Sustainability management

Sustainability is one of Raiffeisen's four corporate values. For this reason, the cooperative banking group actively addresses challenges and opportunities in business, society and the environment, and is dedicated to making Switzerland a healthy place to work. As a bank committed to sustainability, Raiffeisen uses its core competence to provide sustainable products to cooperative members and clients. Its efforts have proven successful: Today, over 50% of the money held in Raiffeisen funds is invested in sustainable products. Furthermore, Raiffeisen and two other banks ranked highest in a sustainability rating study of the Swiss retail banking sector conducted by the WWF in 2017. At the same time, Raiffeisen believes there is further potential to align its core business even more with sustainability.

The Executive Board of Raiffeisen Switzerland is responsible for the sustainability strategy of the Raiffeisen Group. All sustainability activities go through the Corporate Social Responsibility (CSR) unit within Raiffeisen Switzerland's General Secretariat. CSR acts as a centre of competence and sustainability catalyst, and is tasked with refining the sustainability strategy and entrenching strategy-driven processes and activities at Raiffeisen Switzerland's operating units and the 255 Raiffeisen banks.

The materiality matrix and GRI Content Index are core elements of sustainability reporting. The GRI Content Index is available on the internet at raiffeisen.ch/csr. This report also highlights Raiffeisen's community involvement, dialogue with stakeholders, management of environmental and social risks, and the results of sustainable management.

Materiality matrix

The materiality matrix tracks various sustainability issues based on their relevance to Raiffeisen and various stakeholders. Issues with more relevance for stakeholders and Raiffeisen are weighted more in the development and implementation of the sustainability strategy. The matrix is a snapshot, but also forecasts the future relevance of the individual issues.

The last materiality analysis was conducted in 2015 by key personnel from Raiffeisen Switzerland and independent external specialists. It remains valid in the current year and will be thoroughly revised in 2018. The materiality matrix from 2015 identifies the following issues as highly relevant:

  • Brand
  • Client satisfaction
  • Financial independence and stability
  • Core values
  • Digital transformation
  • Cooperative model
  • Client-relevant product and service portfolio

Brand

Sustainability has top priority for Raiffeisen. It protects the Raiffeisen brand accordingly.

The brand tracking study that Raiffeisen has conducted every year since 2006 shows that the majority of the Swiss population once again viewed Raiffeisen as Switzerland's strongest and most likeable bank brand in 2017. The cooperative also scored highly on client proximity and sustainability compared to the competition. Raiffeisen banks earned high marks for reputation, regional ties and credibility as well.

Raiffeisen was also perceived as an industry leader for its contribution to the common good in Switzerland in 2017, according to the Public Value Atlas for Switzerland, a study conducted by the University of St.Gallen.

Client satisfaction and value

Clients are satisfied if they receive advisory services that meet their needs and offer good value.

Raiffeisen maintained its position in the 2017 national satisfaction survey: high satisfaction among main-bank clients, a leading position compared to other banks and the highest satisfaction ratings in the industry concerning the quality of its advisory services. Once again, 80% of main-bank clients said in the current year that they would recommend Raiffeisen to an acquaintance.

Financial independence and stability

Raiffeisen is an important player in facilitating the circulation of money through the economy. As a systemically important banking group, its financial stability is crucial for Switzerland's economy. Raiffeisen banks protect their clients' and cooperative members' funds and support the circular flow of money through the economy. True to its principle of "security comes before profitability comes before growth", Raiffeisen aims for a low cost/income ratio with maximum security. It improved this ratio once again in the current year.

In 2017, Raiffeisen once again figured among Switzerland's most secure banks. For years, it has enjoyed a consistently high Moody's rating of Aa2 (with a stable outlook). By coming together in a cooperative association with a Group-wide risk controlling system, Raiffeisen banks have created a strong risk community that has remained profitable for years. Raiffeisen is not dependent on majority interests: Every cooperative member has only one vote.

Core values

The core of the Raiffeisen Group is its cooperative, value-driven business model. Raiffeisen's business activities and its relationship with employees are based on its core values: credibility, sustainability, client proximity and entrepreneurship. The bank focuses on the cooperative members' long-term wellbeing, not on short-term profit maximisation.

