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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM 6-K
REPORT OF FOREIGN PRIVATE
 
ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
Date: March 17, 2025
UBS Group AG
(Registrant's Name)
Bahnhofstrasse 45, 8001 Zurich, Switzerland
(Address of principal executive office)
Commission File Number: 1-36764
UBS AG
(Registrant's Name)
Bahnhofstrasse 45, 8001 Zurich, Switzerland
Aeschenvorstadt 1, 4051 Basel, Switzerland
(Address of principal executive office)
Commission File Number: 1-15060
Indicate by check mark whether the registrants file or will file annual reports under cover of Form following this page.
20-F or Form 40-
F.
Form 20-F
 
☒
 
Form 40-F
 
☐
This
 
Form
 
6-K
 
consists
 
of
 
UBS
 
Group
 
Sustainability
 
Report
 
2024,
 
which
 
appears
 
immediately
ubsgroupsustainabilitp3i0
 
Sustainability Report
2024
Thinking and acting with the long term in mind
Table of contents
Page
 
Sustainability Report 2024
| Introduction
 
1
Introduction
The importance of sustainability and culture to UBS
In 2024, we made further progress
 
in advancing our sustainability and culture
 
agenda. We have done so both based
 
on
our commitment to further evolving UBS’s culture as well as
 
our continued ambition to be a leader in sustainability.
Our sustainability
 
and impact
 
strategy is
 
based on
 
three strategic
 
pillars: (i)
Protect
: manage
 
our business
 
in alignment
with our sustainable, long-term strategy
 
and evolving standards; (ii)
Grow
: embed an innovative
 
sustainability and impact
offering across all our business divisions; (iii)
Attract
: be the bank of choice for clients and employees.
We support our clients
 
in the transition to
 
a low-carbon world and
 
consider climate change risks and
 
opportunities across
our bank
 
for the
 
benefit of
 
our clients,
 
shareholders and
 
all our
 
stakeholders. In
 
2024, following
 
a review
 
of our
 
own
operations target for scope 1 and 2, we decided to set a revised target to reduce scope 1 and 2 emissions to net zero by
2035, which
 
reflects both
 
the integrated
 
organization and
 
latest regulatory
 
guidance. We
 
made progress
 
on these
 
key
components
 
of
 
our
 
climate
 
action
 
plan,
 
reducing
 
our
 
net
 
greenhouse
 
gas
 
scope
 
1
 
and
 
2
 
emissions
 
and
 
energy
consumption. For scope 3,
 
we remain committed to
 
our lending sector decarbonization
 
targets to address our
 
financed
emissions in specified sectors and have progressed on these.
We
 
further
 
advanced
 
on
 
our
 
multi-year
 
sustainability
 
and
 
climate
 
risk
 
Initiative
 
toward
 
the
 
goal
 
of
 
fully
 
integrating
qualitative and quantitative sustainability and climate risk considerations into the firm’s traditional risk management
 
and
stress-testing frameworks.
In
 
our
 
first
 
fully
 
consolidated
 
environmental,
 
social
 
and
 
governance
 
(ESG)
 
ratings
 
following
 
the
 
acquisition
 
of
 
Credit
Suisse, MSCI reaffirmed our AA ESG rating and we increased our S&P
 
Global Corporate Sustainability Assessment score.
Trends
In 2024,
 
sustainability-focused
 
public investment
 
fund markets
 
recorded a
 
new high
 
of USD
 
3.2trn. While
 
the level
 
of
inflows decreased compared
 
to previous years,
 
investors continued to
 
allocate to sustainability-focused
 
funds and ETFs.
Investments into
 
alternative
 
asset classes,
 
including hedge
 
funds, real
 
estate and
 
infrastructure,
 
continued throughout
2024. The share of sustainable investing private-market
 
fundraising in total reached an all-time high.
There has been a sharp rise as well as divergence
 
in sustainability-related regulation over the past
 
few years. Regulators,
particularly
 
in
 
Europe,
 
have
 
begun
 
to
 
emphasize
 
labeling
 
regimes,
 
introducing
 
new
 
local
 
criteria
 
for
 
sustainable
investment solutions.
In an
 
evolving
 
macroeconomic
 
and complex
 
regulatory
 
landscape, we
 
help our
 
clients
 
achieve
 
their
 
sustainability
 
and
impact objectives. The transition to a lower-carbon economy,
 
including the associated risks and opportunities, continues
to
 
be
 
the
 
main
 
focus
 
for
 
many
 
clients.
 
This
 
is
 
driven
 
both
 
by
 
their
 
own
 
ambitions
 
and
 
by
 
regulatory
 
requirements.
Additionally, there is a diversification of sustainable investing
 
into private markets.
People and communities
We are
 
dedicated to being
 
a world-class employer
 
for talented individuals
 
across all our
 
markets and a
 
place where people
can unlock their full
 
potential. Our global presence in
 
51 countries and jurisdictions, combined
 
with the expertise of
 
more
than 110,000 employees worldwide, helps us to create better
 
outcomes for our clients, communities and colleagues.
Our employees execute our business strategy and deliver on
 
our client promise. We therefore aim to
 
attract, develop and
retain employees who have the
 
capabilities, potential and mindset to help
 
us achieve those aims. Meritocracy
 
continues
to be at the forefront of any decision we make.
Corporate citizenship principles are embedded into our employment practices, for example,
 
in the benefits we offer and
in our fair pay practices.
In December 2024, we celebrated
 
25 years of the UBS
 
Optimus Foundation. During this
 
time, Optimus has grown
 
from
a small
 
grant-making
 
organization
 
to an
 
influential network
 
of foundations
 
in nine
 
locations working
 
at a
 
global and
local level to drive
 
transformative change for
 
marginalized communities.
 
In 2024, we
 
surpassed our goal
 
set in 2021 of
mobilizing USD 1bn in philanthropic capital by end of 2025,
 
by reaching a total of USD 1.1bn.
In 2024, we successfully engaged 32% of our global workforce in volunteering activities, many in skills-based programs.
We recognize
 
the importance
 
of continuing
 
this effort
 
for those
 
we support,
 
empowering our
 
participating employees
and fostering communities that also benefit our business.
 
 
 
ubsgroupsustainabilitp6i1 ubsgroupsustainabilitp6i0
Sustainability Report 2024
| Introduction
 
2
Our commitment
We support our clients
 
in understanding the impact
 
of climate change in
 
their business models,
 
their supply chains and
their investments, including risks
 
and opportunities. That is why
 
we contribute to the
 
development of methodologies and
data that enhance
 
transparency. However, our
 
climate-related ambitions and
 
targets depend on
 
the overall progress
 
made
by all
 
sectors
 
and
 
countries,
 
and factors
 
that
 
are
 
beyond
 
our
 
direct control
 
require
 
clear
 
guidance from
 
governments
through thoughtful regulations and policies.
Clients remain at the heart of what we do. We therefore remain steadfast in our commitment to be their bank of choice
and support them with offerings that meet their evolving
 
needs.
 
 
Colm Kelleher
Chairman of the Board of Directors
Sergio P. Ermotti
Group Chief Executive Officer
UBS was among the companies that first signed the UN Global Compact in 2000 and is also
 
a member of the UN Global
Compact
 
Network
 
Switzerland,
 
meaning
 
we
 
are
 
committed
 
to
 
its
 
principles
 
on
 
human
 
rights,
 
labor
 
standards,
 
the
environment and anti-corruption. As reflected in detail in this
 
report, we have a comprehensive set of goals and
 
activities
in place pertaining to the principles of the UN Global
 
Compact.
 
ubsgroupsustainabilitp7i0
Sustainability Report 2024
| Introduction
 
3
About this report
Overview
The reporting period
 
for this UBS
 
Group Sustainability Report
 
is 1 January
 
to 31 December
 
2024, which is
 
aligned with
the financial reporting period
 
of UBS Group AG.
 
All 2024 data included
 
in the report is
 
therefore for this
 
period. Historical
data (for
 
2022 and
 
prior) pertains
 
to pre-acquisition
 
UBS, unless
 
otherwise stated.
 
Data showing
 
progress against
 
our
decarbonization
 
sectorial
 
targets
 
pertains
 
to
 
31
 
December
 
2023
 
(due
 
to
 
the
 
unavailability
 
of
 
relevant
 
2024
 
data,
 
as
explained in the respective section
 
of this report).
Unless otherwise noted, the information included in this report is presented at the consolidated level for UBS Group AG.
 
›
Refer to “Note 28 Interests in subsidiaries and other entities”
 
in the “Consolidated financial statements” section of
 
the UBS Group
Annual Report 2024, available under “Annual
 
reporting” at
 
ubs.com/investors
, for supplementary information regarding certain
significant subsidiaries
This report has been prepared with reference to the Global Reporting Initiative
 
(GRI) and in accordance with our Basis of
preparation. It also comprises the non-financial disclosures required for
 
UBS Group AG and its subsidiaries, including UBS
AG, under the Swiss Code of Obligations Art.
 
964b, including the Swiss Ordinance on Climate Disclosures. A
 
table at the
end of this report (Appendix 3) provides the references to
 
such non-financial information.
 
›
Refer to the GRI Content index, available at
ubs.com/sustainability-reporting
, for more information on the metrics with references
to GRI standards
›
Refer to the Basis of preparation document, available at
ubs.com/sustainability-reporting
, for more information on the metrics
definitions, approaches and scope
 
›
Refer to the “Supplement to Managing sustainability
 
and climate risks” section of the Supplement
 
to this report, available at
ubs.com/sustainability-reporting
, for information on the implementation of the environmental
 
risk regulations in Singapore and
the Hong Kong SAR by UBS, and disclosures in connection
 
with the legal entity reporting requirements of the ESG
 
Sourcebook in
the Business Standards section of the UK Financial Conduct
 
Authority Handbook, and for information pertaining
 
to UBS Group
AG’s approach to the “Swiss Ordinance on Due Diligence and Transparency in relation to Minerals and Metals from Conflict-
Affected Areas and Child Labor”
›
Refer to “Key terms and definitions” in the “Appendix
 
3 - Other supplemental information”
 
section of this report for terms and
abbreviations used in this report
Credit Suisse integration – explanations and related assumptions
On 12 June
 
2023, UBS Group
 
AG acquired
 
Credit Suisse
 
Group AG,
 
succeeding by operation
 
of Swiss law
 
to all assets
and
 
liabilities
 
of
 
Credit
 
Suisse
 
Group
 
AG,
 
and
 
became
 
the
 
direct
 
or
 
indirect
 
shareholder
 
of
 
all
 
the
 
former
 
direct
 
and
indirect subsidiaries
 
of Credit
 
Suisse Group
 
AG. UBS
 
Group AG
 
is a
 
holding company
 
and conducts
 
substantially all
 
its
operations through UBS AG, and subsidiaries thereof. UBS aims
 
to substantially complete the integration of Credit Suisse
into UBS by the end of 2026.
 
The legal structure of the UBS Group
 
The chart below gives an overview of our principal legal entities
 
and our legal entity structure.
›
Refer to the “Risk factors” and “Regulatory and
 
legal developments” sections and the “Integration
 
of Credit Suisse” section of the
UBS Group AG Annual Report 2024, available under “Annual reporting” at UBS’s sustainability metrics, as disclosed in the UBS Group AG Sustainability Report 2024, have been assured by Ernst &
ubs.com/investors
, for more information
 
Sustainability Report 2024
| Introduction
 
4
Assurance and agreed-upon procedures
Young
 
Ltd, Basel (EY). EY’s
 
procedures covered
 
29 metrics subject
 
to reasonable assurance
 
in key areas
 
such as climate
and 230 metrics subject to limited assurance. A list
 
of these metrics and level of assurance can be
 
found in the assurance
report.
 
In 2024, we
 
also engaged
 
EY to
 
perform agreed-upon
 
procedures (AuP)
 
on our lending
 
sector decarbonization
 
targets
to assist
 
us
 
in
 
determining
 
whether
 
these
 
have
 
been
 
set
 
in line
 
with reference
 
scenarios
 
mentioned
 
and
 
informed
 
by
certain requirements taken from pertinent global standards
 
and initiatives.
›
Refer to “Appendix 3 – Other supplemental
 
information” in the “Appendix” section of this report
 
for the assurance report
›
Refer to the Lending sector decarbonization targets
 
AuP report, available at
ubs.com/sustainability-reporting
, for more
information on agreed-upon procedures on our lending sector decarbonization
 
targets
Explanation of dependencies
Certain activities of UBS that pertain to the implementation of its sustainability and impact strategy are directly impacted
by factors that UBS cannot influence directly or can only influence
 
in part. These include pertinent governmental actions
(e.g. when it
 
comes to the
 
achievement of the
 
Paris Agreement
 
and thus the
 
achievement of our
 
firm’s climate-related
ambitions);
 
the
 
quality
 
and
 
availability
 
of
 
(standardized)
 
data
 
(e.g.
 
in
 
such
 
areas
 
as
 
emissions);
 
the
 
development
 
and
enhancement
 
of
 
required
 
methodologies
 
and
 
methodological
 
tools
 
(e.g.
 
on
 
climate
 
risk);
 
the
 
ongoing
 
evolution
 
of
relevant definitions (e.g. sustainable finance); and the furthering of transparency (e.g. pertaining to company disclosures
of data).
 
Areas
 
where
 
these dependencies
 
are
 
of particular
 
relevance
 
(including,
 
in particular,
 
regarding
 
the examples
noted above) are explained in the relevant
 
sections of this report.
17 March 2025
UBS Group AG
Contacts
Information to stakeholders
 
about the content
 
of this report
 
is provided
 
by the stakeholder
 
management team,
 
part of
UBS Group Sustainability and Impact.
cr@ubs.com
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Introduction
 
5
Terms used in this report, unless the context requires otherwise
 
”UBS,” ”UBS Group,” “UBS Group AG consolidated,” “Group,”
 
“the
Group,” “we,” “us” and “our”
UBS Group AG and its consolidated subsidiaries
“UBS sub-group”
All UBS Group entities, excluding Credit Suisse AG
 
and its consolidated
subsidiaries, Credit Suisse Services AG, and other
 
small former Credit Suisse
Group entities now directly held by UBS Group AG
“UBS AG,” “UBS AG consolidated“
 
UBS AG and its consolidated subsidiaries
“Pre-acquisition UBS”
UBS before the acquisition of the Credit Suisse Group
“Credit Suisse AG”
 
Credit Suisse AG and its consolidated subsidiaries
 
before the merger with UBS
AG
“Credit Suisse Group” and “Credit Suisse Group AG consolidated”
Credit Suisse Group AG and its consolidated subsidiaries,
 
before the
acquisition by UBS
“Credit Suisse”
 
Credit Suisse AG and its consolidated subsidiaries
 
before the merger with UBS
AG, Credit Suisse Services AG, and other small former
 
Credit Suisse Group
entities now directly held by UBS Group AG
“UBS Group AG” and “UBS Group AG standalone”
UBS Group AG on a standalone basis
“Credit Suisse Group AG”
 
Credit Suisse Group AG on a standalone basis
“UBS AG standalone”
UBS AG on a standalone basis
“Credit Suisse AG standalone”
Credit Suisse AG on a standalone basis
“UBS Switzerland AG”
UBS Switzerland AG on a standalone basis
“UBS Europe SE consolidated”
UBS Europe SE and its consolidated subsidiaries
 
“1m”
One million, i.e. 1,000,000
“1bn”
One billion, i.e. 1,000,000,000
“1trn”
One trillion, i.e. 1,000,000,000,000
In this report, unless the context requires otherwise, references to any
 
gender shall apply to all genders.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Introduction
 
6
Our integration journey – key measures taken in
 
2024
In 2024,
 
our focus
 
continued to
 
be on
 
the integration
 
of Credit
 
Suisse, with
 
our progress
 
described in
 
the shareholder
letter in the UBS Group AG Annual Report. We have also continued the
 
integration process across our sustainability and
culture activities, with key measures set out in the table
 
below.
Governance
We advanced with the integration of governance
 
bodies and policies
We near-completed the integration of Credit Suisse sustainability activities
 
into the operational processes and structure of the UBS
Group by decommissioning further Credit Suisse governance
 
bodies and policies. In 2025, we aim to
 
fully integrate the remaining
Credit Suisse sustainability-relevant governance bodies,
 
policies and procedures into the overall UBS Group sustainability
 
governance in
accordance with the overall UBS Group integration efforts
 
and timeline.
Strategy
We apply our sustainability and impact strategy
 
Group-wide
We applied within the overarching sustainability and impact
 
strategy of the UBS Group a limited number of
 
sustainability-related
policies, processes and activities that continued
 
at Credit Suisse in 2024.
Environment
We progressed on our Group-wide climate ambition
We developed and introduced the Group-wide Company Transition Assessment Scorecard (CTAS), which assesses how
 
advanced a
company is on its transition path toward decarbonization.
 
We worked on defining a more strategic and scalable
 
toolset for calculating, monitoring and reporting
 
the integrated firm’s climate-
related metrics covering the financing of corporate
 
loans and facilitated emissions. Guided
 
by our technology and ESG (environmental,
social and governance) data strategy, we developed a fully cloud-based
 
toolset that will be fully operational in 2025.
 
We concluded our first integrated ISO14001
 
environmental management surveillance audit for
 
our in-house environmental program
and set a new scope 1 and 2 target reflecting the
 
integrated organization and latest guidance.
 
Social
We are building a unified culture
 
We leveraged a dedicated forum chaired by the Head
 
Group Human Resources and Corporate Services and composed
 
of senior
management representatives and selected external
 
advisors to steer culture integration across our firm.
We consolidated the former Credit Suisse Foundations with
 
the UBS Optimus Foundation, with the
 
alignment of their philanthropic
foundation program portfolios underway.
We rolled out our Group-wide Responsible Supply Chain
 
Management framework and our Global Procurement
 
and Vendor
Management Policy and Guidance to Credit Suisse.
Supporting
opportunities
 
We leverage
 
the power of the integrated firm for
 
the benefit of clients
We continued to align our sustainability-related governance
 
structures and policies and brought together our processes
 
and teams to
enhance collaboration and leverage our combined
 
strengths.
 
We applied UBS sustainable investing policies to the
 
Credit Suisse products when onboarded to the UBS shelf.
 
This process is being
carried out in waves and will continue until
 
at least the end of 2025. We continued with having
 
in operational use the legacy Credit
Suisse Sustainable Investment Framework (the
 
SIF) for Credit Suisse Wealth Management and Credit Suisse Asset
 
Management clients
still being serviced through the Credit Suisse systems.
Managing
sustainability
and climate
risks
We integrated the firm’s sustainability and climate risk appetite
We further enhanced our transition and physical
 
risk methodologies and updated the sustainable
 
finance and carbon and
environmental market guidelines,
 
to address emerging sustainability and climate risks.
›
Refer to the “Integration of Credit Suisse” section of the UBS Group Annual Report 2024, available under “Annual reporting” at UBS – who we are
ubs.com/investors
, for more information
 
Sustainability Report 2024
| General information
 
7
General information
Our business model
 
UBS is the largest truly global wealth
 
manager and the leading bank in Switzerland.
 
These key pillars of our strategy are
enhanced by focused and competitive
 
investment bank and asset management
 
capabilities.
 
Staying close to our clients,
whether
 
they
 
are
 
individuals,
 
institutions
 
or
 
businesses,
 
and
 
providing
 
financial
 
advice
 
and
 
solutions
 
to
 
help
 
them
 
to
achieve their goals is of
 
the upmost importance to
 
us.
 
We have a capital-generative
 
and well-diversified business
 
model
with strong competitive positions
 
in our target markets.
 
Our business model, our
 
strong and risk-aware culture
 
and our
superior client service, as
 
well as our respected brand
 
with over 160 years
 
of history and our
 
capital prudence, have made
it possible to consistently
 
and sustainably both
 
grow profits and
 
deliver a high
 
return on equity over
 
the long term. The
acquisition of the Credit Suisse Group has further accelerated our
 
growth strategy by providing our client franchises with
additional scale,
 
complementary capabilities
 
and talent
 
in line
 
with our
 
ambition to
 
position UBS
 
for sustainable,
 
high-
quality returns and long-term growth.
 
We are focused on driving sustainable long-term growth
 
while maintaining risk and cost discipline
Our objective is to generate value for
 
our shareholders and clients by driving sustainable
 
long-term structural growth and
attractive
 
capital
 
returns.
 
To
 
accomplish
 
this,
 
we
 
are
 
building
 
on
 
our
 
scale,
 
content
 
and
 
solutions,
 
while
 
remaining
disciplined on capital, risk and costs.
 
Maintaining a balance sheet
 
for all seasons remains the foundation
 
of our success.
This gives us the capacity
 
to invest strategically and
 
will enable us to deliver
 
against our financial targets
 
and ambitions,
which are outlined in the “Targets, capital guidance and
 
ambitions” section of this report.
Our growth
 
plans are
 
rooted in
 
an attractive
 
business mix
 
that is
 
also a
 
source of
 
our competitive
 
strength. Our
 
asset-
gathering
 
businesses
 
are
 
characterized
 
by
 
being
 
structurally
 
attractive
 
from
 
a
 
capital
 
consumption
 
perspective
 
and
generate more than half of
 
our revenues
1
, while representing around
 
40% of our risk-weighted
 
assets (RWA)
1
. Roughly
another third of our
 
RWA
1
 
are in Personal &
 
Corporate Banking in Switzerland,
 
our home market and
 
an attractive, stable
and well-diversified
 
economy,
 
with low
 
historic credit
 
losses. Furthermore,
 
we operate
 
a capital-light
 
Investment Bank,
which is limited to 25% of Group RWA.
1
Moreover, our aim is to maximize our impact and that of
 
our clients to create long-term sustainable value. We also
 
have
a responsibility
 
toward the
 
communities we
 
serve and
 
our employees. We
 
have outlined
 
selected environmental,
 
social
and governance (ESG) aspirations, which we expect to
 
support our financial targets and ambitions.
We have a global, diversified business model
Our invested
 
assets of
 
more
 
than USD 6trn
 
are regionally
 
diversified across
 
the globe.
 
We give
 
our clients
 
access
 
to a
broad,
 
relevant
 
and
 
customizable
 
range
 
of
 
solutions,
 
which,
 
together
 
with
 
our
 
thought
 
leadership
 
and
 
capabilities,
position us well to
 
become their partner of choice.
 
Our strategic ambitions reflect the
 
long-term outlook on demographic
and social trends affecting wealth distribution, product demand
 
and client experience.
Half of our wealth management clients’ invested
 
assets are in the Americas, where we
 
are among the top players in the
world’s largest
 
wealth
 
pool, with
 
solid wealth
 
generation
 
prospects.
 
The Investment
 
Bank has
 
invested
 
in growing
 
its
Global Banking,
 
Global Markets
 
and Research
 
capabilities
 
in the
 
region, and
 
it is
 
focused on
 
cross-regional
 
and cross-
divisional collaboration to drive growth.
In Asia
 
Pacific, which is
 
the fastest-growing wealth
 
market, we are
 
by far
 
the largest
 
wealth manager,
2
 
and we
 
are building
on that scale to drive growth.
 
We are further developing
 
our businesses in the region
 
to deliver our leading capabilities,
leveraging our expanded and diversified footprint, strengths
 
in cross-divisional collaboration and global connectivity.
 
In EMEA we are focused on improving profitability and driving focused growth by optimizing our domestic footprint and
providing a comprehensive offering for entrepreneurs.
Finally, in Switzerland we have a highly
 
integrated business and aim to reinforce our position
 
as the leading bank. We are
driving our digital transformation, enhancing the client experience and improving efficiency, while focusing on capturing
selected
 
growth
 
opportunities.
 
We
 
are
 
also
 
delivering
 
on
 
our
 
commitments
 
to
 
our
 
home
 
market,
 
as
 
we
 
continue
 
to
provide around CHF 350bn of credit to Swiss companies
 
and the economy.
 
 
Sustainability Report 2024
| General information
 
8
We collaborate as one UBS to deliver integrated coverage
 
for clients
 
We strive
 
to serve
 
our clients
 
as one
 
firm, with
 
collaboration
 
across our
 
business divisions
 
being a
 
cornerstone
 
of our
strategy
 
and
 
a
 
key
 
differentiator,
 
as
 
we
 
deliver
 
the
 
best
 
of
 
UBS.
 
For
 
example,
 
our
 
asset-gathering
 
franchises
 
work
 
in
synergy
 
to
 
offer
 
clients
 
a
 
comprehensive
 
product
 
suite
 
paired
 
with
 
exclusive,
 
premium
 
personalized
 
services.
 
The
Investment Bank complements these by delivering
 
insights, execution capabilities and risk management expertise
 
to both
our
 
wealth
 
and
 
Swiss
 
corporate
 
clients.
 
We
 
regularly
 
enhance
 
this
 
integrated
 
approach
 
to
 
support
 
our
 
growth,
 
as
demonstrated by
 
recent initiatives,
 
such as the
 
establishing of
 
the division-agnostic
 
Unified Global
 
Alternatives and
 
the
creation of Global Wealth Management Solutions.
Supporting sustainability
 
We help our clients achieve
 
their sustainability and impact
 
objectives while navigating the
 
evolving macroeconomic and
complex regulatory
 
landscape. To
 
help us realize
 
this ambition,
 
our sustainability
 
and impact
 
strategy is
 
based on
 
three
strategic
 
pillars:
 
(i) Protect
 
–
 
manage
 
our
 
business
 
in
 
alignment
 
with
 
our
 
sustainable,
 
long-term
 
Group
 
strategy
 
and
evolving standards;
 
(ii) Grow –
 
embed an
 
innovative sustainability
 
and impact
 
offering across
 
all our
 
business divisions;
and (iii)
 
Attract
 
–
 
be the
 
bank of
 
choice for
 
clients and
 
employees.
 
We
 
support
 
our
 
clients in
 
the
 
transition
 
to
 
a
 
low-
carbon
 
world
 
and
 
consider
 
climate
 
change
 
risks
 
and
 
opportunities
 
across
 
our
 
bank
 
for
 
the
 
benefit
 
of
 
our
 
clients,
shareholders and all our stakeholders.
 
We are investing in our technology to drive business
 
outcomes
 
We have a proven technology strategy in place
 
to focus on delivery and experience for
 
our clients and employees, while
we are preparing for the future.
 
We are constantly modernizing our technology to support
 
an already strong foundation;
we
 
have
 
a
 
robust
 
infrastructure,
 
70%
 
of
 
which
 
is
 
in
 
the
 
public
 
and
 
private
 
Cloud,
 
that
 
maintained
 
over
 
99.999%
availability over the last year and maintains high security
 
standards.
 
This
 
foundation
 
facilitates
 
our
 
integration
 
and
 
enables
 
us
 
to
 
embrace
 
and
 
implement
 
innovation,
 
such
 
as
 
generative
artificial intelligence (AI), to bring technology products and
 
solutions to the next level.
 
We are
 
evolving into
 
an AI-driven
 
institution, using
 
generative
 
AI to
 
drive growth,
 
improve client
 
service, and
 
increase
productivity.
 
In the
 
fourth
 
quarter
 
of 2024,
 
we
 
announced
 
the
 
deployment
 
of 50,000
 
Microsoft
 
Copilot
 
licenses,
 
the
largest in the global financial services industry at
 
the time. This initiative is
 
already showing increased usage of generative
AI tools, with
 
1.75 million prompts
 
across all tools
 
in 2024,
 
and it is
 
expected to
 
substantially expand
 
in 2025.
 
We will
continue delivering AI initiatives across our businesses, including
 
re-inventing how we do software engineering.
We
 
invest in
 
partnerships
 
with
 
leading
 
academic
 
institutions
 
worldwide
 
and
 
other
 
key
 
players
 
to develop
 
ideas,
 
drive
outcomes across the firm and foster pioneering AI research.
 
We
 
are
 
committed
 
to
 
driving
 
innovation
 
and
 
excellence,
 
ensuring
 
that
 
our
 
technology
 
advancements
 
meet
 
the
expectations of our clients, employees, and stakeholders.
Our efforts
 
are supported
 
by our
 
governance and
 
controls that
 
are designed
 
to safeguard
 
the interests
 
of our
 
clients,
employees and other stakeholders.
›
Refer to the UBS Group Annual Report 2024, available
 
under “Annual reporting” at
ubs.com/investors
, for more information
1
Excluding Non-core and Legacy.
2
Asian Private Banker, 23 January
 
2024.
 
Sustainability Report 2024
| General information
 
9
Our stakeholder engagement
We engage with UBS’s stakeholders,
 
such as clients, employees, investors, policymakers, legislators
 
and regulators, along
with representatives of the business community, society and non-governmental
 
organizations (NGOs), on a regular basis
and on a
 
wide range of
 
topics. This
 
engagement helps
 
us to better
 
understand stakeholder
 
expectations and
 
concerns
and to manage
 
pertinent issues
 
and challenges.
 
In recent
 
years, the exchange
 
of views
 
and ideas with
 
stakeholders on
sustainability-related
 
issues
 
has
 
grown
 
in
 
importance.
 
Such
 
interactions
 
are
 
undertaken
 
through
 
various
 
dedicated
channels.
Employees
Our employees
 
want to
 
be heard
 
and to
 
be involved
 
in shaping
 
their daily
 
experience. As
 
such, we
 
offer opportunities
throughout
 
the
 
year
 
for
 
employees
 
to
 
connect
 
with
 
management
 
and
 
provide
 
feedback
 
on
 
topics
 
such
 
as
 
strategic
alignment, employee
 
engagement,
 
well-being, our
 
work environment
 
and line
 
manager effectiveness.
 
As an
 
example,
initiatives such
 
as our regular
 
Ask the
 
CEO event,
 
give employees
 
the chance
 
to learn
 
about (and
 
ask questions
 
about)
topics such as strategy.
Our multi-faceted
 
employee
 
listening
 
strategy
 
is adaptable,
 
captures
 
feedback
 
in
 
a
 
timely way
 
and
 
drives
 
meaningful
improvements to the employee experience. We conduct employee life cycle surveys,
 
short “pulse” surveys to understand
what is top
 
of employees’ minds and
 
in-depth analyses, such as
 
virtual focus group sessions.
 
In 2024, those
 
conversations
allowed participants from every business division and function to share their perspectives and insights on the integration
and provided employee sentiment data points to track progress. Group-wide surveys measure cultural indicators, such as
line manager effectiveness and employee experience.
 
Clients
Our clients’ needs and their preferred communication
 
channels continually evolve. Our objective is to
 
engage with clients
in
 
the
 
ways
 
most
 
convenient
 
for
 
them.
 
We
 
use
 
a
 
variety
 
of
 
channels,
 
in
 
particular
 
digital
 
channels
 
and
 
regular
 
client
relationship and service meetings, as
 
well as various corporate roadshows and
 
dedicated events, with a mix
 
of hybrid and
in-person events.
Global Wealth
 
Management
 
interacted
 
with its
 
clients through
 
a
 
broad range
 
of forums
 
and channels
 
in 2024,
 
from
personalized private briefings with
 
subject matter experts to
 
segment-specific virtual and in-person
 
events and large-scale
initiatives.
 
Through
 
marketing
 
and
 
media
 
campaigns,
 
events,
 
advertising,
 
publications
 
and
 
digital-only
 
solutions,
 
we
helped
 
drive
 
greater
 
awareness
 
of
 
UBS
 
among
 
prospective
 
clients
 
and
 
reinforced
 
trust-based
 
relationships
 
between
advisors
 
and clients.
 
We
 
proactively
 
engaged
 
with
 
clients
 
to reassure
 
them
 
about
 
the
 
acquisition
 
of the
 
Credit
 
Suisse
Group and highlighted the benefits
 
of the combined organization for
 
them. This was done through
 
individual meetings
and calls and by
 
opening up certain flagship events
 
and conferences to clients of the
 
combined firm. Our global footprint
means that we were
 
well positioned to
 
take advantage of the
 
opportunities in every region.
 
We have continued to
 
deliver
capabilities to clients,
 
for example
 
through digitally enabled
 
e-banking and sales
 
tools, while also
 
setting up new
 
units,
such
 
as
 
Global
 
Wealth
 
Management
 
Solutions,
 
Unified
 
Global
 
Banking
 
and
 
Unified
 
Global
 
Alternatives,
 
adding
 
even
greater connectivity
 
across all
 
our businesses.
 
We have
 
also continued
 
to roll
 
out artificial
 
intelligence (AI)
 
to positively
impact
 
our
 
business
 
and
 
serve
 
our
 
clients
 
better.
 
We
 
expect
 
generative
 
AI
 
will
 
continue
 
to
 
help
 
us
 
generate
 
more
personalized
 
advice
 
and
 
solutions
 
more
 
quickly
 
and
 
in
 
a
 
sustainable
 
and
 
responsible
 
way,
 
ensuring
 
a
 
more
 
efficient
experience for our clients around the globe.
 
Personal
 
&
 
Corporate
 
Banking holds
 
regular
 
client
 
events
 
(leveraging
 
a
 
number
 
of
 
formats,
 
such
 
as webcasts
 
and
 
in-
person, virtual or hybrid events), covering a wide range
 
of topics. In 2024, we further enhanced our digital engagement
strategies to
 
reach more
 
clients and
 
strengthen relationships
 
with existing
 
ones. We
 
utilize various
 
channels, including
social media, online displays, search engines and helplines,
 
as well as our branch network.
In Asset Management, we continue to host
 
our global program of client events
 
and engagement activities. These include
our annual
The Red
 
Thread
 
market outlook
 
roadshow, which
 
we host
 
in key
 
locations across
 
the world,
 
as well
 
as our
flagship
UBS Reserve Management Seminar
, which marked its 30th year of
 
operation in 2024. The event brings together
institutional investors
 
to debate
 
relevant topics and
 
share best practices,
 
and the accompanying
 
survey provides
 
one of
the most authoritative depictions of central banks’
 
investment views. Alongside this, our teams
 
continued the high level
of interaction
 
with clients
 
globally, supported
 
by digital
 
tools and
 
our publication
 
of macro
 
and thematic
 
insights. We
also hosted a broad range of hybrid events, including our investment
 
series, to help our clients better understand market
challenges and opportunities, and we continued to engage
 
with clients through our social media and online channels.
 
 
 
Sustainability Report 2024
| General information
 
10
The Investment
 
Bank hosted
 
more than
 
240 conferences
 
and educational
 
seminars
 
globally in
 
2024, providing
 
clients
with access
 
to corporations,
 
experts, research
 
and capital
 
introductions. The
 
events covered
 
a diverse
 
range of
 
topics,
including
 
macroeconomic,
 
geopolitical
 
and
 
sector-
 
and
 
region-specific
 
themes,
 
in
 
addition
 
to
 
regulatory,
 
product
 
and
market trends. More than 50,000 clients
 
took part in such events over
 
the year. We leverage our
 
intellectual capital and
relationships and use
 
our execution capabilities,
 
differentiated research content, bespoke
 
solutions, client franchise
 
model
and global platform to expand coverage
 
across a broad set of clients.
UBS Live Desk
,
 
built within the
UBS Neo
 
platform,
provides
 
clients
 
with
 
a
 
stream
 
of
 
fast-paced
 
commentary
 
from
 
UBS
 
traders.
 
