Aim to measure impact on biodiversity
At Landsbankinn, we’ve been ahead of the curve as regards legislation on sustainability and have taken action without any legal requirement to do so. Now the legal onus has increased, requiring us to take these issues even more seriously. Our largest current undertaking is to prepare the Bank for transposition of the EU Taxonomy into the Icelandic regulatory environment.
Landsbankinn has been a member of PCAF since 2019 and we participated in the development of their carbon accounting method intended to allow financial undertakings to measure and analyse emissions from their credit and asset portfolios. In December of 2022, we joined PBAF, an association working to enable financial institutions to assess and disclose impact and dependencies on biodiversity of loans and investments. There was no obligation to join either partnership, we joined of our own free will. EU requirements on climate issue disclosure by financial institutions are based largely on PCAF’s methodology and the assessment of transition and climate risk relies for the most part on data from PCAF on emissions from credit and asset portfolios. I am certain that the PBAF methodology, once it has been developed, will attain the same status and that financial undertakings will be required to use it to disclose their impact on biodiversity.
Setting science-based targets
Among the other projects we’re working on in the Sustainability Team is setting science-based targets to be approved by the Science-Based Target initiative. This is quite an undertaking, as science-based targets are considerably more difficult to formulate than unscientific ones. Targets are considered science based it they are in accordance with the latest climate research and aim to ensure that the reduction in indirect emissions from Landsbankinn’s credit portfolio support the objective of the Paris Agreement, to limit global warming to below 1.5°C.
We have been leading in sustainable finance. We know the score. We know what we have to do and are fully committed to doing it well!”