ABN AMRO Bank N : Impact Report 2023

ABN AMRO Impact Report 2023

About this report

Welcome to ABN AMRO Bank N.V.'s sixth annual Impact Report.

2

The Impact Report and the underlying methodology (including the monetised impact values and the integrated profit and loss statement) should be seen as a publication that helps us to better understand the impact we make as a bank and which could support us in future CSRD compliance. This Impact Report is not intended to meet CSRD requirements that are

About this report

Welcome to our 2023 Impact Report

Results of our 2023 assessment

Analysing the impact

The purpose of this report is to show the impact of ABN AMRO's activities on the bank's main stakeholder groups: clients, employees and investors, as well as on broader society.

The Report is based on results from ABN AMRO's 2023 impact measurement and contains four sections:

• Results (which outlines the main results from our 2023 assessment)
• Analysis (which provides further analysis in three key areas - mortgages, biodiversity and corporate lending by sector)

• How we use impact thinking (which sets out how ABN AMRO uses results from its impact measurement as an input to management decisions)
• ABN AMRO Impact Statements (including the bank's Integrated Profit & Loss Statement)

In addition, there is a Note on Methodology, which provides more detail on the methodology used to compile this report. Please note that this report should be read in conjunction with other ABN AMRO publications, including the bank's 2023 Integrated Annual Report, available online at abnamro.com.

applicable to the bank (as per 2024 Integrated Annual report), as the goal of the Impact Report is different. The methodology, scope and definitions used in the Impact Report were designed for a different purpose than ESRS compliance and so are not fully aligned with the definitions used in ESRS, more detailed information on the differences can be found on page 38.

This Impact Report should therefore be seen as a complementary view on the impact of the bank, next to the Integrated Annual Report, which is our main report for ESRS compliance in the future.

How we use Impact Thinking

Our impact statements

Methodology and approach

Other ABN AMRO reports

ABN AMRO Bank N.V.

Integrated

Annual Report 2023

Integrated

Annual Report 2023

ABN AMRO Bank N.V.

Note on methodology:

As used in the Impact Report 2023

Note on methodology:

As used in the Impact Report 2023

ABN AMRO Bank N.V.

Pillar 3 Report 2023

Pillar 3 Report 2023

ABN AMRO Bank N.V.

Abbreviations and definitions

of important terms 2023

Abbreviations and definitions of important terms 2023

Welcome to our 2023 Impact Report

"Because we realise its importance, we have been working hard to embed impact throughout our organisation."

About this report

Welcome to our 2023 Impact Report

Results of our 2023 assessment Analysing the impact

How we use Impact Thinking

Our impact statements Methodology and approach

This is ABN AMRO's sixth annual Impact Report. Our reporting has grown in importance and sophistication

• we have become better at measuring the impact of our activities. Over the past six years, I am proud of what we have been able to achieve.

Understanding impacts is important - first, because it gives us better insight in the effects we have on our stakeholders. By understanding the positive and negative effects, we can work to reduce the negative ones - and we do, through our approach to risk management and by working closely with clients and partners.

It also helps us to identify opportunities - and to seize these opportunities by directing more attention to areas where we know we have a positive impact, particularly through our loans and investment services, or where we can reduce the risks by seizing the opportunities.

Because we realise the importance of understanding impact, we have been working hard to embed Impact Thinking throughout our organisation.

In the recent years we made many impact reports which helped us to assess the high-level sustainability consequences of our loan portfolio. To make it more concrete for our clients we needed to dig deeper and to understand the consequences per sector.

We are using Impact Thinking increasingly with our Social Impact Fund to make investment decisions - we have found that it provides valuable insights for us as investors and for the companies in which we are investing, to help them build and grow their businesses.

In recent years, we have seen regulators take more interest in key information beyond the traditional P&L. It is the recognition of the (positive) role banks play in society, but also of the new risks banks face, especially as a result of worsening climate change. Our experience in measuring and reporting also helped us to respond quickly to new regulatory requirements.