The
UBS Analytical
 
Research
 
Community
(UBS-ARC)
is a
 
proprietary,
 
interconnected
 
research
 
network
 
of industry
 
leaders, subject
 
matter
 
specialists, executives,
academics and analysts in the Americas region.
Client feedback and surveys
We
 
engage
 
with
 
our
 
clients
 
on
 
a
 
regular
 
basis
 
and
 
on
 
a
 
wide
 
range
 
of
 
topics.
 
This
 
engagement
 
helps
 
us
 
to
 
better
understand
 
clients’
 
expectations
 
and
 
concerns,
 
including
 
those
 
pertaining
 
to
 
sustainability,
 
and
 
to
 
manage
 
pertinent
issues
 
and
 
challenges.
 
Feedback
 
received
 
from
 
clients
 
relevant
 
to
 
our
 
policies
 
is
 
considered
 
in
 
the
 
regular
 
reviews
 
of
policies
 
and
 
incorporated
 
where
 
applicable.
 
Our
 
client
 
insight
 
and
 
feedback
 
teams
 
are
 
responsible
 
for
 
gathering
 
and
processing all demands and issues raised through
 
our central channel, available online.
Investors
We have regular interactions
 
with institutional investors, financial analysts and
 
other market participants, such as
 
credit-
rating agencies, including on sustainability topics. These interactions
 
take place through the UBS Investor
 
Relations team,
with subject
 
matter experts
 
engaged as
 
required, and
 
help us
 
to learn
 
about investors’
 
concerns and
 
address them
 
as
effectively
 
as possible.
 
The
 
annual general
 
meeting
 
is also
 
an
 
open forum
 
for
 
shareholders
 
to voice
 
their
 
concerns
 
or
inquiries that may then feed into our approach on material topics.
 
Governments and regulators
Financial
 
market
 
stability
 
is
 
largely
 
dependent
 
on
 
the
 
overall
 
economic,
 
regulatory
 
and
 
political
 
environment
 
and
 
the
conduct of firms within the sector. We actively
 
participate in political and regulatory discussions to share our expertise on
proposed regulatory and
 
supervisory changes. Our
 
lobbying priorities
 
and engagements –
 
both direct
 
and indirect through
our
 
trade
 
associations
 
–
 
are
 
a
 
reflection
 
of
 
our
 
strategy
 
and
 
priorities.
 
In
 
Switzerland,
 
they
 
must
 
be
 
aligned
 
with
 
the
general political engagement approach defined by the
 
Political Board Swiss Chapter. In the US,
 
our lobbying priorities are
presented to and approved by the Region Americas’ top
 
management group at the beginning of each year.
Regarding
 
the
 
stability
 
of
 
the
 
financial
 
system,
 
UBS
 
advocates
 
for
 
an
 
internationally
 
aligned
 
regulatory
 
framework,
including capital
 
and liquidity
 
rules, anti-money
 
laundering and
 
digital regulation.
 
Moreover, in
 
the wake
 
of the
 
Credit
Suisse rescue,
 
we advocate
 
for targeted
 
and balanced
 
amendments to
 
the too-big-to-fail
 
(TBTF) framework
 
to address
the lessons learned from the
 
recent crisis
.
 
We also actively engage in
 
discussions relating to corporate
 
responsibility and
sustainability.
 
Sustainability
 
and
 
sustainable
 
finance
 
continue
 
to
 
remain
 
key
 
focus
 
topics
 
in
 
our
 
interactions
 
with
 
our
financial regulators and supervisors. These
 
are subject to ongoing oversight
 
and control by the second and
 
third lines of
defense.
In recognition of the vital function of Switzerland’s political parties, UBS provided a total of CHF 1.2m
1
to political parties
in
 
both
 
2023
 
and
 
2024
 
as
 
a
 
contribution
 
toward
 
their
 
operational
 
costs.
 
These
 
financial
 
contributions
 
are
 
direct
 
and
calculated based on the number of parliamentary seats the respective party holds
 
at the federal and cantonal level. Swiss
parties are eligible to apply for a financial
 
contribution if they commit to free competition,
 
the market economy and the
Swiss
 
financial
 
center.
 
They
 
should
 
also
 
have
 
a
 
national
 
focus
 
and
 
either
 
form
 
a
 
parliamentary
 
group
 
in
 
the
 
federal
parliament or be represented in at least one cantonal government.
 
1
Beyond the above there were no additional contributions,
 
including in-kind.
 
 
Sustainability Report 2024
| General information
 
11
Society
 
We regularly
 
interact with
 
various stakeholders
 
across broader
 
society. This
 
supports our
 
efforts to
 
consider views
 
and
insights from
 
a range
 
of backgrounds
 
and further
 
enhances the
 
experience
 
UBS provides
 
both inside
 
and outside
 
the
firm. This includes UBS’s ambition to maximize its impact in local communities in which it operates
 
by providing financial
and human
 
support through
 
strategic grant
 
making and
 
employee volunteering.
 
Our partnerships
 
in academia
 
further
contribute to our efforts to engage with thought leaders
 
in universities and other academic institutions.
 
We
 
also
 
engage
 
with
 
NGOs
 
and
 
appreciate
 
their
 
input
 
and
 
insight,
 
as
 
they
 
help
 
us
 
consider
 
our
 
approach
 
to,
 
and
understanding
 
of,
 
societal
 
issues
 
and
 
concerns.
 
NGOs
 
have
 
long
 
established
 
themselves
 
as
 
critical
 
watchdogs
 
of
companies, both scrutinizing and challenging how we address
 
a broad range of environmental, social and human
 
rights
concerns. In 2024, discussions with NGOs remained particularly focused on
 
climate change, including the transition to a
low-carbon economy. Other topics discussed included sustainable
 
finance, human rights and nature.
Meanwhile,
 
our
 
media
 
teams
 
maintain
 
direct
 
and
 
long-term
 
relationships
 
with
 
media
 
representatives
 
across
 
all
 
our
business regions and provide them with timely information on a wide range of global, regional and
 
local topics. We also
actively engage in
 
dialogue with analysts
 
at ESG rating
 
and research
 
agencies,
 
which helps us
 
to evaluate our
 
sustainability
performance and
 
activities and
 
provides a
 
useful means
 
for benchmarking.
 
In 2024,
 
we provided
 
detailed information
about our sustainability
 
performance to
 
a range
 
of agencies, either
 
in response to
 
questionnaires or
 
via calls
 
(with ESG
analysts) and our Sustainability Report regularly serves as
 
a key source of information for these agencies.
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| General information
 
12
Assessment of the significance of environmental,
social and governance (ESG) topics to UBS
Assessing
 
the
 
significance
 
of
 
ESG
 
topics
 
helps us
 
to ensure
 
that our
 
sustainability disclosures
 
reflect our
 
stakeholders’
expectations and
 
concerns. It
 
also informs our
 
discussions as
 
we evolve
 
our approach to
 
sustainability. Our
 
approach is
grounded in
 
recognizing the
 
importance of
 
engaging with
 
subject matter
 
experts and
 
listening to
 
key stakeholders
 
to
inform and evolve our sustainability strategy.
 
Note
: For
 
2024, we
 
have
 
used
 
the
 
results from
 
the
 
2023 Global
 
Reporting
 
Initiative
 
(GRI)-based assessment
 
outlined
below, as
 
no
 
material
 
changes
 
to the
 
assessment
 
were
 
identified.
 
This
 
assessment
 
supports
 
our
 
interactions
 
with
 
our
stakeholders, including regulators, that would want to understand
 
the relevance of ESG topics to our disclosures.
Methodology
Definitions
Our assessment
 
methodology was
 
focused on impact
 
reporting for
 
a multi-stakeholder audience.
To
assess our impact,
we
leveraged
the GRI Universal Standards 2021
 
revised definitions,
 
customizing
 
these
 
for the following:
–
The “impact” is the effect the
 
organization has or could have on
 
the economy, the environment and people, including
on their
 
human rights,
 
which in
 
turn can
 
indicate its
 
contribution (negative
 
or positive)
 
to sustainable
 
development.
Note: impacts can
 
be actual or potential,
 
negative or positive,
 
short-term or long-term,
 
intended or unintended,
 
and
reversible or irreversible.
–
The
 
“topics”
 
represent
 
the
 
organization’s
 
most
 
significant
 
impacts
 
on
 
the
 
economy,
 
the
 
environment
 
and people,
including impacts on
 
their human rights.
The degree of significance
 
(“very high,” “high” or
 
“medium”) was qualitatively assessed with
 
the help of
 
internal subject
matter
 
experts.
 
Their
 
inputs
 
considered
 
the
 
scale
 
and
 
scope
 
of
 
actual
 
or
 
potential
 
impact
 
(on
 
the
 
economy,
 
the
environment or society), the likelihood and irremediability.
Process
Our
 
process
 
consolidated
 
both
 
past
 
significant
 
topics
 
that
 
remain
 
relevant
 
and
 
newly
 
identified
 
topics.
 
In
 
2023,
 
we
refreshed
 
our
 
assessment,
 
starting
 
with
 
a
 
review
 
of
 
our
 
organizational
 
context
 
(i.e.
 
activities,
 
business
 
relationships,
sustainability context, stakeholders), before completing the three main process steps outlined below.
 
Step 1: Desk research
Step 2: Stakeholder consultation
Step 3: Final review
–
We developed an
 
initial list of topics
 
and
subtopics based
 
on internal and external
sources.
–
Integrated impact of integration of Credit
Suisse.
–
We consulted internal subject matter experts,
including those interacting
 
with stakeholders
directly, to add, refine and prioritize our
 
self-
assessed list of significant
 
topics.
–
We had the outcome of the assessment and
final list of topics verified by senior
management and
 
reviewed for
 
external
assurance purposes.
Organizational context
Before
 
identifying
 
our
 
actual
 
or
 
potential
 
impacts,
 
we
 
considered
 
the
 
sustainability
 
context
 
across
 
our
 
activities
 
and
business relationships, including:
–
our strategy;
–
our sustainable finance products and services, business relationships
 
and stakeholders; and
–
new products or services (for the climate materiality assessment only, pertaining to risks and opportunities).
In this context,
 
we identified which
 
stakeholders and experts
 
should inform the
 
determination of our
 
significant topics.
Internal subject matter experts were consulted via group
 
discussions.
 
 
 
 
 
 
 
 
Sustainability Report 2024
| General information
 
13
Governance
Reviewed
 
by
 
the
 
UBS
 
Group
 
Board
 
of
 
Directors’
 
Corporate
 
Culture
 
and
 
Responsibility
 
Committee
 
(the
 
CCRC),
 
the
assessment process was
 
managed by a group
 
of employees who deal
 
with stakeholder expectations and concerns
 
in their
respective
 
roles.
 
Their
 
regular
 
engagement
 
with
 
clients,
 
employees,
 
investors,
 
suppliers,
 
regulators
 
and
 
governments,
communities, and civil society ensured that the views of these stakeholders were adequately considered. The assessment
team applied the following three principles to arrive at
 
the outcome of the assessment:
–
Completeness: the team reviews the long and short lists and their aggregation into a prioritized list.
–
Accuracy:
 
the
 
team
 
challenges
 
the
 
approach,
 
provides
 
access
 
to
 
relevant
 
resources
 
and
 
helps
 
to
 
overcome hurdles
throughout the process.
–
Relevance: the team reviews all decisions in terms of relevance for the stakeholders they represent.
Execution
Desk research – identifying impact
We conducted
 
initial desk
 
research
 
to identify
 
general areas
 
where negative
 
or positive
 
impacts are
 
mostly likely
 
to be
present
 
relative
 
to
 
our
 
own
 
activities,
 
business
 
relationships
 
and
 
stakeholders.
 
During
 
this
 
scoping
 
exercise,
 
we
considered, in particular,
 
the internal and external stakeholder sources listed below.
Internal sources
External sources
–
UBS climate risk materiality assessment
–
UBS climate-related opportunities materiality
 
assessment
–
UBS’s 2022 GRI-based materiality topics list
–
G7 Communiqué
–
G20 Communiqué
–
WEF Global Risk Report
–
ECOFACT’s Top 5 Trending
 
Topics
–
FINMA Risk Monitor
–
Peers’ material topics disclosed
–
ECB’s climate-related risks to financial stability May 2022
–
PRI’s Strategic Plan 2021–2024
Stakeholder consultation
During
 
the
 
assessment
 
process,
 
we
 
considered
 
feedback
 
from
 
clients,
 
investors,
 
NGOs,
 
media,
 
policymakers
 
and
employees via polls and
 
open discussions. We
 
also regularly
 
gather feedback on
 
emerging issues and the
 
quality of our
reporting and impact from various sources, including other experts at our firm, stakeholder inquiries, questionnaires
 
and
rating firms.
 
Outcome
The topics considered as significant for UBS fall into three impact categories: the economy, the environment
 
and society.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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Sustainability Report 2024
| General information
 
14
Significant ESG topics
1,2
Significant topics
and impact
category
Related subtopics
Description
 
Sustainable finance
–
sustainable and impact investing
 
–
sustainable financing
–
blended finance
–
financial inclusion
 
–
transition finance
–
natural capital and nature finance
–
engagement and stewardship
 
–
ESG research
As a global financial services firm, UBS has
 
a role to play in mobilizing
capital to support the transition to a more sustainable
 
world and
prevent a negative impact. Our impact arises as a result of
 
our business
relationships and the financial services we provide, for
 
example, in the
way we partner with our clients to help them
 
mobilize their capital
toward a more sustainable world and help protect our clients’
 
assets
from the impacts of climate change and loss of biodiversity.
Regulatory
compliance
–
client protection: data confidentiality;
transparency (clear terms and conditions of
products); fair pricing schemes; easy-to-
understand products and services
 
–
combating financial crime: anti-corruption
 
and
anti-money laundering; crime and manipulation
detection processes
 
–
conduct: compliance with laws, rules, tax
authorities and regulations; integrity of the
financial system; our Code of Conduct and
 
Ethics;
forward-looking engagement with risk topics and
risk prevention
 
–
data confidentiality
 
–
financial stability and resilience: going concern
leverage ratio (phase-in, %); CET1 capital
 
ratio;
managing risk-weighted assets within
 
an
increasingly stringent risk framework; clear
strategy
 
–
legal and litigation risk
–
responsible marketing
Our firm operates in a highly regulated industry
 
and compliance with
legal and regulatory requirements is a prerequisite for our license to
operate. Our impact arises as a result of how we
 
comply with and
navigate the ever-evolving regulatory and legal landscape
 
to protect
and serve the interests of all our stakeholders or
 
mitigate negative
impacts on them.
 
Climate and nature
–
our approach to environmental matters
–
environment-related investments, financing and
research
–
sustainability and climate risk management
–
energy and resource efficiency, reduction of
emissions and resource consumption (energy,
paper, water)
–
standards in product development, investments
and financing and for supply chain management
decisions
We understand that we have a responsibility to identify, manage or
mitigate potential adverse impacts on the
 
environment. Our impact
arises from our own environmental footprint,
 
which we aim to reduce
with a focus on energy, water, paper,
 
waste and travel.
 
Client experience
–
delivering excellence
–
best services and practices
–
understanding clients and their needs
Responding to clients’ expectations and delivering
 
exceptional service
are essential for our long-term future performance.
 
We aim to
differentiate our impact through our promise to deliver a client
experience that is personalized, relevant, on time
 
and seamless.
 
Technology
–
technology as a differentiator
–
front-to-back digitization to deliver a seamless
client experience
–
cyber risks, data security and protection
–
digital culture and workspaces
–
integrated digital product and service offering
–
data management (incl. ESG data management
and governance)
We are making technology a differentiator for our clients and
employees. It is our responsibility to balance the increasing
 
demand for
digitalization and our commitment to improve
 
energy efficiency. We
also need to protect our clients and operations
 
against the threat of
cyberattacks that could lead to negative impacts,
 
such as financial and
reputational damage.
Corporate
governance
–
internal policies and guidelines
 
–
governance structure
 
–
strategy
 
–
risk management
 
–
board succession planning
–
transparency
To deliver the best for our clients and stakeholders, we hold ourselves
to the highest standards and a well-defined
 
strategy and business
model. Our impact arises in the way we sustain
 
long-term business
success and contribute to sustainable growth.
 
We make an impact on a
truly global scale by working with other thought
 
leaders.
Employees
–
corporate culture
 
–
hiring, developing and retaining talent
–
workforce inclusion, employment conditions and
opportunities
–
flexible work arrangements
–
employee support,
 
including benefits,
occupational health and well-being
–
employee listening and engagement
–
performance management process, along with
fair pay
–
employee representation
We cannot succeed without our employees. That
 
is why we drive our
culture and foster our employees’ continuous career development.
 
An
effective people management strategy helps us
 
attract, develop and
retain talented individuals and ensures we take responsibility
 
as an
employer worldwide. Our impact arises in the way
 
we offer a place
where people can unlock their full potential, and in the
 
way we
support employee health and well-being.
 
 
 
 
 
ubsgroupsustainabilitp19i0
 
ubsgroupsustainabilitp19i1 ubsgroupsustainabilitp19i2 ubsgroupsustainabilitp19i3 ubsgroupsustainabilitp19i4
 
ubsgroupsustainabilitp19i5 ubsgroupsustainabilitp19i6
Sustainability Report 2024
| General information
 
15
Social impact and
human rights
–
client philanthropic investments
–
corporate community engagement, partnerships
and volunteering
–
deploying resources (including philanthropic
capital) to support and build an impact
 
economy
–
sustainability and climate risk management
(including human rights)
–
standards in product development, investments
and financing and for supply chain management
decisions
We aspire to support a more inclusive society by building the impact
economy, by working with a wide range of stakeholders to help clients
that wish to maximize their impact on the
 
environment, health,
education and child protection, while optimizing the
 
contribution of
our firm to our local communities through employee
 
volunteering and
corporate philanthropy. To manage our supply chain’s impact, we
include ESG standards within our sourcing and procurement activities.
Operational
efficiency and
effectiveness
–
cost and process efficiency
 
–
focus on core competencies
 
–
flexibility to adapt to the changing regulatory and
public policy environment
 
–
outsourcing / nearshoring / offshoring,
automation
 
–
location strategy – product and execution
excellence
 
–
business disruption and vulnerability; disruption
 
of
the value chain
Ensuring efficient and effective operations is fundamental
 
to our ability
to remain competitive, to invest for the future and to
 
be resilient in the
face of revenue volatility. Impact occurs within our business, which in
turn affects how we serve our clients and
 
support our employees.
 
Economy
Environment
Society
1
 
This table is arranged in order of most to least significant impact, as the outcome of our internal assessments and pre-set threshold
 
to determine which topics are significant.
2
 
Certain activities of
 
UBS that pertain
 
to the implementation
 
of its sustainability
 
and impact strategy
 
are directly impacted
 
by factors that
 
UBS cannot influence
 
directly or can
 
only influence in
 
part. These
 
include
pertinent governmental actions (e.g. when it comes
 
to the achievement of the Paris Agreement);
 
the quality and availability of (standardized) data (e.g.
 
in such areas as emissions); the development and enhancement
of required methodologies and methodological tools (e.g. on climate risk); the ongoing evolution of relevant definitions (e.g. sustainable finance); and the furthering of transparency (e.g. pertaining to company The role of our supervisory bodies – the Board of Directors of UBS Group
disclosures of data).
 
Sustainability Report 2024
| Governance
 
16
Governance
Our sustainability governance
 
The
 
Board
 
of
 
Directors
 
of
 
the
 
UBS
 
Group
 
(the
 
BoD)
 
has
 
ultimate
 
responsibility
 
for
 
the
 
success
 
of
 
the
 
Group
 
and
 
for
delivering sustainable
 
shareholder value within
 
a framework
 
of prudent and
 
effective controls.
 
The BoD decides
 
on the
Group’s strategy and the
 
necessary financial and human
 
resources, on the recommendation of
 
the Group Chief Executive
Officer (the
 
Group CEO),
 
and also
 
sets the
 
Group’s values
 
and standards
 
to ensure
 
its obligations
 
to shareholders
 
and
other
 
stakeholders
 
are
 
met.
 
The
 
BoD
 
oversees
 
the
 
overall
 
direction,
 
supervision
 
and
 
control
 
of
 
the
 
Group
 
and
 
its
management.
 
It
 
also
 
supervises
 
compliance
 
with
 
applicable
 
laws,
 
rules
 
and
 
regulations.
 
The
 
Chairman
 
of
 
the
 
BoD,
together
 
with the
 
Group CEO,
 
takes
 
responsibility for
 
UBS’s reputation
 
and is
 
closely
 
involved in,
 
and responsible
 
for,
ensuring
 
effective
 
communication
 
with
 
shareholders
 
and
 
stakeholders,
 
including
 
government
 
officials,
 
regulators
 
and
public organizations.
 
As of 31
 
December 2024, the
 
UBS Group BoD
 
consisted of 12
 
non-executive members
 
and the Group
 
Executive Board
(the GEB) consisted of 15 executive members (2023: 12 and
 
16 respectively).
 
All non-executive members are also elected
as members of
 
the UBS
 
AG BoD.
 
Except for the
 
President of UBS
 
Switzerland AG, all
 
GEB members are
 
executive members
of UBS AG.
 
As of 31
 
December 2024, the
 
UBS AG BoD
 
consisted of
 
12 non-executive
 
members and the
 
Executive Board consisted
of 14 executive members.
 
The number of members is unchanged from
 
2023.
 
26.7%
 
(2023:
 
37.5%)
 
of
 
members
 
of
 
the
 
UBS Group
 
GEB
 
and
 
41.7%
 
(2023:
 
33.3%)
 
of
 
members
 
of the
 
BoD were
women, while for UBS
 
AG women made up
 
21.4% of members
 
of the Executive
 
Board and 41.7%
 
of members of the
BoD.
 
›
Refer to the “Corporate Governance” section
 
of the UBS Group Annual Report 2024, available
 
under “Annual reporting” at
ubs.com/investors,
 
for more information
 
The BoD’s role on ESG topics
 
Five committees support the BoD in fulfilling its duty through the respective
 
responsibilities and authority given to them.
All BoD committees
 
have specific responsibilities
 
pertaining to ESG
 
(environmental, social
 
and governance) matters.
 
For
example, the
 
Risk Committee
 
supervises the
 
integration of
 
ESG in
 
risk management,
 
the Governance
 
and Nominating
Committee
 
supports the
 
BoD in
 
establishing
 
best practices
 
in corporate
 
governance, the
 
Compensation Committee
 
is
responsible for
 
financial and
 
non-financial compensation
 
topics, and
 
the Audit
 
Committee has
 
oversight of the
 
control
framework underpinning ESG metrics.
›
Refer to the “Supplement to Governance”
 
section of the Supplement to the UBS Group Sustainability
 
Report 2024, available at
ubs.com/sustainability-reporting
, for more information
The BoD’s Corporate Culture
 
and Responsibility Committee
 
(the CCRC) is the
 
supervisory body primarily responsible
 
for
corporate culture and
 
sustainability. It is
 
chaired by
 
the Chairman of
 
the UBS
 
Group, with four
 
BoD members
 
as committee
members.
 
Permanent
 
guests
 
include
 
the
 
Group
 
CEO,
 
the
 
Group
 
Chief
 
Risk
 
Officer
 
(the
 
GCRO),
 
the
 
GEB
 
Lead
 
for
Sustainability
 
and
 
Impact
 
(S&I), the
 
Chief Sustainability
 
Officer
 
(the
 
CSO) and
 
the
 
Group
 
General
 
Counsel.
 
The
 
CCRC
oversees
 
our
 
Group-wide
 
sustainability
 
and
 
impact
 
strategy
 
and
 
key
 
activities
 
across
 
environmental
 
and
 
social
 
topics.
These include climate, nature and
 
human rights. Annually, it considers and
 
approves the firm’s sustainability and
 
impact
objectives.
 
As part
 
of this
 
process,
 
it also
 
considers
 
the
 
impact and
 
financial
 
materiality
 
of climate-
 
and sustainability-
related risks and opportunities on UBS.
 
The CCRC’s
 
function is
 
forward-looking in that
 
it monitors
 
and reviews
 
societal trends and
 
transformational developments
and assesses their potential relevance for the Group. In
 
undertaking this assessment, it reviews stakeholder concerns and
expectations pertaining to the
 
societal performance of UBS
 
and the development
 
of its corporate
 
culture. UBS has
 
various
mechanisms (including complaint
 
and feedback procedures)
 
in place to ensure
 
that such concerns and
 
expectations are
received, managed and, where necessary,
 
brought to the attention of
 
the GEB and the BoD.
 
The CCRC is also
 
responsible
for conducting the annual review
 
process for the Code of
 
Conduct and Ethics (the Code) and
 
for proposing amendments
to the BoD. This process includes a prior review of the Code
 
by the GEB and is led by the Group CEO.
 
The role of our supervisory and administrative bodies
The GEB develops the Group
 
strategy and is responsible
 
for managing our assets and
 
liabilities in line with that
 
strategy
and our regulatory commitments, and in the interests
 
of our stakeholders. As determined by the
 
BoD’s Risk Committee,
the GEB manages
 
the risk profile of
 
the Group as
 
a whole and has
 
overall responsibility for establishing
 
and implementing
risk management and control. For the management of risks, UBS maintains a risk governance framework. This framework Our risk governance framework operates along three lines of defense.
also governs ESG risks.
 
 
ubsgroupsustainabilitp21i0
Sustainability Report 2024
| Governance
 
17
Our first line of defense, business management,
owns its
 
risks and
 
is accountable
 
for maintaining
 
effective processes
 
and systems
 
to manage
 
them in
 
compliance with
applicable
 
laws,
 
rules
 
and
 
regulations,
 
as
 
well
 
as
 
internal
 
standards,
 
including
 
identifying
 
control
 
weaknesses
 
and
inadequate processes.
Our
 
second
 
line
 
of
 
defense,
 
control
 
functions,
 
is
 
separate
 
from
 
the
 
business.
 
Control
 
functions
 
provide
 
independent
oversight, challenge financial and non-financial risks arising from the firm’s business activities and establish independent
frameworks for
 
risk assessment,
 
measurement, aggregation,
 
control and
 
reporting, protecting
 
against non-compliance
with applicable laws, rules and regulations.
Our third line of defense,
 
Group Internal Audit (GIA),
 
reports to the Chairman
 
of the BoD and to
 
the Audit Committee.
This
 
function
 
assesses
 
the
 
design
 
and
 
operating
 
effectiveness
 
and
 
sustainability
 
of
 
processes
 
to
 
define
 
risk
 
appetite,
governance, risk management, internal controls,
 
remediation activities and processes to
 
comply with legal and
 
regulatory
requirements and internal governance standards.
 
›
Refer to the “Non-financial risk framework”
 
section of the UBS Group Annual Report 2024, available
 
under “Annual reporting” at
ubs.com/investors
, for information about our approach to managing
 
non-financial risks
Ensuring (availability of) appropriate skills and expertise
 
The
 
BoD
 
and
 
the
 
GEB
 
are
 
well
 
diversified
 
and
 
composed
 
of
 
members
 
with
 
a
 
broad
 
spectrum
 
of
 
skills,
 
educational
backgrounds, experience
 
and expertise from
 
a range of sectors that
 
reflect the nature
 
and scope of the
 
firm’s business.
The Governance
 
and Nominating
 
Committee
 
maintains
 
a competencies
 
and experience
 
matrix to
 
identify gaps
 
in the
competencies
 
and
 
experiences
 
considered
 
most
 
relevant
 
to
 
the
 
BoD,
 
taking
 
into
 
consideration
 
the
 
firm’s
 
business
exposure, risk profile, strategy and geographic reach. In
 
recent years, the composition of the
 
BoD has been systematically
shaped in response to the identified requirements. We consider the continuous education of our BoD and GEB members
to be an important priority and support their participation in various training sessions. In addition to a comprehensive Our sustainability and corporate culture activities are grounded in our Principles and Behaviors and overseen at the highest
induction
 
program
 
for
 
new
 
BoD
 
members,
 
continuous
 
training
 
and
 
topical
 
deep
 
dives
 
are
 
part
 
of
 
the
 
BoD
 
and
 
GEB
agenda.
 
 
ubsgroupsustainabilitp22i0
Sustainability Report 2024
| Governance
 
18
Our sustainability governance
 
level of our organization. Our Code covers our commitment
 
to acting with the long term in mind and
 
creating value for
clients, employees, communities and
 
investors. This includes
 
our commitment to
 
protecting the environment
 
and fulfilling
our compliance obligations.
 
Integration of Credit Suisse
In
 
2024,
 
we
 
advanced
 
with
 
integrating
 
Credit
 
Suisse
 
sustainability
 
activities.
 
It
 
is
 
our
 
aim
 
to
 
complete
 
integration
 
in
accordance with the overall UBS Group integration efforts
 
and timeline.
›
Refer to “Appendix 1 – Governance”
 
section to this report for more information about active
 
and retired sustainability
governance for Credit Suisse
Group Sustainability and Impact (GSI)
GSI
 
develops
 
the
 
Group’s
 
sustainability
 
and
 
impact
 
(S&I)
 
strategy
 
and
 
oversees
 
the
 
strategy’s
 
implementation
 
by
 
the
business divisions and Group functions
 
responsible for execution.
 
GSI operates as a Group function under the leadership
of the GEB
 
Lead for S&I.
 
Each of the
 
senior managers listed
 
below reports directly
 
to the GEB
 
Lead for S&I.
 
Specifically,
the senior manager roles directly reporting to the GEB
 
Lead for S&I are the Chief Sustainability Officer, the Head of Social
Impact and Philanthropy and the GSI Chief Operating Officer. Senior managers may hold more than one role and, where
required, may have additional responsibilities and reporting
 
lines in the Group’s legal entities.
 
GEB Lead for Sustainability and Impact
The GEB
 
Lead for
 
S&I has
 
overall responsibility
 
for the
 
management and
 
control
 
of the
 
GSI function.
 
In particular,
 
the
GEB Lead for S&I is
 
responsible for the oversight of matters, such as maintaining an
 
appropriate and adequate functional
organization
 
designed
 
to
 
ensure
 
compliance
 
with
 
applicable
 
laws and
 
regulations.
 
Additionally,
 
where
 
necessary,
 
the
GEB Lead
 
for S&I
 
represents
 
UBS in
 
interactions with
 
regulatory
 
authorities on
 
Group-wide
 
sustainability-
 
and impact-
related topics in close coordination with the Group CEO, other GEB members and Governmental and Regulatory Affairs.
In relation
 
to disclosures,
 
the
 
annual UBS
 
sustainability
 
reporting
 
and disclosure
 
process
 
is managed
 
by the
 
GEB Lead
jointly with Group Finance.
›
Refer to the “Supplement to Governance“
 
section of the Supplement to the UBS Group Sustainability
 
Report 2024, available at
ubs.com/sustainability-reporting
, for an explanation and depiction of the
 
sustainability governance at the UBS Group, including
the main bodies involved in this governance
Chief Sustainability Officer
The Chief
 
Sustainability Office
 
r
 
(CSO), jointly
 
with the
 
Head of
 
Social Impact
 
and Philanthropy
 
(SIP), supports
 
the GEB
Lead for S&I
 
in setting the
 
Group-wide S&I
 
strategy,
 
in alignment with
 
the business
 
divisions and Group
 
functions. The
CSO and team
 
develop and maintain
 
frameworks and methodologies
 
to drive Group-wide
 
consistency.
 
In addition, the
CSO team monitors
 
new GSI regulatory
 
consultations and owns
 
and drives Group
 
advocacy efforts,
 
in partnership with
the GSI
 
Chief Operating
 
Officer (GSI
 
COO) and
 
GSI-aligned Group
 
functions. The
 
CSO maintains
 
and annually
 
reviews
our S&I commitments,
 
memberships or contracts
 
at Group, divisional,
 
functional or regional
 
level for completeness
 
and
alignment with the Group-wide S&I strategy
 
.
 
Sustainability Report 2024
| Governance
 
19
Head of Social Impact and Philanthropy
 
The Head of SIP and team oversee the UBS charitable entities
 
,
 
including Optimus Foundation entities and donor-advised
fund entities.
 
Their
 
remit
 
includes
 
overseeing
 
the
 
strategy,
 
corporate
 
structure
 
and governance,
 
financial
 
matters
 
and
relevant risks and controls. The SIP team reviews inherent reputational risks relating to social impact grants and escalates
high reputational
 
risks to
 
the GEB
 
Lead for
 
S&I, in
 
line
 
with the
 
UBS Reputational
 
Risk Management
 
Policy.
 
They also
manage the SIP client
 
and employee offering through the delivery of
 
philanthropic insights, advice and execution services
to existing and prospective clients.
 
GSI Chief Operating Officer
 
The GSI
 
Chief Operating
 
Officer (GSI COO)
 
and team
 
manage the
 
end-to-end processes and
 
the service
 
delivery, operating
and
 
control
 
environment
 
of
 
GSI,
 
together
 
with
 
business
 
divisions
 
and
 
Group
 
functions,
 
ensuring
 
timely
 
escalation
 
of
relevant matters
 
impacting GSI and
 
effective oversight
 
of operational performance.
 
Furthermore, they
 
support the GEB
Lead
 
for
 
S&I
 
in
 
developing
 
Group-wide
 
S&I
 
objectives,
 
in
 
alignment
 
with
 
business
 
divisions
 
and
 
Group
 
functions,
 
to
implement the
 
Group-wide S&I strategy
 
and monitor
 
the progress against
 
these objectives. In
 
addition, the team
 
manages
the annual UBS sustainability reporting process,
 
jointly with Group Finance.
Oversight of objective-setting and monitoring processes
 
UBS runs an
 
annual objective-setting
 
process for objectives
 
related to
 
sustainability and impact
 
matters, which includes
environmental
 
(including
 
climate-related)
 
and social
 
topics. As
 
delegated
 
to the
 
GEB Lead
 
for S&I
 
by the
 
Group
 
Chief
Executive
 
Officer
 
(the
 
Group
 
CEO),
 
the
 
GEB
 
Lead
 
for
 
S&I
 
is
 
responsible
 
for
 
setting
 
the
 
Group-wide
 
S&I
 
strategy
 
and
developing
 
Group-wide
 
S&I
 
objectives
 
in alignment
 
with
 
business
 
divisions
 
and Group
 
functions.
 
The
 
annual
 
strategy
review
 
and objective-setting
 
process
 
is done
 
to identify
 
priorities and
 
strategic focus
 
areas
 
across
 
the Group.
 
Progress
made in implementing Group-wide S&I objectives is
 
reported as part of UBS’s annual sustainability disclosure.
 
Swiss
 
law
 
requires
 
Swiss
 
companies
 
to
 
achieve
 
net-zero
 
greenhouse
 
emissions
 
in
 
their
 
own
 
operations
 
by
 
2050.
 
This
requirement is
 
integrated into
 
the firm's
 
methodologies and
 
approaches. Adherence
 
to these
 
requirements is
 
primarily
driven by
 
three
 
GEB
 
members:
 
the
 
GEB
 
Lead
 
for
 
S&I,
 
along
 
with risk
 
teams
 
led by
 
the
 
Group
 
Chief
 
Risk
 
Officer,
 
and
compliance teams under
 
the Chief Compliance
 
and Governance Officer,
 
and is
 
considered in the
 
annual GEB performance
assessments.
 
UBS considers
 
the performance
 
assessments
 
in determining
 
the
 
performance
 
award decisions.
 
