Stakeholders
Our main stakeholders are the customers of Arion Bank, shareholders and bondholders, our human resources and society as a whole. At Arion Bank we realize the importance of listening to the differing needs of these groups and understanding what is most important to them.
Double materiality assessment
In 2023 Arion Bank took its first steps towards implementing the European Sustainability Reporting Standard (ESRS). The standard forms part of the requirements for the forthcoming transposing of the Corporate Sustainability Reporting Directive (CSRD) into Icelandic law. We are therefore publishing a double materiality assessment in respect of the standard for the first time. The results of the assessment were obtained through discussions with stakeholders, surveys of employees and workshops. The assessment was carried out in collaboration with KPMG Iceland. Reference is made to the ESRS in the Bank’s environmental accounts, but the implementation of the standard is far from complete.
The assessment examines financial materiality on the one hand, and social and environmental materiality on the other hand, i.e. with respect to the main opportunities and risks in the Bank’s operations and the impact on society and the environment.
The diagram below shows the main results of the double materiality assessment.
Results of the materiality assessment
Further information on how the materiality statement relates to ESRS can be seen here.
Customers
Arion Bank operates 13 branches across Iceland and a call centre. At our headquarters we have a dedicated team of experts, providing individuals, companies and investors with specialized advice and general financial services. Approximately 99% of all our interaction with customers is now via our digital channels. The Arion app, online banking and the Bank’s website are open day and night, all year round.
By offering universal financial services and insurance to individuals, companies and investors, the Bank can provide our customers with a comprehensive overview of all their finances in just one location. This is how we meet different needs and apply our expertise so that we can help the customer reach their full potential.
We want customer experience at Arion to be unique. During the year we established new service standards which are a road map for providing and developing services and represent a vital step towards becoming the best at meeting the needs of our target groups. They are written from the viewpoint of the customers and describe how we want them to experience our services.
In order to understand and meet the needs of our customers, we keep a record of all customer feedback and carry out customer surveys to gauge their satisfaction and experience. The results of these surveys are carefully analyzed and used to help improve services. In 2023, we received 7,672 ideas and suggestions from our customers which we use to improve our services. For the seventh consecutive year, the Arion app was voted the best banking app in Iceland by users in a survey by Maskína. The app also gets the highest rating from customers of the other banks. The app can be used by anybody who has electronic ID, irrespective of whether they are regular customers of the Bank or not. Anyone with the app can open accounts, start regular savings, buy insurance policies, trade with securities and view their pension savings. In 2023 Arion Bank placed second in the Icelandic Customer Satisfaction Index (Íslenska ánægjuvogin). We continue to simplify our customers’ finances and identify new ways to give them what they need.
Over the last few years, we have made a concerted effort to develop our diverse service channels and to make it easier for customers to get in touch with us and the services we offer. A new call centre system was introduced in the autumn, making our service both quicker and more effective. The Bank now runs a fraud hotline during and after regular opening hours which helps customers who may have fallen victim to fraud. Senior citizens get priority service, and there is a special hotline to attend to the needs of seniors and it has got excellent feedback. More and more customers are using webchat and the Arion chatbot is on hand 24/7 to answer customers’ questions. The chatbot is able to complete 60% of the conversations initiated by customers, with the remainder being referred to one of our service representatives. Technological innovations such as video meetings with financial advisors have made it easier for people, particularly in regional Iceland, to obtain services conveniently.
The partnership between Arion Bank and Vörður went from strength to strength, and a growing number of customers are choosing to do their banking and insurance in the same place. The partnership between these companies promises exciting times ahead, and the ability to offer our customers – companies, investors and households – comprehensive and outstanding bancassurance services has huge potential.
Human Resources
Arion Bank’s goal is to retain and attract outstanding employees and to help them grow professionally and personally. We aim to create a positive and motivational working environment and to support our employees.
We regularly conduct workplace audits and surveys among employees to ascertain their level of job satisfaction and engagement. The results show that Arion is considered a good place to work and has a capable management team. Employees are encouraged to take responsibility for their professional development, knowledge and skills.
In 2023 there continued to be a strong focus on learning and development (L&D), both digitally and through regular seminars at which employees share their expertise and experience. We introduced an L&D system which brings in gamification techniques to teach people how to use the Bank’s CRM system and broadens our employees’ skill sets. We also offered mentor programmes, new employee programmes and leadership training – all aimed at making a good workplace an even better one.
The Bank has adopted a clear policy on equality and human rights and an equality action plan. One of the Bank’s targets is for the unexplained gender pay gap to be less than 1%, and the audit for equal pay certification revealed that the gap was 0.2% this year, and we are very proud of what has been achieved in this respect.
Shareholders and bondholders
Investor Relations specializes in communicating with shareholders, bond investors, analysts and other market participants. Under the Bank’s funding strategy, the Bank aims to be the leading issuer in Iceland, a position based on excellent relationships with domestic and international market participants, effective reporting and solid credit ratings from the ratings agencies. Regular meetings are held with investors while the Bank also communicates information to investors at earnings release events, capital markets days, various conferences, prior to bond issues and on other occasions.
The annual general meeting is usually held every March. The annual general meeting (or shareholders’ meeting) is the main venue for shareholders to have a say on the management of the Bank. At the annual general meeting shareholders elect a board of directors, auditors and vote on other matters raised by the shareholders or board of directors.
All relevant market information is published in releases to the stock market and any information sensitive to the market will be released in accordance with the relevant legislation and regulations.
Arion Bank arranges quarterly meetings for market participants at which the CEO, CFO and other members of the management team present the interim financial results. The Bank plans to hold a capital markets day for shareholders and market participants every two years, and the next event is scheduled for 1 March 2024.
Society
Arion Bank is a large company by Icelandic standards and social responsibility and sustainability revolve around running a responsible business and having a positive impact on society and the environment, for example through the Bank’s buying of supplies, lending to customers and investments made on their behalf.
In all the decisions we make, we assess the various interests at stake, with the long-term view being just as important as short-term considerations, and assess the possible gains and risks involved in the decisions and loans we make. Every year we collaborate on a wide range of exciting investment projects with our customers with the aim of strengthening the business sector in this country.