ING Group

RATING

SECTOR

Banking

WEBSITE

CONTACT

Cedar
Bijlmerdreef 106
1102 CT Amsterdam
The Netherlands

Phone: +31 (20) 541-5411
Fax: +31 (20) 541-5497

STOCK EXCHANGE

LISTING

EMPLOYEES

91,411

CHIEF SUSTAINABILITY OFFICER

Anne-Sophie Castelnau

AWARDS

  • ‘Socially responsible investing bond of the year’ award by International Financing Review (IFR)
  • 2020 Finder Award: Best Non-Risk Based Personal Loan
  • ING Superannuation – CANSTAR 2020 Most Satisfied Customers
  • SuperRatings Gold Super and Pension 2020
  • SuperRatings Gold Super and Pension 2019

CONTENT SOURCE

FURTHER READING

Report created by Emilia Sharples

ING Group

SECTIONS :  Sustainability  Targets    Evaluation  •  Key Points  •  Overview

Company Activity

The ING Group is a Dutch multinational banking and financial services corporation headquartered in Amsterdam with a strong European base. The three letters (ING) stand for “Internationale Nederlanden Groep“.

Its primary businesses are retail banking, direct banking, commercial banking, investment banking, wholesale banking, private banking, asset management, and insurance services. ING is the Dutch member of the Inter-Alpha Group of Banks, a cooperative consortium of 11 prominent European banks. ING Bank has been a member in the list of global systemically important banks since 2012.

The bank serves around 38.9 million customers, corporate clients and financial institutions in over 40 countries. With total assets of US $1.1 trillion, it is one of the biggest banks in the world, and consistently ranks among the top 30 largest banks globally. Moreover, ING is among the top ten in the list of largest European companies by revenue.

Company Sustainability Activity

ING IS ranked first in the bank industry group by Sustainalytics and has a ‘AA’ rating in MSCI’s ratings universe. ING Group shares are included in major sustainability and Environmental, Social and Governance (ESG) index products of leading providers such as STOXX, Morningstar and FTSE Russell.

The bank measures and manages the impact of their operations through their environmental programme. The environmental impact of their operations mainly consists of energy use in buildings, IT systems, business travel, waste and water.

Sustainable Policies:

  • They’ve financed billions of euros of renewable energy projects while saying ‘no’ to certain companies who engaged in unsustainable practices and sectors and ‘yes, but’ to others, outlining sustainability improvements they have to make first. 
  • ING was the first bank to commit to exiting the coal industry. 
  • They are steering their loan book to finance activities that are aligned with achieving the goals of the Paris Agreement.
  • Enhanced their policy framework for Environmental & Social Risk (ESR), sustainable finance activities and their Terra approach.

Ratings:

  • ING was again recognised by CDP as a ‘Climate change A-List’ company leading on climate action. This is the seventh year in a row that they’ve received this recognition.
  • In Sustainalytics’ view, ING’s “management of ESG material risk is strong”.

Sustainable Finance:

Transparent and Coherent Reporting:

Sustainable Investments:

  • Funds companies and sectors that are helping to keep global warming below two degrees Celsius. This includes funding projects that advance renewable energy, promote the circular economy and help combat climate change.
  • The bank has financed billions of euros of renewable energy projects, green buildings, sustainable transport and infrastructure, among others.
  • Sustainability improvement loan: offers corporate clients a lower interest rate for improved sustainability performance
  • Every client and transaction is assessed, monitored and evaluated against the requirements of the  Environmental and Social Risk (ESR) framework to ensure compliance and limit the negative impact on the environment and communities.

Community Engagement:

  • Financed billions of euros in energy projects, from wind farms, solar energy, and geothermal power production.
  • ING takes part in various initiatives, contributing its knowledge and expertise to help develop new market standards.
  • Incorporates principle of financing a circular economy: one where people and companies ‘reduce, reuse and recycle’ instead of ‘take, make and waste’.
  • Conducted a pilot using the data from a local provider, BlueLabel, assessing approximately 7,600 postcodes for the impact of drought, heat stress, flooding risk from dyke breaches and flooding due to heavy rainfall.

Engagement with Corporations

  • The Sustainable Structured Finance team acts as a laboratory for new sustainable business models that need financing in Europe, the Middle East and Africa.

Highlights

Targets

Climate Action

  • Reduce their Scope 1 and 2 CO2 emissions from buildings and data centres by 80% by year-end 2022, and 90% by year-end 2030 (base year 2014).
  • Reduce their Scope 3 CO2 emissions from business travel by airplane and car by 25% by year-end 2022 (base year 2014).  
  • Remain carbon neutral by offsetting remaining carbon emissions.

Responsible Energy Consumption/Waste

  • Reduce energy consumption by 65% by year-end 2030 (new target, base year 2014).
  • Reduce their global residual waste by 26% by year-end 2022 (base year 2014).
  • Reduce their water footprint by 26% by 2022 (base year 2014).
  • Continue to procure 100% renewable electricity for all ING buildings where the bank has management control worldwide.
  • Preferably procure green energy from local renewable projects: electricity supplied by energy sources that are naturally and continually replenished, such as wind, solar power, geothermal and hydropower.
  • Maintain a standard for transparency about progress by disclosing material environmental performance indicators in its annual report
  • Reduce financing to upstream oil and gas by 19% by 2040.

