Itaú Unibanco Sustainability Management - Information as of December 2017 - BankTrack
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Itaú Unibanco Sustainability
Management
Information as of December 2017
Contents
1. Governance, Policies and Structure
2. Environmental & Social Risk and Climate Changes
3. Client Management, Education and Financial Inclusion
4. Employee Management
5. Ethics, Integrity and Human Rights
6. Impact Measurement
7. Sustainable Development Goals (SDGs)
8. Corporate Citizenship and Philanthropy
2
Contents
1. Governance, Policies and Structure
2. Environmental & Social Risk and Climate Changes
3. Client Management, Education and Financial Inclusion
4. Employee Management
5. Ethics, Integrity and Human Rights
6. Impact Measurement
7. Sustainable Development Goals (SDGs)
8. Corporate Citizenship and Philanthropy
3
Sustainability Timeline
Sustainability at
Sustainability the board of
directors’
Committee
Strategy
(officers level) Committee
Sustainability Creation of Superior Ethics
Governance operating and Sustainability
(executive level) committees Committee
Itaú Unibanco
Merger
2000 2005 2007 2008 2010 2013 2014 2016 2017
First cell for Central Bank
analysis of Regulation
environmental Revision of the
Sustainable sustainability
and social risks performance in strategy
corporate vision
4
Itaú Unibanco Corporate Governance
Stockholders’ Meeting
Fiscal Council
1 executive member
Board of Directors Composition 5 independent members
6 non-executive members
Nomination
Risk and
Related and International Digital
Independent Audit Personnel Capital Strategy Compensatio
Parties Corporate Advisory Advisory
Committee Committee Management Committee n Committee Board
Audit Committee Governance Board
Committee
Committee
Integration of
Internal Audit challenges, strategy
and trends related to
business
sustainability
Board of Officers
Disclosure and Trading Committee
5
Sustainability Governance
Board level
Definition and monitoring of
the sustainability strategy Board of Directors
Members of the Board of Directors
Strategy Committee
Members of the Board of Directors
Executive level Periodicity: annual
Integration of challenges and
trends into businesses Superior Ethics and
Sustainability Committee
Members of the Executive Committee
Officers level Periodicity: semi-annual
Decision on and prioritization
of projects Sustainability Committee
Members Officers of departments involved in
the sustainability agenda
Periodicity: bimonthly
Operational level
Management of projects by Internal
specific topics Working Groups Diversity
Responsible
Members/Executives of departments involved
Management - Investment
in sustainability projects Ecoefficiency
Financial
Integrity and Ethics Reporting
Education
Environmental and Social Risk Committee
Meets on a quarterly basis and is responsible for suggesting Foundations and
institutional positions and internal procedures on the Institutes
exposure to the environmental and social risk.
6
Sustainability Corporate Area
The Sustainability and Inclusive Businesses corporate area counts on 54 employees* who are responsible for addressing the strategy in
partnership with other partner areas
Superintendency
Sustainability and Inclusive Businesses
Management
Sustainability
Sustainability in Business Microcredit
Management
Coordination
COORDINATION SQUAD COORDINATION COORDINATION COORDINATION
COORDINATION SQUAD COORDINATION COORDINATION
Sustainability in Human Rights Sustainability in Sustainability in SQUAD Microcredit
Institutional Innovation in Microcredit Microcredit
Reporting and and Business Wholesale – Risks Retail and Climate Finance Commercial
Sustainability Sustainability Commercial Operations
Impact Diversity and Operations Channels Planning
7
*Total active employees in April 2018
Sources of knowledge and trends
Climate Change
Reporting and
Transparency
Responsible Bank
Diversity
Integrity and Ethics
Sustainable Development
8
Recognition | Sustainability Indexes
Global Context
The only Latin American Part of the Euronext
bank to be part of the DJSI Vigeo portfolio since
portfolio since its inception 2015
in 1999.
Leader in Transparency in Part of the Index
2014 e 2015. portfolio since its
second edition in 2017
Brazilian Context
Part of the ISE Part of the ICO2
portfolio since its portfolio since its
inception in 2005. inception in 2010
9
Sustainability in Latin America
2015 2016 2017 2018
Sustainability LATAM Diagnosis LATAM Developments in plans currently in Review of the sustainabiity
Support to countries in addressing A diagnosis to assess adherence of progress franchise
and prioritizing the topics on a local these countries to this model (level Developments in the governance and Continuity of the aligned plans
basis by means of a set of practices of maturity related to the topic and strategy implementation, and inclusion and review of the Latam
and step-by-step implementation preparation of local action plans) of Colombia in the diagnosis phase sustainability franchise
procedures.
Governance
Brazil Latam Countries*
Sustainability Area Sustainability Area
Provides support to LATAM countries regarding Defines plans, implementation and reporting to
sustainability guidelines the head office
LATAM Area Board
Discusses the “sustainability” topic with the Committees with the Sustainability area to make
board at each country initiatives feasible
*Argentina, Chile, Colombia, Paraguay and Uruguay
10Policies, guidelines and studies
Corporate Governance Diversity
Policy to include people with disabilities (internal)
Corporate Governance Policy
Internal Diversity Appreciation Policy (internal)
Commitment to Diversity*
Environmental and Social Responsibility and Climate
Change
Policy for Sustainability and Social Environmental Responsibility Aging
Environmental and Social Risks and Opportunities – Itaú´s Position
Climate Change commitment Aging Position (Live Longer Dialogue)*
Water Shortage and its Economic Impacts
Revision of the Energy Rationing Risk*
Social and Environmental Risk Policy – Credit Corporate Clients
Social and Environmental Risk Policy – Insurance * Financial Education
Choices and Money – Study on financial behavior and decisions
Ethics, Integrity and Human Rights
Code of Ethics
Integrity and Ethics Corporate Policy
Illicit Acts Prevention and Combat Corporate Policy Suppliers
Anti-Corruption Corporate Policy
Information Security Corporate Policy Procurement Policy*
Commitment to Human Rights Supplier Relationship Code*
11
*Document in portugueseContents
1. Governance, Policies and Structure
2. Environmental & Social Risk and Climate Changes
3. Client Management, Education and Financial Inclusion
4. Employee Management
5. Ethics, Integrity and Human Rights
6. Impact Measurement
7. Sustainable Development Goals (SDGs)
8. Corporate Citizenship and Philanthropy
12Brazil – Main Goals Assumed
• Reduce GHG emissions by 43 percent by 2030 (base year 2005)
Climate Changes •
•
Zero deforestation in Legal Amazon and recover 12 million hectares of forests by 2030
Increase the share of renewable sources in the energy mix to 45 percent
• Zero the emission of pollutant gases by 2100
Together with UNEP FI and other 15 banks, we are studying the impact of climate change on our loan portfolios,
considering different scenarios of temperature increase. The financial sector still need to determine what
Targets and metrics measurement system is the most efficient and, accordingly, develop targets based on global temperature increase.