We realise that impact is not just about a series of numbers. Thinking and managing in terms of impact is

"Ultimately, Impact Thinking

will make the bank stronger"

about a cultural shift. It is about Impact Thinking - in other words, making sure we take impact into account when making our decisions: impact on the bank, of course, but also through our clients and the impact on those who depend on us. Ultimately, Impact Thinking will make the bank stronger.

And in making the bank stronger, we will be better able to manage risk, better able to seize opportunities for growth, better able to support and protect our clients and contribute to a fairer, more sustainable society in line with our purpose: Banking for better, for generations to come.

Robert Swaak

CEO of ABN AMRO

Our 2023 assessment

ABN AMRO is one of the Netherlands' leading banks. We provide loans and other financial services to individuals and businesses, both in the Netherlands and elsewhere in north-west Europe.

Results of our 2023 assessment

Our 2023 assessment

Our 2023 impact dashboard Our 2023 impact takeaways External costs within our value chain

Analysing the impact

Our activities often have a significant impact on stakeholders - not just our clients and those working for the bank, but also on our shareholders and investors, on suppliers to the bank and other business partners, as well as on broader society.

We realise that this impact may be positive or negative. By providing mortgages, for example, we are offering borrowers the benefits of home ownership. But by having to repay mortgage loans, some clients may experience financial distress.

Similarly, by lending to companies, we may add to economic growth and job creation but could also contribute to climate change or biodiversity loss.

Input to and complementing European sustainability reporting standards

The Impact Report's measurement approach draws from impact methodologies such as the Impact- Weighted Accounts Framework (IWAF), the basis of which was established in 2019. We use external data sources such as social and environmental databases, government data and academic literature to estimate the impact of the bank. As such, the results presented

in this report are used as one of several inputs to the double materiality assessment as part of European Sustainability Reporting Standards (ESRS). For more information on how this has been used please

see page 7.

The two frameworks partly overlap in their underlying concepts however there are several key differences, such as the topics in scope and methodological features used in the Impact Reporting methodology such as monetisation and attribution (see page 38 in the Annex for further details).

CSRD and the Impact Report methodology complement each other. CSRD will unlock a wealth of data on environmental and social topics. In the future the impact methodology can serve as a tool to leverage this data for decision making. For example, the impact methodology can be used by the bank to support Sector bankers in specific sectors to measure client impact across topics and provide support in managing this impact.

Using Impact Thinking in our decision-making

Integrating impact thinking in our decision-making allows us to identify potential risks and opportunities, both for ourselves and our stakeholders1. Since we launched our first Impact Report in 2018, interest in Impact Thinking has grown, both within ABN AMRO and the banking sector.

While managing risks, assessing impact helps us identify potential social and environmental risks. Identifying these risks means we can take action, deliver on our sustainability ambitions, avoid financial losses, or damage to our reputation, as well as protecting our clients. For example, we look at the potential contribution to the loss of biodiversity, including which sectors and business lines have the biggest footprint and explore what we can do to contribute to solutions.

Assessing impact is also helping ABN AMRO meet new regulatory requirements. Regulators are beginning to put more emphasis on companies' social and environmental disclosures.

How we use Impact Thinking

Our impact statements

Methodology and approach

As of 2024, CSRD and ESRS require companies - including ABN AMRO - to disclose material Impacts, Risks and Opportunities.

We are using impact measurement to support the impact investing portfolio of our Sustainable Impact Fund (SIF). SIF makes direct investments in companies and projects involved in the energy transition, in the circular economy, and in social areas like inclusion and health & wellbeing.

Finally, we are continuously working on improving the granularity and coverage of our impact data client level. This will help us, and our banking clients make more tailored decisions specific to their circumstances. This year we started a case study in the textile sector to look what it takes to further implement our Impact methodology on sector level. Currently such detailed data is difficult to come by, but we expect that to change as new reporting regulations come into effect. You can read more about our approach to Impact Thinking on pages 20-25.

Support for our double materiality assessment During the past year, we started using impact data in our new double materiality assessment. An important data source for our Impact data was the Impact Institute's Global Impact Database. This data proved useful not only in helping identify impacts, but also in linking these impacts to the ESRS - the reporting standards underpinning the EU's new Corporate Sustainability Reporting Directive (CSRD). Double materiality assessments became mandatory with the CSRD's introduction at the beginning of 2024.1

For more information, see our 2023 Annual Integrated Report, available online.