However,
there is no direct link between
 
senior management compensation and
 
specific climate goals. In
 
line with Swiss law, and
as set out in this report, UBS has announced a climate plan to achieve net zero by 2035 across its own operations (scope
1 and 2), well ahead of the 2050 deadline.
›
Refer to the “Supplement to Governance”
 
section of the Supplement to the UBS Group Sustainability
 
Report 2024, available at
ubs.com/sustainability-reporting
, for additional information about our sustainability
 
governance
In 2024, to further support our
 
evolved S&I strategy, we revised our
 
GSI governance structure and internal forums,
 
which
now comprise the GSI Business Development & Client Forum
 
(the GSI BDCF) and the GSI Execution Forum (the GSI
 
EF).
GSI Business Development & Client Forum
 
The GSI
 
BDCF is
 
established under
 
the authority
 
of the
 
GEB Lead
 
for S&I.
 
The forum
 
is focused
 
on client,
 
product and
impact approaches in relation
 
to the overall UBS S&I implementation
 
activities, together with the
 
business divisions. The
GSI BDCF is the most senior administrative body overseeing
 
the Group-wide S&I activities.
 
GSI Execution Forum
The GSI Execution
 
Forum reports to the
 
GSI BDCF and
 
is established under
 
the authority of
 
the GSI COO
 
to help discharge
their role and responsibilities. The forum is responsible for the oversight of the front-to-back operating environment
 
and
for the implementation of the Group-wide S&I strategy
 
through Group-wide strategic objectives
 
and outcomes.
Other senior management roles with Group-wide sustainability
 
responsibilities
Chief Risk Officer Sustainability
Our management of
 
sustainability and climate
 
risk is steered
 
at the GEB
 
level. Reporting to
 
the Group
 
CEO, the
 
Group
Chief
 
Risk
 
Officer
 
is
 
responsible
 
for
 
developing
 
and
 
implementing
 
control
 
principles
 
and
 
an
 
appropriate
 
independent
control framework
 
for sustainability
 
and climate
 
risk within
 
UBS, together
 
with integrating
 
it into
 
the firm’s
 
overall risk
management and risk
 
appetite frameworks.
 
The Chief
 
Risk Officer Sustainability supports
 
the GEB by
 
providing leadership
on sustainability risk in collaboration with business divisions and
 
Group functions.
 
GSI Chief Financial Officer
The GSI
 
Chief Financial
 
Officer
 
(the GSI
 
CFO) is
 
the primary
 
lead on
 
sustainability topics
 
for the
 
Group
 
Chief Financial
Officer
 
(the
 
GCFO),
 
working
 
closely
 
with
 
the
 
Group
 
Controller
 
and
 
the
 
GEB
 
Lead
 
for
 
S&I.
 
The
 
GSI
 
CFO
 
oversees
 
the
external
 
sustainability
 
disclosures
 
and
 
associated
 
requirements
 
in
 
partnership
 
with
 
Group
 
Legal,
 
Group
 
Compliance,
Regulatory and Governance, Group
 
Risk and GSI.
 
The GSI CFO
 
additionally ensures that UBS operates
 
an effective control
environment, underpinning our sustainability disclosures
 
and reporting processes.
 
Sustainability Report 2024
| Governance
 
20
Head of Group Compliance, Regulatory & Governance (GCRG)
 
Sustainability
The Head
 
of GCRG Sustainability
 
is responsible
 
for the
 
integration of
 
ESG requirements
 
into the UBS
 
non-financial risk
framework
 
and
 
non-financial
 
risk
 
appetite
 
objectives
 
in
 
line
 
with
 
firm-wide
 
standards
 
as
 
part
 
of
 
the
 
broader
 
GCRG
mandate. GCRG
 
is respon
 
sible for
 
developing
 
the Group’s
 
risk management
 
and control
 
framework
 
for non-financial
risks
 
(compliance
 
risk,
 
operational
 
risk
 
control
 
and
 
financial
 
crime
 
prevention).
 
The
 
GCRG
 
function
 
provides
 
ongoing
monitoring of the adequacy
 
of our control
 
environment for
 
these risks and drives
 
the review
 
and, where necessary,
 
the
required adaptations to our internal frameworks to ensure that
 
our independent control and oversight capabilities evolve
in line with emerging regulations and changes across
 
business activities.
Head of Sustainable Finance Legal
The Head
 
of Sustainable Finance
 
Legal is
 
responsible for the
 
ongoing delivery of
 
legal advice
 
to the CSO,
 
business divisions
and Group
 
functions
 
in relation
 
to sustainability
 
matters. The
 
Sustainable Finance
 
Legal (SFL)
 
team acts
 
as a
 
center of
excellence fully
 
dedicated to
 
sustainability-related
 
legal risks
 
and opportunities.
 
This includes,
 
but is
 
not limited
 
to, the
interpretation of and provision of support
 
for the implementation of sustainability-related laws and
 
regulations in the EU,
the
 
UK,
 
Switzerland
 
and
 
Asia
 
Pacific,
 
and
 
regional
 
and
 
global
 
international
 
standards
 
applicable,
 
in
 
particular,
 
to
sustainable
 
products,
 
services
 
and
 
activities.
 
In
 
addition,
 
SFL
 
monitors
 
the
 
regulatory
 
developments
 
in
 
the
 
space
 
of
greenwashing
 
along with
 
sustainability-related
 
disputes (including
 
regulatory
 
enforcement
 
actions), human
 
rights
 
and
environmental due diligence regimes across
 
the globe.
Key sustainability topics
Climate program
The
 
climate
 
program
 
coordinates
 
the
 
implementation
 
and
 
execution
 
of
 
our
 
ambition
 
to
 
support
 
our
 
clients
 
in
 
the
transition to a low-carbon world and embed considerations of climate
 
change risks and opportunities in our firm for the
benefit of our
 
stakeholders. It does so
 
in line with
 
UBS’s fiduciary responsibilities and
 
includes members from the
 
business
divisions and
 
Group
 
functions. As
 
part of
 
the program,
 
our in-house
 
environmental
 
management is
 
steered
 
by Group
Real Estate and Supply Chain (GRESC).
 
›
Refer to the “Assurance and certification” section
 
of the Supplement to the UBS Group Sustainability
 
Report 2024, available at
ubs.com/sustainability-reporting
, for information about our application of the environmental
 
management standard ISO 14001
 
Other key sustainability topics
 
Human rights
As our Human
 
Rights Statement articulates, the
 
governance outlined above also
 
applies to our
 
commitment to respecting
internationally recognized human rights across UBS globally.
›
Refer to our Human Rights Statement, available at Business conduct and corporate culture
ubs.com/sustainability-reporting
, for more information
 
 
 
Sustainability Report 2024
| Governance
 
21
In our Code of Conduct and Ethics
 
(the Code), the Board of Directors (the
 
BoD) and the Group Executive Board (the
 
GEB)
set out
 
the
 
principles and
 
practices
 
that define
 
our ethical
 
standards and
 
the way
 
we do
 
business,
 
which
 
apply
 
to all
aspects of our business. The
 
Corporate Culture and Responsibility
 
Committee (the CCRC) of
 
the BoD is also responsible
for conducting the annual
 
review process for the
 
Code and for proposing
 
amendments to the
 
BoD. This review process
includes a prior review
 
of the Code by
 
the GEB and
 
is led by the
 
Group CEO. In undertaking
 
this assessment, it reviews
stakeholder concerns and
 
expectations pertaining to
 
the societal performance
 
of UBS and to
 
the development of UBS’s
corporate culture.
›
Refer to the Code of Conduct and Ethics of
 
UBS, available at
ubs.com/code
, for more information
Principles for identifying, preventing, escalating and managing conduct
 
risks are established in the Group-wide Conduct
Risk Management Framework.
 
These principles are
 
aligned to the
 
Code and the
 
Group-wide escalation framework
 
and
include:
 
–
our
 
strategy
 
and
 
business
 
model,
 
along
 
with
 
our
 
incentives
 
and
 
rewards,
 
which
 
are
 
designed
 
to
 
actively
 
manage
conduct risk.
 
Above all,
 
our culture
 
and our
 
Principles and
 
Behaviors are
 
the strongest
 
mitigant to
 
our exposure
 
to
conduct risk;
–
a review of relevant management
 
information,
 
which is critical to giving
 
a view of the risk
 
landscape and where risks
may be crystallizing;
 
–
policy,
 
appetite
 
and
 
governance,
 
which
 
are
 
key
 
components
 
of
 
our
 
conduct
 
risk
 
framework
 
and
 
contribute
 
to
 
its
sustainability.
 
Identifying actual or potential conduct risks is the responsibility of every UBS
 
employee,
 
who must take appropriate steps
to identify and escalate
 
any actual or
 
potential conduct risks
 
they may see
 
in their day-to-day-activities
 
and have a
 
duty
to lead by example, role model UBS’s Behaviors and support
 
our risk culture of “see something, say something.”
 
Ongoing monitoring ensures the firm’s activities and those
 
of employees are monitored to detect issues with a potential
impact on clients and markets and to detect individual cases
 
of employee misconduct.
 
We are committed
 
to incentivizing the
 
right behavior by
 
establishing reward principles
 
and internal control
 
frameworks
to support adherence to internal and external standards, laws, rules
 
and regulations.
 
Violations, whether it is
 
of our Code, UBS
 
policies or external laws, rules
 
or regulations, may result in
 
a disciplinary action,
up
 
to
 
and
 
including
 
dismissal.
 
Furthermore,
 
employees’
 
conduct
 
is
 
taken
 
into
 
account
 
in
 
year-end
 
performance
 
and
reward decisions.
 
We have a
 
global mandatory training
 
module,
 
Conduct and Culture,
 
that educates
 
all UBS employees
 
on adherence
 
to
the three keys to success, understanding the Code, identifying conduct risk
 
and how it can arise from within any part of
the organization, and culture and ethics.
Additionally, all employees must affirm annually
 
that they have read and
 
will adhere to the Code and other
 
key policies,
supporting a culture
 
where ethical and
 
responsible behavior is
 
part of our
 
everyday operations. By
 
following and affirming
the Code, we foster a culture
 
where responsible behavior is ingrained
 
in a way that protects our
 
clients, our people and
our reputation
 
and ensures
 
stability and
 
sustainable performance.
 
This safeguards
 
our ability
 
to create
 
lasting value
 
for
our shareholders, clients and societies.
Significant matters requiring immediate senior management
 
awareness and action are managed in accordance
 
with our
Group-wide
 
escalation
 
framework,
 
which
 
lays
 
out:
 
(i)
 
minimum
 
requirements
 
for
 
escalations;
 
(ii)
 
applicable
 
escalation
paths
 
for
 
distinct
 
governance
 
dimensions;
 
and
 
(iii)
 
the
 
interplay
 
between
 
governance
 
dimensions.
 
The
 
framework
 
is
complemented by relevant
 
divisional / functional
 
/ legal entity
 
/ local annexes
 
detailing specific escalation
 
requirements,
which outline
 
taxonomies, thresholds, processes and protocols. The framework
 
does not replace day-to-day information
exchange, decision-making mechanisms or
 
regular reporting. As
 
such, the escalation framework
 
does not replace
 
existing
governance, line management,
 
any of the
 
existing monitoring /
 
reporting requirements
 
or regular risk
 
assessments that
may result in the need to report and follow up.
The
 
firm
 
has
 
a
 
global
 
Whistleblowing
 
Protection
 
for
 
Employees
 
Policy
 
and
 
framework,
 
with
 
established
 
internal
whistleblower
 
reporting
 
channels,
 
including
 
hotlines
 
and
 
an
 
online
 
platform,
 
where
 
the
 
whistleblower
 
can
 
remain
anonymous if preferred.
All
 
employees
 
are
 
required
 
to
 
complete
 
mandatory
 
Speak
 
Up
 
training
 
every
 
two
 
years,
 
with
 
new
 
joiners
 
required
 
to
complete
 
it
 
upon
 
onboarding.
 
This
 
training
 
aligns
 
with
 
the
 
Whistleblowing
 
Protection
 
for
 
Employees
 
Policy,
 
raising
awareness of available
 
reporting channels. Throughout the
 
year, there are
 
activities such as
 
communication from the GEB,
newsletters, whistleblowing campaigns and regular employee surveys, aimed at encouraging
 
employees to speak up and
raise awareness with regard to the various whistleblower
 
reporting channels that can be used to raise concerns.
 
 
Sustainability Report 2024
| Governance
 
22
For staff
 
receiving whistleblowing
 
reports, there
 
are procedures
 
and guidance
 
on handling
 
such reports
 
to ensure
 
each
whistleblowing
 
concern
 
is
 
taken
 
seriously
 
and
 
investigated.
 
Whistleblowing
 
reports
 
made
 
through
 
the
 
dedicated
whistleblowing channels
 
(hotlines and
 
online platform)
 
are received
 
and appropriately
 
triaged by
 
the relevant
 
Regional
Head of Investigations and their delegates (selected
 
investigators in their team),
 
who are trained on how to handle such
whistleblowing reports.
There are controls
 
and processes in
 
place to check
 
for potential retaliation
 
against known whistleblowers.
 
For example,
if a whistleblower is potentially
 
at risk of redundancy,
 
this individual is flagged
 
to the Investigations Operating
 
Group to
assess whether the redundancy decision is made independently
 
of the whistleblowing.
Our framework and
 
Group Investigations Policy define
 
clear roles and responsibilities,
 
including reporting requirements,
for ensuring accurate and complete quarterly reporting to
 
the BoD and the GEB, as well as to regulators.
 
Our Group
 
Investigations function
 
is responsible
 
for delivering
 
and overseeing
 
all investigations,
 
including incidents
 
of
corruption and bribery.
 
These must be conducted
 
and governed in a
 
way that ensures the
 
investigations are independent,
objective
 
and
 
reliable
 
as
 
defined
 
in
 
our
 
Group
 
Investigations
 
Policy,
 
which
 
governs
 
the
 
conduct
 
of
 
all
 
investigations,
including
 
whistleblowing
 
investigations.
 
Roles
 
and
 
responsibilities
 
in
 
the
 
overall
 
Group
 
Investigations
 
framework
 
are
defined at two levels: (i) cross-functional governance
 
bodies that have responsibilities across the investigations
 
portfolio;
and (ii) prescribed roles and responsibilities over certain individual
 
investigations.
 
Policy effectiveness
 
is assessed
 
through our
 
non-financial risk
 
framework. All
 
policies are
 
accompanied by
 
controls that
are
 
designed
 
to
 
prevent
 
non-financial
 
risks
 
from
 
materializing,
 
ensuring
 
UBS
 
operates
 
within
 
its
 
risk
 
appetite.
 
These
controls are
 
regularly evaluated
 
for both
 
design and
 
operational effectiveness.
 
Should the
 
firm operate
 
beyond its
 
risk
appetite or if a non-financial risk event occurs, corrective
 
actions are taken to return to within the defined
 
appetite. This
may involve remediating deficient controls, adjusting risk tolerance, modifying
 
the firm’s risk profile or accepting the
 
risk.
Independent assurance processes are in place to promptly
 
identify and address heightened non-financial risks.
Non-financial risks are regularly reported to the
 
GEB and the BoD. The
 
BoD oversees UBS’s risk management and culture,
approving the risk management
 
and control framework
 
of the Group. The
 
GEB, acting as
 
the risk council,
 
holds overall
responsibility
 
for
 
establishing
 
and supervising
 
the
 
implementation
 
of risk
 
management
 
and control
 
principles,
 
and
 
for
managing the
 
Group’s risk
 
profile as
 
determined by
 
the BoD
 
and the
 
Risk Committee. Monthly
 
reports summarize relevant
changes to the firm’s risk profile
 
and the Annual Non-Financial
 
Risk Report highlights the identified
 
key risk themes and
activities undertaken to manage related exposures.
 
Sustainability Report 2024
| Governance
 
23
Combating financial crime
The GEB
 
oversees our
 
efforts to
 
combat money
 
laundering, corruption
 
and terrorist
 
financing. Our
 
first line
 
of defense
owns
 
the
 
anti-money-laundering
 
(AML)
 
and
 
terrorist-financing
 
risk
 
front
 
to
 
back
 
for
 
its
 
respective
 
clients
 
and
 
their
activities and has the primary responsibility for managing that risk. Dedicated staff
 
in our second line of defense support
the organization
 
in developing,
 
maintaining and
 
implementing Group
 
financial crime
 
programs,
 
including control
 
and
oversight.
 
Our
 
third
 
line
 
of
 
defense
 
is
 
the
 
reinforcement
 
component
 
led
 
by
 
Group
 
Internal
 
Audit
 
and
 
independently
evaluates the financial crime control frameworks.
 
UBS complies
 
with applicable laws
 
and regulations
 
and is
 
committed to meeting
 
industry standards regarding
 
the effective
prevention
 
of money
 
laundering
 
and financing
 
of terrorism.
 
We
 
take
 
comprehensive
 
measures
 
to
 
prevent
 
and
 
detect
non-compliance with
 
laws and regulations
 
and do
 
not tolerate
 
or facilitate
 
criminal activity
 
or breaches
 
of the
 
letter or
spirit of applicable laws, regulations, rules and policies designed to
 
prevent such activities.
 
We do not
 
engage in business
 
activities that present
 
unacceptably high levels
 
of money laundering,
 
fraud, sanctions or
corruption risk.
 
Additionally, we
 
do not
 
engage in
 
activities
 
that pose
 
risks that
 
cannot be
 
effectively managed
 
by the
existing
 
control
 
environment.
 
Although
 
it
 
is
 
not
 
possible
 
to
 
eliminate
 
such
 
residual
 
risk
 
entirely,
 
we
 
have
 
appropriate
policies, procedures, controls and processes in place to manage
 
the relevant risks.
We assess
 
the money
 
laundering, fraud,
 
sanctions and
 
bribery and
 
corruption risks
 
associated with
 
all of
 
our business
operations annually against our control framework and take
 
action, where appropriate,
 
to further mitigate these risks.
Public-private partnerships
We are a founding
 
member of the
 
Wolfsberg Group, an
 
association of global
 
banks that aims to
 
develop standards for
the
 
financial
 
services
 
sector
 
to
 
prevent
 
financial
 
crimes,
 
such
 
as
 
money
 
laundering,
 
fraud,
 
corruption
 
and
 
terrorist
financing,
 
and
 
to
 
develop
 
industry
 
standards
 
for
 
know-your-client
 
(KYC)
 
due
 
diligence
 
and
 
ongoing
 
transaction
monitoring.
 
The Wolfsberg Group brings together banks from around
 
the world at its annual forum and regional outreach meetings
focused on financial
 
crime topics. It
 
also delivers an
 
annual academy to
 
support the development of
 
junior Financial Crime
Prevention (FCP)
 
officers and
 
works on
 
guidance papers
 
in related
 
key areas
 
of financial
 
crime. UBS
 
is actively
 
involved
with this group.
 
We are a member of various
 
public-private partnerships operating globally that have been set
 
up to foster closer working
relationships between financial institutions
 
and law enforcement, most notably
 
the Joint Money Laundering Intelligence
Taskforce operations group in the UK, which has worked
 
on a number of human trafficking and modern slavery cases.
 
Prevention and detection of corruption and bribery
Our
 
Group
 
Policy
 
Against
 
Bribery
 
&
 
Corruption
 
(ABC
 
Policy)
 
is
 
consistent
 
with
 
the
 
principles
 
of
 
the
 
United
 
Nations
Convention
 
against
 
Corruption.
 
Our
 
policy
 
sets
 
out
 
a
 
zero-tolerance
 
approach
 
to
 
bribery
 
and
 
corruption;
 
UBS
 
is
committed
 
to detecting
 
and
 
preventing
 
bribery
 
and corruption
 
and
 
requires
 
employees
 
and associated
 
persons
 
to do
business in a fair and transparent manner, in compliance
 
with the principles of the policy.
 
Every employee is responsible for the following:
–
compliance with
 
the UBS
 
Group’s zero-tolerance
 
approach to
 
bribery and
 
corruption and
 
the requirements
 
set forth
in the policy and related procedures;
–
taking reasonable steps to detect and prevent bribery;
–
maintaining accurate books and records to fairly reflect
 
employees’
 
expenditure;
 
–
reporting cases of concern or doubt to Financial Crime Prevention Anti-Bribery and Corruption (FCP ABC) or based on
the Group’s Whistleblowing Protection for Employees Policy.
 
Delegated by
 
the Global
 
Head Financial
 
Crime Prevention
 
to Anti-Bribery
 
and Corruption
 
(ABC) Taxonomy
 
Owner, the
Global ABC Head, supported by
 
the specialized teams, is
 
responsible for establishing and maintaining
 
an ABC framework
and incorporating the
 
principles of the
 
policy as minimum
 
global standards.
 
To this end,
 
we have controls
 
in place
 
and
hold ourselves accountable for detecting, stopping and reporting bribery and corruption matters;
 
we do not tolerate any
form of corruption or bribery, including facilitating payments, nor
 
do we offer or accept improper gifts or payments.
The ABC framework comprises: policy,
 
procedures, training and communications,
 
risk assessments, controls across all
 
key
risks areas, investigations
 
and incident management,
 
and monitoring and
 
assurance (including
 
independent audit). The
framework aligns
 
with globally
 
recognized standards
 
and laws,
 
rules and
 
regulations designed
 
to prevent
 
and mitigate
bribery and corruption risks
 
across all jurisdictions in
 
which we operate (e.g. UK
 
and US legal and
 
regulatory requirements
for ABC frameworks
 
,
 
including the UK
 
Bribery Act and
 
the US Foreign
 
Corrupt Practices
 
Act).
There is a
 
global team of
dedicated
 
anti-bribery
 
and
 
corruption
 
officers
 
responsible
 
for
 
setting
 
and
 
maintaining
 
the
 
framework
 
standards.
 
The
board
 
and
 
senior
 
management
 
set
 
out
 
the
 
ABC
 
policies
 
and
 
risk
 
appetite,
 
and
 
all
 
employees
 
are
 
accountable
 
for
compliance.
 
The
 
ABC
 
framework
 
includes
 
controls
 
across
 
all
 
key
 
risk
 
areas:
 
employees,
 
third
 
parties
 
(vendors
 
and
intermediaries),
 
charitable
 
and
 
political
 
donations
 
and
 
sponsorships,
 
hiring,
 
gifts
 
and
 
business
 
entertainment,
 
deals,
mergers and
 
acquisitions, and
 
client-related
 
ABC risk.
 
There is
 
regular control
 
testing to
 
ensure that
 
the program
 
and
controls are appropriately designed, operationally effective
 
and adhered to in line with policy requirements.
 
Sustainability Report 2024
| Governance
 
24
Where corruption or
 
bribery incidents arise,
 
these are identified
 
through controls monitoring, self-declaration
 
or reporting
(e.g.
 
through
 
the
 
whistleblowing
 
mechanism)
 
or
 
through
 
ongoing
 
due
 
diligence
 
or
 
risk
 
assessments.
 
Each
 
incident
 
is
assessed for
 
severity
 
and impact
 
,
 
with senior
 
management
 
involved
 
for
 
the
 
more
 
serious
 
incidents.
 
Incidents
 
that
 
are
breaches of the Group’s
 
policies, including the
 
ABC Policy, are dealt
 
with in line with
 
the Employee Incidents Policy
 
and
framework and may result in disciplinary action, including
 
dismissal, in serious cases.
The ABC
 
risk appetite
 
of the
 
UBS Group
 
(including business
 
division appetite
 
and significant
 
Group
 
entity appetite)
 
is
defined within the
 
Anti-Bribery and
 
Corruption Risk
 
Appetite Statement
 
(RAS), which is
 
governed by the
 
Non-Financial
Risk Framework Policy and aims to
 
define the risk appetite of the firm
 
in relation to bribery and corruption risks.
 
The ABC
RAS is subject to annual approval and review by the Board
 
of Directors (the BoD).
Inherent risks for bribery and corruption
 
within the organization are not dissimilar to
 
those faced by other multinationals;
specifically, third-party risk, employee insider threat risk and client risk. The organization has a robust framework in place
to monitor and mitigate the risk of bribery or corruption arising through such inherent risk sources across all levels of the
organization.
 
Specifically,
 
the framework includes
 
controls coverage of
 
functions where such
 
inherent risk is
 
more likely
to
 
arise,
 
such
 
as
 
those
 
functions
 
and
 
teams
 
that
 
actively
 
engage
 
with
 
clients
 
and
 
third
 
parties
 
and
 
those
 
involved
 
in
employee hiring
 
(i.e. business
 
first-line
 
teams and
 
third-party
 
and employee
 
management
 
functions).
 
Additionally,
 
the
framework and policy are applicable to all employees, including
 
executive-
 
and board-level management.
The
 
Group
 
Investigations
 
team,
 
including
 
investigators
 
and
 
the
 
investigations
 
committee,
 
are
 
independent,
 
with
 
a
separate reporting line to the ABC framework and team
 
management. This allows for fair and independent investigation
of both internal or external concerns relating to bribery or
 
corruption.
 
The effectiveness
 
of the
 
ABC framework,
 
including incident
 
management reporting,
 
is subject
 
to frequent
 
and regular
updates at both first- and second-line management forums,
 
including up to the BoD. The reporting includes provision of
qualitative and
 
quantitative risk
 
indicators, covering
 
both inherent
 
and control
 
risk. When
 
a threshold
 
is exceeded,
 
this
may indicate an increased
 
risk of bribery and
 
corruption. Assessment of
 
these risk indicators on
 
a regular basis prompts
the identification of
 
excess(es) of the
 
thresholds under the
 
program’s risk appetite
 
assessments, which will
 
trigger a review
of whether (further)
 
action is deemed necessary
 
at a divisional /
 
entity and / or
 
Group level to avoid
 
undue risk, thereby
focusing on staying within the overall ABC risk appetite.
 
The
 
ABC
 
Policy
 
is
 
translated
 
into
 
multiple
 
languages
 
and
 
is
 
accessible
 
to
 
all
 
employees
 
through
 
our
 
internal
 
policy
repository and relevant
 
intranet ABC site.
 
There is mandatory
 
training for all employees
 
on the policy requirements
 
(see
details
 
below
 
for
 
further
 
information
 
on
 
training
 
provision
 
under
 
the
 
ABC
 
framework).
 
Furthermore,
 
an
 
annual
declaration and commitment to this
 
policy is required from all
 
UBS staff, including a statement of
 
compliance with regard
to any past or current bribery-
 
or corruption-related incidents.
 
In 2024, all employees
 
of UBS, including
 
its senior management
 
and governance bodies,
 
received adequate training
 
on
financial crime prevention
 
matters, which covers
 
AML / KYC, sanctions,
 
fraud and anti-corruption.
 
All staff are required
to complete the Global Financial Crime Prevention refresher
 
module on an annual basis. The frequency for each training
course is specified by the course owner (onetime, annual, bi
 
-annual).
 
ABC training is mandatory for
 
all UBS Group employees, including
 
the GEB and the BoD, and
 
is rolled out on an annual
basis.
 
All
 
new
 
joiners
 
are
 
required
 
to
 
complete
 
a
 
more
 
substantial
 
training
 
course
 
within
 
30
 
days
 
of
 
joining,
 
then
 
all
employees are
 
required to
 
complete an
 
annual refresher
 
training course
 
within 60
 
days of
 
rollout (with
 
a test
 
score of
80% required
 
to pass
 
). The
 
training covers
 
the
 
full ABC
 
Policy and
 
framework,
 
including topics
 
on risk
 
identification,
assessment and escalation of bribery and corruption.
Additional
 
targeted
 
training
 
is
 
delivered
 
online
 
or
 
in
 
person
 
to
 
selected
 
functions
 
on
 
specific
 
financial
 
crime
 
risks
associated with the business lines or activities they are involved
 
in, as needed.
 
Web-based training modules are regularly
 
updated to address compliance issues,
 
including financial crime standards, and
to incorporate learning from both internal and external events
 
and geopolitical developments.
 
Onboarding and ongoing monitoring
UBS performs risk-based
 
initial due diligence
 
on all customers,
 
which is designed
 
to establish their
 
identity and ownership,
the
 
nature
 
of their
 
business
 
activities,
 
and the
 
source(s)
 
of their
 
wealth
 
and funds.
 
This includes
 
formal
 
processes
 
for
mitigating the
 
risk of
 
impersonation
 
fraud in
 
circumstances
 
where
 
we are
 
not doing
 
business on
 
a face
 
-to-face
 
basis.
Where the client represents a
 
potentially elevated risk according to
 
the Group AML &
 
KYC Policy, enhanced due diligence
is performed.
 
We do not establish
 
or maintain relationships with
 
parties when the KYC
 
information cannot be
 
sufficiently established
or where
 
we have
 
reason to believe
 
the party
 
has or intends
 
to use
 
UBS products
 
or services
 
for illicit
 
activities. We
 
do
not
 
open
 
accounts
 
for
 
relationships
 
that
 
do
 
not
 
meet
 
our
 
standards
 
or
 
that
 
pose
 
unacceptable
 
financial
 
crime
 
or
reputational risks for the firm.
After a
 
client onboarding is
 
completed, ongoing
 
due diligence
 
and name
 
screening are
 
performed during
 
the life
 
cycle
of the client
 
relationship. Clients
 
are subjected
 
to regular
 
risk rating and
 
client activities
 
and transactions
 
are subject
 
to
AML transaction monitoring. In addition, ongoing periodic KYC reviews are conducted with varying frequency, driven by Our Group AML & KYC Policy sets out the process and criteria relating to the identification, senior management sign-off,
the client risk rating.
 
Sustainability Report 2024
| Governance
 
25
periodic
 
review
 
and
 
ongoing
 
monitoring
 
of
 
clients
 
deemed
 
to
 
be
 
Politically
 
Exposed
 
Persons
 
(PEPs),
 
along
 
with
 
other
customers who have links with jurisdictions or industries
 
that pose elevated levels of financial crime risk.
We apply
 
KYC rules
 
and use
 
advanced technology
 
to help
 
identify suspicious
 
transaction patterns
 
and compliance
 
risk
issues. We continue
 
to invest in our
 
detection capabilities and
 
core systems as
 
part of our FCP
 
program. Red flags
 
must
be referred to
 
FCP if any
 
UBS staff become
 
aware of potentially
 
suspicious activities
 
during the client
 
life cycle
 
and this
may result in
 
investigation, suspicious
 
activity report
 
filing and
 
/ or client
 
exit, as
 
appropriate. When
 
a UBS
 
employee is
suspected of
 
or identified as
 
acting or
 
failing to act
 
in accordance
 
with applicable
 
laws or
 
regulations
 
or in
 
violation of
UBS policy,
 
we escalate
 
this to
 
Group Investigations
 
for further
 
assessment under
 
the Group
 
Investigations Policy.
 
Our
Group Investigations Policy
 
defines clear roles
 
and responsibilities, including
 
reporting requirements, for
 
ensuring accurate
and complete quarterly reporting to the BoD and the GEB,
 
as well as to regulators.
We
 
adhere
 
to
 
the
 
global Financial
 
Action
 
Task
 
Force
 
standards
 
and
 
local
 
laws
 
and
 
regulations
 
with
 
regard
 
to
 
record-
keeping.
 
Our entire financial crime
 
framework is subject
 
to regular controls testing,
 
in both the first
 
and second lines of
 
defense,
which includes
 
a cycle
 
of regular
 
peer review
 
testing executed
 
by a
 
designated team
 
within the
 
Group’s FCP
 
function.
Additionally, our Group Internal Audit
 
team performs a rigorous cycle
 
of independent audit reviews
 
covering the financial
crime framework globally and cross-divisionally and we are subject to ongoing supervision by regulatory authorities in all
the markets in which we operate.
Conduct and culture
The Code sets
 
out the principles
 
and commitments
 
that define
 
our ethical
 
standards and
 
the way we
 
do business. The
Code commits
 
all UBS
 
employees to
 
do whatever
 
we can to
 
combat money
 
laundering, fraud,
 
corruption and
 
terrorist
financing.
 
Additionally, the Code requires
 
that UBS employees do
 
not help or advise
 
our clients, or
 
any other party, to
 
evade taxes
or misreport taxable income and gains.
 
It also states that we should not contract
 
with third parties who provide services
for UBS or on our behalf, where those services help others
 
improperly evade taxes.
›
Refer to the Code of Conduct and Ethics of UBS, available at We are guided by our ambition to be a leader in sustainability.
ubs.com/code
, for more information
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Strategy
 
26
Strategy
Our sustainability and impact strategy
This is reflected in our vision to be the bank for the next
generation. To
 
help us realize
 
that vision,
 
our sustainability
 
and impact
 
strategy is
 
based on
 
three overarching
 
strategic
pillars: Protect, Grow and Attract, representing a natural evolution
 
in our strategic approach.
 
Sustainability and impact vision: the
 
bank for the next generation
Protect
Manage our business in alignment with our
sustainable, long-term Group strategy and
evolving standards.
Grow
Embed an innovative sustainability and impact
offering across all our business divisions.
Attract
Be the bank of choice for clients and employees.
Protect
As part of our continued commitment
 
to protect our clients’ assets and
 
those of our firm, we
 
are focused on managing
our
 
business
 
by
 
aligning
 
to
 
the
 
sustainable
 
long-term
 
Group
 
strategy
 
and
 
evolving
 
standards.
 
We
 
maintain
 
a
 
strong
control and risk
 
framework, as
 
well as a
 
robust sustainability
 
data strategy,
 
to support
 
our risk management
 
processes,
regulatory requirements and product offerings.
›
Refer to the “Environment” section of this report for
 
more information about our decarbonization approach and
 
efforts
›
Refer to the “Managing sustainability and climate
 
risk” section of this report for more information about our
 
sustainability and
climate risk management approach
 
Grow
We continue to expand
 
our sustainability and
 
impact offerings across
 
all business divisions
 
to meet our clients’
 
evolving
needs. For
 
example,
 
we
 
identify and
 
offer
 
innovative
 
sustainable
 
financing
 
and investment
 
solutions, with
 
the
 
aim to
support our clients through the world’s transition to a low-carbon economy.
 
