Sustainability to Stabelo
Stabelo is a signatory of the UN Principles of Responsible Investment (PRI) since 2019. and we believe that residential mortgages are fundamentally aligned with responsible investing. Homeownership is a key path to savings and wealth-building for many and connecting borrowers with lenders is an established way to ease the path to home ownership. A well-functioning mortgage market is a critical part of the local and global economy. A healthy degree of competition and access to a wide range of alternatives in the mortgage market will benefit customers and safeguard a well-functioning marketplace. Furthermore, increasing the diversity of mortgage financing available outside the banking system will support financial stability. This has proven to be especially true in times of stress in the banking system.
Stabelo asset management only invests in “sustainable” mortgages that offers both financial and social returns to its investors. Our investment policies and practices are rooted in our policy for Responsible Investments that also defines the essence of sustainable mortgages.
Fundamentally, Stabelo believes that lending practices that do not make the customers’ wellbeing a top priority is imprudent and not sustainable. Lending practices that have a lax approach towards customer long-term affordability and financial robustness will ultimately have a negative impact on credit quality of the mortgage assets financed by investors. Furthermore, we believe that a mortgage offering should fair and easy to understand without hidden costs and agendas. This enhances borrowers’ ability to make sound financial decisions.
Stabelo seek to work with our investors and stakeholders within the context of the Swedish mortgage market in helping to achieve three of the UN’s 17 Sustainable Development Goals from 2015. The SDGs we have selected are based on how we believe that we can contribute the most in achieving these ambitious goals.
In the attached ESG Strategy document you can read more about specific objectives and targets as well as how our sustainability work is fully integrated in our business ambitions and practices.
Carbon footprint of mortgage portfolio
Stabelo is in the business of residential mortgage lending. Households account for almost 40% of energy consumption in Sweden. The energy used in Sweden today connected to households is relatively clean from carbon dioxide emissions as a great deal comes from either renewable sources or nuclear energy. To measure the climate impact of Stabelo’s mortgage assets, independent risk consultants calculate the carbon footprint of the mortgage portfolio annually, using the best data and techniques available. At the end of December 2019, the annual carbon footprint of Stabelo’s mortgage assets was 4,931 tCO2e which corresponds to 0.52 tCO2e / million SEK invested.
Today the carbon footprint of Stabelo’s mortgages is low. However, to protect homeowners and investors from transition risks associated with achieving the goals set out in the Paris Agreement in 2015, it is important to incentivise homeowners to invest in enhancing the energy efficiency of their homes already now. Our green mortgage initiative is developed to reward a borrower who purchases an energy efficient home or who invests to improve the energy efficiency of an existing property. It will be important to continue to develop this initiative as more data on energy efficiency associated with residential properties become available.
Stabelo’s Code of Conduct
To ensure as broad as possible operational implementation of the principles incorporated in our ESG strategy we have developed three “rules of thumb”, that are easier for our employees to relate to on a day-to-day basis:
- Stabelo will be successful when we act in the interest of our mortgage borrowers, institutional investors, and society as a whole
- The corporate culture of Stabelo is based on high ethical standards, courage, and the capacity to act
- In a situation where an employee is unsure about the most appropriate course of action and is unable to consult a more senior manager, the principle of “mother – frontpage news – child” should be applied: meaning that, we should not develop products that we would not sell to our mother, we should not act in ways that we would not want to read about on the front page of a newspaper, and we should contribute to creating a better future for the children of today.
For more information on sustainability in our business please contact:
Hampus Brodén Sofie Wacha
CEO Head of Financing & Sustainability
Stabelo Group AB Stabelo Asset Management