VP Bank

The role of the administrative, management and supervisory bodies

Composition of the Board of Directors

The Board of Directors of VP Bank consists of seven Members. No Member of the Board of Directors has belonged to Group Executive Management, the Executive Board of VP Bank or the Executive Board of any subsidiary company during the past three financial years.

As of 31 December 2024, the Board of Directors comprised:

Gender composition: Of the seven Members of the Board of Directors, two are women (28.6%).

Independence: All Members of the Board of Directors are non-executive (i.e. Members not actively involved in management). The Board of Directors consists exclusively of non-executive Members in accordance with Liechtenstein legislation, which provides for a clear separation of overall management, supervision and control duties.

Sustainability oversight arrangements

Sustainability Officer on the Board of Directors: Katja Rosenplänter-Marxer serves as Sustainability Officer on the Board of Directors.

Committee with sustainability oversight: The Strategy & Digitalisation Committee is responsible for handling strategic issues on an in-depth basis, including sustainability. Its tasks include:

• Handling strategic issues on an in-depth basis (e.g. digitisation in banking, sustainability)
• Ensuring ongoing steering and management processes in the area of strategy

Risk Committee ESG oversight: The Risk Committee is responsible for:

• Advising the Board of Directors concerning the bank's current and future overall risk appetite and strategy
• Assessing significant risks for the bank, including ESG risks

Audit Committee sustainability reporting oversight: The Audit Committee is responsible for:

• Critically assessing financial and sustainability reporting (individual and consolidated accounts, sustainability declaration)
• Critically assessing the annual audit process for sustainability reporting
• Deciding on the appointment or dismissal of independent audit body for auditing sustainability reporting

Frequency of sustainability discussions

During the financial year 2024:

• Board of Directors held 19 meetings (11 ordinary meetings and 6 extraordinary meetings, plus two all-day workshops concerning strategy and innovation)
• Strategy & Digitalisation Committee met 8 times
• Risk Committee met 8 times
• Audit Committee met 6 times

Sustainability expertise and training

Board member expertise:

Katja Rosenplänter-Marxer (Sustainability Officer and Risk Committee Member):

• Member of the Board of Trustees of the "Lebenswertes Liechtenstein" foundation, Vaduz
• Member of the Board of Directors of Institut für Agrarökologie AG, Aarau

Dr Mauro Pedrazzini (Vice Chairman, Strategy & Digitalisation and Risk Committee Member):

• Former Minister in the Government of the Principality of Liechtenstein (2013–2021), Head of the Ministry for Social Affairs (Health, Social Affairs, Family and Equal Opportunities)
• Executive MBA, University of St.Gallen
• PhD in Physics, Research Centre for Plasma Physics, ETH Lausanne

Specific sustainability-related roles at executive level

Group Executive Management structure (as of 1 January 2025):

• Urs Monstein: CEO and Head of International Locations ad interim
• Adrian Schneider: Region Liechtenstein
• Felix Brill: Investment & Client Services
• Rolf Steiner: Strategic Transformation (new unit responsible for strategic transformation including sustainability initiatives)
• Patrick Bont: Chief Risk Officer
• Philippe Wüst: Chief Financial Officer ad interim

ESG integration in governance processes

Product development: VP Bank strengthens ESG risk management by integrating sustainability criteria into the product development and review process. The assessment is carried out by the Head of Group Sustainability or the CIO as a representative of the Product Control Committee. In the product review process, ESG criteria are integrated as a core component of the scoring model and are continuously reviewed and adapted.

Risk management: The topic of sustainability is becoming increasingly important in risk management with the implementation of the Corporate Sustainability Reporting Directive (CSRD). ESG risks are understood to mean risk drivers and can materialise in both financial and non-financial risks. VP Bank focuses on ESG risks that were identified as material as part of the double materiality analysis.

Compensation policy: The compensation policy and practices of VP Bank Group are sustainability-oriented – especially with regard to environmental, social and governance aspects. They are in line with the Group's business strategy, objectives and values, as well as its long-term overall success.

