Slide 1: Santander ESG: Towards a more sustainable world
Confidential Santander ESG Towards a more sustainable world 2H 2021
Slide 2: Index
Confidential Índice Index 1 ESG strategy 2 Decarbonization Targets 3 Financing the green transition 4 Financial Inclusion, Empowerment & Community support 5 Corporate Governance 6 External engagement & Recognition
Slide 3: ESG strategy
Confidential ESG strategy 01
Slide 4: What makes us different
Confidential ESG strategy Our approach What makes Full alignment with our Corporate & Sustainability strategy us different Financial Inclusion Green Finance Best Bank for Financial #1 worldwide Bank in Inclusion in 2021 financing Renewable Energy Decarbonization Governance Net-zero decarbonization t
Slide 5: Our approach
Confidential ESG strategy Our approach As a responsible bank we place sustainability at the centre of our core activities Founding Member 2021 Best bank for Financial Inclusion 2021 Our vision Our strategy Our actions is to play a major role in the focuses on delivering our Net zero materialize the
Slide 6: Our journey
Confidential ESG strategy Our journey Our journey over the past years highlights Santander’s ongoing commitment to fight climate change and contribute to a more sustainable future 2020 2021 2018 2019 2011 2017 2009 • Responsible Banking • Became carbon neutral • Becoming Founding • Top Risk exercise
Slide 7: Alignment with the UN SDGs
Confidential ESG strategy Alignment with the UN SDGs The SDGs on which Banco Other SDGs on which Banco Santander has the greatest impact Santander also has an impact The 2030 Agenda for Sustainable Development, adopted by United Nations Member States in 2015, provides a shared blueprint for peace an
Slide 8: Responsible Banking commitments
Confidential ESG strategy Responsible Banking commitments We have consistently delivered our Responsible Banking commitments achieving the targets set in 2019 to be met by 2021: 2018 2018 2019 2019 2020 2020 2021 2021 2021 2021 target target 2025/ 2025/ 2030 2030 target target • Single use plastic f
Slide 9: Our achievements
Confidential ESG strategy Our achievements We want to make a positive impact with actions that reflect our sustainability strategy and commitment 7.5 mn People >EUR 550 mn of credit financially empowered granted to since 2019 microentrepreneurs in 2021 77% of electricity used #1 bank worldwide from
Slide 10: Covid-19
Confidential ESG strategy Covid-19 During 2020 and in the midst of the covid-19 pandemic, Santander continued to be part of the solution by supporting individuals, businesses and society as a whole Employees Customers Communities >100k employees working c.6 mn customers supported >EUR 100 mn in aid
Slide 11: Commitment from our Top Management
Confidential ESG strategy Commitment from our Top Management By delivering on our purpose to help people and businesses prosper, we grow as a business and continue to help society address its challenges "At Santander, we've always known we have a responsibility to support society – and I have no dou
Slide 12: Main challenges
Confidential ESG strategy Main challenges Our group strategy focuses on supporting global initiatives to tackle climate change and promote sustainable growth that is accessible for everyone Frameworks Challenges Initiatives Internal Policies and Decarbonization: Working 02 Paris Agreement corporate
Slide 13: Decarbonization targets
Confidential Decarbonization targets 02 Back
Slide 14: Net zero journey
Confidential Decarbonization Targets Net zero journey In order to be aligned with the Paris Agreement and with the aim of limiting global temperature increase to 1.5°C, we have committed to be net zero in carbon emissions by 2050 2019 2020 2021 2025 2030 2050 Milestones 1st Green bond 2nd Green Sing
Slide 15: What do we want to achieve?
