The Swedish real estate company Wallenstam has for a long period of time focused on sustainability and been working proactively with action plans and in being self-sufficient with green electricity. When it was time to finance three Green Building-certified properties in Kvillebäcken, Gothenburg, the company turned to Nordea for sustainable financing.
Wallenstam builds, develops and manages properties primarily in Stockholm and Gothenburg. Wallenstam’s customers consist of around 9,000 households and 1,000 commercial tenants and the investment property value is nearly SEK 50 billion. Owning 66 wind turbines has enabled the company to be self-sufficient in renewable energy.
As one of the largest private sector landlords in Sweden, building rental apartments for its own management operations, the company’s sustainability agenda has the potential to both impact and inspire the sector it operates in. Wallenstam’s focus on contributing to a greener society and more sustainable business resonates well with Nordea’s ambition to do the same.
We spoke to CEO Hans Wallenstam about the company’s focus on sustainability.
You have chosen to work with five of the UN Sustainable Development Goals; Gender Equality, Affordable and Clean Energy, Decent Work and Economic Growth, Sustainable Cities and Communities, and Climate Action. Why did you choose these and is there is one that is particularly close to your heart?
– All 17 global goals that the UN has defined are naturally important. The five that Wallenstam has chosen to prioritize are those that are most closely related to our business, and therefore also where we can have the greatest impact. What really lies closest to the heart of our business is goal number 11 “Sustainable Cities and Communities”. This is probably our biggest initiative in terms of sustainability, and it is also our business concept ‒ to build and create new homes for people. Having a home is a fundamental need and an important part of a functioning society. We contribute to just that, and develop properties and areas that people want to live in, work in and visit.
In your report, Responsible Enterprise, you have written that: “…strong social engagement goes hand in hand with long-term profitability”. Is there too much short-termism in the business world and if so, what should be done?
– I see no contradiction in sustainability, strong social engagement and long-term profitability, but you have to focus on the right things and adopt a long-term and persistent approach. As someone who works in the property sector, I am used to long lead times, and you have to be prepared for the fact that changes take time. At Wallenstam, we work with five-year business plans and this probably reflects my long-term vision, but also provides an assurance, that we and our stakeholders know what we want and where we are going as a company. I believe that more players would benefit from taking a longer-term approach.
How do you view the financial sector’s role when it comes to sustainability and driving change? What do you expect or require from the financial sector? Is the financial sector doing enough? What should a bank like Nordea do more of?
– Now we are starting to see a change also in the financial sector, for example, through an increasing interest in green investments. It is gratifying to see that investments in sustainability are generating a direct return, that sustainability is not automatically a cost but is a strategic position that has a positive effect in terms of a lower cost of capital. It is positive for us as a company, but also for society and for the climate issue generally. Nordea is one of the leading banks in the area of sustainable financing, and I really hope it continues in this direction.
During 2018, as a part of the work with your 2019-2023 business plan, you conducted a stakeholder (residential tenants, commercial customers, employees, lenders and the board) analysis of ‘Material Sustainability Areas’. Is there anything from that result you would like to highlight and was there anything in the result that surprised you?
– The various stakeholder groups’ ranking of the focus areas was surprisingly aligned; generally speaking the focus areas were very similar. Something that perhaps is not so surprising, but interesting nevertheless, is that several of the social focus areas were ranked higher by the stakeholder groups than the environmental focus areas. And of course, we have also seen this in the public debate ‒ that interest and engagement in the social issues in the sustainability area has increased.
Energy-saving projects – individual electricity and water metering seems to reduce consumption – which conclusions do you draw from that?
– When we have measured and followed up electricity and water consumption in our new production, we have been able to see a decrease of 10-25 percent, so from this we can confirm that incentives to conserve electricity and water do work. People generally want to change their behavior and do so when they feel there is an opportunity and that it delivers results.”
Wallenstam currently owns 66 wind turbines and you named them after your employees. Where did you get this idea from and long-term, will every one of your 250 employees have one?
– Today we have 19 wind parks, which are all named after the employees who have worked longest in the company. All of our 250 employees will not have a wind park named after them, but the tradition is continuing! Every newly produced property gets a sponsor – an employee who receives a symbolic key and the employee’s name is put up on a plaque in the property. I think that this is a nice way to recognize loyal employees ‒ people who have chosen to be part of the company for a long time and who contribute to our development.
Here you can find out more about Wallenstam’s sustainability work.
Curious about our efforts to become a more sustainable bank? Have a look at Nordea’s latest sustainability report.
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