Strengthening competitiveness

The most direct way NIB can strengthen the competitiveness of its member country economies is to support projects that enhance the efficiency of companies. Therefore, the first question NIB asks when looking at the customers' projects is to what extent they contribute to improving efficiency or productivity.

NIB distinguishes between internal factors—those that businesses can directly influence—and external factors—those that exist in the company's business environment.

When the Bank assesses the potential impact on competitiveness of the projects, NIB weighs the relative improvement in the company's performance against a no-project situation. The relative impact on the company or on the business sector is then compared to similar projects in similar sectors. To properly gauge the expected benefits of the project, NIB also assesses the implementation risk, in other words, the risk that the project's full potential will not be realised.

Enhancing the environment

The second of the two key eligibility criteria for lending is enhancing the environment. This means that NIB provides loans and guarantees for projects that prevent and treat pollution. To achieve a positive environmental impact rating the project must be in compliance with NIB's Environmental Policy and Guidelines as well as relevant national legislation. A direct positive environmental net impact requires a quantitative assessment. Defining and limiting the scope or boundaries for the analysis is the first step in assessing mandate fulfilment. For every project, we assess the following:      

• peer group performance

• best available improvement

• absolute positive environmental impact.   

The environmental impact is measured on a six-degree scale, including a negative rating which is not applicable for competitiveness. Similarly to the assessment of competitiveness impact, the environmental assessment covers both the potential impact as well as the implementation risk of the project.

Environmental lending

On a regional level, for example in the Baltic Sea area and its drainage basin, NIB focuses on issues such as eutrophication and acidification resulting from air emissions and wastewater discharges. On a global level, NIB views combating climate change through the reduction of emissions of greenhouse gases as an important issue.

Environmental activities are inherent to NIB's daily activities and the environmental management system is integrated into the Bank's other management systems. In addition to its environmental analysts, the Bank's loan officers are also actively involved in the identification and management of environmental loans.

NIB impacts the environment mainly through its financing and, thus, the impacts are largely indirect. Below are data on the positive ecological impacts of the Bank's financing.