Offset of We issued the call notice Commitment to the Climate for carbon offsetting, in partnership with Brazilian company
Main Work Fronts Greenhouse Gas Natura, aimed at together offsetting 500,000 ton of CO2 through independent projects, which correspond to the
(GHG) Emissions emissions of both companies between 2016 and 2018.
in the Topic
Our analysts simulate the levy of a tax on CO2 emissions in carbon-intensive industries and products. The estimated
Carbon Pricing rate is used to measure the financial impact on these companies’ costs and, consequently, on the price of their shares.
We improved the E&S risk analysis methodology by using a sector approach applied to the corporate loan portfolio
(CIB), so as to reassess the relation between E&S and credit risks.
Portfolio Analysis The analysis of the portfolio used the climate change impact on sectors in the short and long terms as one of its
assumptions.
Climate Change E&S risk in the corporate
commitment (2017) loan portfolio (CIB) (2017)*
13
*Document in portugueseThe initiative, headed by the Financial
Task Force on Climate-related Stability Board (FSB), encourages the
organizations to become aware of the
Financial Disclosures (TCFD) physical, liability and transition climate risks
to which they are exposed.
We highlight our activities related to the TCFD strategic pillars
Governance Strategy Risk Management Targets and Metrics
The Board of Directors guides our
Climate variables are taken into Development of indicators and tools to
internal Sustainability and
We participate in multi-sector account in the analysis of the strengthen the assessment and disclosure
Environmental and Social
discussion groups, such as CEBDS, Environmental and Social Risk for of risks and opportunities related to climate
Responsibility Policy for risks and
UNEP-FI, FEBRABAN and FGV the corporate segment and of the change by the UNEP-FI work group on the
opportunities related to climate
financing of large projects recommendations of the TCFD
change
The Sustainability Governance Itaú Asset Management takes
A study was carried out about the A study was carried out to identify the
addresses risk management and Climate Change topics into
climate change impact on our business risks and opportunities in view of
the identification of account in its ESG integration
corporate loan portfolio in the global climate change, with 10-year
opportunities related to the methodology for investment
medium and long-term scenarios projections
climate change agenda analysis
The Superior Ethics and
A study was carried out about
Sustainability Committee resolves We take into account climate Launch of the Asset calculator to compare
Emissions financed based on the
on the actions to be taken by the issues in pricing our insurance emissions of our portfolios with
Portfolio Carbon Initiative
institution to meet the climate products (corporate) benchmarks
guidelines
change agenda
Participation of the UNEP-FI work
The topic is also discussed by the
group to implement the
Sustainability Committee, the
recommendations of the TCFD
main Sustainability forum in the
considering different climate
organization
scenariosIn 2018 we will buy carbon
Our operations | Eco-efficiency credits to offset our 2016/2017
emissions
Ton Carbon avoided Sustainable Actions Committee Environmental Management System Greenhouse Gas (GHG) Emissions
Offsetting Program
Over 2017, 5,381.60 ton carbon was Specialists and the areas involved In 2017, our coverage in
Biannual program that enables us to
avoided through projects for in the group share experiences Environmental Management System
meet our commitment to the
reducing energy consumption and and discuss and analyze projects certificates increased to 40% from
promotion of a low-carbon economy.
own emission related to eco-efficiency 15% last year
Certifications of administrative
buildings
The Business The Tatuapé
Center was Center is certified
certified in 2017 since 2011
Our data center and
Faria Lima building
are certified
15Our operations | Eco-efficiency
16
Consumption 2015 2016 2017 Goals
Reduce our water consumption by 43% per R$1 million of banking products between
Water 1,472,460.63 1,410,592.40 2013 and 2020
(m³) 1,390,142.00
Reduce our energy consumption by 42% per R$1 million of banking products between
2013 and 2020
Energy Reach, by 2020, a Power Usage Effectiveness (PUE) of 1.60, 11% lower than in 2013
717,779.51 630,245.26 604,976.00
(MWh) Acquire, by 2020, 96% of energy for the administrative buildings from renewable
sources
Reduce our Scope 1 emissions by 34% per R$1 million of banking products between 2013
Emissions and 2020
227,547.00 164,791.00 242,877.00 Reduce our Scope 2 emissions by 39% per R$1 million of banking products between 2013
(tCO2e)
and 2020
Transportation Reduce by 28% our business travel indicator, which shows the km traveled per R$1
192,588,882.89 187,051,908.00 229,088,191.00 million of banking products between 2013 e 2020
(KM)
Reduce by 32% the allocation of waste from our administrative units to landfills between
Waste 2012 and 2020
1,460.32 1,084.01 22,373.16 ¹ In 2016, the estimated generation of 178 tons of REEE in 2020 was defined. This estimate
(t) includes the data from Branch (ATMs) and Central Management – Microcomputing
(desktops)
¹ Figure updated considering the branch network with 100% coverage of our facilities in Brazil.Integration of ESG into businesses
1 Governance 2 Processes 3 Compliance
Policies Analysis methodologies Role of the compliance area
Sustainability and environmental and Based on the principles of relevance Measure the quality of the process and
social responsibility policy and proportionality exposure to risk, all areas are monitored
Environmental and social risk policy for adherence to policies, and the
Engagement
results are reported to the committees
Committees Engagement of institutions that are
Sustainability committee relevant for building knowledge
Environmental and social risk Studies Regulatory bodies
committee Development of studies in conjunction External assessments by regulatory
Operational committees (Internal with institutions in the sector bodies
Management, Investment, Reporting,
and Financial Education) Training
Training of teams on environmental
and social issues and training to all
employees on the sustainability and
policy concepts
Signatário Signatário Signatário
desde 2008 desde 2004 desde 2012
1718
Integration of ESG into businesses
20
Analysis of projects Project related corporate loans (Corporate Finance) closed and assessed
by using Environmental and Social Policy criteria
Total investment Itaú Unibanco’s
Number of Projects
(R$ million) share (R$ million)
In 2017, we did not have any project-related Category
transaction rejected due to E&S issues A - - -
B 1 123,46 45,00
C 6 1.324,79 407,20
Project finance (1)(2) closed (Equator Principles III criteria) Total 7 1.448,25 452,20
Number of Total investment (R$ Itaú Unibanco’s share
Projects million) (R$ million)
Category
A 1 409,79 125,21
B - - -
C 1 2,00 0,34
Total 2 411,79 125,55
(1) Project Finance as per Basel definition at www.bis.org/publ/bcbs107.pdf.