Confidential Decarbonization Targets What do we want to achieve? As one of the world’s largest banks, we have a clear role to play in financing the transition to a greener economy. We have met the goal of being carbon-neutral in our own operations in 2020, but we aim to go further and raise our leve
Slide 16: Sectorial policies
Confidential Decarbonization Targets Sectorial policies Our updated Environmental, Social and Climate Change Risk Policy covers all our lending practices to customers involved in coal fired power plants, and in the extraction, production and treatment of oil and gas, expressly prohibiting funding to
Slide 17: Fossil fuel financing portfolio exposure
Confidential Decarbonization Targets Portfolio exposure We rank well below most of our peers in fossil fuel financing in absolute and relative terms in 2021 Mandated Fossil fuels financed Fossil fuels financed Rank Arranger (Billion $) over total lending 1 1 Bank Bank 1 1 51,300 51,300 5.1% 5.1% San
Slide 18: Further commitments
Confidential Decarbonization Targets Further commitments As part of the NZBA, we have estimated the current and future emissions of our power generation portfolio and proposed the first GHG decarbonization targets for 2025 and 2030, further aligning our portfolio to the Paris Agreement Emission inte
Slide 19: Financing the green transition
Confidential Financing the green transition 03 Back
Slide 20: Our global reach
Confidential Green Finance Our global reach Finance is a key enabler of the transition towards a low-carbon economy, and that is why we are contributing to a more sustainable economy by managing climate-related risks and opportunities, building a comprehensive sustainable and green finance propositi
Slide 21: Our global reach: renewable finance league tables
Confidential Green Finance Our global reach In the last decade, we have participated in 936 renewable energy finance deals, representing more than EUR 41 bn, proving our commitment to support Green Finance Global Renewable Energy Project Finance Volume Global Sustainability Linked Loans FY Green Fin
Slide 22: Our contribution
Confidential Green Finance Our contribution Santander has consistently been the leading Bank in financing renewable energies for the past 10 years and we aim to maintain our leadership Value of deals (USD mn) Number of deals (#) #1 #1 171 #1 #1 6,284 #1 #1 5,786 5,771 149 143 #1 #1 #3 #1 4,322 111 4
Slide 23: Protecting the Amazon
Confidential Green Finance Protecting the Amazon We believe it is critical to protect the Amazon rainforest in order to tackle climate change. In July 2020, Santander Brazil announced a plan to promote sustainable development in the Amazon in collaboration with the two other largest private-sector b
Slide 24: Consumer Finance & Phase-out approach in Poland
Confidential Green Finance Consumer Finance & Phase-out approach in Poland Providing sustainable solutions in Consumer Finance & progressing in our decarbonization strategy in Poland Santander Consumer Finance Poland strategy Helping customers go green – car finance Committed to support the Coal pha
Slide 25: Financial Inclusion, Empowerment & Community support
Confidential Financial Inclusion, Empowerment & Community support 04 Back
Slide 26: Global approach
Confidential Financial Inclusion, Empowerment & Community support Global approach At Santander we seek to provide tailored finance to those facing difficulties while trying to access credit, by designing solutions for individuals and SMEs in financial distress. The Group is leading numerous global i
Slide 27: Financial Inclusion & Empowerment - Global approach
Confidential Financial Inclusion, Empowerment & Community support Financial Inclusion & Empowerment - Global approach We continue to help people access the financial system and set up micro-businesses while we provide them with the appropriate tools to manage their finances. This is achieved through
Slide 28: Financial Inclusion & Empowerment - Key initiatives
Confidential Financial Inclusion, Empowerment & Community support Financial Inclusion & Empowerment - Key initiatives We are proud to have developed financial inclusion initiatives that have been successfully implemented in the LATAM region (Banking without a bank) Superdigital is Launched in 2017,
Slide 29: Community support - Higher Education
Confidential Financial Inclusion, Empowerment & Community support Community support - Higher Education We believe education is the bedrock of financial inclusion and customer protection, that is why it sits at the core of our Responsible Banking agenda, and it is fostered through different initiativ
Slide 30: Corporate Governance
Confidential Corporate Governance 05 Back
Slide 31: Our strengths
Confidential Corporate Governance Our strengths As a responsible bank we have a clear, robust governance. Best practices on governance are channelled to all our subsidiaries, as part of our global Governance Model • Commitment to maximise the disclosure and quality Effective engagement • High partic
Slide 32: Our strengths
Confidential Corporate Governance Our strengths We strive to have a clear and robust governance with well-defined accountability and a prudent management of risks and opportunities to ensure: 1 2 3 4 5 Respect for A balanced Board Maximum Be at the forefront of Embedding ESG in shareholders’ rights
Slide 33: Board composition
Confidential Corporate Governance Board composition Our Board composition ensures an ongoing effective supervision supported by a well-balanced committee structure Number of Geographical Independent Board Women on Directors diversity members Board 15 6 66,6% 40% Directors Spanish, US, Portuguese, 3.