Meetings attendance record 2024

Independence and effectiveness arrangements

Functional separation: Liechtenstein legislation provides for a clear separation of the overall management, supervision and control duties performed by the Board of Directors and the duties performed by operational management. The Board of Directors of VP Bank consists exclusively of non-executive Members.

Committee structure: The Board of Directors is supported by four committees to fulfil its duties in an optimum manner:

1. Nomination & Compensation Committee (4 members)
2. Audit Committee (3 members)
3. Risk Committee (4 members)
4. Strategy & Digitalisation Committee (3 members)

Information and control instruments: The Board of Directors has various informational and control tools:

• Monthly financial reports (individual company and Group basis)
• Risk-controlling reports
• Periodic reports on semi-annual and annual financial statements
• Strategy process, medium-term planning, budgeting process and reporting
• Group Internal Audit, which conducts activities in compliance with internationally recognised standards

Annual evaluation: The Nomination & Compensation Committee is responsible for:

• Evaluating the structure, size, composition and performance of the Board of Directors and the Executive Board / Group Executive Management annually
• Assessing the knowledge, skills and experience of individual Members of the Board of Directors annually
• Ensuring that decision-making is not influenced by any individual or group in a way detrimental to the bank's interests

Integration of sustainability-related performance in incentive schemes

Board of Directors

No specific sustainability aspects are taken into account regarding compensation for the members of the Board of Directors. There are no plans to change the compensation scheme for the Board of Directors.

Group Executive Management

Roles covered

GEM compensation is based on the annual target agreements concluded with individual members.

Sustainability KPIs tied to remuneration

With the exception of governance topics, no other specific sustainability targets, such as greenhouse gas mitigation targets or other climate-related targets, are defined.

Sustainability aspects of governance are covered by targets from the following areas:

• Compliance with legislative requirements
• Corporate guidelines, including the Code of Conduct
• Conduct of reviews of corporate risks and strategy planning regarding long-term value creation

Linkage to long-term incentive (LTI)

Performance Share Plan (PSP)

Deferred compensation instruments are used to create incentives for long-term, responsible action. As part of the Performance Share Plan (PSP):

• The allotted entitlements are subject to a vesting multiple set within a range of 50 to 150 per cent, depending upon whether the target is achieved over the first three years of the five-year plan duration
• This is intentionally designed to promote medium-term, sustainable action

Malus and clawback provisions

Until ownership is transferred, the Board of Directors reserves the right to reduce or cancel the entitlements granted upon the occurrence of any defined events, under exceptional circumstances:

• In the event that any criminal offences or major breaches of regulatory requirements are committed
• If individual performance is unsatisfactory (e.g. compliance breaches)

Furthermore, the Board of Directors may recover any previously transferred instruments within three years of any of the above-mentioned events.

Strategy, business model and value chain

Business model and strategy

Founded in 1956 in Vaduz, VP Bank has grown from a friendly local bank to become Liechtenstein's third-largest bank and an internationally active financial services enterprise, with locations in Liechtenstein, Zurich, Luxembourg, Singapore and the British Virgin Islands.

Positioning:

• Universal bank in Liechtenstein
• Partner for intermediaries: these include trustees, external asset managers, lawyers, family offices and fund managers
• Specialist for private clients with complex needs when it comes to asset protection and investment
• Fund competence centre for third-party and private label funds

Clients benefit from:

• an understanding of their needs across national borders
• personal wealth planning, asset management and investment advisory services
• very good investment performance, including in multi-year comparisons
• a modern, user-friendly client platform
• reliability thanks to above-average capitalisation, a strong liquidity position and anchor shareholders with a long-term focus

Segments and markets

VP Bank is divided into three segments:

Liechtenstein & BVI

• Universal bank in Liechtenstein offering a wide range of services from savings accounts to comprehensive financing
• Pursuing a growth strategy in home market coupled with acquisition of market share
• Focus on expansion of digital platform and affluent business
• VP Bank (BVI) Ltd focuses on financing of prime real estate and investment solutions for private clients

International (Europe & Asia)

Europe (Switzerland and Luxembourg):

