Triodos Bank’s stakeholders are key to determining the focus and attention of the organisation’s efforts. The following section highlights who Triodos Bank’s stakeholders are. It describes the material issues that they and Triodos Bank have identified as most important, and hence provide the focus of its reporting. And it details Triodos Bank’s strategic objectives, their progress and the goals for the future.

Stakeholder dialogue: keeping us on our toes

Triodos Bank’s three stakeholder groups are defined as the following:

  • Those that engage in an economic relationship with the business (e.g. customers, depository receipt holders, co-workers and suppliers)
  • Those that don’t engage in economic transactions, but who maintain a close interest in Triodos Bank (e.g. NGOs, governments, regulators, the media and the communities who benefit from our finance) from a societal perspective
  • Those that provide new insights and knowledge (e.g. advisors and inspirers), prompting us to reflect, rethink and explore new territory.

Actively seeking a connection with the world around us is key to ensuring Triodos Bank remains relevant and can continue to build on its frontrunner ambitions. All our business and financial decisions have an impact on our stakeholders. In turn, the societal themes embraced by our stakeholders have an impact on what we do and how we do it. We have benefited from open discussions with them for many years and in varied ways, from hosting evenings of debate with civil society, to organising client days connecting hundreds of customers in all the countries where we work, to depository receipt holder meetings and surveys.

For Triodos Bank, the starting point of any discussion is our essence. So, while some organisations ask their stakeholders what they think they should do, and then proceed to do it, we take a different approach. Our essence defines who we are. It is the fundament to our conversations with the broader stakeholder community. How we bring that essence to life through our actions however, is very much informed by the engagement with our key stakeholders and the developments in society at large.

In addition to numerous interactions throughout the year at all levels of our organisation, we follow a formal process to create an analysis of the issues that are most important both to our stakeholders and ourselves and provide follow-up by integrating these issues into our management objectives. Consequently, we report on the progress of these objectives following the Global Reporting Initiative’s  Standards guidelines.

Increasingly, companies are encouraged to focus their sustainability reporting on the issues that are material to it instead of reporting on a wide range of issues, some of which will be relatively unimportant to an institution’s overall impact. We support this focus and our material issues are highlighted in a materiality analysis below, following structured discussions with a cross-section of our stakeholders and consideration from Triodos Bank itself.

This year’s materiality analysis includes the results of a depository receipt holder survey distributed in all the countries where we work, the feedback we receive at the Annual General Meeting, participation in various global strategic bodies and a stakeholder meeting with representatives from Triodos Bank’s three stakeholder groups, hosted at Triodos Bank’s Head Office. The analysis is supplemented by learnings from several stakeholder events and interactions during the year including sector specific events in various countries and the external analysis we did in support of our strategy process throughout the year. We also conducted a survey among a sample of all three stakeholder categories and asked them to validate the position of the various topics in the matrix according to their relative importance.

Materiality matrix 2018

Materiality Matrix (graphic)

Complying with GRI Standards

 We report on all of our stakeholder consultations using the Global Reporting Initiative (GRI) Standards. GRI requires reporting organisations to comply with their quality and content requirements to ensure a high quality standard of sustainability reporting. Triodos Bank’s mission, vision and strategy are fully based on sustainability ambitions and a commitment to responsible banking. Therefore, many steps required to identify stakeholders and sustainability issues (material topics) for other organisations are standing practice for Triodos Bank. Stakeholder engagement and working together towards a fair and sustainable world are daily business for Triodos Bank. Consequently, not all theoretical steps towards integrated sustainable business and sustainability reporting are made explicitly, or rather: they are embedded in the process of sustainable banking. Examples of these steps are: stakeholder mapping, mapping of topics and assigning proper GRI denominations to variables such as ‘influence’, ‘importance’ or ‘impact’. In practice it appears that Triodos Bank and its stakeholders understand each other perfectly well and are aligned in jointly achieving the goals of financing change and changing finance.

In our surveys and other stakeholder consultations we continuously discuss the influence of material topics on their decisions and the impact of these topics on Triodos Bank. Following this ongoing dialogue with our stakeholders, ‘influence on’ / ‘importance of’ / ‘impact on’ are used interchangeably by both Triodos Bank and its stakeholders. GRI Standards uses the formal denominations of ‘Influence on stakeholder assessments & decisions’ for the y-axis and ‘Significance of economic, environmental & social impacts for Triodos Bank’ for the x-axis. Our stakeholders are more familiar with and continue to use the expressions ‘importance of’ and ‘influence on’ (and are not always familiar with GRI). Therefore, Triodos Bank has chosen to continue using these denominations in its communications, including the annual report.