Slide 34: Executive variable remuneration
Confidential Corporate Governance Executive variable remuneration Annual bonus for executive directors subject to meeting financial and non-financial targets Aligned with our Aligned with strategic goals A B shareholder interests • Annual bonus determined by • 50% of all variable both financial and
Slide 35: Scorecard
Confidential Corporate Governance Scorecard Detailed quantitative metrics, qualitative assessment factors and weightings: Category & weighting: Quantitative metrics Qualitative assessment Customers (20%) NPS1 • Accomplishment of objectives in the rules on risk conduct with customers Risks - Cost of
Slide 36: External engagement & Recognition
Confidential External engagement & Recognition 06
Slide 37: Partnerships & initiatives
Confidential External engagement & Recognition Partnerships & initiatives We drive our responsible banking agenda through a number of local and international initiatives and working groups, which include among others: UNEP Finance initiative. We are a founding World Business Council for Sustainable
Slide 38: Internal Activities and External Engagement
Confidential External engagement & Recognition Engagement Internal External Activities Activities 40% of our total capital contacted Dedicated ESG Team Constant engagement with ~60% of the institutional within the Global ESG analysts and other capital Investor Relations Unit market participants v he
Slide 39: Partnerships & initiatives: awards and recognition
Confidential External engagement & Recognition Partnerships & initiatives Our efforts on sustainability continue to be recognised globally, with different awards that endorse our commitment to tackle climate change, promote diversity and inclusion and support the interests of our employees and stake
Slide 40: Investors Relations Team
Confidential ESG in Santander Investors Relations Team ESG Equity, Fixed Income & Rating Agencies Fernando Beatriz Gema Begoña Morenés Donoso Serrano Navamuel Global Head of Investor Investor Investor Héctor Iturralde Relations Relations Relations Shareholder and Investor Relations Equity, Fixed Inc
Slide 41: Annexes
Confidential Annexes
Slide 42: Reports and additional information
Confidential Transparency & Disclosure Reports and additional information Please click on the below images to consult public details highlighted in this presentation Climate Finance 2020 Annual report Corporate Governance report presentation www.santander.com 42
Slide 43: Our Environmental footprint
Confidential Decarbonization Targets Our Environmental footprint Var. 2019-2020 (%) Var. 2019-2020 (%) 2,064,113 M3 water consumed from the supply system -29.7 194,159 T CO2 teq total emissions (market based) -41.6 920 mn KWH total electricity 57% renewable energy -0.7 Scope 1 24,818 T CO2 teq direc
Slide 44: Current exposure
Confidential Decarbonization Targets Current exposure We have conducted an analysis of our exposure to climate most concerning sectors (based on NACE codes). Most of these sectors are concentrated in SCIB (around 90%) representing 10% of the whole portfolio Dec 2020: Billions euros TR PR SCIB Other
Slide 45: Environmental Social Governance: Europe
Confidential Our ESG strategy EUROPE Local efforts Environmental Social Governance EUR 170 mn in Green Finance 272 k people financially ESG criteria considered when since 2019 & 100% renewable empowered since 2019 & 53.2 k considering remuneration with a 20% energy consumption scholarships granted s
Slide 46: Environmental Social Governance: LATAM
Confidential Our ESG strategy LATAM Local efforts Environmental Social Governance Helping the Amazon region BRL 50 Prospera microfinance initiative >70% Independent directors and 33% mn credit line for cooperatives and 580K customers and BRL 1.4 bn loan of women on Board agribusiness enterprises in
Slide 47: Environmental Social Governance: North America
Confidential Our ESG strategy NORTH Local efforts AMERICA Environmental Social Governance Financial Advisor on the issuance 835 k financially empowered people 70% Independent directors and 40% of 4 Bonds in 2020 since 2019; 238 k beneficiaries from of women on Board SAM – ESG 1st sustainable equity
Slide 48: Thank You.
Confidential Thank You. Our purpose is to help people and businesses prosper. Our culture is based on believing that everything we do should be: