COMMITMENT TO THE ENVIRONMENT AND SUSTAINABILITY STRATEGY
Climate change is one of the major challenges faced by societies. Several scientific fields have been informing about the need to attain a sustained substantial reduction in greenhouse gases over time as the only way to limit the impact of climate change.
After the adoption of the Paris Climate Change Agreement and the UN 2030 Agenda for Sustainable Development in 2015, governments are taking steps to evolve towards low-carbon economies. In Europe, the European Green Deal has set the goal of making Europe the first climate-neutral continent by 2050, which has been materialised in the European Climate Law. The financial sector is expected to play an essential role in this regard, as stated by the European Commission's 2018 Action Plan, which was reviewed in 2021.
The transition to a low-carbon economy entails risks and opportunities for the economy and financial institutions. Meanwhile, the physical damage caused by climate change and the environment's deterioration may have a significant impact on the real economy and the financial system.
In keeping with this social concern, the Unicaja Strategic Plan for 2022-2024 defines sustainability as one of the basic cornerstones of the business's development and risk management. Unicaja has therefore implemented a Sustainable Finances Action Plan, whose execution was completed in 2023, which envisages a range of initiatives both in the business area and in climate risk management so as to achieve maximum alignment with best practices on the matter.
In December 2019, Unicaja joined the Collective Commitment for Climate Action promoted by the United Nations Climate Change Conference (COP 25), the fundamental goal of which is to align signatory institutions' portfolios with the objectives set out by the Paris Agreement by 2030.
Among other issues, this endorsement involves, on the one hand, calculating and disclosing1 the Institution's carbon footprint in all its scopes (1, 2 and 3), including the footprint generated by all its financed portfolios, and, on the other, setting decarbonisation targets for said portfolios in accordance with the aforementioned Agreement.
The decarbonisation goals for certain of the portfolio's segments for their part were set by the Board of Directors in April 2023 and recentlyin, the framework of Strategic Plan 27, extended in March 2025, and are regularly monitored
(1) Information on the Institution's carbon footprint in all its scopes, including category 15 of scope 3 (Financed Portfolios), is included in the Consolidated Non-Financial Reporting Statement for FY 2024.
Decarbonisation objectives
In order to set these objectives, the Institution initially calculated the financed portfolios' carbon footprint at the 2022 year-end using the methodologies and databases most commonly employed by international organisations and institutions across the sector. Since then, we have continued to calculate the carbon footprint of financed portfolios every six months.
Based on an analysis of the different portfolios and sectors' emissions, the Institution's Board of Directors approved in April 2023 the setting of interim decarbonisation goals for the most greenhouse-gas-intensive sectors which contribute most to its carbon footprint, which are: oil & gas, energy and the residential mortgage portfolio.
These objectives require a 28% and 62% reduction in emissions intensity for the oil & gas and energy sectors, respectively, and a 28% reduction for the residential mortgage portfolio.
Subsequently, the Institution's Board of Directors broadened the range of sectors with decarbonisation objectives and, in March 2025, set targets for the steel sector, aviation industry and non-residential mortgage portfolio based on the carbon footprint calculations for financed portfolios as at 31/12/2024.
These objectives require a 11% and 12% reduction in emissions intensity for the steel and aviation sectors, respectively, and a 20% reduction for the non-residential mortgage portfolio.
In order to set these objectives, the implementation of carbon footprint calculation methodologies has been combined with the use of benchmark climate scenarios for the decarbonisation of different sectors, taking into consideration the evolution forecast for the Institution's portfolios and strategy, as well as the interim decarbonisation goals set by the different counterparties.
The targets have only been set for the lending portfolio, with a base year of 2022 for the oil & gas and energy sectors and the residential mortgage portfolio and 2024 for the steel and aviation sectors and the non-residential mortgage portfolio. The 1.5ºC – or Net Zero by 2050 – scenario has been taken into account, this being the most ambitious and widely accepted scenario by the sector, thereby meeting the requirements of sectoral initiatives like the NZBA (Net Zero Banking Alliance).
Having set these objectives, Unicaja will design several initiatives within the context of its business strategy to ensure they are attained:
- Concerning the exposure of counterparties that have emission intensity levels that are aligned with either the Institution's objectives or with ambitious climate-related transition plans, it will focus its strategy on these sectors.
- At the same time, it will remain committed to its existing customers in order to encourage a reduction in their emission intensity levels by means of a variety of actions (covenants, etc.).
- It will continue fostering investment in and the financing of projects which have a positive impact on the environment and combat climate change through emission reductions.
After setting these targets, Unicaja carries out regular monitoring and reports on it in the Prudential Relevance Report that is available on the corporate website.
The Institution has set these objectives as the first step in its strategy to foster decarbonisation in the most emission-intensive sectors included in its lending portfolio. In order to achieve this, it has taken into account the information currently available, methodologies commonly applied by the sector, its business strategy and its principal counterparties' emission intensities and reduction goals.
These objectives may therefore be subject to possible changes as a result of new market information being obtained, changes in decarbonisation goals being published by counterparty entities or better technologies being developed.
"Carbon Disclosure Project” (CDP)
Unicaja participates since 2023 in the CDP climate questionnaire, with a rating of C (‘Awareness’), demonstrating its commitment to climate change management, and with the intention of showing improvement as the progress and efforts we are making crystallise.
CDP is the global benchmark for environmental reporting, with the largest volume of data on companies and cities to analyse their ambition for the transition to a sustainable economy through the measurement and management of the climate impact of their actions and the reduction of their CO2 emissions.
Exclusion criteria for financing environmental, social and governance (ESG) risks
In order to avoid financing activities that might be contrary to Unicaja's sustainability principles, an exclusion policy for financing environmental social and governance (ESG) risks has been developed —which was approved by the Board of Directors— for any activities that have a major environmental, social or economic impact due to the resources they consume, the human capital they use or the controversies they might cause.
Responsible Banking Principles
Unicaja is a signatory of the Responsible Banking Principles, a financial initiative of the United Nations Environment Programme (UNEP FI). The institution has thus joined a coalition of almost 200 banks across the world and undertakes to align its business with the Sustainable Development Goals (SDGs) and the Paris Agreement on Climate Change. These principles set a global benchmark for banking in terms of sustainability and offer practical guidance for actions aimed at creating value for shareholders and society at large.