(2) One of the Project Finance transactions did not fall into Equator Principles because of its financial volume.Integration of ESG into businesses | Responsible Investment
ESG valuation methodology
Proprietary methodology to include ESG issues in the valuation
of fixed income securities and the pricing of active
management funds, taking into account: materiality, relevance
for the industry, risks and opportunity rating, metrics, and
management.
We currently cover 99% of companies listed on Ibovespa,
IBrX-100, and the Business Sustainability Index (local
acronym ISE) of Bovespa.
90% of corporate fixed income securities are also covered
by this methodology.
The target for the coming years is periodically updating the
analysis for variable income securities and expanding the
coverage in corporate fixed income securities to 95%.
Integration of ESG issues in fixed income
Integration of ESG issues in assessment of companies 21Environmental and Social Opportunities
Our Strategy
In 2017, the Wholesale segment allocated 2.92 billion in loan operations that promote E&S benefits, accounting for approximately 1.76% of the loan
portfolio. The contracting of environmental and social operations increased 1.92% compared to 2016.
Green Bonds Floating Income Onlending from the Brazilian Social
In 2017, we took part in the issue of one more FIES: allocates 50% of management fee to and Economic Development Bank
green bond of the Brazilian market. In this educational projects. Since 2004, more than (BNDES)
operation, Klabin contracted US$500 million R$30 million was transferred to 165 NGOs,
In 2017, we allocated R$169.80 million to
(approximately R$1.745 billion), in an benefiting over 36,500 children and youth, in
projects related to the recovery of
operation with bonds distributed in the U.S. addition to 3,400 educators.
sugarcane cultivation land and
market. IT Now ISE: reflects the performance of the
introduction of new sugarcane
Corporate Sustainability Index (ISE).
plantations, agriculture and financing
It Now IGCT: reflects the performance of the
Fixed Income aimed at GHG emission reduction.
Our Products
Trade Corporate Governance Index (IGCT)
Ecomudança Fund: allocates 30% of the
management fee to GHG emission reduction
Clean Energy Credit for environmental and
projects. Since 2009, the Ecomudança
program has invested approximately R$5. 3 We offer our clients financing lines related to social benefits
million in 46 projects. mitigation of climate change, reduction of
In 2017, the Wholesale segment allocated
GHG emissions, renewable energy,
2.92 billion in loan operations that promote
Fundo Itaú Futura: between 2010 and 2017, improvements in the energy transmission
E&S benefits, accounting for
Fundo Social Itaú Futura donated more than and distribution (energy efficiency), bio-fuels,
approximately 1.76% when compared to
R$2,6 million to educational projects infrastructure, and in the logistics systems,
the loan portfolio at the end of 2017.
developed by Roberto Marinho Foundation´s basic sanitation, sustainable agriculture, and
Futura TV channel, which accounts for 30% of recovery of sugarcane cultivation land.
its management fee.
22Evaluating and developing new products and services
Governance
Alignment Forum Risk Management Analysis (AGR) Retail Products Committees Role of the sustainability department
In-person meeting at which product Portal
Composed by the evaluating areas’
or service developers submit Any project that modifies or creates Evaluates and suggests adjustments to ensure
officers, this forum meets periodically
proposals to the other areas products and services is subjected to that products and projects are aligned with
to discuss projects that have
impacted according to division of a rigorous analysis focused on risk three work pillars :
disparities in the evaluation.
business segments. management. • Transparency
• Environmental and social risks
• Financial education
Flow of products and services evaluation
Approved The product The evaluating area
A proposal is Evaluation according validates the opinion
An opinion is issued The evaluating area manager inserts
submitted through to division of and follows the
by the area in charge issues an opinion action plan /
the AGR portal business segments action plan
document
Governance issues an
opinion
Approved with a Total projects 2015 2016 2017
condition evaluated
227 327 108
23Management of Suppliers 24
Supplier Relationship Code
Profile
Transparency, legality, quality and reliability in the
interactions with our suppliers and service
Main Categories Total amount purchased providers. They are required to adhere to the
(R$ billion) guidelines of the code, ensuring alignment of
2015 2016 2017 principles in the business relationship.