Progress

Climate Action

  • Extrapolated CO2 emissions of Scope 1 & 2 decreased by 76% in 2020 relative to the base year of 2014.
  • Extrapolated CO2 emissions of Scope 3 decreased by 73% in 2020 relative to the base year of 2014.
  • Maintained carbon-neutral operations in 2020 by offsetting emissions caused by business travel and non-renewable energy use.
  • Offset 100% of operational carbon emissions through the purchase of Voluntary Carbon Units (VCUs), with the majority originating from a high-impact Acre Amazonian Rainforest REDD+ Portfolio in Brazil. The portfolio is verified and validated to the Verified Carbon Standard (VCS), and has achieved Gold Level status under the Climate Community and Biodiversity (CCB) Standard.
  • In 2018, ING formed the Climate Change Committee (CCC) to secure board-level oversight of strategic climate-related risk and opportunity management.
  • In December 2018, four peers signed on via the Katowice Commitment, which then became the groundwork for the UN-backed Collective Commitment to Climate Action signed by 31 banks in September 2019.
  • Since 2017, captured progress on climate risks and opportunities according to the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) in their Annual Report.

Responsible Energy Consumption/Waste

  • Residual waste decreased by 52% in 2020 relative to base year.
  • Water consumption decreased by 27% in 2020 relative to the base year.
  • Reached 100% proportion of renewable electricity consumption as a percentage of total electricity consumption.
  • ING increased renewable power generation financing by €1.19 billion in 2019 while reducing their direct exposure to coal-fired power plants by 43%.

Certificates

UN Sustainable Development Goals

UN SDGs Compliance

SDG 6: Clean Water and Sanitation

  • Energy efficiency in buildings and production lines: from electric vehicles and bio-based plastics to water treatment and circular economy solutions.
  • Goal to reduce their water footprint by 26 percent by 2022 (base year 2014). 

SDG 7: Affordable and Clean Energy

  • They have financed billions of euros of renewable energy projects while saying ‘no’ to certain companies and sectors and ‘yes, but’ to others, outlining sustainability improvements they have to make first. 
  • Funding projects that advance renewable energy.
  • Financed billions of euros in energy projects, from wind farms, solar energy, and geothermal power production.
  • Energy efficiency in buildings and production lines.

SDG 8: Decent Work and Economic Growth

  • In terms of sustainable economic growth, they have a hard stance against certain activities that they will never finance.
  • Clients and projects that they finance need to meet certain environmental and social standards, assessed through their environmental and social risk approach.
  • Embedding human rights due diligence into their business and are aligning with the UN Guiding Principles on Business and Human Rights.
  • They pursue sustainable innovation through technology and new business models.
  • Their Responsible Finance portfolio contributes to their approach to climate action and financial health.
  • They aim to make a positive impact by providing people with information, innovations and by being involved with both government and private-sector initiatives.
  • Partnership with UNICEF has reached over 1 million children since 2005 and now focuses on providing adolescents with 21st-century skills through their Power for Youth programme.

SDG 12: Responsible Consumption and Production

  • ING has committed to better understanding the impact of their lending activities and to working with clients to drive sustainable progress.
  • In 2018, they recorded €7.1 billion in lending outstandings to industry ESG leaders, and they aim to double this number by 2022 compared to 2017.
  • They drive responsible consumption and production through their sustainable lending activities: selecting companies whose activities consider people, society and the environment.
  • Financing for coal power generation will fall to near-zero by 2025.
  • They do not finance sectors that exhibit controversial behaviour, such as human rights abuses.
  • Completed the first green hybrid bond, raising €1 billion to fund wind energy in the Netherlands and Germany; and the UK’s first green bond in the public utility sector

SDG 13: Climate Action

  • Aim to double their funding by 2022 to organisations that help combat climate change and positively impact society and the environment, up from €14.6 billion in climate finance at the end of 2017.
  • Making progress toward steering their lending portfolio towards the Paris Agreement’s well-below two-degree goal: the Terra approach
  • They’re committed to the UN-backed Collective Commitment to Climate Action, signed by more than 30 banks in September 2019.

SDG 14: Life Below Water

ING has an impressive history of actively achieving sustainability goals and has positively maintained its progress and contribution towards a greener future. ING’s ESG rating was upgraded to ‘AA’ from ‘A’ in December 2020 by MSCI, an investment research firm that provides indices, portfolio risk and performance analytics to institutional investors. Many other third sector analysts have also consistently scored ING highly in areas of sustainability. This reflects the bank’s active participation and the influence it has within the finance sector.

The bank holds many listings and awards and a couple of certificates. Their reporting is consistent and transparent and their commitment is demonstrated through their utilization of their Terra Progress Report. They align their goals directly with the UN’s SDGs and the Paris AgreementThey have practices that cover areas such as clean energy, economic growth and general climate action. However, they fail to mention any goals regarding poverty elimination or employee wellbeing.

This report gives ING Group a rating of B.

Analyst Outlook: Neutral

ING’s future goals are clear and achievable. However, perhaps in comparison to their past success, these are slightly lacking and are less ambitious.

Key Points

  • They’re ranked first in the banks industry group by Sustainalytics and have an ‘AA’ rating in MSCI’s ratings universe
  • They’ve financed billions of euros of renewable energy projects while saying ‘no’ to certain companies and sectors and ‘yes, but’ to others, outlining sustainability improvements they have to make first. 
  • ING launched its first Terra Progress Report.
  • Created a sustainability improvement loan, which offers corporate clients a lower interest rate for improved sustainability performance.
  • Maintained carbon-neutral operations in 2020 by offsetting emissions caused by business travel and non-renewable energy use.
  • They do not finance sectors that exhibit controversial behaviour, such as human rights abuses.
  • Completed the first green hybrid bond, raising €1 billion to fund wind energy in the Netherlands and Germany; and the UK’s first green bond in the public utilities sector.
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