthermore, the CEO and top management donated €6m of their own salaries to strengthen healthcare initiatives.
Although the circumstances were extraordinary, the notion of unwavering support for communities is a standard for the Group. Donations and contributions towards community groups and the real economy were the norm even before the global health emergency hit.
Intesa Sanpaolo business plans have shown the bank’s community initiatives in many ways, as part of its broader ESG commitment, including:
- loans and funding for the real economy
- supporting the transition to a green and circular economy
- financial inclusion
- cultural responsibility
As each new business plan takes root, the bank’s commitment to ESG grows. “ESG has always been a large part of previous business plans,” says Elena Flor, its Head of ESG and Sustainability. “But this plan for the first time has one of its four pillars based solely on ESG.”
Within the new 2022-2025 business plan there is a €328bn commitment to the real economy through medium to long-term new lending; €25bn of social lending dedicated to support non-profit activities, vulnerable and young people; and €500m in investments and donations to people in need, youth and seniors.
There’s also a refreshed commitment to the transition to a circular economy following the success of the previous plan, which made €6 billion available to businesses with circular economy projects.
“We ended the previous plan with €7.7bn disbursed for the circular economy,” says Flor. “And again, with this new business plan we have a €76bn target of new lending to support the green transition of companies – €8bn of which is dedicated to the circular economy – and a €12bn target of green lending to individuals.”
The Group also supports clients on their sustainability journey with strengthened sustainable lending (e.g. sustainable finance, ESG advisory), the dedicated Circular Economy Lab in collaboration with Cariplo Factory, and the Group’s role as Strategic Partner of the Ellen MacArthur Foundation, main promoter of the global transition towards a circular economy.
To foster a long-term approach, in the last quarter of 2021 Intesa Sanpaolo signed up to all the net-zero alliances of the United Nations, covering banking activities as well as asset managers’ and insurance initiatives.
As part of its 2022-2025 Business Plan – and more than a year ahead of the Net-Zero Banking Alliance (NZBA) deadline – Intesa Sanpaolo presented its net-zero-aligned emissions-reduction targets for 2030 in priority high-emitting sectors.
Intesa Sanpaolo has also set itself the target of achieving net-zero emissions in 2030, with 100% of electricity at Group level acquired from renewable sources (a target already achieved in Italian branches and buildings in 2021).
Proving the worth of sustainable finance
“Sustainable investments are at the core of the EU action plan on sustainable growth, whose general objective is really to redirect financial flows to sustainability,” says Elena Flor. “So, in that, financial institutions have a key role to play.
“Intesa Sanpaolo was among the first to offer very early ethical funds, before the year 2000. So we were quite pioneering at that time. It was something of a niche market and in Italy we always had a leadership position in supporting sustainability.”
“Now, if we look at the main asset manager of the Group [Eurizon], in March 2022 48% of its funds were invested according to articles 8 and 9 of the SFDR [Sustainable Finance Disclosure Regulation].”
In 2021 Eurizon launched 23 products, reaching a total of 172 funds, that promote environmental or social characteristics (among others) or have sustainable investment objectives, classified according to articles 8 and 9 of the SFDR, for assets under management of approximately €110bn.
The new business plan cements the Group’s long-held commitment on digitalisation through the launch of IsyBank, a digital-only bank.
At the end of 2021 the Group had 12.9 million multi-channel customers (1.3 million more than in 2020).
“The health emergency changed the habits of many of our clients,” says Elena Flor. “In a way it has accelerated the transition to digital, which was already in place and already on the way.”
“As well as the launch of IsyBank, digital transformation will go on in all areas of the Bank, with investments into full digitalisation of the customer experience, further strengthening of the internal control systems as part of the digital evolution of processes, and digital and AI-based solutions in compliance activities.”
“This tech infrastructure will be extended to the entire Group, including the international network.”
In the 2018-2021 four-year period, Intesa Sanpaolo disbursed a cash contribution to the community of approximately €144m for cultural initiatives. Since 1989 the Group has also funded the Restituzioni programme, which is dedicated to restoration and promotion of national heritage, curated by the bank in collaboration with the Cultural Ministry.
In addition, through the Gallerie d’Italia programme, the Group opens up its vast art collection for public viewing in five galleries. “The art collection is an asset,” says Elena Flor. “But at the same time I think it is a responsibility to care for it.”
People are the most important asset of the Group
The new 2022-2025 business plan provides for significant investments in the Group’s people – and a special focus is dedicated to diversity and inclusion.
Intesa Sanpaolo is a member of the Bloomberg Gender-Equality Index, is the first bank in Europe to be included in the most recent edition of Refinitiv’s Diversity and Inclusion Index, and was among the first in Europe to receive the Gender Equality and Diversity European & International Standard, the international certification evaluating the commitment of organisations to diversity and inclusion.
“Of course, we can always do more,” says Elena Flor. “But in this respect, the Group has been on a journey.”
And rather than rest on the successes of the past four years, it is gearing up to execute a new, bold business plan that puts commitment to ESG up front and promises real change in the years ahead.