2017
Maintenance, works and equity 29.1%
Marketing 13.4% 9.0 10.0 10.0
10,0
Legal expenses 10.8%
Evaluation process
We have been taking part in the CDP Supply Chain A partnership to bring very small and small companies
program for two years, and invited our largest suppliers from minority groups closer to large companies. We
to provide information related to their activities and have already been in contact with 212 companies.
climate change. Code of relationship with suppliersContents
1. Governance, Policies and Structure
2. Environmental & Social Risk and Climate Changes
3. Client Management, Education and Financial Inclusion
4. Employee Management
5. Ethics, Integrity and Human Rights
6. Impact Measurement
7. Sustainable Development Goals (SDGs)
8. Corporate Citizenship and Philanthropy
2526
Client Management
Customer satisfaction Transparency
We are committed to providing guidance on our financial services and products
Benchmarking surveys to evaluate customer satisfaction with the and suit our offer to the client's profile and moment in life.
banking services provided by specific business units
Credit Guider
Online tool designed to help determine the best credit product according to the
client’s need and their moment in life.
Overall 2015 2016 2017
Satisfaction
8.02 7.96 8.05 Quality in Sales Program
Rate (%)
Improve sales quality by identifying and managing possible misconduct by
employees from commercial and operation departments.
The results of such surveys directly influence the variable
compensation of both executives and teams at the Behavioral Finance Program
branches. The program aims at disseminating among employees knowledge about the
biases, emotions and behaviors of clients so that we can develop the best
solutions for their financial lives.
External Ombudsman role 2017 Results
• 94.2% of the incidents were solved in up to 10
Complaint Integrate the client service system and act when a
client is not satisfied with a position received from days
management standard channels (call centers, Customer Service • Around 98.4% of these incidents were solved in
Centers or internet). up to five working days (BACEN requires that a
solution is provided in up to 10 working days)Financial Education
Our Strategy
Enable actual achievements Empower for making better decisions Enhance the topic across society
Provide content, tools and solutions that help employees
Provide transparent products, services and offers Contribute to the discussion of the topic across society, and
and banking and non-banking clients to make better
that help our clients make more conscious inspire people to make better decisions with their money,
choices with their money, according to their needs and
decisions with money, to enable them to reach promoting individual and collective prosperity.
moments of life.
personal goals.
Program for employees and banking and non-banking
Volunteering Program “Uso Consciente do Dinheiro”
Financial Guidance clients
(Conscious Use of Money).
• 108 products and services for financial guidance, • Digital platforms with content for financial education: more • Launched in 2015, it has around 1,100 active
transparency and customer satisfaction; than 3 million views since it was launched in 2014; volunteers in Brazil and Latin America.
• Financial guidance aligned with preventive • Online financial guidance course on a partner platform with
actions, focused on clients who will likely not tips and content to achieve and maintain financial balance:
settle debts, through the offer of credit more more than 15,000 people interested in 2017; Campaigns
suitable to their needs. • Financial Education Program to employees since 2009.
• Entertainment campaign for financial guidance on
• Development of a financial education program Includes communication campaign, in-person and distance
social media. In 2017, we launched two episodes of
for people in debt; and learning and financial advice; and
the Real Life TV webseries that impacted 65.8
• 33,371 employees trained online on Financial • Financial Education Program offered without charge to more
million people.
Education. than 500 corporate clients in Brazil, with managers who
multiply the topic. More than 24,000 clients already impacted.
Guidance to employees, clients and society, supplying tools for them to make the most suitable financial decisions for their
moments in life, and products to support actual achievements.
2728
Financial Inclusion | Itaú Microcredit
Guided productive microcredit Structure review
In 2017, the microcredit operation structure was reviewed, with the
Itaú Microcredit is available in economically disadvantaged areas in
resulting creation of commercial and product planning cells, in
São Paulo and Rio de Janeiro metropolitan regions. The lowest
addition to the commercial operation
credit amount is four hundred reais (R$400.00) and the highest is
fourteen thousand five hundred reais (R$14,500.00).
Number of 2015 2015 2016
clients 8,100 2,778 2,524
Results
Liability Release Banking inclusion
2% of all demand deposits must be directed to All funds released to the end microcredit client 24% of current account holder clients opened
microcredit account after hiring microcredit.
327,1 27,6
24%
310,9 16,2 16,5
307,4 Opened account
76%
Already had an account
2015 2016 2017 2015 2016 2017
(millions of reais) (millions of reais) Data from 2003 to 2017Financial Inclusion | Itaú Women Entrepreneurs
Objective of the program Number of participants in the program
Empower female entrepreneurs in Brazil through in- 2015 2016 2017 Goal 2018
person and online solutions to train, inspire and connect 5,997 8,056 11,200
3,393
them
Solutions Partnerships
Online Platform Partnerships that help provide financial and non-financial solutions
to women entrepreneurs
• Contents related to enterprise
management and leadership
• Management tools
• Motivational videos. 80 actions carried
out through 2017
In-person Actions
• Networking events
Representation in
• Business rounds
GBA´s Board .
• Workshops
29Impact of the Itaú Women Entrepreneurs Program
Conclusions of the impact assessment*
By analyzing controlled groups, we reached the following conclusions in relation to the program :
Women who participated in the program Networking helped them to solve problems These women are investing more in mentorship,
were more involved in networking with and search for busineess opportunities. including compensating professionals for
other entrepreneurs and within their
supply chain. adopting a more professional management
Impact assessment for the bank
30
*Analysis performed every two years31
Financial Inclusion | Accessibility
We have developed countless initiatives intended to
promote the autonomy and the economic development of
person with special needs:
Hearing impairments Visual impairments
TTD1 device Products and services Internet
Cards in Braille which are sent to the client A voice synthesizer (software) installed on the
together with the purchase agreement in the client’s computer, which captures and
The system enables clients to send and receive
audio format transforms the customer’s account information
text messages about the following services :
into audible answers.
Current and savings account balance; Monthly credit card invoice in Braille
Recent entries;
Letters containing general information on the Services available:
Position of investments;
account • Current and savings account balance;
General information;
• Recent entries;
Complaints and suggestions for products and Voice command navigation with headsets
• General Conditions of Itaú Universal
services. connected to the ATMs
Account and Services, available in PDF,
Tactile keyboard, card readers and bar codes audio and video formats.
