Climate issues

We put a great deal of effort into knowing the environmental impact of our operation. We continue to analyse our carbon footprint and our impact on society.

Hjón úti í náttúru

We carry out an in-depth analysis of both the direct and indirect environmental impact of our value chain based on the internationally approved methodology GHG Protocol, the methodology generally used by businesses to calculate their carbon footprint. Calculation and disclosure of greenhouse gas (GHG) emissions from the Bank’s loan and asset portfolios is based on the methodology of the Partnership for Carbon Accounting Financials (PCAF).

GHG Protocol methodology

The scopes are defined as follows:

Scope 1
Direct emissions from our operation, i.e. emissions from sources owned or controlled by the Bank.
Scope 2
Indirect emissions from the generation of electricity and heating that we purchase.
Scope 3
Indirect emissions that occur in our value chain. Indirect emissions from lending activities also fall under scope 3.

Total emissions

The Bank’s total emissions, excluding from construction of new headquarters and financed emissions (Scopes 1 and 2), have contracted by 24% as compared with 2019. Emission from vehicles has dropped by 47% while emission from housing has increased by 25%. We aim to reduce emissions under Scope 1 by 80% by 2025 compared with 2018 emissions and by around 100% in 2030.

Indirect emission from the Bank under Scope 3 increased from the previous year, almost solely from purchased goods and services. The Bank renewed technical equipment for employee workstations and in conference rooms in its new headquarters, and invested in new computers. Emission from the construction of new headquarters continued to contract and work is now concentrated on outdoor areas. Emissions from business trips have increased post-pandemic and are up slightly between 2022 and 2023. Emission from domestic and international air travel as well as rental cars is included in business trips, as is accommodation. The Bank discloses employee accommodation on business trips for the first time this year. Employee travel to and from work includes remote work and falls under commuting. Included under purchased goods and services is paper use, data transfer, fuel production, production of computer equipment and sewerage.

Waste sorting and recycling

Landsbankinn has in recent years worked systematically to reduce its impact on the environment through waste, working both to reduce emissions and contribute to evolution of the circular economy by reusing and recycling. In the span of just three years, the ratio of sorted waste has increased from around 55% to just under 90% in 2023. Alongside higher sorting ratios, recycling and reuse of waste from the Bank has also increased to 85% in 2023, up from 49% in 2021. This increase in sorting, recycling and reuse is achieved while the volume of waste from the Bank increased by over 20%, or almost 18 tonnes.

Employee commuting

Landsbankinn emphasises flexibility and offers employees the opportunity to use different workstations, including remote work as and when tasks allow. Landsbankinn also offers employees a transport contract that promotes eco-friendly transport.

Landsbankinn has an agreement with Hopp and employees can utilise scooters from Hopp to run work errands free of charge between 8-17:00 on weekdays. Facilities for cyclists are excellent in the Bank’s new headquarters, with spacious bicycle storage and airing cupboards.

We carried out an annual commute survey among employees at year-end 2023 and 509 employees responded. The survey shows that employees commute to work by the following means: 8.4% utilise public transportation, 31% walk or cycle, 52.8% drive own cars and 7.8% catch a ride. Of the walking and cycling employees that fall in the same category, 15% walk, just over 8% cycle and 8% use electric bicycles or scooters.

The majority of employees that drive their own car to and from work drive fossil-fuelled cars. Just under a fourth of employees drive electric cards and just under 20% drive plug-in hybrid or hybrid cars.

Financed emissions

Landsbankinn’s analysis of GHG emissions also extends to its balance sheet. 2022 emissions are calculated using the PCAF methodology, also referred to as financed emissions. It is classified as indirect emissions under the fifteenth and final category of Scope 3 as it includes emissions in Scopes 1 and 2 from customers and assets in the Bank’s loan and asset portfolios. Emission from loans to customers is estimated at 247 ktCO₂e in 2022.

Since publication of the last report on the Bank’s financed emissions a year ago, baseline data for the relevant emission factors has been updated. The aim is always to improve basic and supplementary data for carbon calculations. When setting carbon emission goals for the Bank’s credit and asset portfolio, the reference year is 2019. Financed emissions from the Bank’s credit portfolio in 2022 are ca. 20 ktCO₂e lower than in the reference year, which can be attributed to lower emissions from vehicle and equipment loans.

The three sectors in the Bank’s credit portfolio with the highest emissions are the travel sector, fisheries and seafood, and services, IT and telecommunication. These sectors are responsible for over 70% of estimated total emissions from the Bank’s credit portfolio. The travel sector on the one hand and services, IT and telecommunications on the other have the highest emissions in 2022, or about 69 ktCO₂e each. The travel industry has traditionally had the highest total emissions, although emissions have decreased since 2019, when they stood at close to 130 ktCO2e.

Further information is disclosed in the Bank's financed emissions report.

Operation again carbon neutralised

We have carbon-offset the Bank’s 2023 activity and received internationally acclaimed certification from CarbonNeutral®. The Bank’s operation was carbon-offset through carbon sequestration or the reduction of GHG emissions. Working with Climate Impact Partners, we have purchased carbon credits that have undergone a strict certification process and have certainly led to carbon sequestration or avoidance of GHG emissions.


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