FinecoBank S p A : 2020 Consolidated Non-Financial Statement - FinecoBank Group

Sustainability Report

/2020

2020 CONSOLIDATED NON-FINANCIAL STATEMENT

In accordance with the legislative decree 254/2016

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index/

	LETTER TO STAKEHOLDERS	4	5.	OUR PEOPLE	80
			5.1.	Personnel management	82
	METHODOLOGICAL NOTE	6	5.2.	Equal opportunities and non-discrimination	89
			5.3.	People enhancement and development	92
1.	GROUP PROFILE	10	5.4.	Welfare and Work-Life Balance	99
1.1.	Highlights	12	5.5.	Industrial relations	101
1.2.	Prizes and awards	13	5.6.	Health and safety	102
1.3.	ESG Ratings and Indices	14
1.4.	External initiatives	15
1.5.	Who we are, strategy and business model	16	6.	OUR FINANCIAL ADVISORS	106
1.6.	Shareholders	20	6.1.	Training of personal financial advisors	112
1.7.	Sustainable Development Goals	22
	and 2020 - 2023 ESG Plan
1.8.	Membership of associations	31	7.	OUR CUSTOMERS	114
1.9.	The Governance system	33	7.1.	Customer satisfaction and quality of service	117
1.10.	The Internal Controls System	39	7.2.	Fairness and transparency	120
	and Risk Management		7.3.	Privacy and data protection	122
1.11.	Regulators	50	7.4.	Cyber Security and Fraud Management	125
1.12.	Supply chain management	52	7.5.	Financial education and inclusion	128
			7.6.	Responsible Products and Investments	131
2.	GROUP STAKEHOLDERS	54
	AND MATERIALITY ANALYSIS		8.	ENVIRONMENT AND	136
2.1.	Stakeholder engagement	56		LOCAL COMMUNITY
2.2.	Material topics	58	8.1.	Reducing environmental impact	138
				and compliance
			8.2.	Local community and charity projects	146
3.	ECONOMIC PERFORMANCE	60
	AND CAPITAL STRENGTH
3.1.	Economic value generated and distributed	62		BOUNDARY OF IMPACTS RELATING	149
3.2.	Capital management	65		TO MATERIAL TOPICS
				GRI CONTENT INDEX, UN GLOBAL	151
4.	INTEGRITY IN BUSINESS	66		COMPACT AND PRINCIPLES
	CONDUCT			FOR RESPONSIBLE BANKING
4.1.	Organisation and Management Model	69
4.2.	Fight against corruption, conflict of interest	71		INDEPENDENT AUDITORS'	164
	management and anti-competitive practices			REPORT
4.3.	Protection of Human Rights	73
4.4.	Whistleblowing	74
4.5.	Tax compliance	76

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LETTER TO STAKEHOLDERS

Fineco was created and has grown as a company always focused on long-termsustainable growth, with lasting returns and satisfied stakeholders. To achieve this goal, we have chosen to pursue transparency and fair prices for the services we offer, in line with our corporate purpose: offering our clients quality services and products through a multi-channel system in the three areas of integrated banking, investing and brokerage - at a fair price.

This approach is now being accompanied by a set of ESG goals to be achieved by 2023, divided into six strategic guidelines: increasing the offering of products and services with added social and environmental value, combating climate change by implementing an Environmental Management System, promoting a responsible supply chain, attention to people, supporting local communities, and strengthening dialogue with socially responsible investors, in addition to participating in initiatives that support our commitment to sustainable development.

In 2020, we took many steps towards achieving our ESG goals, including the Bank's participation in two major voluntary initiatives of the United Nations: the Global Compact, which promotes corporate social responsibility through adherence to Ten core Principles, and the Principles for Responsible Banking, launched in September 2019 to bring the banking industry closer to the Sustainable Development Goals and the objectives set in the 2015 Paris Climate Agreement. We also started the implementation of the Environmental Management System in accordance with the EMAS Regulation No. 1221/2009/EC, together with numerous initiatives designed to ensure the well-being of all our employees and give them as much support as possible in the "new normal".

Through our Irish subsidiary Fineco Asset Management DAC, we have also expanded our range of ESG products, moving the company further towards sustainability. FAM has signed up to the United Nations Principles for Responsible Investment, aimed at developing a sustainable financial system by integrating social, environmental and good governance criteria into investment practices. One of the most concrete initiatives was the adoption of the green label "No performance fees": a simple and immediate way to flag funds that do not charge performance fees, while also serving to raise awareness across the asset management industry. This has enabled FAM to position itself as a sustainable asset management company, also in terms of reducing costs for clients.

In terms of the Bank's offering, 2020 saw growth in the number of ESG-rated funds available on our platform, together with an increase in the offering of portfolio management based on sustainability strategies. This was accompanied by a strong drive to incorporate green and social bonds into the Bank's internal investments. In addition, the Green Mortgage, which supports the choice of buying energy-efficient property on favourable terms, has established a firm footing in the market.

Fineco's new Non-Financial Statement reveals how 2020 confirmed the resilience of the Group's business model, resulting from its ability to successfully tackle extremely complex market conditions, in a year that also represented an important step in the Bank's process of sustainable growth. The entire society had to face a health crisis that changed established habits, as well as accelerated secular trends that were already underway and have always been a key part of Fineco's DNA and its business model.

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The first is digitalisation, which is rapidly spreading to all ranges of the population and is enabling sectors of the economy, including the banking sector, to achieve their digitalisation targets for the next five years in just one year. New habits are emerging that will not be lost, setting us on a path of no return towards ever greater use of technology. For a bank like Fineco, which was born digital, this has been an opportunity to give our clients the quickest possible support, while continuing to strengthen our existing relationship of trust.

The crisis has also accelerated a second process: raising awareness among savers of the importance of being guided by professionals in their investment decisions. Our main objective at Fineco is to create value for our clients, which is why we have taken an approach of social responsibility in supporting them. An approach that takes into account their real needs, is transparent in terms of costs, and is geared towards growing awareness of ESG issues, by building economic, environmental and social sustainability into our long-term strategy.

In this second Non-FinancialStatement, we want to go beyond the concept of mere end of year reporting and tell you about our plan to align the Bank's commitments to the 17 United Nations Sustainable Development

Goals.

Fineco is now at the forefront in continuing to accompany its stakeholders on the path towards increasing sustainability, which we will all have to take. We are proud to say that social responsibility is part of who we are, and has consistently been a cornerstone of our process of creating long-term sustainable value for our current and future stakeholders.

Alessandro Foti

CEO and General Manager