Dispensers of vouchers and notes.
1TDD – Telecommunication Device for the Deaf32
Financial Inclusion | Digital
Digital Bank
The hyperconnected client The hyperconnected bank
Design
An essential part of the digital transformation is UX IT
the increasing use of mobile devices with access to
the Internet, which directly reflects on the
CRM Risks
exponential growth in the use of mobile banking,
as evidenced by the 29% increase of use for Bank
individuals and 43% growth for companies, when Legal
Franchise Department
compared to 2016.
Products Digital
MKT Business
Application Digital Card Application
Digital Mobile is the most fast-growing channel, which makes access easier Credicard ZERO Itaucard application
solutions for people who do not use banking services (58% of transactions are This application brings functionalities,
performed using mobile devices and Internet) The product has no annual fee and
such as Virtual Card that simplifies
comes with a number of benefits, such as
online shopping, enables transactions
Light application discounts with partners like Uber and
We reached more than to be viewed in real time, features
(around 1MB) to Netshoes, among others. Customer
500,000 users in 2017 spending control by category,
serve low-income experience is 100% digital through the
provides virtual assistance, among
persons mobile application
others.33
Financial Inclusion | Digital
Digital Advisory Board
This committee was created to provide the Board with
inputs, thus supporting the latter´s reflections on A connection hub in Brazil created by Itaú-Unibanco in partnership with
customer experience, as impacted by the evolution of Redpoint to find opportunities to generate competitive advantage and
technology and world trends. evolve as a digital bank
Encourage knowledge sharing among contributors and entrepreneurs
Provides new business opportunities
Blockchain Contributes to a more agile and collaborative culture
We are involved in 100% of blockchain applications in Connection with new talents
progress in Brazil to advance the financial market. Opportunity to innovate in products and services
We created a Blockchain Lab, the bank's largest initiative in
order to develop business’ solutions utilizing blockchain 2017 Result
technology. In this laboratory, we have already begun to
develop, in the form of an internal prototype, a specific • 54 startups
solution for our stock bookkeeping product. • More than 1,000 jobs created
• R$150 million invested in companies
Cubo is increasing its capacity fourfold to approximately 210
startupsContents
1. Governance, Policies and Structure
2. Environmental & Social Risk and Climate Changes
3. Client Management, Education and Financial Inclusion
4. Employee Management
5. Ethics, Integrity and Human Rights
6. Impact Measurement
7. Sustainable Development Goals (SDGs)
8. Corporate Citizenship and Philanthropy
3435
Organizational climate, attraction and retention
Total employees Talent attraction and retention
94,779 Since 2009, ranked among the Best
90,183 Companies to Work for by the main
90,320 The number of employees
specialized publications in Brazil (Você
increased in 2016 mainly
S/A, Época and Valor Carreira
due to the consolidation
magazines).
of Itaú CorpBanca.
Trainee Program Internship Program
143 trainees recruited in 2,094 interns recruited in 2017,
2015 2016 2017
2017, with 97% retention with 48% retention
Organizational Climate Turnover Rate
Confidential annual survey that measure employees’ The turnover rate (ratio of the number of employees hired to the
satisfaction with the working environment and people number of employees terminated in each year) has decreased
management. gradually. This number is monitored by the Executive Committee
on a monthly basis, and the Connecting People program is the
main channel whereby employees are reassigned to other areas.
Overall 2015 2016 2017
10.6%
Satisfaction Rate 82% 85% 86% 10.4% 9.1%
Involuntary
8.1% 8.5% 6.9%
The results of the survey are evaluated by employees and Voluntary
managers of the areas, who are encouraged to develop
action plans to improve the organizational climate. 2.4% 2.2%
1.9%
2015 2016 201736
Diversity
How the topic is managed by the bank
Diversity profile Internal policies
• Internal Diversity Appreciation Policy
% of total employees
• Diversity Appreciation Policy
o Inclusion Program for Persons with Disabilities
2015 2016 2017 o Apprentice Program
• Commitment to Human Rights
Women 60 60 60
Diversity working group
Women in Periodic meetings between the Sustainability, Human Resources, Communication and
leadership 50 51 51.4 Marketing, Governmental Relations, Legal, Compliance, and Foundations and Institutes
positions areas, to discuss all diversity topics in the organization from the standpoint of employees,
clients and society.
Black persons 20 21 22
Women’s Health Program: The percentage of employees
Peopel with returning from maternity leave in 2017
4.6 4.6 4.7 Several benefits are granted to pregnant
disabilities and remaining in their jobs for at least 12
women and mothers returning to work after
months upon their return was :
maternity leave :
Apprentices 2.38 3.1 2.75 • Additional 60 days of maternity leave; 2015: 86%
• A space for pumping breast milk; 2016: 88.7%
• Specialist nurse´s visit after birth;
Elderly¹ 7.65 9.38 9.03 • Course on nutrition and first aids. Extension of paternity leave: a benefit
Participants in the course: that allows the employee to extend the
2015 2016 2017 paternity leave by 15 days in addition to
1,500 1,329 1,740 the five statutory days.
Commitment to diversity*
¹employees over the age of 50 *Document in portuguese37
Performance evaluation and development
Meritocracy Cycle
Annual evaluation based on achievements and Strategic People Plan Feedbacks
behaviors aligned with the organization’s culture. Consolidation of scores related to the evaluation of goals and Honest and transparent feedbacks are part of
behavioral attitudes to analyze the relative performance this exercise
against the employee’s peers on a group basis. For 2016,
43,535 employees were evaluated . Individual Development Plans
Designed to ensure their continuous and structured
behavioral
Trilhas (career paths) development, in 2017, 81.75% of officers, 39% of
superintendents and 45.15% of managers prepared
For cashiers and employees working in the branches, an
their own Individual Development Plan (PDI).
evaluation of behaviors, achievements and readiness is
performed. In the first six-months of 2017, 31,931 employees Consequence management
were evaluated. For promotions and salary increases, the
results employee´s consistent performance is taken into
consideration.