• VP Bank uses its DNA as an intermediary bank to offer external asset managers and family offices a modern service platform
• Target markets include Luxembourg, Switzerland, Germany and the Nordic countries (particularly Sweden and Denmark)
• VP Bank (Switzerland) Ltd benefits from simplified exemption in Germany for cross-border services
• VP Bank (Luxembourg) SA has EU passport for Germany, Sweden, Denmark and other EU markets

Asia (Singapore):

• Focus on promoting synergies between intermediary and private client businesses
• Target markets: Northeast Asia (Greater China region) and Southeast Asia (Singapore, Indonesia, Malaysia, Thailand)
• Hong Kong branch was closed in 2024 for economic reasons

Asset Servicing

• Includes fund management and custodial activities
• VP Fund Solutions (Luxembourg) SA and VP Fund Solutions (Liechtenstein) AG handle fund management
• Entire range of services for managing UCITS and AIFs offered as one-stop shop
• Services include structuring advice, prospectus preparation, fund price calculation, unit register maintenance and custody of fund assets

Products and services

VP Bank offers:

• Sustainable solutions: "Investing for Change" programme integrated into investment and advisory process
• Package solutions: VP Sensa (activation package), VP Vida (wealth management), VP Auda (investment advisory)
• Premium trading service: Direct access to trading desk for intermediaries
• FIX interface: Direct order transmission from portfolio management systems

All investments recommended by VP Bank meet a minimum level of sustainability. The Sustainable Plus offering takes into account minimum quota for sustainable investments and taxonomy-compliant investments.

Number of employees by geography

Information on the number of employees in different regions is provided in chapter S1-6. Total headcount fell by 6.1 per cent to 945 full-time positions during 2024.

Revenue by significant ESRS sustainability matter

Information on respective segments' revenue shares and other financial disclosures is available in the "Segment reporting" section of the Financial Report 2024 of VP Bank Group.

Sustainability-related goals embedded in the business model

VP Bank has integrated sustainability into its overall strategy with the following strategic success factors:

• Strong corporate culture
• Robust risk management
• Future-oriented long-term strategy

Sustainability strategy principles:

• Supporting clients in achieving their sustainability targets with its range of products
• Focusing on key sustainability topics that VP Bank can directly influence
• Integrating sustainability criteria into investment advisory and wealth management processes
• Cooperating and engaging in dialogue with stakeholders to drive improvements in terms of sustainability
• Communicating transparently concerning activities and progress in achieving targets

VP Bank is committed to the Paris Climate Agreement and has begun to implement measures to reduce operational emissions and specific on-balance-sheet financed emissions to net zero by 2050 at the latest.

Value chain description

The value chain (VC) covers all activities carried out by the organisation itself and its upstream and downstream units for the purposes of providing products and services, from development through to final use. VP Bank has defined a model VC divided into three stages:

Upstream processes:

• Tier 1 supplier analysis conducted examining suppliers by region and product category
• 90% of group-wide upstream spending occurs in Liechtenstein and Switzerland
• Dominant purchasing categories: information technology (IT), advisory services and human resources
• Suppliers expected to comply with Supplier Code of Conduct covering safe working conditions, fair treatment of employees and ethical behaviour

Own operations:

• Focus primarily on staff of VP Bank
• Head office in Liechtenstein
• Locations in Vaduz, Zurich, Luxembourg, Singapore, and British Virgin Islands
• Impacts assessed in context of regional locations and sectoral classification

Downstream activities:

Lending business:

• Mortgage business plays central role, particularly from sustainability perspective
• Over 90% of financed real estate situated in Liechtenstein and Switzerland
• VP Bank uses Species Protection Index (SPI) to assess mortgage portfolio
• Focus on supporting growth plans in private client and intermediary segments

Investment business:

• Includes VP Bank's own investments, discretionary portfolio management mandates and VP Bank Funds
• Considerable differentiation due to broad geographic and industry diversification
• Less than 30% of companies covered have significant exposure to biodiversity-sensitive areas
• Less than 10% have significant exposure to areas with high concentration of deforestation

VP Bank has limited market power and scope to influence business relationships and their impact, except in its home market of Liechtenstein where it is one of the three largest financial institutions.