To facilitate this, we established a dedicated
Group Sustainability
 
and Impact
 
(GSI) Business
 
Development &
 
Client Forum
 
(the GSI
 
BDCF) under
 
the authority
 
of the
Group Executive Board (the GEB) Lead for Sustainability
 
and Impact, focused on client, product and impact approaches.
›
Refer to the “Governance” section of
 
this report for more information about the GSI BDCF
›
Refer to the “Supporting Opportunities” section
 
of this report for more information about our innovative
 
sustainability and
impact offering
Attract
We aspire
 
to be
 
the bank
 
of choice
 
for clients
 
and employees
 
alike, maintaining
 
top quartile
 
sustainability ratings
 
and
positioning UBS as the go-to employer through our engagement
 
and education programs. In 2024, our MSCI
 
AA rating
was
 
reaffirmed
1
 
and we
 
increased
 
our S&P
 
Global Corporate
 
Sustainability Assessment
 
(CSA) score
 
to
 
72,
2
 
compared
with 69 in 2023.
›
Refer to the “Social” section of this report for more
 
information about UBS’s employees and its philanthropic activities
1
 
Source: MSCI ESG Ratings & Climate Search Tool, UBS Group AG ESG Rating 2024
.
2
 
Source: S&P Global, UBS Group AG 2024 CSA Score as of March 2025, out of a maximum of 100.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Strategy
 
27
Our key aspirations and progress
 
We work with a long-term focus on providing appropriate
 
returns to our stakeholders in a responsible manner.
We are
 
committed to
 
providing transparent
 
aspirations, goals
 
and targets
 
and reporting
 
on the
 
progress made
 
against
them. This table provides an overview, with more detailed
 
information provided throughout this report.
Ambitions
Topics
Our aspirations, goals or targets
Progress in 2024
 
1. Protect
Climate
Lending sector decarbonization targets have been established
 
to
address our financed emissions by aligning specified sectors
 
to
decarbonization pathways.
1
Reduce emissions intensity associated with UBS in-scope lending
by 2030 from 2021 levels for:
–
Swiss residential real estate by 45%;
–
Swiss commercial real estate by 48%;
–
power generation by 60%;
–
iron and steel by 27%; and
–
cement by 24%.
Reduce absolute financed emissions associated with UBS in-scope
lending by 2030 from 2021 levels for:
–
fossil fuels by 70%.
Calculated progress against pathways for lending sector
decarbonization targets.
2
Changes in emissions intensity associated with UBS in-scope
 
lending
(end of 2023 vs 2021 baseline):
–
Swiss residential real estate reduced 11%;
–
Swiss commercial real estate reduced 9%;
–
power generation reduced 33%;
–
iron and steel reduced 20%; and
–
cement reduced 3%.
Changes in absolute financed emissions associated with UBS
 
in-scope
lending (end of 2023 vs 2021 baseline):
–
fossil fuels reduced 80%.
Reduce our scope 1 and 2 emissions to net zero by 2035 (90%
reduction of scope 1 and net scope 2 emissions by 2035
 
vs 2023
baseline, neutralizing the remaining 10% with high-quality carbon
removals).
Scope 1 and net scope 2 emissions reduced 35% vs 2023
 
baseline.
Reduce our absolute energy consumption by 35% by
 
2030 vs
2023 baseline.
 
Absolute energy consumption reduced 10% vs 2023
 
baseline.
 
Achieve 100% renewable electricity aligned to RE100 in markets
where feasible by 2026.
Achieved 99.8% renewable electricity aligned to RE100.
Environment
Paper: Use 100% recycled and Forest Stewardship Council (FSC)
paper for our operations by 2025.
Reached 49.9% share of recycled and FSC paper in our operations
 
in
2024.
Waste: Achieve 60% recycling ratio for our office waste by 2025.
Achieved 52.9% recycling ratio in 2024.
Water: Reduce water consumption by 5% by 2025 vs 2019
baseline.
Water consumption reduced 8% vs 2019 baseline.
2. Grow
Market
opportunities
Embed an innovative sustainability and impact offering across
 
all
our business divisions.
Increased sustainable investing invested assets to USD 296bn
 
(2023:
USD 282bn).
3
Facilitated 96 green, social, sustainability or sustainability-linked
(GSSS) bond transactions globally against our target of 100 (2023:
102).
4
The total on-balance sheet drawn exposure of sustainable loans
granted to corporate and institutional clients booked on the UBS
Switzerland AG platform amounted to USD 2.0bn as of end 2024
(excluding mortgages).
5
Supporting our clients to achieve their sustainable investing
 
goals:
20% of Asset Management’s fund offering globally will be
sustainable-investing products, providing choice for clients.
As of end 2024, 23.4% of Asset Management’s fund offering Raise USD 1bn in donations to our client philanthropy foundations
consisted of sustainable-investing products.
6
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Strategy
 
28
Ambitions
Topics
Our aspirations, goals or targets
Progress 2024
 
Social
impact and
philanthropy
and funds (cumulative for 2021
-
2025).
Achieved a UBS Optimus Foundation donation volume of USD 366m
in 2024 (2023: USD 328m), totaling USD 1.1bn since 2021,
 
thus
surpassing our goal (all figures include UBS matching contributions).
7
Reach 26.5 million beneficiaries by 2025 (cumulative for 2021–
2025).
Reached 7.4 million beneficiaries in 2024 (2023:
 
7 million)
8
 
and
25.9 million beneficiaries across our social impact activities
 
since
2021.
9
3. Attract
Bank of
choice
Maintain top quartile position in key ESG ratings by the end of
2026.
Achieved top quartile position vs direct peers as defined in
 
UBS
compensation report in:
–
MSCI: AA rating, “Leader” in industry group;
–
S&P Global Corporate Sustainability Assessment: Score of 72.
Constituent of the Dow Jones Sustainability Indices (DJSI);
–
CDP: A– rating. Included in the leadership band.
Cautionary note:
We have developed
 
methodologies that we
 
use to set
 
our climate-related targets
 
and identify climate-related
 
risks and that
 
underly the metrics
 
that are disclosed
 
in this report.
 
Standard-setting
organizations and
 
regulators continue
 
to provide
 
new or
 
revised guidance
 
and standards,
 
as well
 
as new
 
or enhanced
 
regulatory requirements
 
for climate
 
disclosures. Our
 
disclosed metrics
 
are based
 
upon data
available to us, including estimates
 
and approximations where actual or specific
 
data is not available.
 
We intend to update our disclosures
 
to comply with new guidance and regulatory
 
requirements as they become
applicable to UBS. Such updates may result in revisions to our disclosed metrics, our methodologies
 
and related disclosures, which may be substantial, as well as changes to the metrics we disclose.
1
Our climate transition plan does not cover all our business activities. We may add ambitions for additional scope 3 activities
 
over time and on a best-efforts basis based on the availability of appropriate measurement
frameworks and data,
 
and the materiality
 
of the relevant
 
activity to UBS.
 
We will continue
 
to publicly disclose
 
our progress on
 
an annual basis
 
and, while we
 
continue to take
 
steps to align
 
our in-scope business
activities with the ambitions set out above, it is important to
 
note that progress toward our targets may not be linear. We regularly review our targets and
 
update our disclosures in line with new or enhanced
 
regulatory
developments, evolving best practices for the financial sector and climate science. Such reviews may lead us to revise previously agreed voluntary commitments,
 
metrics and methodologies. Metrics are based on gross
lending exposure
 
consisting of
 
total on-balance
 
sheet loans
 
and advances
 
to customers
 
and off-balance
 
sheet guarantees
 
and irrevocable
 
loan commitments.
 
Refer to
 
the “Basis
 
of preparation”
 
section of
 
the
Supplement to the UBS Group Sustainability Report 2024, available at ubs.com/sustainability-reporting for more information about exclusions and parts of the value chain
 
within sectors covered by metrics and targets.
 
2
Refer to the “Environment”
 
section of this report
 
for further information. The
 
inherent one-year time lag
 
between the as-of date
 
of our lending exposure
 
and the as-of date
 
of emissions can be
 
explained by two
factors: corporations disclose their emissions in annual reporting only a few months after the end of a financial year, and specialized third-party data providers take between 12 and 18 months to collect disclosed data
and make it available
 
to data users.
 
Consequently, the
 
baselines for our decarbonization
 
targets are calculated based
 
on year-end 2021
 
lending exposure and 2020
 
emissions data. Our 2023 emissions
 
actuals are
based on year-end 2023 lending exposure and 2022 emissions data. For asset financing (i.e.
 
real estate) there is no time lag, and exposure and emissions actuals refer to the same year.
 
3
The figures do not include
invested assets classified
 
under the Credit
 
Suisse sustainable investment
 
framework but include
 
invested assets of
 
Credit Suisse portfolios,
 
which have been
 
migrated onto UBS
 
platforms and vetted
 
against UBS’s
sustainable investing policies or merged with existing UBS sustainable investing portfolios. This process is being carried out in waves and will continue until at least the
 
end of 2025. The 2023 figure has been restated.
For more information, see the “Supporting Opportunities”
 
section of this report.
 
4
These metrics include transactions meeting the
 
UBS Sustainable Finance Guideline, as described
 
in the ”Sustainability and climate
risk policy framework“
 
section of the
 
Supplement to this
 
report, available at
 
ubs.com/sustainability-reporting.
 
5
Loans booked on
 
the Credit Suisse platform
 
are not in
 
scope of this
 
metric. As Credit
 
Suisse loans
migrate to the UBS infrastructure, a due
 
diligence against the UBS Sustainable Product
 
Guidelines framework will be performed.
 
6
Measured over a three-year rolling
 
period. The scope includes UBS Asset
 
Management
sponsored and
 
managed traditional
 
and alternative
 
funds. Mandates,
 
White Label,
 
UBS Asset
 
Management single
 
investor and
 
feeder funds
 
are excluded.
 
As of
 
2024, products
 
managed by
 
Credit Suisse
 
Asset
Management that are categorized in accordance with
 
the legacy Credit Suisse sustainable investing framework
 
are within the scope of the total
 
number of funds but not the total number
 
of UBS Asset Management
sustainable investing funds.
 
They will
 
only be included
 
once migrated
 
onto UBS Asset
 
Management product
 
shelves, i.e.
 
once corresponding
 
data has
 
been onboarded to
 
UBS systems,
 
they are
 
fully meeting
 
the
requirements of UBS’s
 
Group Sustainable Investing
 
Policy, and
 
are classified as
 
a UBS sustainable
 
investing product. This
 
process is being
 
carried out in
 
waves and will
 
continue at least
 
until the end
 
of 2025.
 
7
Figures provided for the UBS Optimus Foundation
 
are based on unaudited management accounts and information
 
available as of January 2025. Audited
 
financial statements for UBS Optimus Foundation entities
 
are
produced and available per local market
 
regulatory guideline.
 
8
 
Figures prior to 2024 exclude beneficiaries
 
reached through Credit Suisse-led programs.
 
9
Some of the beneficiaries reached were due to
 
activities
funded through mandatory contributions
 
required in India and
 
South Africa due to
 
respective corporate social
 
responsibility laws. The
 
cumulative reported figure does
 
not represent unique beneficiaries.
 
Where the
same individual was enrolled in a program in the previous year,
 
they are still counted in the following year as they are considered to have received different levels of support over the period.
 
Sustainability Report 2024
| Environment
 
29
Environment
Our climate transition plan
We have drawn
 
up a climate
 
transition plan, including
 
our overarching climate approach,
 
along with specified
 
key policies
and principles, targets
 
and actions. This
 
transition plan
 
has been approved
 
by the Corporate
 
Culture and Responsibility
Committee (the CCRC) of the Board of Directors and is included in our annual objective-setting process for sustainability
and impact matters.
›
Refer to the “Governance” section of
 
this report for more information about our sustainability
 
and climate governance and our
objective-setting process, and to “Key policies and principles”
 
in the “Appendix 1 – Governance”
 
section of this report for more
information about our sustainability-
 
and climate-related key policies and principles
Our climate approach
Our climate approach is guided by our climate ambition and
 
its underlying key objectives.
Our climate ambition
We will support our clients in
 
the transition to a low-carbon world
 
and embed considerations of climate change risks
 
and
opportunities into our firm for the benefit of our stakeholders,
 
now and in the future.
Our key objectives
Supporting our clients’ low-carbon transition
–
 
Mobilizing capital toward an orderly transition to a low-carbon
 
economy.
–
 
Aligning our in-scope lending activities to the objectives
 
of the Paris Agreement.
–
 
Supporting the transition of our financing and investing
 
clients to low-carbon and climate-resilient business models
 
.
–
 
Embedding climate considerations into our financing, investment
 
and capital markets offering.
Reducing our climate impact
–
Minimizing our own operational footprint and utilizing resources
 
in an efficient and sustainable way.
–
Measuring and managing our travel footprint, including reducing
 
air-travel-related emissions.
–
Interacting with our suppliers on emissions reductions and
 
managing our supply chain responsibly.
Managing the risks of climate change to our business
–
Identifying, measuring, monitoring, managing and reporting
 
sustainability and climate risks.
–
Applying our sustainability and climate risk policy framework
 
.
–
Further integrating
 
sustainability and
 
climate risk
 
regulatory requirements
 
into financial risk
 
management and
 
stress-
test frameworks.
–
Ensuring that the sustainability and climate risk policy framework is integrated into our Group- and organization-wide
activities.
Our climate approach
 
is aligned to
 
our sustainability and
 
impact strategy, which
 
is based on three
 
overarching strategic
pillars: protect, grow and attract. In relation to our climate
 
approach, our strategic ambition manifests as:
–
Protect
 
our
 
business
 
by
 
managing
 
climate
 
risks
 
and
 
supporting
 
our
 
clients’
 
low-carbon
 
transition
 
to
 
protect
 
their
assets.
–
Grow
 
our business by embedding an innovative UBS climate
 
transition offering across all business divisions.
–
Attract
 
and be the bank
 
of choice for clients and
 
employees by being recognized
 
as a leader
 
in climate, and leading
by example in our own operations.
›
Refer to the “Strategy” section of this report for more information about the sustainability and impact strategy By 2050, the global economy aims to transition to net zero.
 
 
Sustainability Report 2024
| Environment
 
30
Our climate-related targets
For example, across our own operations (scopes 1 and 2),
UBS plans to achieve net zero by 2035, well ahead of 2050.
 
We have defined the following targets:
Scopes 1 and 2:
 
Reducing our scope 1 and 2 emissions to net zero by
 
2035.
1
Scope 3:
Addressing our financed emissions by aligning specified
 
sectors to decarbonization pathways.
2
In 2024, we have updated our climate targets to consider
 
the following:
–
alignment with upcoming regulatory requirements and market
 
standards;
–
a review of the combined organization, reflecting the current
 
state of planning within the firm; and
–
ongoing macro-developments in public policy and climate science projections
 
across the sectors in which we operate.
Our climate-related targets have been set based on
 
the methodologies, data and assumptions currently in use. Following
a review of our own operations target
 
for scopes 1 and 2 (as disclosed in the
 
UBS Group Sustainability Report 2023)
 
for
the integrated
 
organization, we
 
have set
 
a new
 
1.5°C-aligned scope
 
1 and
 
2 net-zero
 
target to
 
be achieved
 
by 2035.
The target reflects
 
our enlarged corporate
 
real estate portfolio
 
following the acquisition
 
of the Credit Suisse
 
Group and
considers the latest definition of a “net-zero target” in the
 
Corporate Sustainability Reporting Directive (CSRD).
3
We
 
remain
 
committed
 
to
 
our
 
lending
 
sector
 
decarbonization
 
targets
 
to
 
address
 
our
 
financed
 
emissions
 
in
 
specified
sectors. All these targets
 
are 1.5°C-aligned except
 
for targets for Swiss
 
residential real estate
 
and Swiss commercial real
estate, which
 
are aligned
 
to a
 
below-2°C scenario.
4
 
In 2024,
 
we also
 
engaged EY
 
to perform
 
agreed upon
 
procedures
on
 
our
 
lending
 
sector
 
decarbonization
 
targets
 
to
 
assist
 
us
 
in
 
determining
 
whether
 
these
 
have
 
been
 
set
 
in
 
line
 
with
reference
 
scenarios
 
mentioned
 
and
 
informed
 
by
 
certain
 
requirements
 
taken
 
from
 
pertinent
 
global
 
standards
 
and
initiatives.
Our
 
Asset
 
Management
 
business
 
division
 
is
 
committed
 
to
 
supporting
 
our
 
clients
 
in
 
achieving
 
their
 
climate-related
investment
 
goals.
 
In
 
the
 
UBS
 
Group
 
Sustainability
 
Report
 
2023,
 
we
 
referred
 
to
 
the
 
target
 
set
 
by
 
Asset
 
Management
aiming, by
 
2030, to
 
align 20%
 
of UBS
 
AG Asset
 
Management’s total
 
assets under
 
management (AuM)
 
with net
 
zero.
Given
 
the
 
integration
 
taking
 
place
 
within
 
Asset
 
Management,
 
we
 
are
 
reviewing
 
the
 
legacy
 
target
 
set
 
prior
 
to
 
the
acquisition
 
of the
 
Credit
 
Suisse
 
Group,
 
taking
 
into
 
account
 
all
 
AuM
 
of the
 
combined
 
businesses.
 
Therefore,
 
we
 
have
withdrawn the target. We remain committed to supporting the Paris Agreement climate goals in line with global efforts.
We recorded USD 64.4bn of
 
total assets as having a
 
net-zero ambition at the
 
end of 2024, compared with
 
USD 35.5bn
at the end of 2023.
We
 
regularly
 
review
 
our
 
targets
 
and
 
update
 
our
 
disclosures
 
in
 
line
 
with
 
new
 
or
 
enhanced
 
regulatory
 
developments,
evolving best practices for the
 
financial sector and climate science.
 
Such reviews may lead us
 
to revise previously agreed
voluntary commitments, metrics and methodologies.
 
Our
 
climate
 
transition
 
plan
 
does
 
not
 
cover
 
all
 
our
 
business
 
activities.
 
We
 
may
 
add
 
ambitions
 
for
 
additional
 
scope
 
3
activities
 
over time
 
and on
 
a best-efforts
 
basis based
 
on the
 
availability
 
of appropriate
 
measurement frameworks
 
and
data, and the materiality of
 
the relevant activity to UBS.
 
We will continue to publicly
 
disclose our progress on an
 
annual
basis and, while we continue to take steps to align our in-scope business activities with the ambitions
 
set out above, it is
important to note that progress toward our targets may
 
not be linear.
Our priority is to support our clients in the transition to a low-carbon world, including their transition-financing needs. In
the
 
area
 
of client
 
investments,
 
our ability
 
to
 
meet
 
our ambitions
 
depends
 
on
 
our obligations
 
to our
 
clients,
 
including
fiduciary duties as an investment manager and
 
on the terms of the mandates
 
agreed with clients. We continue to embed
sustainability
 
and
 
climate
 
considerations
 
into
 
our
 
operating
 
model,
 
leading
 
to
 
regular
 
adjustment
 
of
 
evaluation
 
and
decision-making frameworks, governance structures, control
 
and monitoring processes and underlying systems.
Our climate-related
 
ambitions and
 
targets
 
have a
 
critical dependency
 
on the
 
overall
 
progress
 
made by
 
all
 
sectors and
countries. Collaboration
 
across the
 
private and
 
public sectors
 
is required.
 
The decarbonization
 
of the
 
global economy,
emissions reductions by clients
 
and the realization of
 
our own targets and
 
ambitions all depend on
 
various factors outside
our
 
direct
 
influence.
 
Clear
 
guidance
 
from
 
governments
 
through
 
thoughtful
 
regulations,
 
policies
 
and
 
incentives,
 
the
development and scaling of key technologies and broader
 
changes in the behavior of society are needed.
1
Refer to the “Reducing our own environmental impact”
 
section of this report for details about our scope 1 and 2 net-zero target.
2
 
Refer to the ”Supporting our financing clients’ low-carbon transition”
 
section of this report for details about our lending sector decarbonization targets.
3
 
Definition of a net-zero target by
 
the CSRD: Setting a net-zero target at
 
the level of an undertaking aligned with
 
meeting societal climate goals means: (i) achieving a
 
scale of value chain emissions reductions consistent
with the abatement required to reach global net zero in
 
1.5°C pathways; and (ii) neutralizing the impact of any residual emissions (after
 
approximately 90–95% of GHG emission reduction with the possibility of justified
sectoral variations in line with a recognized sectoral pathway) by permanently removing an equivalent
 
volume of CO
2
.
4
 
For Swiss real estate mortgage lending (commercial
 
and residential real estate), our targets are using
 
the percentage decarbonization rate implied by
 
the Energy Perspectives 2050+ ZERO Basis
 
scenario (below-2°C
scenario) as a minimum rate to
 
be followed. This scenario
 
is a representative, country-specific
 
pathway, reflective of
 
the government’s climate strategy.
 
It also informs Switzerland’s
 
decarbonization ambitions for real
estate as set out in the Swiss Climate and Innovation Act.
 
 
ubsgroupsustainabilitp35i0
Sustainability Report 2024
| Environment
 
31
Our climate roadmap
 
Sustainability Report 2024
| Environment
 
32
Supporting our clients’ low-carbon transition
It is our priority to support our clients in the transition to a low-carbon world. To support this aim, we have defined a set
of targets and actions related to our financing and investing
 
activities,
 
which are outlined below.
Supporting our financing clients’ low-carbon transition
Our lending sector decarbonization targets
Lending sector decarbonization
 
targets for 2030
 
have been established
 
for Swiss real
 
estate mortgages (residential
 
and
commercial real
 
estate) and
 
for financing
 
of in-scope
 
activities in
 
the fossil
 
fuels (oil,
 
gas and
 
coal), power
 
generation,
iron and steel and cement corporate sectors.
Our
 
approach
 
to
 
target-setting
 
is
 
based
 
on
 
industry
 
guidance
 
and
 
our
 
calculation
 
methodology
 
is
 
based
 
on
 
global
standards
 
such
 
as
 
the
 
GHG
 
Protocol
 
Corporate
 
Accounting
 
and
 
Reporting
 
Standard
 
and
 
the
 
Partnership
 
for
 
Carbon
Accounting Financials (the PCAF).
Our 2030
 
targets
 
were
 
approved
 
and
 
are
 
continued
 
to
 
be overseen
 
by the
 
CCRC,
 
and are
 
managed
 
by the
 
business
divisions in collaboration with Group Sustainability and Impact (GSI)
 
and the Group functions under the leadership of the
Group Executive Board (GEB) Lead for Sustainability and Impact.
 
›
Refer to the “Climate-related methodologies – decarbonization
 
approach for our financing activities” section of the
 
Supplement
to the UBS Group Sustainability Report 2024, available
 
at
ubs.com/sustainability-reporting
, for more information about our
target-setting methodology and full financed emissions
 
disclosures
›
Refer to the “Basis of preparation” section of the
 
Supplement to the UBS Group Sustainability Report
 
2024, available at
ubs.com/sustainability-reporting
, for more information about our climate-related lending metrics Decarbonization levers and key actions underpinning our lending sector decarbonization targets
 
ubsgroupsustainabilitp37i0
Sustainability Report 2024
| Environment
 
33
To
 
underpin our lending sector decarbonization targets, we assessed the impact of two decarbonization levers. Through
lever 1,
 
we assess
 
the effects
 
of our
 
clients’ disclosed
 
decarbonization
 
commitments
 
on our
 
future
 
expected portfolio
intensities. Lever 2 focuses on managing our portfolio to achieve
 
the remaining required
 
intensity reductions.
In
 
addition,
 
we
 
identified
 
key
 
actions
 
relevant
 
to
 
both
 
levers,
 
outlining
 
how
 
we
 
support
 
our
 
clients
 
in
 
realizing
 
their
decarbonization
 
commitments
 
and how
 
we manage
 
our portfolio
 
toward achieving
 
our targets:
 
i) providing
 
products
and services;
 
ii) engaging
 
with clients;
 
and iii)
 
monitoring progress
 
against targets
 
through our decarbonization
 
control
framework.
Lever 1: Clients’ disclosed decarbonization commitments
To
 
understand
 
the
 
current
 
decarbonization
 
ambitions
 
of
 
our
 
clients,
 
we
 
conducted
 
a
 
review
 
of
 
our
 
clients’
 
currently
disclosed decarbonization commitments and transition plans. On this basis, we assessed the future potential aggregated
reduction
 
of our
 
portfolio
 
intensities for
 
the power
 
generation,
 
iron and
 
steel and
 
cement sectors,
 
assuming that
 
our
clients realize their decarbonization commitments and transition plans. Through
 
actions 1 and 2 outlined below, we aim
to support our clients in realizing their
 
decarbonization commitments.
 
Sustainability Report 2024
| Environment
 
34
We
 
recognize
 
that
 
our
 
clients’
 
realization
 
of
 
their
 
emission
 
reductions
 
has
 
dependencies
 
on
 
various
 
factors
 
and
 
that
financial
 
institutions
 
have
 
limited
 
direct
 
influence
 
over
 
clients’
 
transition
 
abilities
 
or
 
the
 
speed
 
at
 
which
 
the
 
transition
happens. We constantly track our clients’ progress toward their
 
disclosed commitments and assess the influence of them
meeting their commitments on our own trajectories.
Lever 2: Portfolio management
To work toward the remaining required reduction of
 
our portfolio intensities
 
to realize our lending
 
sector decarbonization
targets,
 
we
 
aim
 
to
 
manage
 
our
 
portfolio.
 
This
 
can
 
be
 
done
 
at
 
the
 
business
 
selection
 
stage,
 
which
 
is in
 
line
 
with
 
our
sustainability risk
 
process.
 
It may
 
trigger enhanced
 
due diligence
 
for transactions
 
in carbon-intensive
 
sectors that
 
have
higher
 
climate-related
 
impacts
 
and
 
risks,
 
as
 
well
 
as
 
trigger
 
the
 
pre-deal
 
assessment
 
review
 
of
 
deals
 
against
 
our
 
set
decarbonization
 
thresholds.
 
It can
 
also be
 
done through
 
the exit
 
from
 
or maturity
 
of our
 
Non-core
 
and Legacy
 
loans,
which contribute
 
to the
 
adjustment of
 
our lending
 
exposure and
 
associated carbon
 
intensity.
 
Through actions
 
1 and
 
2
outlined below, we aim
 
to support our clients’ climate transition,
 
while action 3 allows us to track our performance
 
and
manage progress toward our
 
targets.
Although
 
we
 
continue
 
to
 
take
 
steps
 
to
 
align
 
our
 
in-scope
 
business
 
activities
 
with
 
our
 
decarbonization
 
targets,
 
it
 
is
important to note
 
that progress toward
 
our targets may
 
not be linear.
 
Our priority is
 
to support our
 
clients in the
 
transition
to
 
a
 
low-carbon
 
world,
 
and
 
their
 
transition-financing
 
needs.
 
Collaboration
 
across
 
the
 
private
 
and
 
public
 
sectors
 
is
required.
 
The
 
decarbonization
 
of
 
the
 
global
 
economy,
 
emission
 
reductions
 
by
 
clients
 
and
 
the
 
realization
 
of
 
our
 
own
targets and ambitions all depend
 
on various factors outside our
 
direct influence. Clear guidance by governments
 
through
thoughtful regulations, policies and incentives, the development and scaling of key technologies and broader changes in
the behavior of our society are needed.
›
Refer to "Non-core and Legacy" in the "Our businesses"
 
section of the UBS Group Annual Report 2024,
 
available under "Annual
reporting" at
ubs.com/investors
, for more information
Action 1: Providing products and services
We
 
offer
 
sustainable
 
and
 
sustainability-linked
 
financial
 
advice
 
and
 
solutions
 
(advisory,
 
lending,
 
basic
 
banking
 
and
transition financing
 
solutions) to
 
support our
 
clients’ climate
 
transition. These
 
solutions can
 
be on-balance
 
sheet
 
(e.g.
green or sustainable loans and mortgages) or
 
off-balance sheet (e.g. access to debt
 
and equity capital markets). They can
also include transaction structuring.
For example, in Personal &
 
Corporate Banking, we offer
 
sustainability-linked loans (SLLs) to
 
incentivize the borrowers to
achieve their sustainability performance targets. Our SLL offering is open
 
to eligible corporate clients from all sectors that
wish to reflect
 
their sustainability
 
ambitions in
 
their funding
 
strategy and
 
to benefit
 
from meeting agreed
 
sustainability
performance targets.
 
The SLLs have
 
specific sustainability-related
 
key performance indicators
 
that are agreed
 
with each
client.
 
We continue to develop and refine our sustainable finance
 
solutions and approaches on an ongoing basis.
›
Refer to the “Supporting Opportunities” section
 
of this report for more information about our sustainable
 
finance product and
service offering, and specifically to the “Personal &
 
Corporate Banking” section for more information about
 
our corporate client
business
Action 2: Engaging with clients
In 2024, to support
 
our review of
 
our clients’ disclosed decarbonization
 
commitments and transition
 
plans (lever 1), we
developed the
 
Company Transition Assessment Scorecard (CTAS). The CTAS was
 
designed to
 
support a range
 
of purposes
in the future, including
 
the support of our clients’
 
climate transition through
 
engagement. By understanding our
 
clients
better,
 
we aim
 
to work
 
alongside them
 
to assist
 
with their
 
climate transition
 
efforts. This
 
can include
 
encouraging the
disclosure of current emissions, setting
 
future decarbonization targets in line
 
with Paris Agreement-aligned pathways and
developing credible transition plans.
›
Refer to the “Supporting our climate approach: key
 
enabling actions” section of this report for
 
more information about the CTAS
Action 3: Monitoring progress against targets through our
 
decarbonization control framework
We
 
implemented
 
a
 
decarbonization
 
control
 
framework
 
to
 
track
 
our
 
performance
 
and
 
manage
 
progress
 
toward
 
our
lending sector decarbonization targets. This framework has
 
been approved at GEB level and
 
has been integrated into our
sustainability and climate risk policy framework.
For in-scope
 
sectors,
 
the
 
performance
 
and associated
 
changes
 
in
 
the
 
lending
 
portfolio
 
are
 
discussed
 
during
 
quarterly
performance reviews with business division representatives
 
(Global Wealth Management, Personal & Corporate
 
Banking
and the Investment
 
Bank) and our
 
sustainability and climate
 
risk unit. This
 
includes an analysis
 
of trends and
 
significant
changes in exposures,
 
emissions or criteria that
 
are deemed to influence
 
the target metrics. Possible
 
measures to be taken
by the business divisions are also discussed.
For
 
in-scope
 
corporate
 
sectors
 
for
 
which
 
decarbonization
 
targets
 
have
 
been
 
set,
 
we
 
have
 
established
 
a
 
pre-deal
assessment
 
process
 
to
 
review
 
the
 
impact
 
of
 
relevant
 
transactions
 
that
 
are
 
within
 
the
 
scope
 
of
 
our
 
lending
 
sector
decarbonization targets.
 
For each
 
in-scope sector,
 
risk tolerance
 
thresholds have
 
been defined
 
at business
 
division and
Group levels. An internal tool enables the business divisions to evaluate the potential impact of a new
 
transaction on the
portfolio. An escalation process has
 
been put in place
 
should a transaction exceed these
 
thresholds. Transactions are then
also reviewed by
 
the business division
 
representatives and
 
can be further
 
escalated up to
 
GEB level if
 
required. The
 
risk
tolerance thresholds are
 
defined annually and the
 
utilization of the
 
agreed thresholds is monitored
 
on a quarterly
 
basis.
Relevant staff in the business divisions have been trained on these
 
requirements.
 
Sustainability Report 2024
| Environment
 
35
Performance against targets and outlook
For the
 
in-scope lending
 
sectors for
 
which decarbonization
 
targets
 
have been
 
set, the
 
following sections
 
describe,
 
for
each sector:
–
the scope of the target and relevance for our business divisions;
–
the progress
 
against the
 
sector
 
target
 
and the
 
indicative
 
trend
 
line,
 
including the
 
main
 
drivers for
 
the reduction
 
or
increase of absolute emissions / emissions intensity;
–
the impact of the
 
decarbonization levers and a description
 
of key actions taken,
 
where relevant (note that not
 
all levers
apply to all target sectors); and
–
a description of the key dependencies.
 
Our lending
 
sector decarbonization
 
targets have
 
a critical
 
dependency on
 
the overall
 
progress made
 
by all
 
sectors and
countries.
 
Swiss residential real estate
The
 
scope
 
of
 
the
 
decarbonization
 
pathway
 
for
 
residential
 
real
 
estate
 
lending
 
is
 
limited
 
to
 
our
 
financing
 
activity
 
in
Switzerland across Personal & Corporate Banking
 
and Global Wealth Management.
The required 45% reduction
 
to realize our 2030
 
target is slightly
 
more ambitious than
 
the decarbonization rate
 
implied
by the Swiss government’s Energy
 
Perspectives 2050+ ZERO Basis (EP
 
2050+) scenario for residential
 
buildings,
 
which is
44%.
 
For
 
the
 
target
 
scope,
 
this
 
scenario
 
is
 
a
 
representative,
 
country-specific
 
pathway,
 
reflective
 
of
 
the
 
government’s
climate strategy. The
 
EP 2050+ also informs
 
Switzerland’s decarbonization ambitions for real
 
estate as set
 
out in the
 
Swiss
Climate and Innovation Act.
As
 
at
 
the
 
end
 
of
 
2023,
 
our
 
estimated
 
emissions
 
intensity
 
for
 
the
 
portfolio
 
had
 
decreased
 
by
 
11%
 
against
 
the
 
2021
baseline,
 
with an
 
emissions
 
intensity
 
of
 
34.4
 
kg
 
CO
2
e
 
/
 
m
²
 
ERA
 
(Energy
 
Reference
 
Area).
 
The
 
reduction
 
was
 
primarily
driven by an increased share
 
of financed properties with
 
non-fossil-fuel heating. Our estimated
 
emission intensity is 1%
below the 2023 level of our indicative trend line to 2030
 
(34.8 kg CO
2
e / m
²
 
ERA).
To further decarbonize our real estate
 
portfolio in alignment with the Swiss
 
government’s decarbonization ambitions, we
remain dependent
 
on technical
 
advances and
 
concerted policy
 
action, for
 
example,
 
by incentivizing
 
improved building
efficiency and the use
 
of non-fossil-fuel heating systems. We
 
will continue to work
 
with the government and
 
our industry
peers to align on the required actions.
We remain committed to
 
doing our part and
 
supporting our clients in reducing
 
the emissions intensity of their
 
properties.
This includes raising the awareness of our existing and prospective clients regarding the climate impact
 
of real estate and
helping our existing
 
clients decarbonize their properties
 
through renovations. For example,
 
we provide access
 
to an online
renovation journey and calculator
 
for owner-occupied real
 
estate,
 
enabling our clients to
 
work out expected
 
renovation
costs and
 
timelines, the
 
CO
2
e emissions
 
footprint and
 
the energy
 
consumption levels
 
before and
 
after renovation.
 
For
renovations or acquisitions
 
of energy-efficient properties, we offer preferential financial conditions to clients through our
UBS
 
Mortgage
 
Green,
 
UBS
 
Mortgage
 
Energy
 
and
 
UBS
 
Mortgage
 
Renovation
 
products.
 
In
 
2024,
 
our
 
partner
 
Norm
Technologies launched an
 
offering for our
 
new and existing
 
mortgage clients to
 
carry out a
 
tailored, digital energy
 
analysis
for them to gain an improved understanding of the climate
 
impact of their properties.
Swiss commercial real estate
The
 
scope
 
of
 
the
 
decarbonization
 
pathway
 
for
 
commercial
 
real
 
estate
 
lending
 
is
 
limited
 
to
 
our
 
financing
 
activity
 
in
Switzerland across Personal & Corporate Banking
 
and Global Wealth Management.
The required
 
48% reduction
 
required to
 
realize our
 
2030 target
 
is in
 
line with
 
the decarbonization
 
rate implied
 
by the
Swiss government’s EP 2050+ scenario for residential buildings
 
and services, which is also 48%.
As at
 
the end of
 
2023, our
 
estimated emissions intensity
 
for the
 
portfolio had decreased
 
by 9% against
 
the 2021 baseline,
with an
 
emission intensity
 
of 28.5
 
kg CO
2
e / m
²
 
ERA. The
 
reduction was primarily
 
driven by
 
an increase
 
in the share
 
of
financed properties
 
with a
 
good-quality building
 
envelope that
 
reduces
 
heat loss.
 
