NatWest Group

In terms of senior leadership accountability, the responsibility for sustainability issues within NatWest lies with the board of directors. Moreover, the financial institution links the remuneration of its executive team to sustainability performance criteria. Regarding engagement, the financial institution publishes case studies describing where it has engaged successfully with investees on sustainability themes and impact topics. In terms of its approach towards impact management, the financial institution acknowledges that its financing activities have both positive and negative impacts. It has also identified and prioritised its impacts through a materiality assessment process, which included feedback from external stakeholders, and set targets for these prioritised impacts. Furthermore, NatWest tracks progress against these targets.

As a member of the Glasgow Financial Alliance for Net Zero (GFANZ), NatWest has set a target of net-zero financed emissions by 2050. Regarding engagement, the financial institution discloses the key sectors it has identified as priorities to engage with on climate change, and the rationale for choosing these priorities. It also discloses that alignment with the Paris Agreement is one of its engagement topics; moreover, it requires some of its clients to have a strategy aligned with the Paris Agreement. NatWest Group Pension Fund is a member of Climate Action 100+; resultingly it collectively engages on climate change. The financial institution discloses the aggregate amount and share of finance it devotes to climate solutions. Looking to the future, it aims to finance GBP 100 billion in climate solutions by 2025 and discloses progress against this target. Finally, NatWest is committed to minimising its negative impacts on nature and biodiversity.

NatWest has a grievance mechanism accessible to all workers and external stakeholders to raise human rights, as well as bribery and corruption, concerns or complaints. The financial institution also commits in public policy documents to prohibit bribery and corruption, respect the health and safety of workers and protect personal data. In terms of workforce diversity, the financial institution discloses a breakdown of its total direct operations workforce for each employee category by gender and ethnicity. It also discloses the proportion of its workforce covered by collective bargaining agreements. Finally, regarding transparency on financial inclusion, NatWest discloses the amount of finance it directs towards usually excluded groups through its Enterprise Programmes.

In terms of female representation in leadership positions, women are marginally underrepresented on NatWest’s board as 4 out of 11 members are women. Additionally, the financial institution has an opportunity to reach at least 40% female representation in senior leadership positions as it currently has 38% women in its top three layers. There is no evidence that the financial institution discloses the ratio of basic salary and remuneration of women to men in its total direct operations workforce for each employee category. Furthermore, while it discloses actions it takes to address gender equality, for example increasing the representation of women, it is not clear how these actions address any identified pay gaps. Regarding engagement, NatWest has an opportunity to describe its engagement approach on sustainability themes and impact topics with clients and investees across all its financing activities.

There is an opportunity for NatWest to disclose absolute interim financed emissions reduction targets that cover all of its financing activities, rather than intensity-based targets. In terms of fossil fuels, while the financial institution discloses its wholesale lending exposure to oil and gas, it has an opportunity to disclose the amount of finance it directs towards fossil fuel companies and projects through all its financing activities. NatWest will not lend to, or underwrite, oil and gas companies, or companies with more than 15% of activities related to thermal and lignite coal, unless they have a credible transition plan. Going forward it has an opportunity to disclose a similar strategy which covers all fossil fuels across all its financing activities.

NatWest has a publicly available policy statement committing it to respect human rights. However, it has an opportunity to use stronger language to turn this statement into a formal commitment. It could also describe a process for identifying its human rights risks and impacts through its relevant financing activities. In terms of workforce diversity, the financial institution discloses an age breakdown for its entire workforce but has an opportunity to disclose this information for each employee category. Finally, regarding transparency on financial inclusion, there is no evidence that NatWest discloses the amount of finance directed towards low-income developing countries.