at Nordic Solar

Nordic Solar is in the continuing process of evolving sustainability (ESG) – a process that is already shaping our company’s DNA. ESG has therefore also become one of the main areas in our 2025 strategy.

For us, sustainability is not a project. Sustainability is an integral part of everyday life that shapes Nordic Solar and must be integrated into our culture and the way we behave internally, but also in the way we do business outside the company’s walls. You can read more here.

Nordic Solar Sustainability Report 2021

Sustainability Report 2021

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An investment in the green transition – solar energy

At Nordic Solar we are investing in sustainable energy in the shape of solar parks, in Denmark and in other European countries. It is our way of contributing to the green transition. Via our investments we are contributing to one of the environmental goals that the EU has defined as central in the green transition, the counteracting of climate change.

At the same time the six other environmental goals, that the EU has defined in the so-called EU Taxonomy for Sustainable Investments, won’t be damaged. In addition, a sustainable investment requires good management practices, taking into account sound management structures, working conditions, remuneration of staff and compliance with tax rules.

Our constant work integrating responsibility and sustainability in our business, investments, and company culture, comprises the solar parks we are investing in and the lifecycle of the solar parks. By this process we are contributing to the green transition, in that consumers throughout Europe are benefitting from electricity produced in sustainable energy plants. At the same time, we are aware that there can be negative impacts on nature, climate, and people. We are constantly working on diminishing this.

We want to create a high degree of transparency for our investors in relation to sustainability, thereby promoting activities and investments that create positive effects in relation to the climate, sustainability, the environment, biodiversity and social rights.

At Nordic Solar we are constantly working on improvements. We have three focus areas, which we have defined as central to our work in contributing positively to sustainability:

  • Climate and environment
  • ’Caring Company & diversity’
  • ‘Business Innovation and governance’

In order for an investment to be considered sustainable, it must be ensured that the international guidelines are abided by. According to the EU Taxonomy, the following international guidelines are concerned:

  • OECD guidelines of responsible business conduct
  • The UN guidelines for human rights and business
  • The International Labor Organization’s (ILO) eight conventions for basic labor rights

Nordic Solar invests in projects that meet the environmental goal 1 of the EU Taxonomy and via the applicable environmental legislation of the European countries of the investments, it is ensured that there is no significant damage to the other six environmental goals.

This means that, compliance with the minimum guarantees covers the following aspects:

  • Human rights (incl. labor rights and consumer rights)
  • Bribery
  • Aggressive tax planning
  • Fair competition

We are working on systematically conforming to the minimum guarantees via our policies and procedures, in order to avoid and prevent negative impact on the aspects above.

In connection with our projects, Nordic Solar is continuously working on preventing negative impact on sustainability factors through active ownership, our business connections, as well as the entire product life cycle. This is an integrated part of our investment- and decision-making process. Documentation for this will from 1st of January 2023, be found in our declaration of sustainability impacts (Principal adverse sustainability impact statement).

To create a complete overview of our overall negative and positive impacts on the climate and key areas of focus, Nordic Solar has planned to map our financial products based on a life cycle assessment from the production, of operation and for disposal and recycling. Based on the life cycle assessment, our CO2e inventory* will be updated. Our life cycle work is planned for 2023.
[*CO2e – CO2-equivalent represents the overall greenhouse gas effect for all climate gasses].

Sustainability risk policy and investment decision process

Nordic Solar is defined as a Manager of Alternative Investment Foundation, that promotes environmental or social characteristics through investments in solar parks (Article 8 under the EU Regulation on sustainability-related information in the sector for financial services).

Our board have approved two policies, that sketch out the overall framework for how we work with sustainability:

  • Policy on sustainability
  • Investment Policy

For any investment in a solar park/project location, the sustainability is assessed in relation to three factores:

  1. Significant contribution to at least one environmental goal
  2. No significant negative impact on other environmental goals
  3. Comply with guidelines for socially responsible corporate conduct

Concerning 1.
Nordic Solar only invests in solar parks (economic activity), which is the Eu’s Taxonomy for environmentally sustainable investments. Investments in solar parks are considered as contributing significantly to counteracting climate change, as they are renewable energy solutions.