Key inputs and outputs

The sustainability-related measures and targets defined with reference to strategic objectives are identified based on the results of the materiality analysis. Material sustainability topics identified include:

• Climate change (E1)
• Own workforce (S1)
• Consumers and end-users (S4)
• Business conduct (G1)

Detailed metrics and targets for these topics are provided in chapter ESRS 2 MDR-T.

Interests and views of stakeholders

For VP Bank, stakeholders include all organisations and persons that place financial, legal, operational or professional demands on the undertaking. Stakeholder dialogue plays a central role in the implementation and review of the bank's sustainability efforts. VP Bank engages in dialogue with internal and external stakeholder groups. VP Bank strives to promote a culture of responsible action by means of group-wide training and awareness-raising measures.

Detailed information on stakeholder engagement in the double materiality analysis process and how this process has been shaped by VP Bank's stakeholders can be found in chapter ESRS 2 IRO-1. The sustainability-related measures and targets defined with reference to strategic objectives are identified based on the results of the materiality analysis. This means that stakeholders' opinions and expectations are incorporated into strategic adjustments. The findings and results relating to key sustainability topics, including IROs, obtained from the double materiality analysis have been presented to the Board of Directors and Group Executive Management and used as a basis for decision-making.

Stakeholder engagement by group

Memberships

Voluntary commitments provide a practical guide for dealing with sustainability topics. They are a tool for covering areas that are not yet explicitly regulated and provide market participants with guidance and a standardised approach. For VP Bank, group-wide membership of various initiatives is an important aspect of knowledge sharing with its stakeholders. For this reason, VP Bank supports initiatives that provide it with the opportunity to contribute to sustainable development, to learn from experts, to share knowledge and experience, to find out about new topics and to support its strategy and commitments.

Integration into strategy and business model

Stakeholder engagement in the double materiality analysis involved three main phases. Initially, a wide range of internal and external stakeholders were invited to participate in an online survey to assess the materiality of impacts and financial materiality. Internal experts from various departments were then asked to evaluate the financial materiality of sustainability topics as part of an expert workshop. Finally, interviews were conducted with Members of Group Executive Management (GEM) and the Board of Directors and the three anchor shareholders to verify and check the plausibility of the results.

Specific stakeholder engagement disclosures

Employees (S1)

VP Bank promotes the exchange of ideas between management and the workforce via various channels. These include:

• Town halls with Q&A sessions for the Group and the individual locations.
• Members of Group Executive Management (GEM) offer meetings for exchanges of ideas with employees.
• There is an e-mail address that employees can send suggestions to. Among other things, these may include suggestions for improving the corporate culture or processes.
• News which can also be accessed on the intranet is sent to employees via internal communication channels.

VP Bank carried out a comprehensive employee survey in 2022, which was led and evaluated by an external agency. Management has held various workshops based on the survey to improve employee satisfaction.

Where possible, the insights gained from the exchange of ideas between management and employees are incorporated into the strategy either directly or indirectly.

Consumers and end-users (S4)

The clients of VP Bank, i.e. consumers and end-users, are the focus of the bank's activities. Client trust is of central importance. VP Bank acquires this trust through active exchanges of information, a responsible approach to client funds and transparent communication and pricing. Essential building blocks for this are the bank's structured investment process, built on its goal-based advisory model, and ensuring affordability in the lending business.

Management conducts one-on-one conversations with clients to ensure that their feedback is taken into account directly and integrated into the strategy and business model. In addition, client surveys are carried out, the results of which are communicated to management and the Board of Directors. When developing new products, the opinion of clients is taken into account by involving test clients.

Material impacts, risks and opportunities and their interaction with strategy and business model

The table below summarises material positive and negative impacts and the risks and opportunities identified as part of the double materiality analysis for VP Bank. A comprehensive sustainability-related resilience analysis, including a quantitative scenario analysis, has not yet been carried out. A qualitative climate scenario analysis can be found in Chapter E1-1. The periods under consideration for the qualitative and quantitative assessment are based on the information set out in chapter ESRS 1. Detailed information concerning the methodology can be found in chapter ESRS 2 IRO-1.