Our estimated
 
emissions intensity
 
is
2% above the 2023 level of our indicative trend line to 2030 (28.0
 
kg CO
2
e / m
²
 
ERA).
To further decarbonize our real estate portfolio
 
in alignment with the Swiss government’s decarbonization
 
ambitions, we
remain dependent
 
on technical
 
advances and
 
concerted policy
 
action, for
 
example,
 
by incentivizing
 
improved building
efficiency and the use
 
of non-fossil-fuel heating systems. We
 
will continue to work
 
with the government and
 
our industry
peers to align on the required actions.
We remain committed to
 
doing our part and
 
supporting our clients in reducing
 
the emissions intensity of their
 
properties.
This includes
 
helping our
 
existing clients
 
to decarbonize
 
through renovations
 
and providing
 
the respective
 
financing. In
2024, we launched the UBS Loan Green,
 
which is designed for clients planning new low-energy constructions or
 
energy-
efficient
 
renovations,
 
or
 
purchasing
 
energy-efficient
 
properties.
 
The
 
product
 
provides
 
tailored
 
financing
 
and
comprehensive expert advice and accepts various building
 
certifications.
 
Furthermore, in 2024, we teamed up with Wincasa, a leading Swiss
 
property services provider, to launch a new advisory
solution, UBS Renovation Services, for investment property owners planning energy upgrades. The service offers
 
tailored
analysis
 
of
 
the
 
renovation
 
potential,
 
a
 
detailed
 
feasibility
 
study
 
and
 
coordination
 
of
 
construction
 
planning
 
and
management through a network of specialized real estate
 
companies.
 
 
Sustainability Report 2024
| Environment
 
36
Fossil fuels (oil, gas and coal)
Our fossil
 
fuel portfolio
 
is concentrated
 
in a
 
small number
 
of corporate
 
clients in
 
the Investment
 
Bank and
 
Personal &
Corporate Banking with limited exposure from
 
Global Wealth Management.
As at the
 
end of 2023,
 
our estimated total
 
financed emissions for the
 
fossil fuels portfolio have
 
decreased by 80% against
the 2021
 
baseline,
 
accounting to
 
12.9 million
 
metric tons
 
of CO
2
e. From
 
2021 to
 
2022, there
 
was a
 
29% reduction,
primarily driven by an overall
 
reduction of the financed
 
portfolio and a significant
 
decrease in exposure to coal.
 
In 2023
our portfolio had a number of loans that were classified as non-core, and as of 31 December
 
2023, these loans were no
longer
 
held in
 
line
 
with the
 
strategy
 
of the
 
Group, primarily
 
driving
 
the
 
remaining
 
reduction.
 
Our estimated
 
financed
emissions are 76% below the 2023 level of our indicative
 
trend line to 2030 (54.6 million metric tons of CO
2
e).
With the remaining concentrated portfolio, we
 
would not expect the same
 
level of emission reductions over
 
the next few
years. Achieving our target requires collaboration
 
across the private and public
 
sectors due to the reliance on fossil
 
fuels
for energy security and because it is the most affordable
 
source of energy in many countries.
Power generation
Our power
 
generation portfolio mainly
 
consists of
 
corporate clients in
 
the Investment Bank,
 
Personal &
 
Corporate Banking
and Global Wealth Management.
As
 
at
 
the
 
end
 
of
 
2023,
 
our
 
estimated
 
emissions
 
intensity
 
for
 
the
 
portfolio
 
had
 
decreased
 
by
 
33%
 
against
 
the
 
2021
baseline, with an
 
emissions intensity of
 
227 kg CO
2
e / MWh.
 
The reduction was primarily
 
driven by a
 
decrease in exposure
to clients with
 
relatively high
 
carbon intensity, including
 
loans that were
 
classified as non-core.
 
In Personal &
 
Corporate
Banking,
 
our clients
 
in the
 
power
 
generation
 
sector,
 
who
 
have
 
a
 
significant
 
share
 
of renewable
 
energy
 
production in
Switzerland,
 
further
 
contributed
 
to
 
our
 
emissions
 
intensity
 
being
 
below
 
the
 
International
 
Energy
 
Agency
 
(the
 
IEA)
benchmark. Our estimated
 
emission intensity is
 
23% below
 
the 2023 level
 
of our indicative
 
trend line to
 
2030 (294 kg
CO
2
e / MWh).
We expect a
 
further decrease in
 
intensity based on
 
our assessment of
 
our clients’
 
disclosed decarbonization commitments,
assuming that our clients realize those decarbonization commitments.
We aim to manage our portfolio by engaging with our clients to support them in adapting their energy mix
 
and increase
our own exposure
 
to sources
 
of energy
 
with lower
 
emissions. We
 
expect the
 
reduction of
 
loans that
 
were classified
 
as
non-core to further contribute to a decrease in the portfolio intensity.
Reaching our
 
target requires
 
collaboration across
 
the private
 
and public
 
sectors. The
 
sector remains
 
dependent on
 
the
right policies,
 
incentives and
 
frameworks to
 
be in place.
 
Recent data
 
indicates that
 
investment of
 
around USD 2trn
 
per
annum is going toward clean energy,
 
which represents two thirds of the
 
global energy investment. This increase is
 
mainly
driven by emissions reduction targets and the need to guarantee
 
energy security.
1
Iron and steel
Our iron and steel portfolio
 
is concentrated in a
 
small number of clients in
 
the Investment Bank and Personal
 
& Corporate
Banking with limited exposure from
 
Global Wealth Management.
As
 
at
 
the
 
end
 
of
 
2023,
 
our
 
estimated
 
emissions
 
intensity
 
for
 
the
 
portfolio
 
had
 
decreased
 
by
 
20%
 
against
 
the
 
2021
baseline, with an emissions intensity of
 
1.41 metric tons of CO
2
 
/ metric ton of steel.
 
The reduction was primarily driven
by existing clients reducing their carbon intensities, a decrease in
 
loans that were classified as non-core, and an increased
share of exposure to
 
secondary steel production clients
 
with lower intensities.
 
Our estimated emissions intensity
 
is 14%
below the 2023 level of our indicative trend line to 2030
 
(1.64 CO
2
 
/ metric ton of steel).
We expect a
 
further decrease in
 
intensity based on
 
our assessment of
 
our clients’
 
disclosed decarbonization commitments,
assuming that our clients realize those decarbonization commitments.
We will continue
 
to finance our
 
clients’ transition to
 
support shifting production
 
to reduce the
 
sector’s reliance on
 
coal
while increasing scrap production and the use of direct reduction and
 
electric arc furnaces.
Reaching our
 
target requires
 
collaboration across
 
the private
 
and public
 
sectors. The
 
sector remains
 
dependent on
 
the
commercialization
 
and scaling
 
up of
 
low-carbon
 
steelmaking
 
technologies,
 
which requires
 
research and
 
development,
and robust policy and market incentives.
Cement
Our cement portfolio consists of corporate clients in Personal
 
& Corporate Banking and the Investment Bank.
As at
 
the end of
 
2023, our
 
estimated emissions intensity
 
for the
 
portfolio had decreased
 
by 3% against
 
the 2021 baseline,
with an emissions
 
intensity of 0.62
 
metric tons
 
of CO
2
 
/ metric ton
 
of cementitious.
 
The reduction was
 
primarily driven
by a
 
decrease in
 
intensity by
 
our existing
 
clients.
 
Our estimated
 
emissions intensity
 
is 2%
 
above the
 
2023 level
 
of our
indicative trend line to 2030 (0.60 metric tons of CO
2
 
/ metric ton of cementitious).
1
 
https://www.iea.org/reports/world-energy-investment-2024/
 
 
 
 
 
 
 
ubsgroupsustainabilitp41i0
Sustainability Report 2024
| Environment
 
37
We believe
 
our main
 
clients in
 
the cement industry
 
are best
 
in class
 
in terms
 
of ESG (environmental,
 
social and
 
governance)
disclosures
 
and
 
externally
 
verified
 
emissions
 
reduction
 
targets,
 
some
 
of
 
which
 
include
 
interim
 
2030
 
targets.
 
We
 
will
continue
 
to
 
finance
 
our
 
clients’
 
transition,
 
potentially
 
increasing
 
our
 
exposure
 
with
 
appropriate
 
sustainability-linked
product offerings or project ring-fencing,
 
and advising on various transactions,
 
such as the acquisition of assets, disposal
of certain business lines, equity raises and share buybacks.
 
Reaching our
 
target requires
 
collaboration across
 
the private
 
and public
 
sectors. The
 
sector remains
 
dependent on
 
the
right policies
 
and incentive
 
frameworks being
 
in place.
 
Specifically in
 
the cement
 
sector, production
 
emissions intensity
has remained flat in recent years, highlighting the need for
 
technological disruption.
UBS AG 2024 Poseidon Principles disclosure (shipping)
The Poseidon
 
Principles are
 
a framework
 
for assessing
 
and disclosing,
 
on an
 
annual basis,
 
the climate
 
alignment of
 
in-
scope ship finance
 
portfolios (individual vessels
 
weighted by their
 
loan exposure with
 
the reporting financial
 
institution)
to the ambition of the International Maritime Organization (the
 
IMO), including its 2023 Revised GHG Strategy for
 
GHG
emissions from international shipping to decrease
 
to net zero by or around 2050
 
with interim targets in 2030 and 2040
on a well-to-wake (WTW) basis (compared with 2008
 
levels).
1
This is
 
the fourth
 
year of
 
disclosure under
 
the Poseidon
 
Principles and
 
the first-time
 
reporting in
 
the name
 
of UBS
 
AG.
The result
 
is based
 
on the
 
Credit Suisse
 
AG ship
 
finance portfolio
 
as at
 
the end
 
of 2023
 
and, therefore
 
,
 
precedes the
completion of the legal
 
merger of the
 
two firms. The reported
 
alignment deltas are reflective
 
of the IMO’s revised
 
GHG
reduction ambition, with the underlying methodology adopted by the Poseidon Principles in 2023, as further updated in
the reporting year.
2
Poseidon Principles disclosure (UBS AG – Credit Suisse AG portfolio)
For the year ended
31.12.23
31.12.22
Shipping (delta alignment to “IMO 2023 minimum trajectory”)
9.1%
11.5%
Shipping (delta alignment to “IMO 2023 striving for trajectory”)
14.4%
15.7%
1
 
The IMO Revised GHG Strategy sets out
 
the following absolute reduction levels of ambition: (i) to
 
reduce total annual GHG emissions by at least
 
20%, striving for 30%, by 2030 (compared with 2008);
 
(ii) to reduce
total annual GHG emissions by at least 70%,
 
striving for 80%, by 2040 (compared
 
with 2008); (iii) GHG emissions to peak
 
as soon as possible and to reach
 
net-zero GHG emissions by or around 2050
 
(the Poseidon
Principles trajectories are
 
based on a
 
net zero by
 
2050 consideration);
 
and (iv) carbon
 
intensity to decrease
 
in order to
 
reduce CO
2
 
emissions per transport
 
unit by at
 
least 40% by
 
2030 (compared with
 
2008). The
Revised GHG Strategy considers
 
well-to-wake CO
2
e emissions, i.e.
 
it includes upstream emissions,
 
as well as accounts
 
for the impact of
 
methane (CH
4
) and nitrous oxide
 
(N
2
O). The updated
 
IMO trajectories are
 
not
1.5°C-aligned.
 
2
The Poseidon Principles Annual Disclosure Reports are published under https://www.poseidonprinciples.org/finance/resources . For the 2024 reporting cycle (based on 2023 data), the Poseidon Principles Technical In 2024, we experienced a strong reporting level and responsiveness from our clients, with further improvements in data
Guidance v.5.1 was used.
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Environment
 
38
quality.
 
This
 
is
 
a
 
testament
 
to
 
the
 
established
 
Poseidon
 
Principles
 
and
 
regulatory
 
frameworks,
 
such
 
as
 
the
 
IMO
 
Data
Collection System (DCS) and IMO Carbon Intensity Index
 
(CII) rating systems.
The
 
results
 
continue
 
to
 
be
 
materially
 
driven
 
by,
 
and
 
may
 
fluctuate
 
each
 
reporting
 
year
 
due
 
to,
 
the
 
continuous
implementation and
 
tightening of
 
regulations, a
 
broader adoption
 
of technical
 
improvement measures
 
and the
 
limited
direct influence over operational aspects by ship owners
 
and reporting financial institutions. In the long term, we
 
expect
that
 
technology-related
 
aspects
 
of
 
decarbonization,
 
such
 
as
 
the
 
adoption
 
and
 
availability
 
of
 
new
 
low-emission
technologies and related fuel supply, could further drive the
 
portfolio alignment performance.
 
The Poseidon Principles continue to be
 
a relevant factor in our ship finance
 
client and transaction due diligence.
 
Related
processes and tools have been further refined and embedded
 
in our organization.
By understanding
 
our clients’
 
decarbonization
 
strategies
 
better,
 
we continue
 
to work
 
alongside them
 
to support
 
their
climate
 
transition
 
efforts.
 
The
 
improvement
 
of
 
data
 
availability
 
and
 
transparency
 
and
 
our
 
continuous
 
participation
 
in
decarbonization initiatives, including the Poseidon Principles, support
 
our client discussions and portfolio optimization.
Our approach to measuring facilitated emissions from our capital
 
markets business
Our role in capital market transactions helps our clients to access capital for their
 
businesses. We facilitate capital-raising
by clients, and we believe it is important
 
to monitor the related emissions from
 
these transactions. The Investment
 
Bank
offers clients access to the primary and secondary
 
public capital markets and private capital transactions.
Facilitated
 
emissions
 
differ
 
from
 
financed
 
emissions
 
in
 
two
 
respects:
 
firstly,
 
they
 
are
 
off-balance
 
sheet
 
(representing
services rather
 
than financing)
 
and, secondly,
 
our role
 
is completed
 
within a
 
short time
 
frame rather
 
than a
 
long-term
loan-related
 
exposure.
 
As
 
a
 
result,
 
and
 
in
 
line
 
with
 
industry
 
guidance,
 
we
 
distinguish
 
between
 
on-balance
 
sheet
“financed” and off-balance sheet “facilitated” emissions.
 
By disclosing
 
our facilitated
 
emissions for
 
selected
 
carbon-intensive
 
sectors for
 
public capital
 
markets
 
transactions, we
aim to provide
 
transparency regarding the emissions
 
we facilitate as
 
a result of
 
our capital market
 
activities. Our facilitated
emissions
 
are
 
calculated
 
following
 
the
 
PCAF’s
 
Global
 
GHG
 
Accounting
 
and
 
Reporting
 
Standard
 
–
 
Part
 
B
 
Facilitated
Emissions (first version, December 2023) for facilitated emissions, including public equity capital markets and public debt
capital
 
markets,
 
where
 
we
 
held
 
a
 
lead
 
bookrunner
 
or
 
lead
 
manager
 
/
 
co-manager
 
role
 
in
 
the
 
transaction.
 
Facilitated
emissions are not shown for the 2024 reporting year, due
 
to the inherent time lag in the availability of emissions data.
 
It is important to note that
 
these facilitated emissions are dependent
 
on the capital markets activity
 
during the year and
our market share is expected to fluctuate in our year-on-year
 
reporting.
We continue to
 
review and assess
 
emerging industry guidance and
 
target-setting methodologies for facilitated emissions.
 
We review and assess Global Banking transactions and employ a robust business selection process for mandates that are
accepted. This means that, in
 
our capital markets activities for carbon-intensive sectors,
 
we consider the potential climate
and sustainability
 
impacts of
 
the transaction
 
and related
 
material risks
 
and opportunities,
 
in line
 
with our
 
sustainability
and climate risk policy framework.
Facilitated emissions for selected carbon-intensive sectors (UBS Group)
For the year ended
31.12.23
31.12.22
Facilitated
amount
(USD bn)
Facilitated
emissions,
scopes 1
and 2
(million
metric t
CO
2
e)
Facilitated
emissions,
scope 3
(million
metric t
CO
2
e)
PCAF
score,
scopes 1
and 2
2
PCAF
score,
scope 3
2
Facilitated
intensity
(million
metric t
CO
2
e / USD
bn)
Facilitated
amount
(USD bn)
Facilitated
emissions,
scopes 1
and 2
(million
metric t
CO
2
e)
Facilitated
emissions,
scope 3
(million
metric t
CO
2
e)
PCAF
score,
scopes 1
and 2
2
PCAF
score,
scope 3
2
Facilitated
intensity
(million
metric t
CO
2
e / USD
bn)
Selected carbon-intensive
sectors
1
6.5
1.3
1.8
1.6
1.7
0.46
12.0
2.0
2.3
1.6
2.3
0.35
4
Selected carbon-intensive
sectors as % of total
5.3%
5.7%
Other sectors
 
117.7
197.7
Total facilitated amount
3
124.2
209.7
1
 
Selected carbon-intensive sectors are the following: fossil
 
fuels (coal, oil and gas), power generation,
 
iron and steel, aluminum, cement, automotive and
 
air transportation. Agriculture and real estate
 
are excluded
due to the limited
 
data availability. Refer to the sector
 
approach in the “Climate-related
 
methodologies – decarbonization approach
 
for our financing activities“ section
 
of the Supplement to
 
the UBS Group Sustainability
Report 2024, available at ubs.com/sustainability-reporting, for more information about the parts of the value chain within scope.
 
2
 
The PCAF data quality score has been combined for the key sectors and weighted
by the facilitated amount.
 
3
 
Includes all sectors.
 
4
 
Facilitated intensity is reported to two decimal places and may therefore differ from the values presented in the UBS Group Sustainability
 
Report 2023.
›
Refer to the “Supporting Opportunities”
 
section of this report for more information about the
 
Investment Bank’s capital market
activities
›
Refer to the “Basis of preparation” section of the
 
Supplement to the UBS Group Sustainability Report
 
2024, available at
ubs.com/sustainability-reporting
, for more information about our methodology to calculate facilitated emissions Supporting our clients’ neutralization of residual emissions
 
Sustainability Report 2024
| Environment
 
39
Our
 
climate
 
transition
 
plan
 
prioritizes
 
emission
 
reductions
 
in
 
line
 
with
 
science-based
 
climate
 
targets
 
and
 
credible
trajectories to achieve
 
these targets. In addition,
 
we anticipate that
 
the deployment of carbon
 
removal solutions
 
will be
needed
 
to
 
supplement
 
the
 
emission
 
reduction
 
strategies
 
of
 
some
 
of
 
our
 
clients
 
and
 
counterbalance
 
hard-to-abate
emissions.
 
We
 
aim
 
to
 
support
 
our
 
clients
 
in
 
the
 
deployment
 
of
 
solutions
 
to
 
neutralize
 
residual
 
emissions
 
in
 
line
 
with
science-based
 
decarbonization
 
pathways.
 
As
 
best
 
practice
 
guidance,
 
regulation,
 
methodologies
 
and
 
technologies
develop, our approach to decarbonization, including
 
neutralization, will continue to evolve.
High-integrity
 
participation
 
in
 
carbon
 
markets
 
plays
 
a
 
role
 
that
 
is
 
supplemental
 
to
 
sectoral
 
and
 
economy-wide
decarbonization.
 
We
 
have
 
made
 
a
 
strategic
 
investment
 
in
 
Carbonplace,
 
a
 
consortium-led
 
venture
 
to
 
build
 
an
infrastructure layer to scale the global voluntary
 
carbon market. Through its embedded
 
network of banks, registries and
data
 
providers,
 
Carbonplace
 
enables
 
our
 
clients
 
and
 
other
 
market
 
participants
 
to
 
buy,
 
sell,
 
hold
 
and
 
retire
 
voluntary
carbon credits on a
 
transparent, secure and
 
scalable settlement platform.
 
Furthermore, the Investment
 
Bank completed
a first-of-a-kind carbon finance transaction that aims to
 
provide returns to investors from the sale of
 
credits generated by
carbon dioxide removal
 
projects, enabling our
 
clients to directly
 
invest in the development
 
of high-quality technological
carbon
 
removals.
 
We
 
support
 
transparent
 
investment
 
in
 
carbon
 
markets
 
that
 
are
 
aligned
 
with
 
the
 
current
 
publicly
available consensus on high integrity
 
standards and robust governance (including
 
the Voluntary Carbon Markets Integrity
Initiative Claims Code of Practice, the Integrity Council
 
for the Voluntary Carbon Market Core Carbon
 
Principles and the
Oxford Principles for Net-Zero-Aligned Carbon Offsetting).
Supporting our investing clients’ low-carbon transition
We are committed to supporting our investing clients in the transition to a low-carbon world in line with our obligations
to our clients, including
 
fiduciary duties as an
 
investment manager and on the
 
terms of the mandates agreed
 
with clients.
We offer a distinct approach to client investments,
 
which focuses on solutions and engagement
 
activities that empower
clients to
 
achieve
 
their transition
 
goals. We
 
have identified
 
six key
 
strategic actions
 
to support
 
our investing
 
clients in
Asset
 
Management
 
and
 
Global
 
Wealth
 
Management.
 
It
 
is
 
important
 
to
 
note
 
that
 
not
 
all
 
these
 
strategic
 
actions
 
are
relevant to
 
both business
 
divisions,
 
or to
 
all regions
 
within a
 
division, and
 
our progress,
 
where applicable,
 
may not
 
be
linear or simultaneous.
–
Develop our platform
 
of available climate
 
-related strategies, products
 
and solutions to
 
facilitate our investing
 
clients’
transition to a low-carbon world.
–
Engage investee companies to encourage them to adopt credible climate transition plans and manage climate-related
risks and opportunities (applicable to Asset Management only).
–
Collaborate
 
with
 
third-party
 
fund
 
managers
 
to
 
understand
 
their
 
climate
 
transition
 
plans
 
and
 
approach
 
to
 
consider
climate-related risks
 
and opportunities
 
(applicable to
 
Global Wealth
 
Management only),
 
where the
 
legal framework
allows.
–
Support clients’
 
progress on
 
their climate
 
objectives through
 
education sessions
 
and thought
 
leadership, along
 
with
portfolio construction
 
and transparency,
 
aiming to
 
assist clients
 
who seek
 
awareness of
 
mitigating climate
 
risks and
identifying transition opportunities in their investments.
–
Provide employees with the training, tools
 
and information necessary to support
 
our clients to navigate the transition
to a low-carbon world in accordance with their climate
 
objectives.
–
Engage with policymakers on key topics such as regulations
 
and policy development.
Details by business division on each strategic action are provided
 
in the respective sections below.
 
›
Refer to the “Supporting our climate approach: key
 
enabling actions” section in this report for more information
 
about our Group
initiatives
Asset Management
 
Asset Management is committed to supporting our clients in
 
achieving their climate-related investment goals. In the UBS
Group Sustainability Report 2023, we referred to the target set by Asset Management aiming, by 2030, to align 20% of
UBS AG
 
Asset Management’s
 
total assets
 
under management
 
(AuM) with
 
net zero.
 
Given the
 
integration taking
 
place
within Asset
 
Management, we
 
are review
 
ing the
 
legacy target
 
set prior
 
to the
 
acquisition of
 
the Credit
 
Suisse Group
 
,
taking into
 
account all
 
of the
 
AuM of
 
the combined
 
businesses. We
 
have therefore
 
withdrawn the
 
target. We
 
remain
committed to supporting the Paris Agreement climate goals
 
in line with global efforts. At the end of 2024, we recorded
USD 64.4bn of total assets as having a net-zero
 
ambition, compared with USD 35.5bn at the
 
end of 2023.
Aligned
 
to
 
our
 
overall
 
approach
 
for
 
supporting
 
our
 
investing
 
clients,
 
Asset
 
Management
 
has
 
adopted
 
key
 
policies,
guidelines and frameworks,
 
along with actions
 
to manage
 
our climate-related
 
impacts and realize
 
opportunities. These
policies and actions are outlined below.
Our climate-related policies, guidelines and frameworks
Specific policies, guidelines and frameworks
 
are in place and aim
 
to manage climate-related
 
impacts and the realization
of opportunities within Asset Management.
The
 
climate
 
risk
 
integration
 
guidelines
 
describe
 
the
 
approach
 
toward
 
integrating
 
the
 
physical
 
and
 
transition
 
risks
 
of
climate change into the
 
assessment of public market issuers
 
and investment portfolios. The
 
guidelines identify companies
with elevated climate
 
risks and set
 
steps for
 
assessment of the
 
specific risks
 
and mitigation actions,
 
which are incorporated
into investment decision-making. The scope of the framework covers listed equity and corporate bonds. The most senior
level accountable for the implementation of the guidelines
 
is the head of the Sustainable Investing team.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Environment
 
40
The net-zero alignment framework has been
 
established to guide the internal classification
 
and development of products
and
 
solutions
 
meeting
 
clients’
 
needs
 
for
 
net-zero
 
investing.
 
The
 
framework
 
describes
 
a
 
range
 
of
 
methodologies
 
for
determining the net-zero
 
ambition of investment
 
products and covers
 
investments in public
 
equities and corporate
 
bonds,
sovereign bonds, direct
 
real estate, direct
 
infrastructure, carbon markets
 
and private debt.
 
In 2024, the
 
framework was
reviewed and
 
updated to
 
reflect further
 
developments of
 
industry guidance.
 
The most
 
senior level
 
accountable for
 
the
implementation of the guidelines is the head of the Sustainable
 
Investing team.
›
Refer to “Key policies and principles” in the “Appendix
 
1 – Governance”
 
section of this report for details about the Group-wide
policies, guidelines and frameworks
Climate-related investing metrics
 
The table
 
below provides
 
metrics related
 
to the
 
investments of
 
our Asset
 
Management division.
 
Investment-associated
emissions are
 
provided based
 
on the
 
recommendations
 
of the
 
Task
 
Force on
 
Climate-related
 
Financial Disclosure
 
s
 
(the
TCFD) and
 
are derived
 
from the
 
GHG emissions
 
(scopes 1
 
and 2)
 
attributed to
 
the issuers
 
and the
 
positions within
 
the
investment portfolios we
 
manage. The metrics
 
are calculated for portfolios
 
where emissions data is
 
available and primarily
covers
 
our
 
equity,
 
fixed
 
income
 
and
 
multi-asset
 
portfolios,
 
accounting
 
for
 
48%
 
of
 
the
 
total
 
invested
 
assets
 
of
 
Asset
Management.
The design of the table has
 
been changed from the one
 
used for the UBS Group Sustainability
 
Report 2023 with a view
to simplifying
 
the presentation
 
of the
 
metrics. It
 
now includes
 
three commonly
 
used metrics
 
for investment-associated
emissions for
 
Asset
 
Management.
 
Furthermore,
 
it provides
 
carbon
 
intensity
 
metrics
 
for
 
equity and
 
fixed
 
income
 
asset
classes.
Absolute
 
carbon
 
emissions
 
increased
 
year
 
on
 
year
 
primarily
 
due
 
to
 
inclusion
 
of
 
Credit
 
Suisse
 
portfolios
 
and
 
greater
coverage for
 
fixed income portfolios.
 
Carbon intensity
 
for Asset
 
Management decreased
 
as a
 
result of an
 
overall fall in
carbon intensity
 
across the
 
equities asset
 
class driven
 
by increased
 
equity market
 
valuations, partially
 
offset by
 
a rise
 
in
the carbon intensity of fixed income.
Climate-related investing metrics – portfolio emissions (Asset Management)
For the year ended
31.12.24
31.12.23
Asset Management Investment-associated carbon emissions:
Carbon emissions (absolute in million metric tons of CO
2
e)
1,2
54.8
41.3
Carbon intensity (in metric tons of CO
2
e per USD m invested)
1
56.5
62
Carbon intensity (in metric tons of CO
2
e per USD m of revenue)
1
101.2
103.6
Equities Asset Class
Carbon intensity (in metric tons of CO
2
e per USD m invested)
1
38.5
45.6
Carbon intensity (in metric tons of CO
2
e per USD m revenue)
1
90.4
101.5
Fixed income Asset Class
Carbon intensity (in metric tons of CO
2
e per USD m invested)
1
108.3
84.2
Carbon intensity (in metric tons of CO
2
e per USD m revenue)
1
130.9
122.5
1
 
Based on data for scope
 
1 and 2 GHG
 
emission of investee companies
 
from a third-party
 
data provider and positions
 
held in investment portfolios.
 
Note the scope of
 
the portfolio emissions metrics
 
reported for
2024 is Asset Management,
 
and includes Credit Suisse
 
portfolios which have migrated
 
onto UBS platforms by
 
the end of the
 
year. This
 
process is carried
 
out in waves and
 
will continue until
 
the end of 2025
 
at a
minimum. The scope of the metrics reported for 2023 is UBS AG Asset
 
Management only and excludes Credit Suisse portfolios.
 
2
 
2023 absolute carbon emissions have been restated from 46.3
 
to 41.3 million metric
tons of CO
2
e.
Our key climate-related actions
Asset Management aims
 
to manage its
 
climate-related impacts
 
and realize
 
opportunities through
 
the actions described
below.
 
These
 
actions
 
are
 
only partially
 
and indirectly
 
connected
 
to the
 
investment-associated
 
emissions
 
we report
 
for
Asset Management and for the selected asset classes.
 
Action 1: Develop our platform of available climate-related
 
strategies, products and solutions
 
Asset Management integrates considerations of climate change risks across a range of the products and solutions that it
offers. From the viewpoint that climate change represents a financial risk across
 
a broad range of investments, it assesses
the potential scale of
 
risks arising from transition and the
 
risks associated with the effects of
 
climate change on operating
assets
 
and
 
supply
 
chains.
 
In
 
2024,
 
Asset
 
Management
 
added
 
further
 
specific
 
climate-related
 
risk
 
indicators
 
into
 
its
proprietary ESG risk
 
dashboard, generating
 
a risk signal
 
across several risk
 
dimensions, including transition
 
and physical
risks. This makes
 
it easier to
 
identify investments where
 
the risks are
 
higher,
 
assess how these
 
risks are
 
being managed
and provide a forward-looking view that
 
informs portfolio manager investment decisions.
 
Across our
 
private markets business,
 
there is
 
a climate risk
 
management process to
 
identify, assess
 
and potentially mitigate
climate risks to
 
improve the
 
adaptation and /
 
or resiliency
 
of our portfolios
 
to climate-change-related
 
hazardous events
and the
 
transition to
 
a net-zero
 
world. This
 
approach is
 
embedded throughout
 
the investment
 
life cycle
 
for underlying
assets of portfolios, where relevant and possible. Assessment of transition risk using the IEA net-zero roadmap is applied
to direct infrastructure investments. Standardized
 
due diligence questionnaires are used
 
in our multi-manager investment
businesses
 
(real
 
estate,
 
private
 
equity
 
and
 
infrastructure)
 
to
 
understand
 
climate
 
risks
 
at
 
fund
 
and
 
asset
 
levels,
 
where
possible.
 
In
 
addition,
 
our
 
Multi-Managers
 
Real
 
Estate
 
business
 
independently
 
assesses
 
physical
 
risk
 
and
 
transition
 
risk
using the S&P Trucost and CRREM decarbonization pathways,
 
respectively.
In addition,
 
Asset Management offers
 
specific products
 
that address
 
different aspects of
 
climate change.
 
Examples include
strategies that invest in climate solutions, the energy transition, infrastructure debt and green real estate, and in indexed In 2024, we expanded the number of portfolios that we offer with a net-zero alignment ambition in the equities and
strategies.
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Environment
 
41
direct real estate asset classes.
The table below shows progress related to total assets with
 
a net-zero ambition.
The increase in the value of assets with net-zero
 
ambition was driven by an increase in the number
 
of net-zero ambition
portfolios
 
and
 
market
 
performance.
 
The
 
classification
 
of
 
additional
 
net-zero
 
ambition
 
portfolios
 
resulted
 
from
 
newly
launched
 
portfolios,
 
changes
 
to
 
existing
 
portfolios
 
and
 
a
 
refinement
 
to
 
the
 
Asset
 
Management’s
 
net-zero
 
alignment
framework to align with current industry standards and best
 
market practice.
Climate-related investing metrics: Opportunities – net-zero investing (Asset Management)
For the year ended
31.12.24
31.12.23
Assets with net-zero ambition (USD bn)
1
64.4
35.5
Number of net-zero ambition portfolios
1
49
35
Net-zero ambition assets share of total assets under management
 
(%)
2
3.6
2.9
1
 
Credit Suisse portfolios are in the process of being assessed in the context of the Asset Management's net-zero alignment framework to identify portfolios with a net-zero ambition and are therefore not reflected in
the reported metrics.
 
2
 
For 2024, the
 
total assets under management
 
represent Asset Management
 
including Credit Suisse.
 
For 2023,
 
the total assets under
 
management represent UBS
 
AG Asset Management
excluding Credit Suisse.
›
Refer to the “Supporting Opportunities” section
 
of this report for more information about examples
 
of climate and / or transition
products
Action 2: Engage investee companies
Asset Management has had
 
a dedicated climate engagement
 
program focused on investee
 
companies in place for over
six years. This program is based on selecting companies that make
 
a significant contribution to portfolio emissions across
listed
 
equity
 
and
 
corporate
 
fixed
 
income
 
investment
 
portfolios.
 
This
 
engagement
 
is
 
based
 
on
 
a
 
set
 
of
 
expectations
published on
 
our website
 
from whic
 
h
 
company specific
 
engagement objectives
 
are
 
developed, supplemented
 
with an
evidenced-based research
 
framework,
 
along with sector-specific
 
standards addressing
 
governance, corporate
 
transition
plans and exposure to sector-specific
 
decarbonization levers across business operations
 
and the value chain.
 
In
 
its
 
private
 
markets
 
business,
 
Asset
 
Management’s
 
active
 
ownership
 
on
 
climate
 
change
 
is
 
integrated
 
into
 
the
management
 
of
 
its
 
funds
 
and
 
is
 
implemented
 
by
 
all
 
operational
 
functions
 
throughout
 
the
 
ownership
 
cycle
 
of
 
an
underlying
 
project.
 
This
 
spans
 
from
 
development
 
or
 
acquisition
 
to
 
the
 
ongoing
 
asset
 
management,
 
renovation
 
and
maintenance, through to sale.
Action 3: Support clients’ progress on their climate
 
objectives
Asset
 
Management
 
recognizes
 
that
 
its
 
approach
 
to
 
climate
 
change
 
investment
 
is
 
determined
 
by
 
clients’
 
choices.
Therefore,
 
we aim
 
to play
 
a role
 
in helping
 
our clients
 
to achieve
 
their climate
 
objectives, working
 
collaboratively with
them on
 
climate risk
 
management by
 
providing information
 
about best
 
practices and
 
approaches for
 
portfolios with
 
a
net-zero ambition. This includes
 
supporting climate-oriented portfolio construction
 
through internal transition readiness
assessment methodologies, transparency on climate
 
-relevant data metrics and thought leadership.
In 2024,
 
Asset Management
 
supported clients
 
in a
 
variety of
 
ways reflecting
 
the specific
 
needs of
 
the clients
 
involved.
We created
 
thought pieces
 
and guidance
 
for clients
 
on climate
 
change aspects
 
of investing.
 
We supported
 
a client
 
in
meeting the
 
need for
 
decarbonizing the
 
sovereign part
 
of a
 
portfolio. We
 
also assisted
 
a retail
 
bank with
 
developing a
net-zero multi-asset
 
offering for its
 
client, along
 
with methodology
 
and building
 
blocks for a
 
fund-of-funds solution.
 
A
further example is
 
our development of a
 
net-zero ambition corporate bond
 
fund for Swiss institutional
 
clients.
 