Material topics

All the topics identified in the materiality matrix relate directly, or indirectly, to Triodos Bank’s purpose as an integrated sustainable bank using money to deliver positive change. The boundary of the topics in blue are typically external. They are defined either by relevant issues within a client relationship or by our business strategy. The material topics in green are more internal. They describe how we operate as a responsible institution ourselves. Ordinarily we have a direct impact on these topics, in the selection of suppliers or our remuneration policies, for example. The results suggest Triodos Bank’s stakeholders want and expect Triodos to continue to be a leader in sustainable finance, with a strategy that reflects and supports its mission. In addition, impact investments (in this sense combining both lending and investing in sustainable enterprises), and delivering sustainable financial services, continue to be very important both for Triodos Bank and for its stakeholders.

The analysis shows our stakeholders think it is important that Triodos Bank acts as a thought leader. We also believe Triodos Bank should play a role in this way, acting as a frontrunner in the banking sector because this can stimulate change in others. This is true for the activities we finance in specific sectors, and for the debate about how to improve the banking system in service of society and the challenges we face for example. Our role in the development of a financial sector paragraph in the Dutch Climate Accord and the launch of the United Nations Principles for Responsible Banking are examples of this in practice.

Based on our conversations and trends in civil society, we have decided to introduce two new topics in our matrix this year, reflecting new priorities for our organisation as well as our stakeholders. They are:

  • Products with a Purpose – in the past we focused on being a first bank to customers, offering sometimes generic products. We believe we should focus on offering products that support the sustainable movement we want to see, like our private mortgages in The Netherlands that stimulate customers to improve the energy efficiency of their home by offering a specific loan that makes this possible. We consider this topic as new, since it is more aptly replacing the former ‘first bank for customers’.
  • Social inclusion – inequality of opportunity is increasingly dividing society. Triodos Bank wants to focus on exploring the role finance can and should play to address this societal challenge. Therefore Triodos Bank is stepping up efforts to help realise putting social inclusion into practice, both for its clients and stakeholders and for itself.

We also share the priority that our stakeholders give to helping our borrowing clients to become even more sustainable. You can find examples, including interviews with borrowers, in the impact chapter.

Despite continued public debate about remuneration, this topic continues to be a relatively low priority for our stakeholders and the bank. This may reflect satisfaction with the prevailing approach to remuneration at Triodos Bank and suggests that our policy is well understood. Triodos Bank does not offer bonuses and has a relatively low difference between its median and highest salary, for example. For more details of our remuneration policy, and our performance as a responsible employer, please see the co-worker report.

From our engagement activities it is clear our stakeholders and Triodos Bank find many of the same issues important, as they did in 2017. We did make a further few adjustments: we combined ‘managing risk’ and ‘resilient financial institution’ into one bullet and we positioned this higher on our own axis, reflecting the increased focus on the resilience of banks from politics and regulators. Secondly, we decided to rename ‘Contributing to communities’ to ‘Engaging with communities’ to better reflect how we actively collaborate and engage with entrepreneurs and other customers to finance the change we believe is required.

Being a learning organisation, whilst very important to Triodos Bank, is felt to be less important to our stakeholders. For our organisation it remains an important strategic priority, as we believe being able to learn collectively will enhance our efficiency and our ability to act.

Through our engagement throughout the year we did not identify any issues that are of very high importance to one party and very low importance to another. This leads us to conclude that Triodos Bank and our stakeholder’s areas of interest are much aligned. At the same time, our stakeholders consistently urge us to be a frontrunner in financing innovative and pioneering initiatives, to increase the impact we create in the real economy. How we balance this ambition with being a responsible financial institution, managing impact, risk and return is our responsibility.

When compared with the surveys and matrices in the previous years, it was decided to remove:

  • Environmental practices: having only few ‘brick and mortar offices’, the net positive/negative impact of Triodos Bank’s own environmental practices is relatively insignificant, particularly when compared to the much larger impact we make through the way we finance change.
  • Broadening scope: we decided to remove this topic, since it was confusingly interpreted by both Triodos Bank employees and our stakeholders as both representing broadening the scope of our products and services as well as representing the scope of our activities. Both interpretations are now integrated in our topics (‘products with a purpose’ and ‘thought leader’).

 We use the results of this stakeholder engagement activity, as well as the examples detailed here, directly in the development of our strategic objectives. The results will also inform our work more generally, throughout the year, as a reference for new ideas and the further development of existing activity. Longer-term we will continue to look for ways to deepen our stakeholder engagement activity in general. Staying closely connected to what matters to our stakeholders and using the wisdom of that community will serve as a basis from which to progress further.

78%

of our assets are
in the real economy