Summary of material IROs

Integration with strategy and business model

The double materiality analysis has shown that the climate issue is essential in the downstream value chain of VP Bank, specifically in the lending and investment business. VP Bank is committed to the Paris Climate Agreement and has begun to implement measures to reduce operational emissions and specific on-balance-sheet financed emissions to net zero by 2050 at the latest.

The material IROs are directly linked to VP Bank's strategic success factors: strong corporate culture, robust risk management and a future-oriented long-term strategy. The sustainability strategy and targets have been defined within the context of the overall strategy.

VP Bank bases its decisions and actions on the following principles:

• Supporting clients in achieving their sustainability targets with its range of products
• Focusing on key sustainability topics that VP Bank can directly influence
• Integrating sustainability criteria into investment advisory and wealth management processes
• Cooperating and engaging in dialogue with stakeholders to drive improvements in terms of sustainability
• Communicating transparently concerning activities and progress in achieving targets

Resilience to identified IROs

A comprehensive sustainability-related resilience analysis, including a quantitative scenario analysis, has not yet been carried out. A qualitative climate scenario analysis can be found in Chapter E1-1.

VP Bank conducted a qualitative climate scenario analysis with two scenarios: "Disorderly" and "Hot House World". The Disorderly scenario assumes high transition risks and low physical risks, as policy responses are delayed but sufficient to achieve climate targets. The Hot House World scenario assumes that the necessary policy response comes too late or not at all, leading to a sharp increase in physical risks while transition risks scarcely come into play. The scenarios were evaluated in the context of short-, medium- and long-term horizons as defined in ESRS 2 BP-1.

Description of the process to identify and assess material impacts, risks and opportunities

Methodology overview

Over the period 2023/24, VP Bank carried out a double materiality analysis (DMA) in accordance with the EFRAG IG 1 implementation guidance documents. As part of this process, the bank initially identified actual and potential IROs in relation to sustainability topics. Material IROs were subsequently assessed and identified. Once a sustainability topic has been classified as material from the perspective of its impact and/or financial materiality, reference is made to the relevant disclosure requirements (DR) in the respective thematic ESRS.

Context and scope

VP Bank started the DMA process with an in-depth review of its business model, operational structure and value chain (VC). This involved a systematic examination of upstream suppliers, operational activities and downstream activities with regard to clients as well as the lending and investment business. Actual and potential IROs were identified and evaluated on the basis of this examination.

Value chain mapping

VP Bank has identified hotspots for the three stages of the VC, allowing for structured identification and further analysis of potential and actual IROs.

Upstream value chain: Comprises goods and services purchased up to the point at which they are received by VP Bank. Procurement costs for tier 1 suppliers are used as a basis for the assessment. The relevance matrix of the Federal Office for the Environment (FOEN) was used in relation to procurement (purchasing) in Switzerland. The relevance matrix is based on ISO 20400:2017. Hotspots for identifying IROs with suppliers are regions, products and services. At VP Bank, 90 per cent of group-wide upstream spending occurs in Liechtenstein and Switzerland, with the dominant purchasing categories being information technology (IT), advisory services and human resources.

Own operations: The focus is primarily on the staff of VP Bank. For the bank's own operations, impacts, risks and opportunities were assessed in the context of the regional locations at which VP Bank operates and their sectoral classification.

Downstream value chain: Includes its clients and the lending and investment business. Hotspots used to identify IROs in the downstream VC are regions and sectors. The investment business takes into account investments for which VP Bank makes the investment decision. In the lending business the focus is on the mortgage business, with the geographic location of financed real estate being used as a key consideration. More than 90 per cent of financed real estate is situated in Liechtenstein and Switzerland.

Stakeholder engagement

As part of the DMA process, stakeholder engagement involved three main phases:

1. Initially, a wide range of internal and external stakeholders were invited to participate in an online survey to assess the materiality of impacts and financial materiality
2. Internal experts from various departments were then asked to evaluate the financial materiality of sustainability topics as part of an expert workshop
3. Finally, interviews were conducted with Members of Group Executive Management (GEM) and the Board of Directors and the three anchor shareholders to verify and check the plausibility of the results

Further information on the stakeholder groups identified by VP Bank and the general approach to engagement can be found in chapter ESRS 2 SBM-2.