As a result,
we have increased the shelf of products that we offer to
 
clients with a climate-related perspective.
During the
 
year, Asset
 
Management published
 
a Climate
 
Aware report
 
showing decarbonization
 
path visualizations.
 
It
also published a
 
series of insights
 
on approaches to
 
COP29, physical risks,
 
battery power and
 
natural capital, as
 
well as
an engagement for impact report,
 
an IPE special report
 
and a climate report
 
that provided an overview of
 
its commitment
and actions to the energy transition.
 
Action 4: Provide employees with training, tools and information
Asset Management provides relevant
 
training, tools and information to its employees
 
to support clients in the transition
to a
 
low-carbon world.
 
With the
 
aim of
 
enabling the
 
alignment of
 
the activities
 
of Asset
 
Management’s employee
 
s
 
to
the
 
division’s
 
sustainable
 
investing
 
goals,
 
Asset
 
Management
 
delivered
 
an
 
ESG
 
talk
 
series
 
and
 
updated
 
Group
foundational
 
sustainable
 
investing
 
training
 
aimed
 
at
 
an
 
Asset
 
Management
 
audience.
 
It
 
enhanced
 
role-specific
sustainable
 
investing
 
know-how
 
by
 
running
 
the
 
first
 
Berkeley
 
UBS
 
external
 
certification
 
program.
 
It
 
also
 
conducted
regulatory
 
learning sessions
 
educating investment
 
professionals
 
on sustainable
 
investing regulatory
 
and greenwashing
risks.
›
Refer to the “Supporting our climate approach: key enabling actions” section of this report for more information about our Action 5: Engage with policymakers
Group-wide training and culture activities
 
Sustainability Report 2024
| Environment
 
42
Asset Management undertakes engagement with the industry and government with the aim of providing input to policy
and regulation in the development of well-functioning
 
markets.
With respect
 
to climate
 
change, Asset
 
Management engages
 
with key
 
stakeholders such
 
as national
 
and international
policymakers through
 
industry forums,
 
including the
 
European Fund
 
and Asset
 
Management Association
 
Stewardship,
Market
 
Integrity
 
and
 
ESG
 
Investment
 
Standing.
 
In
 
Switzerland,
 
Asset
 
Management
 
is a
 
member
 
of
 
Swiss
 
Sustainable
Finance and the Asset
 
Management Association Switzerland
 
Working Groups on Sustainable
 
Finance, including a focus
on developing the Swiss Climate Scores methodologies and
 
the Swiss Stewardship Code.
›
Refer to the “Supporting our climate approach: key
 
enabling actions” section of this report for
 
more information about the
Group’s initiatives on industry, governments and public sector engagement
Global Wealth Management
Global Wealth Management is a distributor of investment solutions, including those that focus on
 
climate. We recognize
that
 
some
 
investors
 
may
 
have
 
decarbonization
 
ambitions
 
or an
 
interest
 
in
 
investing
 
in
 
the
 
transition
 
to
 
a
 
low-carbon
world, therefore
 
we
 
aim to
 
provide
 
a
 
range
 
of solutions
 
for
 
private
 
investors
 
and
 
family
 
offices
 
to address
 
their
 
own
decarbonization targets
 
where possible.
 
We may
 
seek to
 
do this through
 
allocations to
 
climate-related
 
solutions in our
discretionary mandates where relevant
 
and available, and by curating climate investment options for advisory portfolios.
The focus on
 
providing a
 
range of credible
 
solutions is complemented
 
by building investor
 
awareness, driving
 
solutions
innovation across
 
asset classes
 
and strategies, and
 
providing investors
 
with the tools
 
to understand their
 
portfolios in a
climate
 
context.
 
However,
 
the
 
available
 
solutions,
 
approaches
 
and
 
climate-related
 
data
 
and information
 
will
 
differ
 
by
region.
Our key climate-related actions
Action 1: Develop our platform of available climate-related
 
strategies, products and solutions
 
Global Wealth
 
Management
 
aims to
 
support climate
 
change mitigation
 
by providing
 
options for
 
private investors
 
and
family
 
offices
 
to
 
address
 
their
 
own
 
decarbonization
 
objectives
 
where
 
possible.
 
In
 
2024,
 
Global
 
Wealth
 
Management
continued
 
to
 
increase
 
the
 
number
 
of
 
investment
 
solutions
 
across
 
asset
 
classes
 
and
 
strategies
 
to
 
support
 
clients’
decarbonization objectives.
›
Refer to the “Supporting opportunities” section
 
of this report for more information about our products and
 
solutions
Action
2
: Support clients’ progress on their climate objectives
We aim
 
to support
 
our clients
 
in making
 
progress
 
on their
 
climate objectives
 
through
 
education, investment
 
research,
and portfolio
 
construction and transparency. Our investment specialists
 
provide investment insights
 
to clients and
 
advisors
on various climate-related and
 
transition-investing topics, given the
 
importance of climate change
 
for capital markets
 
and
business
 
models.
 
This
 
includes
 
incorporating
 
climate
 
considerations
 
into
 
portfolios,
 
setting
 
portfolio
 
decarbonization
targets and building exposure to carbon markets.
In 2024, we continued to provide coverage
 
of climate-related and broader sustainable investing topics in publications for
private clients.
 
Our Chief
 
Investment Office identified
 
three key sustainability
 
themes for the
 
year that encompass
 
different
areas
 
of
 
the
 
transition
 
to
 
the
 
low-carbon
 
world:
 
the
 
industrial
 
transition,
 
sustainable
 
infrastructure,
 
and
 
water
 
and
agriculture.
 
Throughout
 
the
 
year,
 
we
 
provided
 
a
 
private
 
investor
 
perspective
 
on
 
investment
 
opportunities
 
tied
 
to
 
the
transition. Our
 
analysts covered
 
a broad
 
range of
 
topics, including,
 
but not
 
limited to,
 
longer-term investment
 
themes
(e.g. energy efficiency, the energy transition(s), smart mobility,
 
the circular economy, and the blue economy), investments
in
 
renewable
 
energy
 
infrastructure,
 
decarbonization
 
of
 
high-climate-impact
 
sectors
 
(e.g.
 
cement,
 
steel
 
and
 
shipping),
climate risks and opportunities tied to artificial intelligence,
 
implications for the transition from global election outcomes.
We activated
 
this content internally
 
and externally
 
through a
 
variety of
 
channels, including video
 
content, social
 
media
campaigns and podcasts in collaboration with industry partners,
 
as well as through our website.
We also
 
continue to
 
see a
 
greater focus
 
on climate
 
transparency in
 
select regions.
 
Since the
 
introduction of
 
the Swiss
Climate
 
Scores
 
in
 
2023,
 
we
 
have
 
continued
 
to
 
inform
 
advisors
 
on
 
this
 
content
 
and
 
made
 
reports
 
published
 
by
 
Asset
Management and third-party
 
managers available through
 
our platform. We
 
also incorporated key
 
environmental statistics
into the after-sales materials for relevant investment modules we
 
offer to our clients.
Action 3: Collaborate with third-party fund managers
 
We work closely with third-party
 
fund managers on developing new sustainability and
 
climate solutions, where
 
relevant
and as legal frameworks
 
allow for it. We
 
aim to identify
 
relevant and compelling
 
investment opportunities and
 
credible
tools and to support the launch of new solutions where such are possible and relevant for client portfolios. For example,
in
 
2024,
 
we
 
co-designed
 
and
 
launched
 
an
 
energy
 
transition
 
infrastructure
 
fund
 
for
 
clients
 
interested
 
in
 
investing
 
in
transition-related real assets.
 
We also
 
host regular “innovation
 
sessions” with
 
managers on
 
our platform
 
to discuss
 
market
trends, development ideas and new strategies. These
 
sessions include a focus on sustainability and transition.
We
 
continue
 
to
 
believe
 
that
 
the
 
transition
 
to
 
a
 
low-carbon
 
world
 
requires
 
an
 
“all-of-the-above”
 
approach,
 
where
investments
 
in
 
clean
 
energy
 
infrastructure
 
and
 
green
 
technologies
 
are
 
complemented
 
by
 
effective
 
and
 
credible
shareholder and
 
bondholder engagement
 
with heavy
 
polluters on
 
decarbonization.
 
As such,
 
we dedicate
 
a portion
 
of
our
 
discretionary
 
portfolios
 
to
 
impactful
 
engagement
 
strategies,
 
including
 
those
 
that
 
invest
 
in
 
companies
 
with
 
the
objective of engaging on decarbonization , and regularly collaborate with these managers on their impact measurement In growing our employees’ capabilities around climate and the transition, we aim to provide them with the training, tools
and reporting capabilities.
 
Sustainability Report 2024
| Environment
 
43
Action 4: Provide employees with training, tools and information
and information
 
necessary
 
to support
 
our clients
 
in navigating
 
the transition
 
to a
 
low-carbon world.
 
In Global
 
Wealth
Management, we
 
continued the
 
rollout of
 
an education
 
curriculum covering sustainability
 
and sustainable investing
 
topics
in certain
 
regions.
 
This curriculum
 
offered
 
to advisors
 
covered
 
climate-relevant
 
topics and
 
considerations
 
for investing
around the transition.
›
Refer to the “Supporting our climate approach: key enabling actions” section of this report for more information about our Reporting to the Head Group Human Resources and Corporate Services, Group Real Estate and Supply Chain (GRESC)
Group-wide training and culture activities
 
 
ubsgroupsustainabilitp48i0
Sustainability Report 2024
| Environment
 
44
Reducing our own environmental impact
has overall responsibility
 
for managing environmental
 
and climate-related impacts
 
arising from our own
 
operations and
supply chain. GRESC partners
 
with Group Operations and
 
Technology Office (GOTO),
 
who manages technology-related
environmental
 
impacts,
 
from
 
hardware
 
and
 
data
 
centers.
 
GRESC
 
ensures
 
that
 
implementation,
 
monitoring
 
and
improvement efforts comply with local
 
legislation and adhere to
 
the international environmental management
 
standard
ISO 14001 globally and the international energy management standard ISO 50001 in the EMEA
 
region. GOTO drives the
optimization of
 
our technology within
 
our data centers
 
and the cloud,
 
ensuring optimal
 
efficiency measures
 
across our
energy-intensive
 
assets
 
while
 
encouraging
 
development
 
practices
 
that
 
consider
 
efficiency
 
and
 
reduce
 
our
 
overall
environmental impact
 
.
 
To mitigate
 
our climate-related
 
impacts, we
 
have defined
 
a scope
 
1 and
 
2 emission
 
s
 
reduction
target and actions to guide our transition toward net zero.
Our scope 1 and 2 net-zero target
We have replaced our original 2025 scope 1 and
 
2 target as disclosed in the UBS Group
 
Sustainability Report 2023 with
a new
 
scope 1
 
and 2
 
net-zero
 
target
 
to be
 
achieved by
 
2035 that
 
is in
 
line with
 
net-zero
 
guidelines. The
 
new
 
target
reflects our
 
enlarged corporate
 
real estate
 
portfolio following
 
the acquisition
 
of the
 
Credit Suisse
 
Group and
 
considers
the latest definition of a “net-zero target”
 
in the Commission Delegated Regulation (EU)
 
2023/2772 (CSRD).
1
 
We aim to,
at a minimum,
 
reduce our emissions by
 
90% against our
 
2023 baseline of
 
46,278 metric tons
 
of CO
2
e before neutralizing
any residual emissions through the purchase of carbon removal
 
credits.
 
This target
 
covers our
 
scope 1
 
and market-based
 
scope 2
 
emissions across
 
all our
 
global own
 
operations. As
 
part of
 
the pathway
toward 2035, we
 
also defined a
 
2030 interim target
 
to reduce our
 
scope 1 and
 
net scope 2
 
emissions by 57%
 
against our
2023 baseline. This interim target does not
 
include the use of any
 
carbon removal credits.
›
Refer to the “Reducing our environmental footprint
 
– additional information” section of the Supplement
 
to the UBS Group
Sustainability Report 2024, available at
ubs.com/sustainability-reporting
, for details about our scope 1 and 2
 
emissions
1
Definition of a net-zero target by the CSRD: Setting a net-zero
 
target at the level of an undertaking aligned with meeting societal climate goals means:
 
(i) achieving a scale of value chain emission reductions consistent
with the abatement required to reach global net zero in
 
1.5°C pathways; and (ii) neutralizing the impact of any residual emissions (after
 
approximately 90–95% of GHG emission reduction with the possibility of justified
sectoral variations in line with a recognized sectoral pathway) by permanently removing an equivalent volume of CO When developing the new scope 1 and 2 target, we reviewed sectoral net-zero pathways (e.g.
2
.
 
 
ubsgroupsustainabilitp49i0
Sustainability Report 2024
| Environment
 
45
real estate) but concluded
that there was no sectoral pathway that reflected the
 
structure of our operations.
 
We have followed the latest guidance
from
 
the
 
SBTi
 
and
 
use
 
its
 
Absolute
 
Contraction
 
Approach
1
,
 
limiting
 
global
 
warming
 
to
 
1.5°C.
 
Demonstrating
 
our
commitment to climate action, we have set
 
a more ambitious target, aiming to
 
achieve net zero by 2035, well
 
ahead of
2050 – the deadline under the SBTi Absolute Contraction
 
Approach.
For our own operations and
 
the scope of our scope
 
1 and net scope 2 emission
 
reduction targets, business growth
 
and
technological advancement may lead to
 
changes
 
in workforce numbers,
 
impacting real estate-
 
and service-related needs.
The continued advancement
 
of low-emission technologies for
 
space heating and
 
countries’ net-zero targets will
 
positively
impact the target achievability. We recognize
 
that the impact of such developments is
 
difficult to quantify and therefore
needs
 
to be closely monitored. Projections
 
of real estate demand changes will be
 
factored into the annual model
 
review
to ensure early course correction if required. Another
 
development that will impact target achievement
 
is the availability
of
 
renewable
 
electricity
 
in
 
line
 
with
 
RE100
 
requirements
 
as
 
global
 
demand
 
increases
 
with
 
production
 
not
 
necessarily
following at the same pace.
In 2024, our scope 1 and net
 
scope 2 emissions reduced by 35%
 
against our baseline. This reduction
 
was mainly driven
by the consolidation of our real estate footprint and our increased
 
coverage of renewable electricity.
Accompanying our scope
 
1 and 2 net-zero
 
target, we also aim
 
to reduce by
 
2030 our absolute
 
energy consumption by
35% compared with
 
our 2023 baseline.
 
The ambition level
 
of this energy
 
reduction target was
 
set through forecasting
the
 
expected
 
energy
 
usage
 
reductions
 
resulting
 
from
 
the
 
implementation
 
of
 
the
 
decarbonization
 
levers
 
and
 
actions
described
 
below.
 
In
 
2024,
 
we
 
achieved
 
a
 
10%
 
reduction
 
in
 
energy
 
use
 
compared
 
with
 
our
 
baseline,
 
driven
 
by
 
the
consolidation and energy optimization
 
of our real estate
 
and data centers.
 
Our energy reduction target
 
also contributes
to mitigating the risk of not being able to secure full coverage
 
of renewable electricity.
We have also set a target of sourcing 100% renewable electricity from qualifying generation by 2026 in line with RE100
technical guidance, in markets where credible renewable electricity generation and tracking systems exist. This will cover
our corporate
 
real estate
 
portfolio, including
 
data centers.
 
In 2024,
 
99.8% of
 
the electricity
 
we used
 
across our
 
global
real
 
estate
 
portfolio
 
was
 
from
 
renewable
 
sources,
 
with
 
30%
 
of
 
bundled
 
electricity
 
and
 
70%
 
of
 
unbundled
 
electricity
coming from such sources. Out of our total gross scope
 
2 emissions, 91%
 
is covered by contractual instruments.
We
 
have
 
set
 
2023
 
as
 
our
 
baseline
 
year
 
for
 
our
 
scope
 
1
 
and
 
2
 
net-zero
 
target
 
and
 
our
 
energy
 
reduction
 
target.
 
The
updated
 
baseline
 
reflects
 
material
 
changes
 
for
 
the
 
combined
 
firm
 
and
 
an
 
adjusted
 
scope
 
of
 
our
 
renewable-source
electricity commitment to
 
address markets with
 
limited procurement availability
 
of electricity from renewable
 
sources in
line with RE100. All three targets
 
are led and managed by GRESC in
 
collaboration with GOTO. We have actively engaged
relevant stakeholders in the development of
 
these targets by collecting strategic assessments from
 
topic experts, regional
representatives and real estate managers.
 
We aim, at a
 
minimum, to review our
 
targets every five years and,
 
from 2030 onward, to
 
update the base year
 
and target
values after
 
every
 
five-year
 
period to
 
ensure
 
consistency
 
with the
 
most
 
recent climate
 
science and
 
best
 
practices.
 
It is
important to
 
note that
 
progress toward
 
our targets
 
may not
 
be linear,
 
with year-on-year
 
volatility expected
 
due to
 
the
nature of operational requirements and business development.
1
As per the SBTi Corporate Net-Zero Standard Criteria v1.2, March 2024.
 
Sustainability Report 2024
| Environment
 
46
As part of our global emission accounting
 
to model our 2035 reduction target,
 
we have also assessed the prevalence
 
of
locked-in emissions within the scope of our
 
target. We own and control some buildings
 
with significant on-site fossil fuel
use (such as those heated
 
with natural gas or
 
oil) and are aiming
 
to either replace such
 
systems or move out
 
of the real
estate,
 
wherever
 
possible. For
 
some locations,
 
we
 
are
 
also dependent
 
on
 
municipal
 
action to
 
develop
 
or decarbonize
district heating systems, as electrification with the current infrastructure
 
or location is not a viable alternative.
 
Decarbonization levers and key actions underpinning
 
our own operations targets
To achieve our targets related to
 
our own operations as outlined above
 
and to manage our climate-related impacts in
 
our
own operations,
 
we have
 
identified
 
key decarbonization
 
levers and
 
actions required
 
in our
 
real estate
 
operations and
service portfolio. The decarbonization levers are aggregated types of
 
mitigation actions. Therefore, actions are structured
by decarbonization lever.
Lever 1: Phase
 
out fossil fuels and switch to greener alternatives (scope 1)
We
 
have
 
established
 
a
 
four-part
 
action
 
plan
 
to
 
phase
 
out
 
fossil
 
fuels
 
and
 
implement
 
greener
 
alternatives
 
in
 
order
 
to
significantly reduce our associated scope
 
1 emissions. By deploying
 
a series of targeted
 
actions, we can transition
 
to more
sustainable practices and energy sources, ensuring
 
a cleaner and more resilient future
 
for our own operations.
Action 1: Phase out fossil-fuel-powered own vehicles
 
Across
 
all
 
regions,
 
we
 
plan
 
to
 
phase
 
out
 
our
 
fossil-fuel-powered
 
own
 
vehicles
 
by
 
2035.
 
In
 
markets
 
where
 
this
 
is not
feasible,
 
we
 
will pursue
 
the
 
best
 
available
 
industry
 
options,
 
such as
 
hybrid
 
vehicles,
 
while continuing
 
to seek
 
greener
alternatives.
 
This
 
will
 
help
 
us
 
ensure
 
compliance
 
with
 
emission
 
standards
 
and
 
optimized
 
operational
 
efficiency
 
while
minimizing our carbon footprint.
Action 2: Switch to more sustainable fuel alternatives and battery
 
replacements
In
 
2024,
 
we
 
developed
 
high-level
 
plans,
 
which
 
extend
 
through
 
2035,
 
to
 
reduce
 
and
 
replace
 
fossil
 
fuels
 
in
 
critical
engineering
 
power
 
systems.
 
We
 
will
 
seek
 
to
 
replace
 
those
 
fuels
 
with
 
more
 
sustainable
 
alternatives,
 
such
 
as
 
biofuels,
hydrogenated vegetable oils and battery replacements.
We initiated a cross-regional market
 
analysis of fuel alternatives
 
in 2024, to be
 
completed by 2025, to ensure
 
appropriate
replacements can be procured accordingly to meet our 2035 scope 1 and 2 net-zero
 
target. The outcome of this market
analysis will inform our further detailed planning.
 
Action 3: Eliminate usage of heating oils and natural gas
We aim to eliminate oil- and natural-gas-based heating systems within our own operations
 
by 2035, in line with industry
decarbonization
 
efforts.
 
We
 
plan
 
to
 
achieve
 
this
 
by
 
identifying
 
and
 
targeting
 
real
 
estate
 
assets
 
for
 
electrification
 
and
switching to district heating to maximize the operational
 
and cost efficiency of each asset’s life cycle.
 
Action 4: Transition to low-GWP refrigerants
We have initiated the replacement of refrigerants with alternatives with lower global warming
 
potential factors. We plan
to complete this action across all regions by
 
2035.
 
Lever 2: Reduce our operational emissions (scope 2)
In parallel
 
with
 
reducing
 
our
 
scope 1
 
emissions,
 
we
 
are
 
also focusing
 
on reducing
 
our operational
 
emissions
 
through
strategic enhancements to our
 
corporate real estate portfolio. By
 
implementing three key actions, we
 
plan to create more
energy-efficient workspaces and real estate.
 
Action 1: Consolidate
 
and optimize
 
our corporate real estate portfolio
In
 
collaboration
 
with
 
the
 
individual
 
business
 
divisions,
 
we
 
will
 
prioritize
 
the
 
selective
 
exits
 
from,
 
and
 
downsizing
 
of,
underutilized spaces
 
in our real
 
estate globally
 
through 2035
 
and beyond.
 
We also
 
plan to optimize
 
our corporate
 
real
estate
 
portfolio’s
 
energy
 
usage
 
either
 
via
 
retrofitting
 
(Action
 
2)
 
or,
 
in
 
some
 
cases,
 
by
 
relocating
 
to
 
more
 
sustainable
buildings. During
 
2024, we
 
achieved a
 
52% reduction
 
of our
 
scope 2
 
market-based emissions
 
across the
 
consolidated
portfolio against our 2023 baseline.
 
We are
 
reducing energy
 
consumption
 
in our
 
own data
 
centers as
 
a result
 
of migrating
 
to third-party
 
co-location data
centers and cloud providers where the power usage effectiveness
 
ratio is substantially more efficient.
Action 2: Upgrade
 
and retrofit our corporate real estate portfolio
 
To
 
effectively address our real estate
 
energy footprint, we intend to upgrade and retrofit our real
 
estate portfolio and fit
out in
 
line with
 
internationally recognized
 
building standards
 
,
 
such as
 
Leadership in
 
Energy and
 
Environmental Design
(LEED)
 
by
 
the
 
USGBC.
 
We
 
expect
 
to
 
improve
 
and
 
extend
 
the
 
existing
 
energy
 
management
 
system
 
within
 
the
 
EMEA
region, with greater implementation
 
of ISO 50001 to drive energy efficiency within
 
our own operations.
In 2024,
 
we achieved
 
multiple green
 
building certifications
 
across our
 
offices globally
 
as part
 
of our
 
transition toward
more
 
sustainable
 
real
 
estate.
 
In
 
Switzerland,
 
we
 
are
 
renovating
 
the
 
Paradeplatz
 
6
 
building
 
in
 
Zurich,
 
with
 
the
 
aim
 
of
achieving LEED Platinum certification for
 
the building by 2027.
 
In Monaco, the refurbishment of
 
our Villa Belgica building
achieved
 
the
 
Building
 
Research
 
Establishment
 
Environmental
 
Assessment
 
Method
 
(BREEAM)
 
Excellent
 
rating.
 
In
 
West
Kowloon, Hong
 
Kong, our
 
newest flagship
 
office is
 
on track
 
to be
 
completed by
 
2027. We
 
are aiming
 
for it
 
to be
 
the
most sustainable office built for our Asia Pacific operations.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Environment
 
47
UBS locations
LEED Platinum
LEED Gold
LEED Silver
LEED certified
Switzerland
1
1
EMEA
5
2
Americas
5
23
5
4
Asia Pacific
11
9
Action 3: Support the decarbonization of district heating and cooling
 
systems
 
Although we
 
recognize
 
that
 
we do
 
not exert
 
any direct
 
operational
 
control
 
over external
 
district heating
 
and cooling
systems, we plan
 
to support their
 
decarbonization in connection
 
with our real
 
estate consolidation strategy.
 
To
 
achieve
this objective,
 
we intend
 
to establish
 
an engagement
 
plan for
 
stakeholder
 
management
 
activities within
 
the next
 
few
years,
 
including
 
fostering
 
partnerships
 
and
 
exerting
 
influence
 
with
 
stakeholders
 
(e.g.
 
local
 
communities
 
and
 
utility
companies)
 
to promote the decarbonization of district
 
heating systems.
Lever 3: Transition to renewable electricity generation (scope 2)
The uptake of renewable electricity
 
generation is critical for supporting the transition
 
to a low-carbon electricity market.
Since
 
2020,
 
we
 
have
 
been
 
working
 
on
 
maximizing
 
the
 
use
 
of
 
renewable
 
energy
 
in
 
our
 
own
 
operations
 
globally.
 
In
accordance with our commitments,
 
we want to source 100% of the electricity we use from renewable-source-qualifying
generation by 2026 in line with RE100 technical guidance,
 
in markets where it is feasible to do so.
 
We aim
 
to
 
leverage
 
our position
 
in the
 
global electricity
 
market
 
to support
 
the transition
 
to a
 
global low-carbon
 
grid
through the key actions listed below.
Action 1: Identify and implement opportunities for direct power
 
purchase agreements
 
We will
 
regularly review our real
 
estate ownership and
 
lease arrangements to
 
identify substantial, long-term
 
opportunities
to
 
source
 
our
 
electricity
 
for
 
these
 
volumes
 
directly
 
from
 
renewable
 
electricity
 
generators
 
through
 
power
 
purchase
agreements.
 
This
 
will
 
support
 
the
 
build-out
 
of
 
new
 
electricity
 
generation
 
plants
 
and
 
strengthen
 
the
 
chain
 
of
 
custody
between the
 
generation source
 
and the
 
end
 
use of
 
electricity,
 
while decreasing
 
the carbon
 
content of
 
the grid
 
in the
longer term.
Action 2: Improve the transparency of the chain of custody
 
for renewable energy certificates
 
We will work with our key electricity suppliers to improve the transparency of the chain of custody for renewable energy
certificates associated with the supply of electricity to our assets. We
 
will ensure that existing products / electricity
 
tariffs
meet
 
RE100
 
technical
 
criteria
 
and
 
we
 
will
 
identify
 
opportunities
 
to
 
support
 
new
 
products
 
/
 
tariffs
 
that
 
improve
 
our
compliance, driving a more competitive and RE100
 
-aligned marketplace in the future.
Action 3: Build competitive renewable energy certificate supply
 
solutions
 
In electricity markets
 
where our volumes are
 
not large enough
 
to facilitate tariff negotiations, or
 
where regulated markets
restrict the electricity tariff options available
 
to us, we will continue to purchase additional
 
renewable energy certificates
to meet our residual needs.
We will undertake competitive tendering for broker services and maintain those contracts through our corporate
 
vendor
management
 
practices
 
to
 
ensure
 
the
 
renewable
 
energy
 
certificates
 
we
 
purchase
 
remain
 
aligned
 
to
 
evolving
 
technical
standards. We will also support renewable electricity generators where their products cannot be sold within local energy
products / tariffs.
Action 4: Actively contribute to consultations on renewable electricity
 
tracking systems in markets where infrastructure
is not developed
In
 
a
 
few
 
countries
 
where
 
we
 
operate,
 
the
 
infrastructure
 
to
 
measure
 
and
 
track
 
electricity
 
volumes
 
generated
 
from
renewable
 
sources
 
is
 
either
 
underdeveloped
 
or
 
non-existent,
 
compromising
 
the
 
availability
 
of
 
renewable
 
energy
certificates
 
in
 
line
 
with
 
RE100
 
technical
 
criteria.
 
In
 
these
 
areas,
 
we
 
will be
 
a
 
strong
 
advocate
 
for
 
the
 
development
 
of
tracking infrastructure, participating
 
in consultations to help change
 
the market, with a view
 
to extending our coverage
of electricity from renewable sources
 
into countries where renewable
 
energy procurement is unfeasible.
Action 5: Assess and install on-site renewable generation
 
of electricity at our owned assets
 
We regularly review our real
 
estate ownership and lease arrangements to identify those
 
assets where we expect to have
long-term operational control and available
 
infrastructure (e.g. roof space) that
 
could facilitate the installation of on-site
renewable
 
generation of
 
electricity.
 
We
 
will continue
 
to make
 
the necessary
 
investments
 
in on-site
 
renewables
 
where
physically and
 
economically feasible,
 
ensuring we
 
minimize our
 
dependency on
 
grid offerings
 
and reducing
 
the risk
 
of
unforeseen market developments that may compromise our ability to source renewable electricity tariffs or renewable We plan to purchase technological carbon removal credits to neutralize residual emissions for our 2035 scope 1 and 2
electricity certificates.
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Environment
 
48
Carbon removals and credits
net-zero
 
target.
 
We
 
estimate
 
that
 
we
 
will
 
eventually
 
retire
 
around
 
5,000
 
metric
 
tons
 
annually
 
based
 
on
 
our
 
existing
contractual agreements for this
 
purpose. In 2022, we
 
signed two landmark partnerships
 
with Climeworks and neustark
to provide us with
 
carbon removal credits.
 
Both companies are
 
pioneers in innovative
 
carbon removal technologies.
 
We
were
 
also among
 
the
 
five
 
companies
 
that
 
joined
 
the
 
NextGen
 
CDR Facility
 
(NextGen)
 
as founding
 
buyers
 
to
 
scale
 
up
carbon removal technologies
 
and catalyze the
 
market for high-quality
 
carbon removal.
 
These partnerships continued
 
in
2024.
Furthermore, since
 
2007, we
 
have been
 
committed to
 
purchasing biogenic
 
carbon
 
reduction and
 
removal credits
 
that
correspond to 100% of our air travel emissions for the Group. In 2024, we retired 75,211 credits from biogenic sinks for
our voluntary air travel commitment, with an average
 
“A” rating from third-party carbon ratings
 
agency BeZero Carbon
at the time of retirement.
We only
 
purchase credits
 
from technological
 
and biogenic
 
sinks that
 
are assessed
 
against the
 
Integrity Council
 
for the
Voluntary Carbon Market (ICVCM) Core Carbon Principles and verified against either
 
the Gold Standard or Verra,
 
among
other international standards. Our carbon credit purchases
 
are strictly aligned to our internal Carbon and
 
Environmental
Markets Guideline, which sets out minimum requirements for
 
such market instruments.
We acknowledge that standards and methodologies for carbon credits are still evolving. We will
 
continue to improve our
portfolio through market partnerships
 
and industry engagement toward
 
a standardized quality benchmark
 
for the future.
›
Refer to “Key policies and principles” in the “Appendix
 
1 – Governance” section of this report for
 
more information about our
Carbon and Environmental Markets Guideline
 
Carbon credits canceled (UBS Group)
For the year ended
31.12.24
Carbon credits canceled in reporting year (tCO
2
e)
75,211
Internal carbon pricing
We continue to apply a forward-looking shadow
 
price of USD 400 per metric ton, covering all
 
our scope 1 and net scope
2 emissions,
 
to incentivize
 
the use
 
of low-emission
 
technologies in
 
real estate
 
projects. Through
 
this shadow
 
price, we
also aim to incentivize
 
the replacement of fossil-fuel
 
heating systems, real
 
estate relocation and
 
fuel transition in critical
engineering power systems.
 
The price applied reflects
 
the blended mix of
 
permanent carbon removals that
 
are required
to
 
neutralize
 
any
 
residual
 
emissions
 
that
 
cannot
 
otherwise
 
be
 
abated
 
as
 
part
 
of
 
our
 
existing
 
long-term
 
contracts
 
to
purchase high-quality credits from technological sinks, as
 
described in the section above.
GHG intensity per net revenue
Total revenues for the year end 2024, as disclosed in the UBS Group income statement,
 
have been used as equivalent to
net revenues for the purpose of calculating the GHG intensity
 
per net revenue.
The total GHG emissions (location- and market-based) exclude scope
 
3, category 15.
GHG intensity per net revenue (UBS Group)
For the year ended
31.12.24
31.12.23
Total GHG emissions (location-based) per net revenue (t CO
2
e / USD m)
24.61
37.38
Total GHG emissions (market-based) per net revenue (t CO
2
e / USD m)
22.13
34.31
Our environmental targets and performance in our own
 
operations
Environmental performance and key focus areas
 
We also
 
work toward
 
minimizing our
 
own operational
 
footprint across
 
key environmental
 
focus areas
 
and supporting
our employees,
 
suppliers and
 
clients to
 
do the
 
same. We
 
have identified
 
the following
 
key environmental
 
focus areas
beyond climate: waste, paper and water; travel; and biodiversity.
Waste, paper and water
In 2024,
 
we reduced
 
our landfill
 
waste by
 
7.8% compared
 
with 2023,
 
resulting in
 
a global
 
decrease
 
of approximately
148.7 metric tons.
 
In 2021, we
 
published a global
 
target that reflected
 
our aim to reach
 
zero waste to
 
landfill by 2025
in locations where we have influence.
 
After conducting local market research
 
and exploring pilots in each region for the
implementation of zero waste
 
to landfill, we
 
have concluded that it
 
is not operationally
 
feasible for us
 
to reach this
 
target.
It will
 
therefore
 
be retired.
 
We continue
 
to measure
 
our waste-to-landfill
 
tonnage and
 
aim to
 
explore options
 
to set
 
a
target that is more in line with market and operational reality.
 
Our ISO 14001 environmental management program and
additional contract spot checks ensure that our waste management partners operate in
 
accordance with contractual and
legislative obligations.
 
Globally,
 
our total
 
waste
 
volume decreased
 
significantly in
 
2024 compared
 
with 2023.
 
We
 
will
continue to raise employee awareness to further
 
increase the portion of recycled waste.
 
ubsgroupsustainabilitp53i0
Sustainability Report 2024
| Environment
 
49
Paper consumption per
 
full-time employee
 
decreased by
 
22.4% in 2024
 
compared with
 
2023, reflecting the
 
impact of
increasing
 
digitalization
 
across
 
the
 
firm,
 
awareness
 
campaigns
 
aimed
 
at
 
our
 
employees,
 
some
 
restrictions
 
on
 
internal
printing and
 
our
 
ongoing
 
efforts
 
to reduce
 
the
 
number
 
of printers
 
in our
 
offices.
 
While the
 
total
 
paper
 
consumption
decreased significantly, the
 
share of sustainable
 
paper in the
 
remaining volume decreased
 
compared with 2023.
 
Of the
total amount of paper
 
used (printing paper and
 
paper products), 49.9%
 
was either sourced as
 
recycled or was certified
by
 
the
 
Forest
 
Stewardship
 
Council
 
or
 
an
 
equivalent
 
body.
 
These
 
measures
 
help
 
reduce
 
the
 
environmental
 
impacts
associated
 
with
 
paper
 
production
 
and
 
manufacturing
 
processes,
 
such
 
as
 
deforestation
 
and
 
energy
 
usage.
 
We
 
will
continue to work with
 
our vendors to increase
 
the share of evidenced
 
sustainable paper and paper products
 
in the course
of the coming year.
To enhance
 
water
 
efficiency
 
in
 
our
 
facilities,
 
we
 
have
 
expanded
 
our office
 
environmental
 
programs.
 