Training and Development
Leadership training Amounts invested in training employees
(million of reais)
Target to have 95% of coordinators and managers trained on
people management and performance, ethics, good labor 232
131
practices in the management of people, clients, risks, and banking 128
business.
2015 2016 2017
% of leadership
training 100% 95% 87%
2015 2016 201738
Employees | Health and Safety
Initiatives to promote the employee’s health
Relevant Goals
Fique OK (Be OK) Program Occupational medical examinations: the purpose of this program is to promote and
preserve the employee’s health as well as to prevent and secure an early diagnosis of
Under this program, support is provided by psychologists, lawyers,
diseases related to activities linked to the workplace or the employee´s work itself.
nutritionists, physiotherapists, and financial advisors to employees and their
family members. In 2017, 56,400 persons (employees or family members)
were assisted through this channel. % of employees submitted
2015 2016 2017 2018 Goal
to occupational medical 75% 85% 97% 98%
examinations
Professional Rehabilitation Program
Occupational Health and Safety (NR-1)
Designed to reintegrate employees under leave of absence by the Social Security Employees are provided via e-learning all guidelines relating to the prevention of
Department who need assistance to resume their original activities: 1,500 work accidents and diseases.
employees in 2017.
Occupational Safety 2015 2016 2017 2018 Goal
Training – NR1
76% 76% 83% 85%
Working day – Compensation system
To enable employees to take care of their personal issues, the
Occupational Safety Representatives (RSLT)
compensation system allows them flexible working hours, leaving or
E-learning on issues relating to the prevention of work accidents and occupational
arriving before or after regular hours, whenever necessary, and they can
diseases designed for branch managers and supervisors
compensate these hours another day.
2015 2016 2017 2018 Goal
RSLT Training
62% 79% 83% 85%Contents
1. Governance, Policies and Structure
2. Environmental & Social Risk and Climate Changes
3. Client Management, Education and Financial Inclusion
4. Employee Management
5. Ethics, Integrity and Human Rights
6. Impact Measurement
7. Sustainable Development Goals (SDGs)
8. Corporate Citizenship and Philanthropy
3940
Ethics
Ethics is present in our business and is reflected in the transparency, respect
and honesty in the relationship with our stakeholders, in the quality of our
services and products and in the concern with financial performance and
environmental and social responsibility
Code of ethics Integrity and Ethics
Established to provide guidance on and Adherence to the term of acknowledgment Corporate Policy
prevent and resolve ethical dilemmas and and to the corporate integrity policies (%)
conflicts of interests in the context of our To establish guidelines additional to the
2015 2016 2017 2018 Goal Itaú Unibanco’s Code of Ethics related
activities and internal relations, and provides
92% 98% 93% 95% to the following:
for our commitment to the topics in the ILO´s
fundamental conventions and other Ethics Corporate Program
international agreements, such as the Additional Guidelines – Conflicts of
Training for employees and management
following: members (e-learning, seminars on ethics for
Interests
senior management) Communication of Departures from
Elimination of child labor the Code of Ethics
2017 Goal 2017 2018 Goal Protection to Persons Using the
Combat against discrimination
Appreciation of Diversity 85% 88% 85% Whistleblowing Channels
Prevention of sexual harassment in the
Integrity and Ethics Corporate Policy
workplace In 2017, we were selected again to compose
Respect to the rights to free union the 2017 Pro-Ethics Company list (Empresa
association and collective bargaining Pró-Ética 2017) promoted by the Ministry of
agreements Transparency, Inspection and General
Controllership of the Federal Government
Code of Ethics41
External Ombudsman’s Office
Ruled by commitment, dialogue, transparency, owner’s mind, integrity and ethics, the purpose of the Internal
Ombudsman’s Office is to help employees resolve interpersonal conflicts and conflicts of interest in the work
environment, ethical misconduct and nonconformities with related institutional policies.
Behaviors reported(%) Guiding/disciplinary measures implemented
2017 Highlights
39 Meetings and lectures held by the Ombudsman’s Office management, covering a total of
1,784 employees.
Executives’ message – broadcasting videos recorded by the bank’s President and executives,
with messages on the importance and interdependence of the channel work42
Combating Corruption
Based on global best practices, our purview of corruption covers illegal acts between In 2017, we maintained our in-person and online
public and private agents, as well as those involving private agents only continuing education program, especially for the
departments most sensitive to the corruption risk,
which have relations with government and
suppliers. The percentage of adherence of
employees and senior management to distance
Integrity and Ethics Corporate training achieved 93% in 2017. See the table below
Anti-Corruption Corporate
for the breakdown per job level by the end of 2017:
Policy Program
The purpose of our Anti-Corruption Corporate Established for the development of corruption
Policy is to reinforce our commitment to cooperate prevention, monitoring and combat practices,
using whistleblowing channels and promoting % of adherence to training
proactively with initiatives to prevent and combat
corruption, and also to establish guidelines for the awareness campaigns and training programs on
conception, implementation and continuous the topic
improvement of training and development Whistleblowing channel for employees
programs, whistleblowing channels and awareness and stakeholders
campaigns. For suspicious transactions that may result
in dismissal or termination of agreement.
Anti-Corruption Corporate Policy43
Prevention and fight against illicit acts
Financial institutions play a key role in preventing and fighting
illicit acts, which includes money laundering, terrorism financing
and fraud.