In the current year, Raiffeisen Switzerland collaborated with the Raiffeisen banks to review the Raiffeisen Group's vision and mission statement based on these four core values. The strategic approaches are defined by the Executive Board and by the Board of Directors of Raiffeisen Switzerland and apply throughout the Group. In implementing the strategy, each Raiffeisen bank adapts it to local conditions and acts on its own authority as an independent company within the basic strategy that applies throughout the Group.

Digital transformation

Raiffeisen believes digital transformation holds opportunities, not only for its banking business, but for the evolution of the cooperative model as well.

Raiffeisen broadened its range of digital services further by systematically and sustainably aligning its business with the digital future. The core banking system update provides a solid foundation for additional digitisation projects. Raiffeisen clients benefit not only from Switzerland's densest branch network but also from increasingly differentiated digital channels.

Furthermore, the RAI Lab promotes a vibrant culture of innovation at Raiffeisen and drives innovation and new business models. One example is the two-day "Innovation Challenge" during which over 100 employees developed innovative ideas for Raiffeisen.

The up-to-date IT infrastructure enables a modern, attractive working model for Raiffeisen employees.

Cooperative model

Dialogue and participation are essential features of the cooperative business model. The ability of cooperative members to exercise voting rights and the "one person, one vote" principle keep decision-making democratic, prevent the dominance of special interests and help encourage a sustainable long-term orientation.

The Raiffeisen banks actively practised the principles enshrined in the cooperative model in the current year. Roughly 400,000 cooperative members attended a general meeting of the various Raiffeisen banks where they had an opportunity to help determine the individual Raiffeisen banks' business policies.

Client-relevant product and service portfolio

A client-relevant product and service portfolio is crucial for sustainable success in the market. Being a cooperative bank, we put our members' needs first.

Raiffeisen Switzerland once again launched new products and services to adapt to changing client needs in the current year.

Demand for Futura investment funds increased even more in the current year. They recorded net cash inflows of CHF 831.1 million. After accounting for market movements, the volume of Futura investment funds increased CHF 1.2 billion to around CHF 5.86 billion. This represents a strong increase of 26.2%, as compared to 13.9% for the remaining conventional products. As a result, Futura funds accounted for an even larger share of Raiffeisen's total fund volume, increasing from 53.7% to 59.3%. In 2017, over 1,500 clients chose superior investment planning by signing up for a home ownership consultation with an energy assessment (eVALO). For details about sustainable Raiffeisen products, visit www.raiffeisen.ch/nachhaltigkeit.

Commitment to social issues

Raiffeisen has been committed to a healthy economy and a diversity of social activities at the regional and national level for decades. It supports associations that promote cultural, athletic, musical and social diversity in all Swiss regions. The Raiffeisen Group's sponsorships amount to roughly CHF 30 million per year.

The Raiffeisen MemberPlus programme provides special benefits to private and corporate client members. As part of the current year's summer membership programme, members travelled to Ticino, received discounted tickets to concerts and other cultural events and enjoyed over 600,000 free visits to over 500 museums throughout Switzerland. Corporate client members benefited from programmes for client or employee events and energy consultations, and attended Raiffeisen Business Owner Centre (RUZ) events.

In 2017, Raiffeisen members used one of the programmes more than a million times. In addition to adding value for cooperative members, these Raiffeisen programmes also delivered a significant impetus to Swiss tourism and the economy.

In sports, Raiffeisen has partnered with Swiss Ski since 2005 and supports numerous local ski clubs and associations. Raiffeisen's football programmes include the Raiffeisen Super League, which it has supported as the main sponsor since 2012, over 90 Raiffeisen Football Camps and the Super League Family Days. Raiffeisen supported the football and ski sports teams in the Special Olympics Switzerland as well. Raiffeisen also partners with others to support the Radio Blind Power project, which provides audio descriptions of Raiffeisen Super League games so that people with visual disabilities can enjoy them, too. All told, Raiffeisen awarded over CHF 1 million in sponsorships to more than 20,000 young athletes in the current year.