Concerning 2.
In connection with applications for the construction of new solar parks/investments in existing solar parks, due diligence assessments are carried out regarding sustainability. Sustainability due diligence includes, among other things:

  • Screening for the authority’s requirement of EIA (Environmental Impact Assessment)
  • Placement in or near environmentally sensitive/protected areas
  • Distance to sensitive land use
  • Possible negative impact on local stakeholders

In the situations where the authorities demand an EIA statement, it is ensured that it is prepared by a third party, in possession of the right skills and resources. If there is no requirement for a separate EIA statement, then the project is considered not to give rise to a significant negative impact on other environmental goals (it is hereby recognized that there may be a negative impact on other environmental conditions, but not of any significant nature) and is handled via the applicable environmental legislation.

The aim is for all solar parks to be assessed in terms of biodiversity and for a plan to be prepared for how the specific project location can contribute positively to the development of biodiversity in the local area.

Concerning 3.
We aim for a proactive dialogue with local the stakeholders who are experiencing a positive or negative impact from the specific solar park. This is done through a systematic mapping of, and dialogue with the stakeholders, to ensure that our projects are experienced as good neighbors and as far as possible, integrated into the local community. Due diligence for sustainability is carried out by a third party. The purpose of sustainability due diligence is to identify possible risks of significant negative impact on environmental and social conditions.

In situations where the location of the investment is in a non-EU country, the International Finance Corporation (IFC) standards for environmental and social sustainability (IFC Performance Standards) will be used as a benchmark for assessing sustainability. All investments are submitted for approval, including a description of any sustainability-related risks and how these risks will be handled. All approved investments are planned and built in accordance with current EU legal requirements regarding the environment, working environment, and labor law conditions.

Contractors and suppliers of main deliveries of components for solar parks are selected based on a screening, where sustainability is one of several parameters, so that it is ensured that current and relevant EU legal requirements are met.

Nordic Solar has a special focus on matters related to human rights in terms of manufacture of solar panels. In addition to an ongoing dialogue with main suppliers, Nordic Solar actively works via Danish and European industry organizations, to ensure increased influence.

In connection to our work with risk management of climate changes and environmental impact, we use ‘Task Force on Climate related Financial Disclosures’ (TCFD). This standard focuses on both the possibilities and risks our financial products create. This includes both the physical and the transitional risks that exist in connection with climate change and environmental impacts. The method indicated in TCFD is generally used in connection with Nordic Solar’s sustainability risk management and in our sustainability report.

The EU Taxonomy

The EU Taxonomy is a common classification system for sustainable economic activities. Nordic Solar will from now on work actively in relation to the screening of our economic activities in according with the EU Taxonomy’s identified environmental goals. Here our economic activities are qualified as environmentally sustainable, if they contribute significantly to one or more of the six environmental goals and does not significantly damage the other environmental goals. Moreover we must ensure fulfillment of social minimum guarantees and carry out screening according to the EU stipulated technical screening criteria.

The six environmental goals:
a) Counteracting climate change
b) Adaptation to climate change
c) Sustainable use and protection of water and marine resources
d) Transformation into a circular economy
e) Prevention and control of pollution
f) Protection and restoration of biodiversity and ecosystems.

After the 1st of December 2022, it will be disclosed, for each of our financial products, to which of the six environmental goals it makes a significant contribution, by investing in the products. Including disclosure of how our investment projects contribute directly or indirectly to environmental objectives and to what extent. For the goals that are contributed to indirectly, it must also be ensured how no significant damage is done. This information will, after the date above, be available in the information about the individual products on our website, as well as in our sales material.

More on the sustainability regulation

In September 2015, the UN General Assembly adopted the ‘2030 Agenda’, which set the global frame for Sustainable Development. The starting point for the agenda is the UN’s 17 world goals and is called Sustainable Development Goals (SDG). The global goals are based on the three aspects of sustainability: social, economic and environmental. On the basis of this, the EU Commission developed the EU Green Pact, which was published on December 11th 2019.

The EU Green Pact aims to ensure sustainability, increase resource efficiency, promote the circular economy and create climate neutrality and resilience. Here, the EU commits, among other things, to three ambitious climate and energy goals by 2030.

To achieve the goals, the financial sector is involved to promote sustainable financing and green investments. This is initiated through the EU Commission Action Plan. Among other things, the plan includes the EU regulation on sustainable financing, the so-called ESG Regulation (ESG: Environmental, Social and Governance).

The Regulation applies to companies in the financial sector in relation to their publication of their sustainability (ESG) information related to their financial products.

The purpose of the Regulation is to harmonize financial investment information about sustainability aspects. This is so that shareholders can assess the environmental and social sustainability of investments, and make qualified investment decisions.

Here you can read more about the ESG-regulation itself.