Integration of ESG risks

As stated in its Sustainability Policy, Ibercaja follows a prudent and global management of both financial and non-financial risks. These non-financial risks include sustainability risks, which Ibercaja undertakes to identify and manage so that they may be gradually integrated into the Bank's overall risk management.
 

In order to integrate ESG factors into decision-making processes, Ibercaja is making good progress in identifying and studying the risks and opportunities of the transition towards a carbon free economy, so as to provide a response with business solutions that support sustainability. The bank analyses the impact of climate and environmental risks on customers and their financial activity so that it can adapt the range of products and services to new needs, transparently communicating solutions promoting environmental responsibility.

Ibercaja has adopted the primary national and international commitments to move forward with regard to sustainability, to protect the environment and fight against climate change. The bank is a signatory of the UNEP-FI Responsible Banking Principles, it is aligned with the Sustainable Development Goals of the 2030 Agenda. In 2019 it adhered to the recommendations of the TCFD Task Force on Climate-Related Financial Disclosures); the Bank is currently working on their implementation.

Managing assets is important to achieve a more sustainable economy and the Ibercaja Group takes into account these sustainability risks and integrates them into the investment decision-making process. We apply standards, principles and best practices when managing investments to generate long-term value for our customers.
 

The Ibercaja assessment service provides personalised or suitable investment recommendations or proposals for customers, in other words, it takes into account the investor risk profile of each customer according to their suitability test, but without taking into account the specific sustainability risks (environmental, social or corporate governance) in the assessment process; which does not necessarily mean that the sustainability risks might not be significant. The sustainability risk will depend on the type of issuer, sector of activity or geographic location of the investments. Therefore, investments with a higher sustainability risk may result in a decrease in the price of the underlying assets and, subsequently, negatively affect their return.
 
Notwithstanding the foregoing, given that the assessment service carried out by Ibercaja is not independent and is mainly based on products designed and manufactured by its Group companies (investment funds and savings insurance), the websites of the aforementioned companies contain information on the way in which the creators of the Ibercaja Group products integrate sustainability risks into the investment process of the assets that make up each product and on how these risks may affect the yield of each product. 

Pursuant to article 4.1.b) of Regulation (EU) 2019/2088 Ibercaja informs that in the provision of the management and assessment services it does not currently take into account any possible adverse affects of the investment decisions regarding sustainability factors, due to not having as at this date due diligence policies related with these adverse sustainability impacts; however, they are expected to be taken into consideration as established in the applicable legislation.

Ibercaja's Remuneration Policy is coherent with the Sustainability Policy and the principles and values of the Bank with regard to managing environmental, social and corporate governance risks. It is in line with the provisions of Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability‐related disclosures in the financial services sector with regard to establishing a remuneration system based on equal opportunities and non-discrimination, contributing to the Bank's good corporate governance, coherent with the internal code of conduct and mitigates an unreasonable assumption of risks.