Through lokalhelden.ch, Raiffeisen provides a free project and donations platform for local projects that has crowdfunded over CHF 2 million in donations for local projects since 2017. Five of these projects are described in more detail at raiffeisen.ch/annualreport.

Raiffeisen employees are also involved in various charitable projects. Raiffeisen Community Engagement, a corporate volunteering programme driven by skills donations, helped ten non-profit organisations address concrete problems with a social, ecological and regional economic focus in the current year.

Finally, Raiffeisen contributes to the financing of Swiss communities. It does so directly through taxes and levies as well as indirectly through interest on members' share certificates and – on a much larger scale – through the creation of jobs in the community.

Sustainable management

Raiffeisen also ensures social and environmental sustainability along its value chains for operations management as well as goods and services procurement.

Statement of net added value

 

Current year in CHF million

Previous year in CHF million

Current year in %

Previous year in %

Creation of added value

 

 

 

 

Corporate performance (= operating result)

3,310

3,108

100.0

100.0

General and administrative expenses

-618

-606

18.7

19.5

Extraordinary income

119

75

3.6

2.4

Extraordinary expenses

-4

-4

-0.1

-0.1

Gross added value

2,807

2,573

84.8

82.8

Value adjustments on participations and depreciation and amortisation of tangible fixed assets and intangible assets

-188

-260

5.7

8.4

Changes to provisions and other value adjustments and losses

1

-6

-0.0

0.2

Net added value

2,620

2,307

79.2

74.2

Distribution of added value

 

 

 

 

Personnel (salaries and employee benefits)

1,395

1,380

53.2

59.8

Cooperative members (paym. of interest on certif.: proposal to AGM)

51

44

1.9

1.9

Government

233

174

8.9

7.5

of which income tax paid

177

153

6.8

6.6

of which formation/release of provisions for deferred taxes

56

21

2.1

0.9

Bolstering of reserves (self-financing)

941

709

35.9

30.7

Total

2,620

2,307

100.0

100.0

Key added value figures

 

 

 

 

Gross added value per personnel unit in 1000 CHF*

300

277

 

 

Net added value per personnel unit in 1000 CHF*

280

249

 

 

Number of personnel units (average)

9,343

9,281

 

 

* Calculated on the average number of personnel

Raiffeisen once again ensured sustainability in its supply chain and outsourcing to partner organisations in the current year by following and constantly updating specific principles and criteria. This means that Raiffeisen suppliers and partner organisations have to meet environmental and social criteria as well as economic ones.

Since 2017, the greenhouse gas balance sheet has been based on new calculation assumptions and amounts to 14,552 tons CO2 equivalents. By applying the new calculation assumptions, the adjusted emissions fell by 2,484 tons (15%) compared to the previous year. Per employee (full-time equivalent), the emissions measured 1,499 tons CO2 in the reporting period. By 2020, Raiffeisen wants CO2 emissions to be 30% lower than the 2012 baseline. Raiffeisen generates greenhouse gas emissions primarily through building energy (electricity and heating) and business travel (cars, public transit and air travel).

The consumption of building energy remained stable in the Raiffeisen Group compared to the previous year. These currently amount to 72.4 gigawatt hours, which corresponds to 7,455 kilowatt hours per employee full-time equivalent. The heating energy reported is less fossil and much lower, while electricity consumption by contrast has increased. This shift has been caused by the new calculation assumptions, the consolidation and concentration of locations within the Raiffeisen Group and conversions at the St.Gallen location.

Business travel remained stable at 20.6 million kilometers; 2,119 kilometers were covered per employee across all travel categories. Business travel emissions were contained by raising employee awareness and defining a ceiling of 130 g CO2/km for Raiffeisen's vehicle fleet. Domestic courier trips rose due to market developments while air travel by contrast decreased markedly.

