Norfund

In terms of senior leadership accountability, the responsibility for Norfund’s strategy and environmental, social, and governance (ESG) policy lies with the board of directors. The DFI publicly commits to gender equality and women’s empowerment and has a gender-balanced board of directors where five out of nine members are women. Moreover, Norfund has an ESG policy where it describes its engagement on sustainability topics with clients.

As a member of the European Development Finance Institutions (EDFI), Norfund has set a target of net-zero financed emissions by 2050. Furthermore, it discloses the aggregate amount of finance it devotes to its clean energy portfolio, specifying what the latter entails. In addition, Norfund discloses some related timebound strategy targets. Furthermore, Norfund discloses it identifies its nature- and biodiversity-related impacts across its financing activities using the IFC Performance Standard on Biodiversity. Further, the DFI discloses it requires biodiversity management plans in place for its energy projects.

Norfund discloses the proportion of women in its total direct operations workforce for each employee category and publishes the amount of loans directed towards SMEs. Moreover, it discloses public policy commitments to prohibiting bribery and corruption and protecting personal data. Norfund also has a grievance mechanism accessible to all workers, external individuals, and communities to raise human rights and bribery and corruption complaints. Additionally, the DFI provides evidence of a global tax strategy and of the income tax paid in each country where the company is a resident for tax purposes for FY 2019.

There is no evidence that Norfund links the remuneration of its executive or management teams to sustainability performance criteria. It can improve its performance on gender equality by disclosing the proportion of women in senior leadership roles as well as how it addresses any gender pay gaps. Moreover, Norfund has an opportunity to describe the escalation framework about clients’ ESG performance and how the ESG policy is applied in practice.

Norfund could disclose interim emissions reduction targets at the group level, such as a 45% reduction in financed emissions by 2030. Although it discloses it engages with companies on climate by following up on climate action plans, it has an opportunity to disclose the key sectors and companies it has identified as priorities to engage with on climate change, specifically on the alignment with the Paris Agreement. Furthermore, the DFI could align its clean energy portfolio with internationally recognised frameworks and report on progress against related targets. There is no evidence that it is committed to minimising the negative impacts it has on nature and biodiversity.

While Norfund has a publicly available policy statement acknowledging the human rights laid out in the UNGPs, it can improve its performance by disclosing a policy committing it to respect human rights and the health and safety of workers. Furthermore, it could describe the process for identifying its human rights risks and impacts through its relevant financing activities. Moreover, there is no evidence that Norfund discloses the proportion of its total direct operations workforce for each employee category by age group. To provide transparency on financial inclusivity, the DFI has an opportunity to disclose the amount of finance directed towards, women-owned businesses, and low-income developing countries.