Time horizons

Impacts, risks and opportunities were identified and assessed across different time horizons, both when assessing impacts and when assessing financial materiality. The time horizons considered are the short-, medium- and long-term (s/m/l) horizons. These time horizons are defined according to the approach set out in the general requirements of ESRS 1:

Decisions and internal control processes

A steering committee has been established, chaired by the Chief Risk Officer (CRO) and consisting of the core project team and other representatives of GEM, in order to carry out and monitor the DMA and the general process of initial reporting according to CSRD requirements. The steering committee was updated concerning the current status every two months. The DMA was carried out under the leadership of the Head of Group Sustainability. As part of the DMA process, decisions on the following topics were made by the core project team: selecting stakeholder representatives and methods for involving them, ensuring a consistent understanding of the targeted evaluation of sustainability topics as well as final aggregation of data points in the evaluation and determining the materiality of sustainability topics. As part of the process, experts from various departments were consulted as required and entrusted with responsibility for topic-related disclosure requirements.

Integration, monitoring and review

The thresholds and time horizons used are based, where possible, on available figures for operational risk management at VP Bank. VP Bank plans to conduct a limited review of its DMA annually in order to ensure that it reflects the current situation. Updates will be applied if necessary. VP Bank plans to carry out a comprehensive materiality analysis every four to five years. During the current reporting period, there is no process for incorporating the results of the DMA into the bank's enterprise risk management (ERM) system.

Identification of actual and potential IROs

VP Bank identifies actual and/or potential IROs throughout its VC and in the list of sustainability topics according to ESRS 1 (AR 16), including entity-specific topics. VP Bank uses a top-down approach to derive IROs from the list of sustainability topics. The individual sustainability topics were taken into account in the following value chain segments: upstream, own operations, downstream (credit) and downstream (investment). VP Bank determines whether a topic, sub-topic or sub-sub-topic is associated with potential and/or actual IROs and where it arises and/or is likely to arise in the VC. Internal stakeholders from various departments were consulted in order to identify IROs. Sustainability topics for which no potential and/or actual IROs have been identified are not taken into account in the subsequent process for assessing and identifying the IROs. Therefore, they are not addressed in the scope of the disclosure requirements for these topics. A list of topics for which no IROs have been identified can be found in Annex SN.3.

Assessment and identification of the main IROs

Based on previously identified actual and potential IROs, the next step is to assess the materiality of impacts and financial materiality. This approach forms the basis for determining the material information in accordance with thematic disclosure requirements under the ESRS.

Assessment of the materiality of impacts

The aim of the analysis is to identify and assess any material impacts of VP Bank on the environment and society throughout the entire value chain.

The assessment of actual and potential impacts is based on three aspects: scale, scope and irremediable character. Together, they indicate the severity of an impact. In the case of potential impacts, the assessment is supplemented by the aspect of likelihood. The overall assessment per impact has been calculated as the weighted average of the relevant aspects. Where any potential negative impacts on human rights are identified, severity prevails over likelihood.

The assessment of the materiality of impacts is based on three components:

• External sources: analysis of external sources (e.g. rating reports, industry reports, peer comparisons)
• Workshop with internal experts from the core project team
• Stakeholder survey: online survey of internal and external stakeholders

Assessment of financial materiality

The aim of the financial materiality analysis is to identify those environmental, social and governance topics that represent or may represent the greatest financial risks and opportunities for the business of VP Bank. VP Bank has considered the fact that there are sustainability topics that only pose risks, others that only entail opportunities and others still that feature both. The assessment of inherent financial risks and opportunities was based on an estimation of the percentage by which the annual profit could be reduced or increased by a particular event. Absolute thresholds are dependent on the profit of VP Bank and should be regarded as a loss buffer. The loss buffer can be absorbed by both a single major event and multiple smaller events.

The assessment of actual and/or potential risks and opportunities is based on scale. The likelihood aspect is also considered for potential risks and opportunities. The overall assessment of financial materiality for each topic has been calculated as a weighted average of risk and opportunity assessments. Care was taken to ensure that no topic was omitted.