The Raiffeisen Group consumed around 1,500 tonnes of – mostly sustainably produced – paper in 2017. An external partner recycles paper centrally for all Raiffeisen Switzerland units, most Group company locations and around two-thirds of the Raiffeisen banks. Paper consumption is factored into Raiffeisen's carbon footprint. Two-thirds of printed products were carbon-neutral in the current year.

Overview of relevant sustainability figures

Category

Unit

Raiffeisen Switzerland and Group companies

Raiffeisen banks (including banks)

Projection (banks not included)

Raiffeisen Group (total)

Raiffeisen Group change in %

Raiffeisen Group (total) per FTE

Building energy (total)

kWh

15,002,000

29,626,000

27,761,000

72,389,000

0

7,455

Electricity

kWh

12,426,000

19,908,000

14,032,000

46,366,000

22

4,775

Heating energy

kWh

2,576,000

9,718,000

13,729,000

26,023,000

-24

2,680

 

 

 

 

 

 

 

 

Business travel (total)

km

16,042,000

1,871,000

2,664,000

20,577,000

2

2,119

of which public transportation (rail, bus, tram)

km

4,720,000

895,000

1,842,000

7,458,000

3

768

of which road transport by private cars (personal vehicles)

km

2,002,000

975,000

822,000

3,799,000

-4

391

of which road transport by company cars (company vehicles)

km

4,471,000

 

4,471,000

6

460

of which road transport for courier deliveries

km

3,714,000

3,714,000

24

382

of which passenger transport by air

km

367,000

367,000

-15

38

of which air freight

tkm

768,000

768,000

3

79

paper consumption

tons

 

 

 

1,520

0.16

water consumption

m 3

18,000

90,000

118,000

226,000

23

 

 

 

 

 

 

 

 

Greenhouse gas emissions from energy and travel *

tonnes CO 2 eq

6,440

2,924

5,188

14,552

-15

1.50

of which Scope 1

tonnes CO 2 eq

1,633

1,696

4,055

7,384

-2

0.76

of which Scope 2

tonnes CO 2 eq

71

317

0

388

171

0.04

of which Scope 3

tonnes CO 2 eq

4,736

911

1,133

6,780

-27

0.70

* This covers relevant emission sources from Raiffeisen’s energy consumption and business travel. The three system boundary categories are: Scope 1: direct greenhouse gas emissions from stationary sources right at the company, e.g. heating or vehicles ; Scope 2: indirect greenhouse gas emissions from energy generation outside the company, e.g. electricity and district heating ; Scope 3: other indirect greenhouse gas emissions outside the company from upstream and downstream processes, e.g. business travel by rail or upstream processes involved in supplying energy. Greenhouse gas emissions are calculated based on the emission factors for the 2015 VfU indicators. Collection of environmental data 2017 with expanded data basis and likewise in previous years. Projections are always made on the assumption of the highest consumption. It was possible to take more measuring points into consideration with increasing experience in data collection and by optimising an interface. As a result of the improvement in the data quality, individual consumption figures have changed within the projection. The improved data quality can be applied retrospectively all the way to 2012. This facilitates monitoring of the goal to reduce greenhouse gas emissions by 30% compared to the 2012 baseline.

Pro Futura is an internal incentive system and practical tool that was made available to Raiffeisen banks in 2017. In it, users can implement measures to cut emissions and resource consumption, substitute non-renewable energy sources with renewable ones, offset unavoidable emissions and raise employee awareness. The trilingual application was used by over 50 Raiffeisen banks in the current year.

Stakeholders

Raiffeisen puts a high priority on engaging and transparently communicating with its various stakeholders. Raiffeisen considers its main stakeholders to be clients, cooperative members, employees, cooperation partners, society and policy makers. Stakeholder concerns are systematically and regularly identified and addressed, for example, in client surveys, at the cooperative members' Annual General Meeting or at employee events.

Environmental and social factors in risk management

Raiffeisen includes environmental and social factors in its risk assessments. They can be included in various risk categories and are given due consideration in group risk management activities. Raiffeisen Switzerland continuously reviews the effectiveness of its risk management process. A discussion on environmental and social risk management was launched in the current year. For more on risk management, see the section entitled Risk policy.