Illicit Acts Prevention and Program to prevent and fight illicit acts
Combat Corporate Policy In order to be compliant with the corporate policy guidelines, Itaú
Unibanco established a program to prevent and fight illicit acts,
The objective of this document is to which includes the following pillars:
consolidate the principles and guidelines of
Itaú Unibanco Holding S.A. relating to the Customer Identification Process
prevention and combat of money laundering, “Know Your Customer” Process (KYC)
terrorism financing and fraud, in accordance “Know Your Partner” Process (KYP)
with the prevailing legislation and regulations “Know Your Supplier” Process (KYS)
and the best local and global market practices. “Know Your Employee” Process (KYE)
Risk Assessment on New Products and Services
Transaction Monitoring
Reporting Suspicious Transactions to Regulators and
Authorities
Training
Illicit Acts Prevention and Combat Corporate Policy44
Information Security
XXX
Information is what supports the entire banking operation. Therefore, we have
the commitment to protect corporate information and ensure the privacy of
clients in all transactions.
Corporate Information Information Security Initiatives
Security Policy Cyber Security
Role of the Information Security area
Ensure the application of the Monitor and handle any type of attack and security We use cutting-edge technology to
information and intellectual property incidents protect our network and data, as well
principles and guidelines of the Management of accesses to systems as other barriers, such as restricted
organization, clients and the general Joint work with business and technology access to our servers, facilities and
public. departments to keep up with the trends of the digital virtual environments, through the
world market use of firewalls, protection by
password and encryption
Training on Information Security for employees
In-person and/or online training on information
confidentiality, integrity and availability. NBR ISO/IEC 27001 Certification
A Brazilian standard developed
to ensure the protection and
privacy of information provided
by clients and other sources.
Corporate Information Security PolicyHuman Rights in Itaú
We are committed to preventing any attitudes that violate the
rights of people with whom we relate UN Global Compact
Partners that guide us in this
issue
UNEP FI
OIT
Update of Itaú Unibanco’s
Commitment to Human
Rights Commitment to Human Rights
2016 Action plans
2014 First Due Diligence
Second Due Diligence
process
process
Provides guidelines for preventing We monitor and supervise the
Human Rights risks we are impacts of our activities on Human
exposed to in our relations with Rights, incorporating activities
Publication of Itaú Definition of the employees, clients and suppliers. It
Unibanco’s Commitment Governance of the
associated with this topic into our
to Human Rights Sustainability department
is driven by the UN Guiding policies and procedures.
Principles on Business and Human
2015 Definition of the periodicity 2017 Rights, under the “Protect, Respect In 2018, a squad was created in the
of the due diligence process and Remedy” framework
– biannual sustainability department
exclusively to manage this topic.
Commitment to Human RightsHuman Rights - Due Diligence
The purpose is to ensure respect to human rights, according to the United
Main topics in human rights:
Nations Guiding Principles on Business and Human Rights.
Labor analogous to slavery Education and Culture
Child labor Compensation
Análise do Compromisso de DH, políticas, processos, Corruption, extortion
1 Pesquisa e mapeamento Moral and sexual
produtos, serviços e entrevistas com envolvidos
harassment and bribery
Avaliação de impactos, de riscos e identificação de
Health an Safety Free union association
2 Definição de prioridades
oportunidades de melhoria
Diversity Labor rights
Análise de GAPs dos princípios Identificação dos GAPs relacionados aos Princípios Discrimination
3 orientadores da ONU Orientadores da ONU
Recomendações para melhoria do processo de gestão Due Dilligence - Biannual
4 Conclusões e recomendações dos Direitos Humanos
Work completed in 2017 in partnership
with an independent third party in order
Departments involved in the Due Diligence process to :
Identify possible impacts on our Meetings
• Sustainability • Integrity and Ethics • Union Relations stakeholders
• Diversity • Inspection • Compliance
• Health and Safety • Procurement • Investor Relations Prepare improvement plans for our
• Internal Ombudsman • Legal • External Ombudsman processes
• Institutional and
Monitor compliance with our documents
Governmental Relations
Commitment to Human Rights . reviewedContents
1. Governance, Policies and Structure
2. Environmental & Social Risk and Climate Changes
3. Client Management, Education and Financial Inclusion
4. Employee Management
5. Ethics, Integrity and Human Rights
6. Impact Measurement
7. Sustainable Development Goals (SDGs)
8. Corporate Citizenship and Philanthropy
47Environmental impacts of Itaú’s operations in Brazil in
2016
Study developed by the Sustainability department to: Measure the main environmental impacts of the bank´s operations and
report them to the stakeholders
Calculation of the impact generated in the Brazilian economy by Itaú’s supply chain and the credit
products offered to clients, individuals and companies, in 2016 (does not include Rede).
Products covered by the study
Supply chain Results obtained
Individuals Companies The 100 largest local suppliers were
Carbon Fossil fuels
considered based on the amount
Personal credit Working capital
spent. footprint
Payroll loans Direct Consumer Credit
/Lease/FINAME Water Energy
Credit cards
Credit cards footprint consumption
Mortgage loans Mortgage loans
Vehicle financing
Vehicle financing
48Findings from the Impact Study
Products – Individuals
Supply chain and Companies
(R$10.1 bi spent) (R$91.2 bi granted)
938,600 10.4 million t
9.6 mi m³ 157,569 t 5,897 GWh 301.8 mi m³ 1,763,405 t 68,336 GWh
t CO2 CO2
Equivalent to the weight
Corresponds to the Sufficient to meet water demand of 12 million barrels of oil
emissions generated by Sufficient to supply 3 of approximately 4.9 million
all vehicles in São Paulo million homes in Brazil people in Brazil for a one-year
in a three-month period for a one-year period period 49Contents
1. Governance, Policies and Structure
2. Environmental & Social Risk and Climate Changes
3. Client Management, Education and Financial Inclusion
4. Employee Management
5. Ethics, Integrity and Human Rights
6. Impact Measurement
7. Sustainable Development Goals (SDGs)
8. Corporate Citizenship and Philanthropy
50Itaú’s actions associated to the SDGs
Global agenda that guides the actions of
companies, government and society for
the sustainable development.