1  These assessments measure materiality from two perspectives: impact materiality - i.e., issues that impact people and the environment and financial materiality - i.e., matters that effect the company's development, financial position, financial performance, cash flows, access to finance or cost of capital over the short-, medium- or long-term.

Results of our 2023 assessment

Our 2023 assessment

Our 2023 impact dashboard Our 2023 impact takeaways External costs within our value chain

Analysing the impact

How we use Impact Thinking

Our impact statements

Methodology and approach

How to read our Impact Statements

Our assessment examines impact through two lenses: first, who is impacted? Second, what kind of impact is it?

This assessment is based on a series of 57 impacts, ranging from the benefits of home ownership and health & safety in the workplace through to the effects of cybercrime and use of natural resources.

Each impact is measured and assigned a euro-equivalent value; this allows us to compile an Integrated Profit & Loss Statement (IP&L). Impacts are shown by stakeholder group (who is impacted?) and by 'capital' (what kind of impact is it?).1

A dashboard summary of our IP&L may be found on page 9.

This approach also allows us to identify external costs - i.e., those costs that are not currently priced into the bank's transactions, such as environmental pollution or harm to labour and human rights. More than 90% of these costs occur downstream, primarily as a result of ABN AMRO's lending and investment activities. It is important to note that impacts in the value chain of ABN AMRO are estimated based on external data sources and models. At this point, primary data on the actual impact created by clients and investees (and their value chains) is not readily available.

We appreciate that measuring value creation is not an exact science. We work hard every year to strengthen our approach and methodology. Currently, we use euro-equivalent ranges to show impact rather than specific amounts.

For this report, we are comparing our 2023 results with 2022 figures restated to reflect changes in our database and to incorporate new data.

For more information:

• External costs within the bank's value chain - page 11
• Integrated Profit & Loss Statement - page 28
• Note on methodology - page 36
• Description and definition of impacts - page 46

Details of our main stakeholder groups and 'capitals' may be found in the impact dashboard.

Results of our 2023 assessment

Our 2023 assessment

Our 2023 impact dashboard Our 2023 impact takeaways External costs within our value chain

Analysing the impact

How we use Impact Thinking

Our impact statements

Methodology and approach

Our 2023 impact takeaways

Results of our 2023 assessment

Our 2023 assessment

We did not see significant year-on-year changes in our impact

Results from our 2023 assessment do not differ greatly from our 2022 results. This is due mainly to the fact that there were no significant changes in our operations or business portfolio since the wind-down of our former non-core portfolio, started in 2021. Results were influenced by changes in economic conditions, most notably higher interest rates but these were not significant enough to be visible in our dashboard summary.

A significant amount of negative impact still occurs in our value chains

Our 2023 results also show estimated negative impacts, occurring primarily downstream at our clients or within their supply chains. Because they are our clients, we are partly associated with their impacts. These impacts relate to social and environmental issues such as climate change, low pay and human rights violations.

These costs are borne mostly by society, we aim to reduce them where possible by upholding minimum standards in our loans and investment services. Through our Climate Strategy, we will also bring our lending and investment portfolios into line with targets set out in the 2015 Paris Climate Agreement.

Our 2023 impact dashboard Our 2023 impact takeaways External costs within our value chain

Analysing the impact

How we use Impact Thinking

Our impact statements

Methodology and approach

We continued to create positive commercial value for all stakeholders

As in previous years, we continued to create value in terms of commercial capital for all our stakeholders, through our reliable financial products and services, salaries and benefits paid to employees, and dividends for investors. During 2023, higher interest rates created value for investors, largely through increased net interest income for the bank. Society continued to benefit from the bank's digital payment systems and tax contributions.

Impact Summary

We create significant positive commercial value for all stakeholders but this still comes at

a cost for people and the planet. In the figure, spheres represent euro-equivalent impact ranges. See page 27 for impact range information.

External costs

Natural

Society