For example,
 
we
monitor water use and
 
optimize
 
flushing times and overflow
 
management. Our water
 
usage increased by only
 
1.7% in
2024 compared with 2023, despite the higher levels of
 
staff working in our offices.
Travel
In 2024, we saw an increase in business travel.
 
Our travel volumes (358m Pkm) for the combined organization following
the integration
 
of Credit Suisse
 
are substantially below
 
the UBS-only pre-pandemic
 
levels of
 
2019 (459m
 
Pkm). We remain
committed to
 
putting sustainability
 
at the
 
heart of
 
our business
 
travel program.
 
Reflecting this
 
commitment, we
 
have
focused our efforts on three key areas:
–
strengthening
 
our
 
reporting
 
with the
 
enhanced
 
carbon
 
intensity
 
metrics,
 
thereby
 
providing
 
comprehensive
 
insights
into travel-related emissions, both before and after
 
trips, to measure and manage our travel footprint;
–
updating our travel
 
policy to encourage
 
employees to opt
 
for eco-friendly transportation
 
options whenever
 
possible,
and strengthening our partnerships with
 
hotels that have embraced sustainable
 
practices, marking them prominently
with green flags at the point of sale to help our staff make
 
informed and conscious choices; and
–
continuing to purchase high-quality carbon offsets that correspond to 100% of our air travel
 
emissions for the Group.
Biodiversity
We have
 
taken steps
 
to increase
 
biodiversity across
 
our offices
 
and raise
 
awareness
 
among our
 
staff. For
 
example, we
have installed green roofs at selected office locations, combined with employee volunteering activities, such as Clean-Up
Day
 
and
 
a
 
program
 
to
 
highlight
 
the
 
critical
 
role
 
that
 
bees
 
play
 
in
 
our
 
natural
 
ecosystem,
 
which
 
all
 
served
 
to
 
shine
 
a
spotlight on the critical role of biodiversity.
Our reporting on environmental targets and indicators in our own
 
operations
The information about our environmental targets and indicators is included in our yearly GHG emissions
 
report, which is
prepared
 
in
 
accordance
 
with
 
the
 
ISO
 
14064
 
1:2018
 
standard.
 
This
 
report
 
is
 
subject
 
to
 
yearly
 
external
 
verification
 
in
accordance with the ISAE 3410 standard and
 
considering the ISO 14064 3:2019 standard.
 
We have
 
successfully passed
 
the ISO
 
14001 audits every
 
year since
 
implementation, including
 
2024. In the
 
EU and
 
the
UK,
 
our
 
activities
 
(excluding
 
legacy
 
Credit
 
Suisse
 
locations)
 
are
 
certified
 
according
 
to
 
the
 
ISO
 
50001:2018
 
energy
management system standard. These sets of extensive audit
 
standards ensure the appropriate policies and processes
 
are
in place, both for the management of environmental and energy topics within our own operations and for affirming their Environmental targets and performance in own operations
daily implementation.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ubsgroupsustainabilitp54i0
Sustainability Report 2024
| Environment
 
50
1
Actuals
(for the year ended)
Targets
Progress
(2024 vs baseline)
GRI
2
31.12.24
31.12.23
31.12.22
2025
2030
2035
Baseline
% change
Status
7
Scope 1 and net scope 2 greenhouse gas emissions in t CO
2
e
(reduction target in %)
305-1,
305-2
30,274
46,278
61,627
(57%)
(90%)
46,278
3
(35%)
green
Energy consumption in GWh (reduction target in %)
302-1-e
679
755
866
(35%)
755
3
(10%)
green
Share of renewable electricity
302-1
99.8%
95.6%
91.1%
100%
100%
76.6%
4
30%
green
Paper consumption in kg per FTE (reduction target in %)
5
301-1-a
21.5
27.7
26.9
(50%)
54.9
4
(61%)
green
Share of sustainable paper (recycled and FSC)
301-1-a-ii
49.9%
71.5%
52.7%
100%
63.2%
4
(21%)
amber
Waste in kg per FTE (reduction target in %)
5
306-3
62.7
69.8
66.3
(10%)
133.5
4
(53%)
green
Zero Waste to Landfill
6
306-5-c-iii
24.8%
22.2%
30.5%
0%
31.6%
4
(22%)
amber
Waste recycling ratio
306-4
52.9%
57.4%
52.2%
60%
50.2%
4
5%
amber
Water consumption in m m
³
 
(reduction target in %)
303-5
1.23
1.21
1.04
(5%)
1.33
4
(8%)
green
Legend: CO
2
e = CO
2
 
equivalents; FTE = full-time employee; GWh = giga watt hour; km = kilometer; kg = kilogram; m
 
m³ = million cubic meter; t = metric ton
1
Refer to
 
the “Environment”
 
section of
 
the Supplement
 
to the
 
UBS Group
 
Sustainability Report
 
2024, available
 
at ubs.com/sustainability-reporting,
 
for detailed
 
information about
 
our environmental
 
indicators.
Reporting period 1 January - 31 December.
 
2
Reference to GRI Sustainability Reporting Standards (see also www.globalreporting.org).
 
3
 
Baseline year 2023
 
4
 
Baseline year 2019
 
5
 
FTEs are calculated on an
average basis including contractors
 
6
 
In locations where UBS has influence and where alte
 
rnatives are available. This
 
is the last time we are reporting against
 
this target as it is being retired. See
 
details in section
'Waste, paper and water'
 
7
Green: on track; Amber: improvements required
Sustainable Technology Guild
 
The
 
Sustainable
 
Technology
 
Guild
 
continues
 
to
 
raise
 
awareness
 
of
 
sustainable
 
software
 
development
 
among
 
our
technology teams that
 
will have a
 
positive environmental
 
impact through
 
the optimization of
 
technology energy use.
 
It
is actively
 
developing measurement solutions for
 
the applications hosted
 
in our
 
data centers and
 
those in the
 
public cloud.
The primary
 
focus of
 
the Guild
 
continues to
 
be minimizing
 
the energy
 
consumption of
 
our technology
 
estate and
 
the
introduction of green software
 
engineering practices.
 
 
 
 
 
 
 
 
 
 
ubsgroupsustainabilitp55i0
Sustainability Report 2024
| Environment
 
51
Managing the environmental impact of our supply
chain
 
Our key climate-related actions
Increased transparency and reporting of climate information by vendors
We are
 
tracking the
 
scope 1
 
and 2
 
emissions reporting
 
of our
 
GHG key
 
vendors. Vendors
 
that collectively
 
account for
more than 50% of our calculated scope 3, category 1, 2, 4
 
and 9 emissions are classified as “GHG key vendors.” On this
basis, we identified 95 GHG key vendors.
1
 
Overview of climate-related disclosures of our GHG key vendors (UBS
 
Group)
2022
2
2023
2024
GHG key vendors that disclosed
emissions and declared in CDP a
stated net-zero target
1
49% (41 / 83)
65% (62 / 95)
78% (74 / 95)
1
 
Shows GHG key vendors that disclosed emissions
 
and declared in CDP a stated net-zero target
 
versus GHG key vendors that did
 
not disclose emissions and / or did not
 
declare in CDP a stated net-zero target.
We do not independently verify our vendors’ goals or progress toward them.
 
2
 
2022 numbers are based on 83 GHG key vendors identified at that time and did not include Credit Suisse vendors. We have since
revised and updated the list of GHG key vendors from 83 to 95 in 2023 to include Credit Suisse vendors.
 
Numbers have, therefore, been tracked against
 
95 vendors from 2023 onward.
In 2024, 70%
 
(341 out of
 
487) completed voluntarily
 
climate disclosures on
 
the non-profit, third-party
 
platform run by
CDP. Though
 
this
 
is the
 
same
 
as the
 
percentage
 
achieved in
 
2023 (307
 
out of
 
440),
 
the absolute
 
number of
 
vendors
completing their disclosures increased 11% from 307 in
 
2023 to 341 in 2024.
Raising awareness on environmental matters through the sustainable
 
procurement guide
In
 
2024,
 
we
 
curated
 
a
 
sustainable
 
procurement
 
guide
 
to support
 
vendors.
 
From
 
environmental
 
certification
 
to
 
waste
management
 
and
 
sustainability
 
reporting,
 
this
 
guide
 
provides
 
insights
 
on
 
how
 
our
 
vendors
 
can
 
take
 
significant
 
steps
toward
 
reducing
 
their
 
environmental
 
footprint,
 
promoting
 
ethical
 
and
 
inclusive
 
practices
 
in
 
their
 
supply
 
chain
 
and
contributing to the well-being of ecosystems.
›
Refer to our climate disclosure guideline for vendors
 
and our sustainable procurement guide for vendors, available
 
at
ubs.com/suppliers,
 
for more information
Reduce supply-chain-related carbon emissions
We reduced
 
our scope
 
3, category
 
1, 2,
 
4 and
 
9 emissions
 
by 28%
 
to 0.81
 
million metric
 
tons of
 
CO
2
e in
 
2024 from
1.13 million metric tons of CO
2
e in 2023. This reduction was achieved through a combination of: (i) spend reduction;
 
(ii)
carbon reduction
 
initiatives;
 
(iii) closure
 
of vendor
 
facility offshore
 
development centers
 
(ODCs); (iv)
 
updated emissions
factors (including
 
updated
 
multi-regional
 
input /
 
output emission
 
factors per
 
industry,
 
updated and
 
higher number
 
of
supplier-specific emission factors used (where disclosed
 
and verified) and,
 
for cloud, activity-based emissions data used);
and (v) improved
 
data quality and
 
refinement of
 
calculation methodology.
 
Our focus is
 
to reduce
 
our emissions further
by identifying and implementing multi-year carbon
 
reduction initiatives.
1
 
Unique vendors in line with UBS’s vendor inventory. In 2023, we have revised and
 
updated the list of GHG key vendors from 83 to 95 to include Credit Suisse vendors.
 
Sustainability Report 2024
| Environment
 
52
Managing our supply chain responsibly
Through
 
our
 
Responsible
 
Supply
 
Chain
 
Management
 
(RSCM)
 
policy,
 
we
 
include
 
ESG
 
standards
 
in
 
our
 
sourcing
 
and
procurement activities.
Identifying, assessing and monitoring high-impact vendors
In 2024, 100%
 
of new vendors
 
were screened
 
for environmental
 
and social risks.
 
In 2023, the
 
same screening
 
process
was
 
conducted
 
for
 
100%
 
of
 
new
 
vendors.
 
In
 
addition,
 
we
 
identify
 
high-ESG-impact
 
vendors
 
when
 
establishing
 
new
contracts or renewals based
 
on whether the
 
vendors are providing goods and
 
services that could either
 
have a substantial
environmental and
 
social impact
 
or be
 
sourced
 
in markets
 
with potentially
 
high social
 
or governance
 
risks. Such
 
high-
impact
 
vendors
 
are
 
assessed
 
against
 
our
 
RSCM
 
policy.
 
These
 
vendors
 
are
 
required
 
to
 
provide
 
disclosures
 
about
 
their
management practices along with corresponding evidence,
 
which is evaluated by a specialist team. Actual and potential
negative impacts considered in the assessment
 
of vendor practices include, but are not
 
limited to, the following:
–
adverse
 
environmental
 
impacts
 
due
 
to
 
inefficient
 
use
 
of
 
resources
 
(e.g.
 
water
 
and
 
energy),
 
poor
 
environmental
practices and emissions during the life cycle of a product;
–
hazardous
 
substances,
 
emissions,
 
pollutants
 
and
 
the
 
limited
 
recyclability
 
of
 
products
 
that
 
adversely
 
affect
 
people,
nature and the environment;
–
modern slavery, forced labor or child labor;
–
unfair employment practices,
 
such as
 
low wages,
 
excessive overtime and
 
the absence of
 
occupational health and
 
safety
measures;
 
–
anti-corruption; and
–
insufficient management of subcontractors and suppliers regarding
 
sustainability aspects.
Should our
 
assessment reveal
 
any non-compliance
 
with our
 
policy, we
 
define and
 
agree,
 
together with
 
the vendor,
 
on
vendor-specific improvement measures
 
and we
 
closely monitor
 
the implementation
 
progress of
 
these remediation actions.
A lack of improvement
 
may lead to the
 
termination of the vendor
 
relationship. Vendors are
 
reassessed after 24
 
months
to ensure that, even
 
in long-term contracts,
 
our expectations regarding environmental
 
and social aspects are
 
being met
and continuously supervised. We also regularly screen active vendors as part of our sustainability and climate risk control
processes.
All high-impact vendors go through assessments against our
 
RSCM policy. We also undertake assessments on some
 
non-
high-impact vendors where
 
we have significant
 
ongoing relationships.
 
In 2024, we
 
carried out risk-based
 
due diligence
assessments
 
of 445
 
vendors
 
of newly
 
sourced contracts,
 
renewals
 
and ongoing
 
contracts
 
(versus
 
266
 
UBS vendors
 
in
2023
 
and
 
15
 
Credit
 
Suisse
 
vendors).
 
If
 
a
 
high-impact
 
vendor
 
does
 
not
 
provide
 
appropriate
 
evidence
 
in
 
line
 
with
 
our
expectations,
 
that
 
will
 
result
 
in
 
corrective
 
action
 
needing
 
to
 
be
 
taken
 
by
 
the
 
supplier
 
to
 
implement
 
a
 
policy
 
and
 
/
 
or
process for the non-compliant requirement within 12 to
 
18 months.
 
To drive positive change in
 
our supply chain, we also
 
require our vendors to improve
 
their management practices in
 
line
with
 
our
 
sustainability
 
goals
 
and
 
industry
 
best
 
practices.
 
Of
 
the
 
vendors
 
assessed,
 
33%
 
were
 
considered
 
in
 
need
 
of
improving
 
their
 
management
 
practices
 
(versus
 
42%
 
in
 
2023).
 
Specific
 
remediation
 
actions
 
were
 
agreed
 
upon
 
and
implementation progress is
 
being closely
 
monitored. We
 
have increased
 
our overall
 
RSCM assessment
 
coverage of vendors
by spend to 51%
 
in 2024 from 20%
 
in 2023. Contracts
 
in high-risk countries include
 
specific contractual requirements
relating to environmental management, human rights and labor
 
rights. If we were to become aware of
 
a case of modern
slavery
 
or
 
human
 
trafficking
 
occurring
 
within
 
our
 
direct
 
supply
 
chain,
 
we
 
would
 
address
 
it
 
through
 
our
 
governance
processes. Depending on
 
the severity of
 
the case, or
 
if satisfactory remediation
 
were not possible,
 
the supplier relationship
could be terminated.
In 2024,
 
none of
 
our vendor
 
relationships were
 
terminated as
 
a result
 
of our
 
assessments and
 
no human
 
rights issues
involving active, directly
 
contracted vendors
 
were identified or
 
reported. In part,
 
this was due
 
to having carried
 
out our
assessment process prior to signing contracts. We have also trained our supply chain function staff on human rights
 
and
modern slavery.
Embedding supplier sustainability in our everyday activities
The goods and
 
services we
 
buy,
 
and where
 
and whom we
 
buy them from,
 
are all
 
crucial elements
 
of our sustainability
impact. We
 
are
 
committed
 
to making
 
a
 
positive
 
environmental
 
and social
 
impact,
 
and we
 
expect
 
the
 
same
 
from
 
our
suppliers. Our Global Procurement and Vendor Management Policy and Guidance considers the ESG impacts
 
of products
and /
 
or services
 
when
 
selecting a
 
vendor.
 
In 2024,
 
this
 
policy was
 
extended
 
to also
 
cover
 
Credit
 
Suisse
 
and is
 
being
applied to Credit Suisse legacy vendors as well.
In
 
2024, we
 
trained
 
our
 
vendor
 
relationship
 
managers
 
on ESG
 
to
 
enable
 
them
 
to
 
have
 
impactful
 
discussions
 
on ESG
performance with their vendors. As an example,
 
in 2024, we noted an improved year-on-year
 
CDP rating for one of the
IT service providers that we have been engaged with over the last few years. The improvement in its ESG performance is
a significant milestone that underscores the positive influence
 
of our partnership.
 
We expect our suppliers to uphold high standards of ethics, mitigate risks and honor global and local labor laws, human
rights and
 
environmental
 
responsibilities.
 
Suppliers are
 
required to
 
follow our
 
global supplier
 
policies,
 
which include
 
a
policy on anti-bribery and corruption, sanctions, fraud and
 
anti-facilitation of tax evasion.
 
Sustainability Report 2024
| Environment
 
53
Inclusive growth in the supply chain
In
 
2024,
 
we
 
continued
 
our
 
efforts
 
globally
 
to
 
support
 
inclusive
 
growth
 
by
 
using
 
diverse
 
suppliers
 
that
 
are
 
often
underrepresented in supplying the needs of
 
major corporations. These are firms
 
certified / recognized by a local
 
/ national
government authority or
 
advocacy organization,
 
including,
 
but not limited
 
to, those certified
 
as women-owned; minority-
owned, including location-specific qualifications
 
such as aboriginal-owned in
 
Canada and indigenous-owned in
 
Australia;
veteran-owned,
 
including
 
ownership
 
by
 
service-disabled
 
veterans;
 
persons-with-disabilities-owned;
 
LGBTQ+-owned;
disadvantaged-owned,
 
including
 
historically
 
underutilized
 
businesses;
 
and
 
small
 
business
 
enterprises,
 
as
 
defined
 
and
recognized by their respective national
 
or state government criteria.
We identify and include diverse vendors as part of our “rule of one” guidance which aims to include at least one diverse
supplier in every competitive tender. The “rule of one” guidance does not give a
 
diverse supplier an added advantage in
the
 
competitive
 
tender,
 
but
 
provides
 
an
 
opportunity
 
for
 
a
 
diverse
 
supplier
 
to
 
participate
 
in
 
the
 
tendering
 
event.
 
The
success
 
of
 
the
 
diverse
 
supplier’s
 
bid
 
is
 
based
 
on
 
their
 
own
 
competitive
 
merits
 
with
 
respect
 
to
 
cost,
 
quality
 
and
sustainability, without further consideration
 
of the diversity of the
 
supplier. Globally, our diverse
 
spend accounts for 9%
of third-party spend, up
 
from 8.5% in 2023.
 
The share of
 
diverse spend has increased
 
despite a significant reduction
 
in
overall third-party spend from 2023 to 2024.
›
Refer to
ubs.com/suppliers,
 
for more information about how we work
 
with our suppliers,
 
including our Responsible Supply Chain
Management policy, our Supplier Diversity focus and our Supplier Code of
 
Conduct
›
Refer to our “Global Supplier Policies,” available
 
at
ubs.com/global/en/our-firm/suppliers/contracting-standards.html,
 
for more
information about our standard contractual terms with suppliers Supporting our climate approach: key enabling
 
Sustainability Report 2024
| Environment
 
54
actions
Beyond the
 
individual actions
 
related to
 
supporting our
 
clients’ low-carbon
 
transition and
 
reducing the
 
environmental
impact of our own operations
 
and supply chain as
 
described in the above
 
sections, we have identified five
 
key enabling
actions as listed
 
below to support
 
the implementation of
 
our climate approach
 
and “enable”
 
the implementation of more
specific targets and actions.
Governance and accountabilities (1)
Our sustainability
 
-
 
and
 
climate-related
 
activities
 
are
 
overseen
 
at
 
the
 
highest
 
level
 
of
 
our
 
organization,
 
and
 
we
 
have
 
a
clearly defined Group-wide sustainability governance in place,
 
including a dedicated climate program.
 
›
Refer to the “Governance” section of
 
this report for more information about our sustainability
 
governance
 
Industry, government and public sector engagement
 
(2)
We actively participate in political discussions to share
 
our expertise on proposed regulatory and supervisory changes and
engage
 
in
 
trade
 
associations’
 
exchanges
 
relating
 
to
 
sustainability
 
and
 
climate
 
(e.g.
 
via
 
the
 
International
 
Institute
 
of
Finance, the
 
Association for
 
Financial Markets
 
in Europe
 
and the
 
Swiss Bankers
 
Association). In
 
Switzerland, where
 
we
are headquartered, we
 
participated in the
 
consultation for a
 
new Swiss Financial
 
Market Supervisory Authority
 
(FINMA)
circular on
 
nature-related financial
 
risks in 2024,
 
where we
 
expressed our
 
support for
 
an approach
 
that is aligned
 
with
the Basel Committee on Banking Supervision (BCBS) Principles for the effective management and supervision of climate-
related financial
 
risks. Furthermore,
 
we launched
 
the Swiss
 
Climate Scores,
 
as we believe
 
they are
 
a key instrument
 
for
further increasing transparency
 
on the climate
 
alignment of financial
 
products. On a
 
regional basis, we
 
engage with policy
makers in
 
the EU,
 
the UK,
 
the Americas
 
and key
 
Asia Pacific
 
jurisdictions. In
 
particular, we
 
have participated
 
in several
industry association efforts in the EU regarding consultations
 
issued by prudential regulators (e.g. the European
 
Banking
Authority draft guidelines for the identification and management of ESG risks under the Capital
 
Requirements Directive).
Training and culture (3)
Educating
 
our
 
workforce
 
on
 
sustainability
 
and
 
sustainable
 
finance
 
is
 
an
 
important
 
part
 
of
 
ensuring
 
we
 
meet
 
our
sustainability
 
and
 
climate
 
ambitions.
 
In
 
2024,
 
we
 
continued
 
to
 
coordinate
 
the
 
delivery
 
of
 
sustainability
 
training
 
and
awareness activities across UBS through a dedicated sustainability education
 
workstream, with the number of headcount
instances of
 
specialized and
 
awareness
 
training totaling
 
430,405.
 
For example,
 
the
 
Sustainability and
 
climate
 
risk unit
trained relevant staff on sustainability and
 
climate risks along with emerging risks such as greenwashing.
 
Elsewhere, in 2024, we provided a variety of climate-related
 
trainings on a Group-wide basis. These included:
 
–
a series of information
 
sessions following the publication of
 
our UBS Sustainability Report 2023
 
to raise awareness and
understanding of our own progress in relation to our climate
 
objectives; and
–
climate-related training as part of our all-staff Global
 
Learning Week initiative, including webinars focused on net-zero
fundamentals, nature, greenwashing and impact accounting.
 
We expect
 
sustainability training
 
and education
 
to become
 
an increasing
 
focus for
 
regulators in
 
the coming
 
years. We
keep abreast
 
of this
 
changing landscape
 
through regular
 
updates with
 
our regulatory
 
monitoring teams
 
and continue
developing climate-
 
and net-zero-specific training for employees and the Board
 
of Directors.
›
Refer to the “People and culture make the difference” section of
 
this report for more information about training and culture
Data and analytics (4)
We implemented various data and analytics solutions
 
to better service our clients and operations.
As part of the efforts to integrate Credit Suisse, we needed to develop a foundational toolset for calculating, monitoring
and reporting the
 
combined firms’
 
climate-related metrics
 
covering financing
 
corporate loans
 
and facilitated
 
emissions.
In
 
2023,
 
we
 
successfully
 
completed
 
the
 
related
 
building
 
activity
 
and
 
met
 
all
 
the
 
quality
 
assurance
 
criteria
 
set
 
by
 
our
internal control functions.
 
In 2024, we worked on defining a more strategic and scalable toolset. Guided by our technology and ESG data strategy,
we developed a fully Cloud-based toolset, which
 
will be operational in 2025. The new toolset
 
will enable us to enhance
and more
 
frequently calculate,
 
monitor and
 
report our
 
climate-related metrics.
 
This will
 
allow our
 
business divisions
 
to
make
 
more
 
informed
 
decisions
 
on
 
their
 
decarbonization
 
pathways
 
and
 
transition
 
financing
 
activities,
 
and
 
facilitate
tracking of progress against our lending sector decarbonization
 
targets.
The
 
new
 
toolset
 
will also
 
enable
 
us
 
to
 
more
 
effectively
 
implement
 
changes
 
related
 
to
 
new
 
climate-related
 
standards,
methodologies and metrics.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Environment
 
55
Company Transition Assessment Scorecard (5)
In 2024, we
 
introduced the Company
 
Transition Assessment
 
Scorecard (CTAS) to
 
evaluate how advanced
 
a company is
on
 
its
 
path
 
to
 
decarbonization.
 
The
 
CTAS
 
was
 
designed
 
with
 
multiple
 
future
 
purposes
 
in
 
mind,
 
including
 
managing
climate transition risks, supporting clients’
 
climate transition efforts through engagement and product development
 
and
business planning.
The CTAS categorizes companies into
 
one of eight climate transition
 
readiness categories using a
 
rules-based approach.
This
 
approach
 
is
 
based
 
on
 
sector-agnostic
 
criteria
 
covering
 
emissions
 
disclosure,
 
decarbonization
 
commitments
 
and
targets, decarbonization
 
plans, and the actual carbon performance of the company.
Initially, and
 
in response
 
to regulatory
 
requirements, the
 
CTAS is
 
used as
 
an input
 
for our
 
Climate Risk
 
Rating
 
Models
(CRRM), in
 
particular the
 
transition risk rating
 
model. This model
 
assigns a
 
climate transition risk
 
rating at
 
the counterparty
level, which is then used
 
across various processes across:
 
(i) risk identification and
 
measurement; (ii) monitoring and
 
risk
appetite setting;
 
(iii) risk
 
management
 
and control;
 
and (iv)
 
risk reporting
 
and disclosure.
 
Although a
 
company’s CTAS
score, when available,
 
serves as an
 
input into the
 
CCRM and the
 
credit selection process,
 
it is not
 
used as the
 
sole criterion
for credit application decisions.
Companies are categorized by utilizing publicly available data from external third-party sources, which means it
 
is limited
to public companies
 
providing relevant
 
disclosures. The
 
CTAS will be
 
annually reviewed
 
and updated.
 
The scope
 
of the
CTAS may be
 
broadened in
 
the future
 
by incorporating
 
additional databases
 
or making
 
enhancements that
 
enable the
inclusion of companies lacking public data.
Overview
Module
Factor
Unaware
Aware
Strategic 1 –
Committed to
aligning
Strategic 2 –
Aligning
toward net
zero
Strategic 3 –
Aligned
targets and
plans
Aligned to net
zero
Achieving net
zero
Climate
solution
Emissions
disclosure
Disclosure of GHG
emissions
✓
✓
✓
✓
✓
✓
✓
Commitments
and targets
Long-term net-zero
commitment
✓
✓
✓
✓
✓
Medium- / short-term
net-zero targets
✓
✓
✓
✓
Net-zero commitment
recognized by third
party
✓
✓
✓
Interim targets
validated by third party
✓
✓
✓
Decarbonization
plan
High-level plan
✓
✓
✓
✓
Credible plan
✓
✓
✓
Carbon
performance
Carbon performance in
line with pathway
✓
✓
Carbon performance at
(or close to) net zero
✓
Note that the
 
categories from “Unaware”
 
to “Achieving
 
net zero” reflect
 
a company’s
 
progress toward
 
reducing its negative
 
impact on the
 
environment. On the
 
other hand, the
 
category “Climate solution”
 
is an
overarching category that goes beyond this and includes companies enabling the transition through their business model by generating
 
green revenues and aligning their capital expenditures accordingly.
›
Refer to the “Managing sustainability and climate
 
risks” section of this report for more information about how
 
we manage
financial and non-financial climate transition risk Supporting our approach to climate – climate-related
 
 
Sustainability Report 2024
| Environment
 
56
materiality assessment
Methodology for assessing climate opportunities
 
Supporting the global economy’s transition to net zero by 2050 will
 
require vast amounts of investment. Banks can help
to effectively and
 
efficiently allocate
 
the capital necessary
 
for the transition,
 
which in turn
 
creates opportunities
 
for the
banking
 
sector
 
and
 
its
 
client
 
base.
 
Estimates
 
of
 
the
 
overall
 
opportunity
 
vary,
 
but
 
the
 
United
 
Nations
 
Framework
Convention on Climate Change (the UNFCCC) suggests the global transformation to a low-carbon economy is expected
to require investment of at least USD 4trn to USD 6trn
 
per year.
1
To assess the
 
opportunities that are specifically
 
relevant to UBS,
 
we evaluate a
 
range of potentially
 
relevant climate-related
categories, encompassing commercial products and services, social finance, resource efficiency and energy
 
consumption,
operational resilience and green funding. Our assessment
 
has been performed annually since 2021.
Our current methodology
 
follows a two-step approach:
 
i) identifying relevant opportunities; and
 
ii) assessing their relative
materiality for the Group over the short,
 
medium, and longer terms. It is
 
important to note that sustainability overall,
 
and
climate
 
specifically,
 
are
 
continuously
 
evolving
 
topics,
 
for
 
example
 
in
 
terms
 
of
 
applicable
 
political
 
and
 
regulatory
frameworks, as
 
well as
 
client and
 
market dynamics,
 
which means
 
our annual
 
assessment always
 
represents a
 
point-in-
time
 
analysis
 
and
 
needs
 
to
 
undergo
 
continual
 
challenging
 
and
 
review,
 
so
 
that
 
it
 
consistently
 
provides
 
an
 
accurate
representation of our opportunity space on climate.
 
We have identified individual opportunities across four distinct
 
areas of our business.
 
Commercial products and services
 
Identifying
 
commercially
 
relevant,
 
climate-related
 
business
 
opportunities
 
starts
 
with
 
the
 
sustainable
 
finance
 
ambitions
annually set
 
by our
 
business divisions
 
(Non-core and
 
Legacy excepted)
 
.
 
The link
 
to our
 
ambitions ensures
 
that relevant
opportunities are systematically
 
screened and selected.
 
We identify business
 
opportunities that
 
can be realized
 
through
our existing or new climate-related products and services.
 
Individual climate-related products and services are organized into six categories,
 
broken down into 11 sub-categories.
A
survey-based, qualitative materiality assessment
2
is performed at
 
the sub-category level
 
by an internal
 
panel of sustainable
finance experts.
 
The expert
 
panel assesses the
 
expected relative
 
materiality of
 
the individual sub-categories,
 
along with
the
 
time
 
horizon
 
over
 
which
 
these
 
are
 
expected
 
to
 
start
 
contributing
 
to
 
UBS’s
 
business
 
outcomes.
 
Materiality
 
here
 
is
interpreted in terms of three
 
equally weighted dimensions: i) revenue
 
potential;
 
ii) strategic relevance;
 
and iii) impact on
the environment and stakeholders (“double
 
materiality”). The scores are
 
subsequently aggregated into UBS Group
 
-level
values for each of the product categories.
 
The
 
assessment
 
is
 
done
 
in
 
a
 
qualitative
 
manner
 
based
 
on
 
expert
 
judgment
 
in
 
order
 
to
 
take
 
account
 
of
 
the
 
inherent
difficulties
 
involved
 
in
 
making
 
more
 
precise
 
and
 
/
 
or quantified
 
assessments
 
of future
 
commercial
 
developments.
 
This
applies
 
particularly
 
in
 
an area
 
such as
 
climate,
 
where
 
regulatory and
 
policy frameworks,
 
and market
 
conventions and
industry trends, are still subject to considerable change and
 
evolution.
 
The following commercial categories of products and services were
 
included in our assessment:
Climate-related investment products
 
These
 
products
 
include,
 
for
 
example,
 
our
 
net-zero-ambition,
 
climate-aware,
 
climate-transition,
 
low-carbon
 
and
 
Paris-
Agreement-aligned
 
portfolios,
 
carbon-referencing
 
structured
 
products
 
and
 
dedicated
 
climate-focused
 
investment
modules.
 
We
 
also
 
see
 
opportunities
 
within
 
real
 
estate
 
and
 
private
 
market
 
investment
 
strategies
 
related
 
to
 
climate
mitigation, such as batteries and cold storage or energy-efficient
 
properties.
Carbon-related financial services and products
 
This includes helping clients in different business lines identify and assess opportunities related to carbon credits
 
(in both
compliance and voluntary markets).
Climate-related financing products and solutions
 
These include
 
green balance
 
sheet lending
 
to corporate
 
and private
 
clients, structuring
 
and underwriting
 
green
 
bonds
for
 
corporate
 
and
 
sovereign
 
issuers,
 
and
 
supporting
 
and
 
financing
 
innovative
 
climate
 
start-ups,
 
along
 
with
 
green
infrastructure finance (e.g. renewable
 
energy).
 
Advice on strategic climate opportunities
 
This includes
 
corporate
 
advisory work
 
incorporating
 
climate
 
factors,
 
for
 
example in
 
valuation and
 
analysis,
 
and,
 
more
specifically,
 
advising
 
on
 
transactions
 
where
 
climate
 
considerations
 
are
 
clearly
 
identifiable
 
as
 
part
 
of
 
the
 
transaction
rationale from the point of view of either an acquirer
 
or a target company.
1
 
Based on information from the UNFCCC, see https://unfccc.int/sites/default/files/resource/cma2022_L21_revised_adv.pdf
 
.
2
 
To guide this assessment, we have used the definition for materiality as provided by the Global Reporting Initiative (the GRI).
 
Sustainability Report 2024
| Environment
 
57
Thematic research
 
This includes
 
in-depth climate
 
-related
 
research
 
and thought
 
leadership work,
 
looking across
 
and delving
 
into relevant
developments for the transition to
 
a low-carbon economy,
 
including at a sectoral level,
 
and links to the
 
financial industry,
financial markets
 
and scientific
 
research.
 
In a
 
highly dynamic
 
field,
 
climate-related
 
research
 
plays a
 
key role
 
in keeping
our clients and ourselves abreast of key
 
trends.
Data analytics and metrics
 
These include data-driven
 
analytical tools available
 
in various business
 
lines, which are
 
being continually developed
 
and
further refined
 
to cover
 
relevant
 
sustainability-
 
and climate
 
-related
 
aspects in
 
greater
 
depth and
 
breadth.
 
Examples
 
of
their
 
application
 
include
 
the
 
portfolio
 
management
 
process,
 
quantitative
 
modeling,
 
climate
 
exposure
 
analytics
 
within
client reporting
 
and data-powered
 
strategic insights
 
work.
 
We
 
also have
 
a range
 
of tools
 
and calculators
 
focusing on
aspects such as emissions, renovations or subsidies, which support our clients’ decision-making on their decarbonization
journey.
 
Platforms
 
These
 
include
 
innovative
 
platform
 
solutions
 
enabling
 
clients
 
to
 
gain
 
access
 
to
 
climate-related
 
products
 
such
 
as
 
green
mortgages and, in
 
future, voluntary carbon credits.
 
Such platform solutions
 
enable UBS to
 
scale up and
 
achieve an impact
going beyond some of our own operational limitations (e.g.
 
our balance sheet, geographical reach or product
 
range).
Social Impact
In addition to
 
our commercial
 
offering, our
 
clients have
 
access to solutions
 
that help
 
them to realize
 
their philanthropy
goals, including climate
 
-related ones. Through
 
our Philanthropy Services
 
teams within
 
Social Impact, we
 
provide grants
and
 
social
 
finance
 
investments
 
for
 
climate-related
 
projects
 
within
 
the
 
environment
 
and
 
climate
 
portfolio
 
of
 
the
 
UBS
Optimus network of foundations. Its environmental
 
and climate strategy focuses on two
 
pillars, “Sustainable Land Use”
and “Coastal and Marine Ecosystems,” and helps clients to identify and select potential opportunities, with an emphasis
on
 
supporting
 
development
 
and
 
increasing
 
financing
 
for
 
climate
 
mitigation,
 
resilience
 
and
 
biodiversity
 
enhancement
using nature-based
 
solutions. Our program
 
directors for
 
climate and environment
 
assess and select
 
these opportunities
in terms of their fit with
 
the UBS Optimus network
 
of foundations’
 
climate and environment strategy,
 
the quality of the
organization’s team and track record, and the potential for scale, and
 
also for their expected results in key impact areas,
including
 
work
 
on
 
climate
 
change
 
mitigation,
 
adaptation
 
and
 
enhancing
 
biodiversity.
 