Development and Launch of the “Integração dos
application of the ODS na estratégia empresarial”
workshop on training (Integration of the SDGs in the
Launch of the 2030 /
SDG Compass in corporate strategy) Compass
SDG Agenda
Context partnership with the
Brazilian Network of the
study in partnership with the
Brazilian Network of the Global
Global Compact Compact
2015 2016 2017 2018 ...
Materiality matrix and SDGs are taken into Beginning of the review of the Development of the SDG
Itaú’s Actions GRI indicators taking the consideration in Itaú’s bank’s sustainability strategy matrix cross-referencing
Itaú’s main challenge:
SDGs into consideration actions towards based on the SDGs strategic challenges and To impact the SDG’s goals through
Sustainability business operations.
Engagement of employees
projects that connect Itaú’s strategic
SDGs as the umbrella for the (Brazil and Latam) in Detailed reporting of SDGs challenges with its business
strategy of the institutes workshops in the Consolidated Annual
and foundations Report
SDGs in training and for
trainee projectRelation between SDGs and Itaú Unibanco’s strategic fronts
Customer Centricity Risk Management
Digital Internationalization
Transformation
People Sustainable Profitability
ManagementMain impacts of the SDGs on Itaú Unibanco
SDG
Promoting formal Women’s Environmental and Environmental and Promoting decent Environmental and
Promoting Access to financial Promoting access
education and economic social management social criteria in and sustainable social criteria in
social and services to clients to health care and
training to empowerment in business and the business and use of work accessible for business and access
Impact financial in rural areas reducing financial
employees and equal facilities renewable energy in all to financial services
inclusion and impact
opportunities the facilities
diversity
• Environmental
• Microcredit • Rural credit • Employee health • Employee • Itaú Women • Environmental • Environmental and social • Environmental and
• Apprentice • Health insurance training Entrepreneurs and social and social management social risk
Main • Citizenship • Environmental • Education Program management management • Microcredit
• Employee
fronts • Rural credit and social • Financial • Public • Eco-efficiency • Eco-efficiency training • Financial Education
management education commitments • Carbon • Impact • Management of • P&S
• Diversity policy offsetting investment suppliers
SDG
Equal Promoting Gestão Environmental and Environmental and Environmental Promoting Impacting and
opportunities sustainable cities, socioambiental e social management social and social ethics, promoting
Impact and access to urban mobility and desenvolvimento in business, management in management in transparency sustainable
financial services cultural heritage sustentável operations and business and business and and fighting development
suppliers operations operations corruption
• Microcredit • Environmental • Membership in
• Environmental • Policies and
Main • Financial and social • Environmental • Environmental associations
• Bike Itaú and social training
Education management and social and social Partnerships
fronts • Itaú Cultural
• Suppliers
management • Ombudsman •
• Diversity • Crisis • Suppliers management management • Impact on
• Financial • Environmental
• Women management • Eco-efficiency • Eco-efficiency • Eco-efficiency policies
Education and social
Entrepreneurs • Associations • Associations • Associations
• Education managementContents
1. Governance, Policies and Structure
2. Environmental & Social Risk and Climate Changes
3. Client Management, Education and Financial Inclusion
4. Employee Management
5. Ethics, Integrity and Human Rights
6. Impact Measurement
7. Sustainable Development Goals (SDGs)
8. Corporate Citizenship and Philanthropy
54Corporate Citizenship
An institute focused on The main purpose of Espaço Itaú Fundação Itaú Social was Instituto Unibanco works to raise Itaú Viver Mais (Itaú
research and production of de Cinema, a network of movie specifically created to structure the quality of Brazilian public Live Longer) offers
content, as well as on theaters, is providing different and implement Itaú’s social education. Focused on improving physical, social and
mapping, encouraging and views of the movies, developing investments throughout Brazil, results and producing knowledge cultural activities in
disseminating artistic and audiences, and leaving a legacy and it is focused on supporting, about high schools, the Institute several locations in
intellectual manifestations. to society, always supporting developing and strengthening develops and implements Brazil for people older
Therefore, it contributes to projects that value and reinforce programs aimed at improving management solutions – in the than 55. The activities
the appreciation of culture in our commitment to public education policies, education system, in schools and are all free of charge
a complex and democratization of culture. enhancing the commitment of in classrooms – committed to the and also offered to non-
heterogeneous society like our employees – and society in effective capability of public account holders. The
Brazil. general – through a volunteer schools to ensure the right to Itaú Viver Mais program
Espaço Itaú de Cinema culture and systematized learning to all students. is based on three pillars:
received approximately evaluation of social projects. living, living together
723,000 people. A total of and reviving.
Itaú Cultural promoted We are involved in raising the
eight complexes with
approximately 260 quality of public education
screening rooms in six Since 2004, more than
activities, which focusing on improving
Brazilian cities We held the 12nd edition of 25,000 participants took
impacted more management of secondary
than177,000 people Prêmio Itaú-Unicef (Itaú-Unicef part in Itaú Viver Mais.
schools. 1,440 schools and
Award), which recognizes civil Today, there are
469,985 students took part in
society organizations and approximately 10,000
Jovem de Futuro (Youth with a
public schools. 1,651 openings in the states of São
Future)
partnerships between CSOs Paulo, Rio de Janeiro, Rio
and public schools registered in Grande do Sul and Minas
the program Gerais.
.Corporate Citizenship| Private social investment
In 2017, we formalized, through an
internal policy, the ruling that all of the
investments made by the bank should
aim to contribute to the Sustainable
Development Goals (SDGs), reaffirming
our commitment to the global agenda
adopted during the United Nations
Sustainable Development Summit in
2015.
(1) Due to the change in the structure of submission of contributions made during the years of 2015 and 2016, and the incompatibility in the form of their representation, this report does
not express a comparison between the last three years
(2) It e does not include sponsorships to the Brazilian Soccer Team and the Miami Open Tennis Tournament.
56For more information, see Itaú Unibanco Annual Report at https://www.itau.com.br/annual-report Questions, feedbacks and suggestions, contact us by the email box: sustentabilidade@itau-unibanco.com.br
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