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Strategic Management of Environmental, Social, and Governance (ESG) Topics
With increasing demand for sustainable investments and evolving regulation in the area of sustainable finance, the importance of a clear stance on ESG and strategic ESG management has sharply increased for financial institutions. SIX is directly affected by this development in its roles first, as a provider of financial market infrastructure, second, as a responsible corporate citizen, and third, as a products and services provider for the financial industry.
Stakeholder expectations regarding the sustainability performance of companies have steadily grown in recent years. The importance of strategic management regarding environmental, social, and governance (ESG) topics has therefore sharply increased, especially for the financial industry. Investors are putting an ever-stronger focus on the impact and the ESG performance of their investments. Government and international organizations emphasize the role of finance in the transition to a sustainable economy, with the EU in particular enforcing transparency requirements to prevent greenwashing.
SIX is directly affected by this development: first as a provider of financial market infrastructure (FMI), second, as a responsible corporate citizen, and third, as a business-to-business provider of products and services for the financial industry. In the year under review, SIX elevated its ESG management to meet the changing stakeholder requirements in each of the three roles.
As an FMI, SIX plays a pivotal role in the transition to a greener, more sustainable economy by enabling the mobilization and reallocation of capital necessary for this transformation. For example, with its stock exchanges in Switzerland and Spain, SIX offers listing and trading venues for green bonds, the proceeds of which are used to finance climate projects. On the Spanish exchange, in particular, the number of green bonds continues to rise, reaching a volume of EUR 12.7 billion by the end of 2021 (see Exchanges Business Unit).
As a corporate citizen, SIX assumes responsibility towards the economy, society, and the environment, including all stakeholder needs in its value creation considerations. SIX pays attention to its own performance, for examply by reducing its carbon emissions, ensuring cyber security, fostering diversity and inclusion, developing its leadership team, or promoting social financial literacy.
As a provider of products and services for the financial industry, SIX supports its customers in fulfilling their needs with regard to ESG and sustainable finance, for instance, by supplying ESG indices or distributing regulatory ESG data (see Financial Information Business Unit). With eBill, SIX is continuously establishing digital billing and invoicing in Switzerland, thereby significantly contributing to the reduction of CO2 emissions in Swiss payments.
A group-wide initiative is currently being conducted to develop a new Group sustainability strategy to be approved by the Board in 2022.