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Our Stakeholders: holding up a mirror to the organisation

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.

Triodos Bank’s resilience is bolstered by engaging proactively with the world around us. Everything we do has an impact on our stakeholders. In turn, 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 client days connecting hundreds of customers in all the countries where we work, to depository receipt holder meetings and surveys.

While some organisations ask their stakeholders what they think they should do, and then do it, Triodos Bank takes a different approach. Our starting point is our essence. Our essence defines who we are and is, therefore, one of our stakeholders too. And it is key to our conversations with the wider stakeholder community.

In this context, and in addition to numerous interactions during the year, we follow a formal process to create an analysis of the issues that are most important both to our stakeholders and ourselves. This approach follows 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 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 and a stakeholder meeting, with representatives from Triodos Bank’s three stakeholder groups, hosted at Triodos Bank’s Head Office. In addition the analysis is supplemented by learnings from a number of stakeholder events and interactions during the year including sector specific events in various countries.

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 considered to be very important both by Triodos Bank and its stakeholders. This year’s engagements also highlighted the importance of setting an example for others and advocating that others adopt the same behaviour. We share some of our stakeholders’ interest in managing our risk, where appropriate, to increase our impact overall. Our focus on innovation is, in part, a response to this shared goal.

Materiality Matrix 2017

Materiality Matrix (organigram)

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 reference point for the banking sector, in particular, because this can amplify our impact. This is true for the activities we finance in specific sectors, and also for the debate about how to improve the banking system for example. The ‘New Pathways’ white paper, described above, is just one example of this in practice. 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.

Remuneration 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 highest and lowest salary, for example. Stakeholders continued to find Triodos Bank’s efforts to maximise its social return very important. For more details of our remuneration policy, and the results of our role 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 2016. Our stakeholders urge Triodos Bank to continue to play an active thought leadership role, with advocacy being rated very highly in both the stakeholder meeting and the depository receipt holder survey. This did not lead to a shift in perceived importance, but does bolster our efforts in this area. Being a learning organisation, whilst very important to Triodos Bank, was felt to be less important to our stakeholders. Given the urgency of some of the other priorities for the bank and for society, this topic shifted slightly in this year’s materiality matrix.

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 aligned. At the same time, among our stakeholders there is consistently more interest in what we ‘do’ as an organisation, in the impact we create in the real economy, than in how we behave in the sector in a responsible way as an institution.

We will 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 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.