The assessment of the financial materiality of impacts is based on three components:

• Analysis of external sources (e.g. rating reports, industry reports, peer comparisons)
• Workshop with internal experts from various specialist areas
• Stakeholder survey: online survey of internal and external stakeholders

Consolidation of impact and financial materiality results

The assessment described above results in a classification of sustainability topics ranging from 0 (no materiality) to 5 (very high materiality). Sustainability topics are classified as "material" if the topic has been assessed as "high" or "very high" in terms of the materiality of the impact and/or financial materiality.

In addition, manager interviews with Members of GEM and the Board of Directors and with anchor shareholders were carried out to check the plausibility of the results by assessing, validating and ensuring the completeness of the double materiality assessment. Overall, discussions confirmed the overall results of the assessment of impacts, risks and opportunities. In addition to combating corruption and bribery, the bank has an additional entity-specific IRO in the field of business conduct (G1).

Material sustainability topics identified

As a result of the double materiality analysis, sustainability topics in the following topic-related ESRS were identified as being material for VP Bank:

• Climate change (E1)
• Own workforce (S1)
• Consumers and end-users (S4)
• Business conduct (G1)

Disclosure requirements concerning non-material environmental targets

This section contains the topic-specific IRO-1-related disclosure requirements concerning sustainability topics that were assessed as being non-material in the scope of the VP Bank DMA. VP Bank has not conducted any consultations with affected communities concerning non-material topics.

Pollution (ESRS E2): The relevance of air and water pollution in the upstream value chain for the areas of telecommunications equipment and information as well as remote services is classified as low to moderate in the relevance matrix. VP Bank only has a minor impact on the environment in respect of its own business activities, as it operates in the service sector and office activities do not cause any major environmental pollution. The topic of pollution is assessed as being non-material for VP Bank.

Water and marine resources (ESRS E3): The relevance of water pollution in the upstream value chain for the areas of telecommunications equipment and information as well as remote services is classified as low to moderate in the relevance matrix. As the bank is a financial services provider, water consumption associated with its own operations is low. The topic of water and marine resources is assessed as being non-material for VP Bank.

Biodiversity and ecosystems (ESRS E4): The relevance of biodiversity in the upstream value chain for the areas of telecommunications equipment and information as well as remote services is classified as low in the relevance matrix. The topic of biodiversity and ecosystems is assessed as being non-material for VP Bank.

Resource use and circular economy (ESRS E5): The relevance of the circular economy in the upstream value chain for the areas of telecommunications equipment and information as well as remote services is classified as low to moderate in the relevance matrix. The topic of use of resources and the circular economy is assessed as being non-material for VP Bank.

Data sources and uncertainty

VP Bank has carried out the double materiality assessment (DMA) based on various data sources. In addition, data from the upstream and downstream value chains were used. Insofar as any forward-looking information is used in the analysis, it should be noted that this information is always subject to a degree of uncertainty and that the underlying estimates may change in the future.

The geographical and product-related distribution of the actual purchasing volume in Swiss francs has been taken into account when assessing the upstream value chain within the DMA. This includes information on the share of procurement costs of tier 1 suppliers according to location, as well as a breakdown by purchasing category: information technology (IT), advisory services and human resources, information services, workplace, marketing and public relations (PR). The measurement uncertainty surrounding the upstream value chain is considered to be low, as the analysis is based on all relevant individual positions and does not use any estimates.

When evaluating the downstream value chain within the context of the DMA, the analysis was broken down into two areas: (i) the lending business, with a focus on mortgage loans; and (ii) the investment business, with a focus on own investments and client assets in wealth management mandates. Due to the heterogeneous nature of the portfolio composition, estimates based on benchmarks were used in connection with client assets. The measurement uncertainty surrounding investments must be classified as moderate. In connection with the financed real estate in the mortgage portfolio, estimates were used for emissions based on building types and location-specific information for natural hazards. The data basis in relation to building-specific characteristics is currently still limited. VP Bank has started to expand the recording of building characteristics with a view to continuously reducing inaccuracies associated with the use of estimates.