They
 
are
 
then
 
reviewed
 
and
approved by a senior-level approval committee. Experts from our Philanthropy Services
 
and the UBS Optimus network of
foundations teams provide a
 
summary assessment of the
 
materiality of this portfolio
 
of projects, which is
 
then included
in the overall assessment.
Our
 
philanthropy
 
opportunities
 
are
 
assessed
 
for
 
materiality
 
and
 
have
 
scores
 
assigned
 
across
 
the
 
two
 
dimensions
 
of
mitigation
 
and
 
adaptation
 
by
 
experts
 
from
 
Social
 
Impact.
 
While
 
we
 
consider
 
these
 
opportunities
 
relevant
 
for
 
our
assessment and for
 
UBS as an organization,
 
they do not
 
carry direct revenue
 
potential. Within the
 
materiality score, we
rate
 
the
 
revenue
 
potential
 
as
 
zero,
 
distinguishing
 
philanthropic
 
opportunities
 
from
 
the
 
commercially
 
relevant
opportunities. By definition,
 
philanthropy opportunities always
 
have a lower
 
score than commercial
 
opportunities, from
a financial relevance perspective.
Own operations
We are committed
 
to reducing our
 
operational impact on
 
the environment and
 
have set
 
clear reduction targets
 
for our
use of
 
resources, as
 
well as
 
formulating ambitious
 
net-zero
 
commitments. Experts
 
from our
 
Group Corporate
 
Services
team,
 
responsible
 
for
 
managing
 
our operational
 
footprint,
 
have
 
assessed the
 
materiality of
 
opportunities
 
arising
 
from
efforts in this
 
area. These opportunities can be
 
grouped into three distinct
 
categories: resilience, energy consumption and
resource efficiency.
Climate-related funding
Through
 
our
 
Green
 
Funding
 
Framework
 
and
 
in
 
partnership
 
with
 
relevant
 
business
 
lines,
 
we
 
continually
 
assess
 
new
opportunities
 
for
 
climate-related
 
funding that
 
could contribute
 
to expanding
 
our
 
investor base
 
or achieving
 
favorable
funding costs. As
 
part of this
 
assessment, experts from
 
Group Treasury review
 
the materiality of
 
opportunities for funding,
such as green or sustainability-linked bonds.
›
Refer to the “Supporting opportunities” section
 
of this report for more details about our sustainable and
 
climate finance product
offering and achievements in 2024
›
Refer to the “Social Impact” section of this report for
 
more details about the activities of Social Impact
›
Refer to the “Environment” section of this report for more details
 
about our in-house environmental management
›
Refer to our Green Funding annual investor report, available at Materiality results for 2024 climate-related opportunities
ubs.com/greenbonds
 
 
ubsgroupsustainabilitp62i0
Sustainability Report 2024
| Environment
 
58
The summarized
 
results for
 
UBS from
 
the various
 
expert assessments
 
in 2024
 
and building
 
on prior-year
 
outcomes are
displayed
 
in
 
the
 
infographic
 
below,
 
placing
 
individual
 
categories
 
within
 
low
 
/
 
medium
 
/
 
high
 
materiality
 
and
 
short-
 
/
medium- /
 
long-term time-horizon
 
segments. We
 
define short-term
 
as less
 
than three
 
years, medium-term
 
as three
 
to
10 years and long-term as beyond 10 years.
 
Categories are displayed on a relative scale. Given
 
our capital-light business
model,
 
it
 
is
 
in
 
line
 
with
 
our
 
expectations
 
that
 
climate-related
 
investment
 
products
 
are
 
the
 
highest-ranked
 
immediate
commercial product opportunity.
 
The highest relative
 
degrees of materiality
 
are also seen
 
for data analytics
 
and metrics
and thematic research as key enablers for a wider range of other
 
business opportunities with clients. Resilience is seen as
the most important climate-related operational opportunity
 
.
 
Sustainability Report 2024
| Environment
 
59
Assessing the materiality of climate-driven risks
Impacts from
 
climate-driven
 
risks arise
 
through
 
changing
 
climate
 
conditions
 
(physical
 
risk) and
 
efforts
 
to
 
mitigate
 
the
effects of a changing climate
 
(transition risk). These climate risk drivers
 
affect banks, the financial system and the
 
broader
economy through both micro- and macroeconomic channels.
 
Annually, the
 
sustainability
 
and climate
 
risk (SCR)
 
unit
 
coordinates a
 
systematic
 
risk
 
materiality assessment
 
of climate-
related
 
risks
 
in
 
accordance
 
with
 
the
 
ISO-14001
 
environmental
 
management
 
standard.
 
The
 
degree
 
of
 
materiality
 
is
determined
 
by
 
assessing
 
the
 
financial
 
product
 
or
 
service
 
and
 
the
 
associated
 
climate
 
risks.
 
Items
 
rated
 
as
 
having
 
an
increased potential risk are
 
mapped to relevant risk
 
controls. The assessment considers transmission
 
channels, risk drivers,
additional amplifiers and / or mitigants and the full range
 
of time horizons.
Risk-rating process
First, UBS
 
evaluates
 
the
 
inherent
 
risk posed
 
to UBS
 
at
 
the
 
product
 
/ service
 
level utilizing
 
an expert
 
-based
 
framework
(aligned with Basel Committee on Banking Supervision guidance)
 
through the following key transmission channels:
(i) traditional
 
risk category,
 
across financial
 
and non-financial
 
risks (e.g.
 
liquidity for
 
financial, regulatory
 
compliance, or
reputational for non-financial);
(ii) risk driver
 
(e.g., climate policies,
 
low-carbon technology
 
for transition risk)
 
and impact drivers
 
(e.g. creditworthiness)
considering potential impact (e.g. probability of default);
 
and
(iii) additional risk amplifiers (e.g. macroeconomic feedback
 
loops) and / or risk mitigants (e.g. internal controls).
Inherent risk ratings are given on a qualitative scale ranging
 
from low to high.
Then,
 
overall
 
proximity
 
of UBS
 
activities
 
to potential
 
negative
 
impact on
 
climate
 
is evaluated
 
alongside the
 
risk-rating
process, resulting in an impact rating at the product / service
 
level based on the same scale.
The most
 
relevant time
 
horizon for
 
inherent risks
 
and impacts
 
is determined
 
ranging across
 
short-term (less
 
than three
years), medium-term (three to ten years) and long-term (beyond
 
ten years).
Initial ratings
 
and time
 
horizons are
 
proposed by
 
leveraging internal
 
subject-matter
 
expertise,
 
scientific and
 
regulatory
publications, market
 
trends analyses,
 
risk monitoring,
 
transaction landscape
 
and the
 
relevant business
 
and /
 
or product
model. The qualitative expert-driven initial ratings
 
are then reviewed and approved in partnership
 
with relevant business
division representatives.
Finally, inherent risk ratings and
 
impact ratings across products and
 
services are aggregated to
 
Group level. The climate-
driven risk ratings by risk driver and traditional risk category (shown on
 
the Y-axis on the chart below) are plotted against
the time horizon (shown on the X-axis on the chart below).
Assessment outcome
In the graph
 
below, we show
 
the climate-driven risk
 
ratings by risk
 
driver (light gray)
 
and traditional risk
 
category (dark
gray).
 
For
 
traditional
 
risks,
 
we
 
aggregate
 
results
 
into
 
financial
 
risk
 
categories,
 
including
 
credit,
 
market,
 
treasury,
 
and
liquidity risks, and non-financial risk categories, including
 
business, continuity, compliance, and reputational risks.
 
Physical risk
 
(D1) is assessed
 
as potentially lower
 
risk to UBS
 
in comparison
 
to transition
 
risk (D2-market
 
sentiment and
D3-policy). This is primarily due to
 
UBS’s product footprint and greater uncertainty associated
 
with the timing and impact
of climate-related transition risks.
 
Selected non-financial risks (Reputational-R2, R3.2-NFR Compliance) are rated as relatively higher risk to UBS, due to the
focus on regulatory compliance (banks being regulated on climate risk management)
 
and liability, as well as a regulatory
focus
 
on
 
sustainable
 
product
 
labeling
 
(truth-in-marketing
 
regulations).
 
Due
 
to
 
UBS’s
 
established
 
approach
 
to
sustainability-
 
and
 
climate-driven
 
business
 
risks
 
(R4),
 
these
 
are
 
rated
 
lower
 
when
 
compared
 
to, for
 
example,
 
inherent
reputational risk exposure.
Climate-driven liquidity
 
(R 1.3) and
 
market and treasury
 
risks (R 1.2)
 
are assessed as
 
having relatively lower
 
potential to
affect UBS
 
in the short
 
term, in comparison
 
to credit
 
risk (R
 
1.1), which is
 
assessed as
 
having higher
 
potential to
 
affect
UBS in a
 
comparable time horizon, due
 
to the overall UBS
 
portfolio characteristics. This is
 
mainly driven by potential direct
or indirect
 
transition costs,
 
or exposure
 
to chronic
 
and acute
 
physical risks
 
in locations
 
likely to
 
be impacted
 
by climate
change. Such effects could lead to a deterioration
 
in creditworthiness, which in turn would have an impact
 
on Expected
Credit Losses (ECLs).
›
Refer to "Note 20 Expected credit loss measurement” in the
 
“Consolidated financial statements” section of
 
the UBS Group Annual
Report 2024, available under “Annual reporting” at
 
ubs.com/investors
, for supplementary information about the assessment
 
of
impact of sustainability and climate risk on the weighted-average ECL Climate-driven risks by risk driver and risk type
 
ubsgroupsustainabilitp64i0
Sustainability Report 2024
| Environment
 
60
Physical risk drivers
D1-Physical
: Impacts from
 
extreme weather events and
 
incremental climate change
 
may affect the value
 
of physical assets
that
 
UBS
 
owns
 
and
 
finances.
 
These
 
impacts
 
should
 
be
 
diligently
 
addressed
 
in
 
accordance
 
with
 
UBS’s
 
financial
 
risk
assessment. We
 
consider the
 
risks to
 
our own
 
physical assets
 
through our
 
comprehensive business
 
continuity planning
and physical climate risk identification
 
process. Incremental changes in climate
 
(e.g., rising temperatures and changes
 
in
precipitation
 
patterns)
 
can
 
exacerbate
 
extreme
 
events,
 
making them
 
more
 
frequent
 
and severe,
 
which
 
in
 
turn
 
affects
economic output
 
and productivity.
 
Such events
 
could reduce
 
the value
 
of properties
 
held as
 
collateral. We
 
see adverse
weather
 
risks
 
occurring
 
more
 
frequently
 
in
 
the
 
short
 
term.
 
The
 
relevance
 
of
 
physical
 
risks
 
equally
 
derives
 
from
geographical and
 
sectoral disaggregation.
 
Based on physical
 
risk heatmaps,
 
our exposure to
 
climate-sensitive regions
 
is
considered moderately low. Similar conclusions are reached
 
based on the sectoral disaggregation of our businesses.
 
Transition risk drivers
D2-Market
 
sentiment:
 
Protecting
 
our clients’
 
assets
 
is a
 
strategic pillar
 
in
 
our approach
 
to climate.
 
Amid the
 
growing
demand for
 
climate-focused
 
products
 
and services,
 
we aim
 
to actively
 
respond
 
to
 
market
 
changes driven
 
by the
 
low-
carbon transition
 
and our clients’
 
interest in
 
managing climate-related
 
risks. We
 
address this
 
potential risk
 
through our
sustainability-
 
and climate-focused product and service offering.
 
D3-Policy and regulatory:
As a global
 
financial services firm
 
active in wealth
 
management, asset management, investment
banking and the provision of services to corporate and
 
institutional clients, UBS may be affected directly and indirectly by
new
 
carbon
 
pricing
 
regulation
 
and
 
energy
 
transition
 
policies.
 
These
 
measures
 
can
 
be
 
designed
 
to
 
both
 
constrain
 
the
impacts of climate change and
 
/ or promote an
 
adaptive response to climate change impacts.
 
They could impact our own
operations, as well as the business operations of our
 
corporate clients, given that such clients rely on the
 
firm to finance
their
 
activities
 
across
 
a
 
range
 
of
 
sectors.
 
We
 
routinely
 
assess
 
the
 
impact
 
of
 
current
 
and
 
emerging
 
regulations,
 
either
directly affecting our operations or indirectly affecting those sectors
 
where we have clients.
D4-Technological change:
Together with corporate clients that rely on
 
UBS to finance their activities in
 
a range of sectors,
UBS may
 
be both
 
directly and
 
indirectly exposed
 
to technological
 
changes.
 
UBS analyzes
 
changes, such
 
as the
 
rise of
electric vehicle
 
and battery
 
technologies in
 
the automotive
 
sector, or
 
energy storage
 
technology advancement
 
impacts
on the power utility sectors, through scenario analysis approaches.
Climate-driven risks
R1.1-Credit risk:
 
We assess
 
the potential
 
impact of
 
climate-driven risks
 
on UBS
 
through counterparties
 
’
 
ability to
 
repay
their debt and our ability to fully recover the value of
 
the loan in the event of a default, due to collateral
 
devaluation.
 
 
Sustainability Report 2024
| Environment
 
61
R1.2-Market & Treasury risks:
We assess the potential impact
 
of climate-driven risks on the
 
value of our financial
 
assets,
by
 
altering
 
or
 
revealing
 
new
 
information
 
about
 
potential
 
future
 
economic
 
conditions
 
or
 
the
 
value
 
of
 
real
 
or
 
financial
assets, resulting in downward price shocks and an
 
increase in market volatility.
R1.3-Liquidity
 
risk:
We
 
assess
 
the
 
potential
 
impact
 
of
 
climate-driven
 
risks
 
on
 
liquidity
 
adequacy,
 
buffers
 
and
 
funding
conditions directly or indirectly through our ability to raise funds and liquidate assets and / or our
 
customers’ demand for
liquidity.
R2-Reputational:
We assess the potential impact of climate-driven risks caused by unfavorable perception, or a lessening
of our reputation, from the point of
 
view of clients, industries, shareholders, regulators, employees or the general public,
which may
 
lead to
 
potential financial losses
 
and /
 
or loss
 
of market share. Reputational
 
risk is
 
considered across all
 
business
activities,
 
transactions,
 
and
 
decisions
 
and
 
includes
 
sustainability-related
 
reputational
 
risks,
 
such
 
as,
 
for
 
example,
greenwashing risk.
R3.1-NFR
 
Continuity:
Our
 
business
 
continuity
 
is
 
associated
 
with
 
climate-sensitive
 
investments
 
and
 
businesses.
 
We
understand
 
the
 
UBS
 
sustainability
 
impact,
 
and
 
risks
 
and
 
opportunities
 
that
 
affect
 
our
 
value
 
and
 
the
 
operational
environment.
 
We
 
plan
 
and
 
create
 
strategic
 
direction,
 
develop
 
tangible
 
and
 
measurable
 
targets,
 
and
 
link
 
these
 
to
operations development
.
 
R3.2-NFR Compliance:
Climate-driven operational
 
risk may
 
increase with
 
regulatory compliance
 
and liability.
 
The aim
 
is
to
 
improve
 
the
 
firm’s
 
risk
 
profile
 
through
 
a
 
more
 
effective
 
and
 
efficient
 
compliance
 
function
 
focused
 
on
 
the
 
most
important risks. We identify, manage, and mitigate these
 
risks to avoid material impact on UBS.
R4-Business:
We assess
 
the potential
 
non-financial impact
 
on UBS from
 
inadequate or
 
failed internal processes,
 
people
and systems and / or externally
 
due to physical climate
 
events or stakeholder legal
 
action. UBS mitigates the above
 
risks
with global operations and interregional capabilities to provide
 
business.
›
Refer to the “Managing sustainability and climate risks” section of this report for more details about climate-related risks We are dedicated to being a world-class employer for talented individuals across all our markets and a place where people
 
ubsgroupsustainabilitp66i0
Sustainability Report 2024
| Social
 
62
Social
People and culture make the difference
Driving sustainable performance
 
can
 
unlock
 
their
 
full
 
potential.
 
Our
 
global
 
presence
 
in
 
51
 
(2023:
 
52)
 
countries
 
and
 
jurisdictions,
 
combined
 
with
 
the
expertise of 110,323 employees
 
worldwide, helps to position
 
us to create better
 
outcomes for our clients,
 
communities
and colleagues.
 
Our employees execute our business strategy and deliver on
 
our client promise. We therefore aim to attract, develop
 
and
retain employees who
 
have the capabilities,
 
potential and mindset
 
to help us
 
achieve those aims.
 
Corporate citizenship
principles are embedded
 
into our employment
 
practices, for example
 
in the benefits
 
we offer and
 
in our
 
fair pay practices.
As a founding member of the World
 
Economic Forum’s Good Work Framework, we partner with like-minded companies
to develop and implement metrics that support high-quality
 
work worldwide.
›
Refer to the “Driving social impact” section of
 
this report for more information about our community
 
impact and employee
volunteering activities
›
Refer to the Supplement to this report, available at
ubs.com/sustainability-reporting
, for more information about our workforce
The three keys and our corporate culture
Our culture is grounded in
 
our three keys to
 
success: our Pillars, Principles and
 
Behaviors. These keys support our business
decisions
 
and
 
our
 
approach
 
to
 
people
 
management.
 
Bringing
 
together
 
two
 
global,
 
systemically
 
important
 
banks
 
and
building
 
a
 
unified
 
culture
 
across
 
our
 
combined
 
organization
 
continued
 
to
 
be
 
top
 
priorities
 
in
 
2024,
 
overseen
 
by
 
a
dedicated culture
 
integration forum.
 
In addition,
 
the Corporate
 
Culture and
 
Responsibility Committee
 
of the
 
Board of
Directors (the BoD) monitors and reviews the activities related
 
to the development of the Group’s corporate culture.
›
Refer to
ubs.com/global/en/our-firm/our-culture.html
 
for more information about our three keys to success
›
Refer to the “Governance” section of this report for more information about key governance bodies pertaining to ESG matters We support culture-building through a number of Group-wide, divisional and regional initiatives.
 
Sustainability Report 2024
| Social
 
63
Examples of that include
our Group Franchise Awards program,
 
which recognizes employees for cross-divisional
 
collaboration and for suggesting
innovation or simplification
 
ideas.
 
Our global peer-to-peer
 
appreciation program, called
 
Kudos, acknowledges colleagues’
exemplary behavior, promoting
 
excellence, fostering
 
belonging, and increasing
 
engagement and employee
 
satisfaction.
Launched in 2024, a global initiative called Crafting our Future uses interactive in-person sessions to ensure leaders at all
levels are aligned with our strategic priorities and our culture.
Hiring, developing and retaining talent
In
 
2024,
 
we
 
hired
 
a
 
total
 
of
 
8,525
 
(2023:
 
11,435)
 
external
 
candidates
 
across
 
the
 
Group
 
and
 
developed
 
2,168
(2023: 3,720) graduates and other
 
trainees, apprentices and interns in various
 
programs. The difference
 
in year-on-year
external
 
hiring
 
numbers
 
was
 
largely
 
due
 
to
 
prioritizing
 
internal
 
mobility
 
in
 
our
 
talent
 
sourcing
 
processes
 
along
 
with
proactive internal recruiting efforts.
 
We are one of the largest providers of multi-year apprenticeships in Switzerland. We
also sponsor a multi-year apprenticeship program in the UK and summer internship and work-study programs in the US,
EMEA, Asia Pacific and Switzerland.
 
›
Refer to the Supplement to the UBS Group Sustainability
 
Report 2024 and to
ubs.com/global/en/careers/awards.html
 
for
employer ratings and recognitions
We are committed to offering hybrid working options wherever possible. In 2024, most employees were eligible to work
partially
 
from
 
home,
 
depending
 
on
 
their
 
role,
 
regulatory
 
restrictions
 
and
 
location,
 
along
 
with
 
divisional
 
or
 
functional
requirements. Such arrangements, along with options such as flexible
 
locations or hours, part-time working, job sharing
and partial retirement,
 
support employee engagement and retention and help
 
us attract a wider range of candidates.
Our talent
 
management approach
 
includes structured
 
talent and
 
succession reviews
 
to help
 
us identify
 
future leaders,
ensure
 
business
 
continuity
 
and
 
proactively
 
manage
 
employee
 
development.
 
In
 
this
 
respect,
 
cross-divisional
 
and
international mobility for early-career talent, mid-career professionals and senior leaders is
 
a central element. Our Group-
wide talent offering is supplemented by programs in the business divisions, functions and regions. These
 
programs cater
to a broad audience ranging from senior leaders to emerging
 
junior talent. We also offer targeted development for new
and
 
experienced
 
line
 
managers.
 
Regular
 
leadership
 
events
 
align
 
business
 
heads
 
with
 
our
 
strategy
 
and
 
further
 
our
corporate
 
and cultural
 
integration.
 
Our Win
 
As One
 
Team
 
initiative,
 
for example,
 
empowers
 
leaders to
 
cultivate
 
high-
performing teams that embody our core values and uphold the
 
highest standards of behavior.
Our Career Navigator platform supports internal mobility with a suite of self-service tools and resources to explore career
paths, search for jobs and short-term rotation opportunities, and connect
 
with mentors. Furthermore, line managers are
expected to support both individual development
 
and internal mobility. In 2024,
 
52.6% (2023: 38.8%) of all roles
 
were
filled by internal candidates.
Internal
 
training
 
is
 
delivered
 
via
 
our
 
UBS
 
University
 
platform.
 
The
 
offering
 
includes
 
client
 
advisor
 
certification
 
and
regulatory, business
 
and line
 
manager training
 
alongside modules
 
on culture,
 
sustainable finance,
 
artificial intelligence,
data
 
literacy,
 
well-being
 
and
 
other
 
topics.
 
Launched
 
in
 
2024
 
in
 
collaboration
 
with
 
a
 
leading
 
US
 
university,
 
our
 
new
sustainability
 
investment
 
program
 
gives
 
professionals
 
across
 
the
 
firm
 
the
 
knowledge
 
and
 
tools
 
they
 
need
 
to
 
make
sustainable
 
investment
 
decisions
 
that
 
may
 
lead
 
to
 
higher
 
risk-adjusted
 
returns.
 
In
 
addition
 
to
 
internal
 
training,
 
we
partnered with a leading external provider in 2024 to offer
 
thousands of additional learning opportunities to all staff.
 
All employees are
 
required to meet
 
initial and
 
ongoing training and
 
competency requirements appropriate to
 
the activities
they undertake on
 
the firm’s
 
behalf. Furthermore,
 
we may
 
require employees
 
to complete mandatory
 
or business-required
training, in line with our mandatory learning policy.
We
 
invested
 
approximately
 
USD 0.1bn
 
in
 
training
 
in
 
2024,
 
with
 
permanent
 
employees
 
completing
 
more
 
than
 
3.0m
learning activities (including
 
mandatory training on
 
compliance, business
 
and other
 
topics). This equated
 
to an average
of 24.8 (2023: 15.3) training hours
per employee.
Performance management
Our performance
 
management approach
 
(MyImpact) reflects
 
our strategy
 
and supports
 
our high-performance
 
culture.
Annually,
 
employees
 
set
 
objectives
 
that
 
foster
 
accountability,
 
translating
 
business
 
objectives
 
into
 
outcome-focused
individual objectives and further aligning
 
the organization to what matters most.
 
All employees also receive a specific risk
objective
 
that
 
reflects
 
how
 
we
 
manage
 
risk
 
and
 
supports
 
a
 
strong
 
and
 
proactive
 
risk
 
culture.
 
We
 
consider
 
both
performance-
 
and behavior-related objectives because we value what an employee accomplishes and how our behaviors
– accountability with integrity,
 
collaboration and innovation – are demonstrated.
An embedded feedback
 
app enables employees
 
to give and
 
receive feedback in
 
real time throughout
 
the year, supporting
continuous improvement and
 
course correction where
 
needed.
 
In 2024, more
 
than 371,000 (2023:
 
296,330) instances
of feedback were given across the combined organization. Annual performance reviews evaluate employees against their Our employees want to be heard and to be involved in shaping their daily experience.
objective
 
outcomes,
 
feedback
 
and
 
behavior,
 
and
 
100%
 
(2023:
 
100%)
 
of
 
eligible
 
employees
 
received
 
a
 
performance
review for the year.
 
 
Sustainability Report 2024
| Social
 
64
Employee engagement
 
As such, we offer opportunities
throughout
 
the
 
year
 
for
 
employees
 
to
 
connect
 
with
 
management
 
and
 
provide
 
feedback
 
on
 
topics
 
such
 
as
 
strategic
alignment, employee
 
engagement, well-being,
 
our work
 
environment and
 
line manager
 
effectiveness.
As an
 
example,
initiatives such as our regular “Ask the CEO” event
 
give employees the chance to learn about (and ask questions
 
about)
topics such as strategy and direction.
Our multi-faceted employee listening strategy
 
is adaptable and captures feedback in a timely way. We conduct employee
lifecycle surveys, short “pulse” surveys
 
to understand what is on top of employees’ minds and in-depth analyses,
 
such as
virtual focus
 
group sessions.
 
In 2024, those
 
conversations
 
allowed participants
 
from every business
 
division and
 
function to
share their perspectives and
 
insights on the
 
integration and provided employee sentiment data
 
points to track
 
progress.
Group-wide surveys
 
measure cultural
 
indicators,
 
such as line manager
 
effectiveness and
 
employee engagement.
 
Our 2024
Group-wide survey,
 
which had
 
a
 
77% employee
 
response rate,
 
assessed indicators such
 
as
 
line manager
 
effectiveness,
engagement,
 
culture
 
and
 
pride.
 
An
 
engagement
 
score
 
of
 
83%
 
in
 
that
 
same
 
survey
 
confirmed
 
that
 
our
 
employees
recommend us as an employer. All of these scores
 
were above the financial services
 
benchmark.
1
We continue to strive to
be an employer
 
of choice in
 
the financial
 
sector.
Employee representation
In addition to seeking out employee
 
feedback, we maintain an open
 
dialogue with our formal employee
 
representation
groups. Our Human
 
Rights Statement and our
 
Code of Conduct
 
and Ethics (the
 
Code) outline our
 
responsibility to respect
the rights of our workers. The
 
UBS European Employee Forum and the European Works Council,
 
Credit Suisse Group AG
include representatives
 
from
 
all European
 
Union Member
 
States where
 
the UBS
 
Group
 
has a
 
presence.
 
They consider
topics
 
related
 
to
 
our
 
performance
 
and
 
operations.
 
Local
 
works
 
councils
 
consider
 
benefits,
 
workplace
 
conditions
 
and
reorganizations,
 
among other topics. Collectively, these groups represent 52.0% (2023: 51.5%)
 
of our global workforce.
Where applicable, our operations are subject to
 
collective bargaining agreements. Benefits are aligned with
 
local markets
and often go beyond legal requirements or market practice.
Fair and equitable pay
 
Fair and consistent
 
pay practices are designed
 
to ensure that employees
 
are appropriately rewarded for their
 
contribution.
We pay for performance, and we take pay equity
 
seriously. We have embedded clear commitments in our compensation
policies and practices
 
and apply the
 
same fair pay
 
standards across
 
all locations.
 
We annually
 
review our approach
 
and
policies, in line with established equal pay methodologies, to
 
support our continuous improvement.
As part of our commitment to equal pay, we regularly conduct internal reviews on
 
pay equity, and our statistical analyses
show a differential
 
between male and
 
female employees in
 
similar roles across
 
our core financial
 
hubs of less than
 
1%.
If we find any gaps not explained by business or by appropriate employee factors
 
such as role, responsibility, experience,
performance or location, we look at the root causes and
 
address them.
We also aim to ensure that all
 
employees are paid at least a
 
living wage. We regularly assess employees’
 
salaries against
local living wages,
 
using benchmarks
 
defined by the
 
Fair Wage Network.
 
Our analysis in
 
2024 showed that
 
employees’
salaries were at or above the respective benchmarks.
 
›
Refer to the UBS Compensation Report 2024, available
 
at
ubs.com/annualreporting
, and to
ubs.com/sustainability-reporting
for
our 2024 UK Gender & Ethnicity Pay Gap Report
 
Employee support
We are committed to being a responsible employer and to caring for our employees. That is one reason we offer flexible
working arrangements
 
and promote
 
employee health
 
and well-being.
 
Social, physical,
 
mental and
 
financial well-being
elements
 
are
 
woven
 
into our
 
HR policies
 
and
 
practices.
 
For example,
 
our
 
support
 
for
 
employee
 
well-being
 
includes
 
a
range of programs,
 
benefits and workplace
 
resources, along with
 
a specialized eLearning curriculum
 
to help employees
better manage their health, foster well-being and strengthen
 
their resilience. A dedicated well-being portal
 
consolidates
our global offering and promotes regional
 
networks, initiatives and resources.
In
 
2024,
 
employees
 
across
 
the
 
firm
 
participated
 
in
 
virtual
 
fitness
 
challenges,
 
mental
 
health
 
initiatives,
 
volunteering
activities and financial education events,
 
and everyone had access to
 
a specialized mindfulness app. We
 
also progressed
with our #WorkingWithCancer commitment through a
 
mentorship program,
 
informational sessions and coffee corners.
Benefits and assistance
 
All our employees have access to competitive benefits, such as healthcare, well-being and retirement benefits, insurance
(such
 
as
 
life
 
and
 
disability
 
insurance)
 
and
 
flexible
 
leave
 
policies,
 
where
 
applicable.
 
All
 
employees
 
are
 
also
 
covered
 
by
policies
 
to
 
protect
 
against
 
employment
 
injury
 
or
 
disability.
 
Parental
 
leave,
 
including
 
adoption
 
leave,
 
is
 
available
 
to
 
all
employees, as indicated in local HR policies, and all locations
 
offer family-related leave. Benefits
 
are set in the context of
local market practice and are regularly
 
reviewed for competitiveness.
1
 
Benchmarks provided by Ipsos Karian and Box as of the third quarter of 2024.
 
 
 
Sustainability Report 2024
| Social
 
65
Employee assistance programs and
 
internal teams help employees
 
and their family members
 
manage personal or work-
related issues that may affect their
 
well-being. The absentee rate of
 
the UBS Group excluding Credit Suisse in
 
2024 was
2.1%
 
(2023:
 
1.9%)
 
globally
 
and
 
Credit
 
Suisse’s
 
absentee
 
rate
 
was
 
2.4%
 
(2023:
 
2.3%)
 
of
 
total
 
scheduled
 
days
 
in
Switzerland
1
, according to the number of illness or accident absences recorded
 
in the respective self-service HR tools.
Should
 
business
 
or organizational
 
circumstances
 
arise
 
that
 
lead
 
to employee
 
redundancy,
 
we
 
offer
 
redeployment
 
and
outplacement
 
services
 
with
 
a
 
focus
 
on
 
redeployment
 
within
 
UBS.
 
We
 
believe
 
these
 
measures
 
help
 
skilled
 
employees
affected
 
by restructuring
 
to
 
favorably
 
position
 
them
 
in
 
the
 
labor
 
market.
 
Employees
 
considering
 
retirement
 
also
 
have
access to various resources to help prepare them for this
 
transition.
›
Refer to the “Health and safety statement”, available
 
at
ubs.com/sustainability-reporting
, for more information about UBS’s
health and safety statement
›
Refer to
ubs.com/employees,
 
for more information about benefits and assistance
Equal opportunities and whistleblowing
 
We provide equal employment
 
and advancement opportunities for
 
all individuals.
 
We are an equal
 
opportunity employer,
and our policies do not tolerate
 
harassment of any kind. We
 
have measures in place
 
to prevent discrimination,
 
bullying,
victimization,
 
harassment
 
(including
 
sexual
 
harassment)
 
and
 
retaliation,
 
along
 
with
 
an
 
anti-harassment
 
representative
who independently reviews relevant training,
 
policies and protocols.
Employees are
 
encouraged to raise
 
concerns openly
 
and to report potential
 
violations of the Code.
 
Group-wide, staff
 
have
multiple ways, including a telephone hotline and an online whistleblowing
 
form that offers confidential and, if preferred,
anonymous ways, to raise concerns about
 
any potential breaches of laws,
 
regulations, rules or other legal requirements,
policies, professional standards, sexual misconduct or harassment, or any
 
violation of the
 
Code. We do
 
not tolerate any
form of retaliation
 
against any employee
 
who reports
 
a concern that
 
they reasonably
 
believe is a
 
breach or violation.
Workforce inclusion
We are committed to being a diverse
 
and inclusive workplace based on meritocracy, and
 
aim to build a culture of
 
belonging
where all employees
 
are recognized and valued,
 
and where everyone can
 
be successful and thrive.
 
At UBS, we aim
 
to hire and
retain the best people for the
 
right roles, to deliver for our
 
clients, our businesses, our shareholders and
 
the communities we
serve. In order to achieve this, we have a diverse workforce with a variety of skills, experiences and backgrounds that reflects
the diversity of our clients to serve them at our best. It is
 
also critically important to us that we respect an environment where
all our employees are treated
 
fairly and able to reach
 
their potential. In every location in which
 
we operate, we continue to
 
act
in accordance with the current
 
law and regulations and will monitor
 
any changes to ensure we remain
 
consistent.
 
›
Refer to the “Supporting opportunities” section
 
of this report for more information about our clients
›
Refer to the “Driving social impact” section of
 
this report for more information about the topic of
 
community and society
›
Refer to the “Managing our supply chain responsibly”
 
section of this report for more information about our
 
suppliers
Our
 
workforce
 
inclusion
 
strategy
 
is built
 
on
 
four
 
pillars:
 
transparency,
 
hiring,
 
developing
 
and
 
belonging.
 
We
 
leverage
these four pillars
 
to help support
 
our entire workforce
 
across a variety
 
of personal characteristics
 
including, but not
 
limited
to, gender,
 
culture, race,
 
ethnicity, sexual
 
orientation and
 
identity, disability,
 
family, veteran
 
status, and
 
generations, to
create an inclusive culture for everyone.
Transparency
Transparency
 
is the foundation framework through which we enable leaders to
 
deliver the strategy, and everyone is held
responsible.
 
We
 
leverage
 
various
 
communication
 
channels
 
and
 
line
 
manager
 
objectives
 
to
 
drive
 
awareness,
benchmarking,
 
thought
 
leadership
 
and
 
feedback
 
to
 
inform
 
the
 
strategy,
 
and
 
data
 
monitoring
 
with
 
respective
characteristics, including management dashboards and
 
toolkits, to support our entire workforce.
 
In
 
2024,
 
26.7%
 
(2023:
 
37.5%)
 
of
 
members
 
of
 
the
 
GEB
 
41.7%
 
(2023:
 
33.3%)
 
of
 
members
 
of
 
the
 
BoD, and
 
33.8%
(2023: 30.3%) of senior managers who reported directly to a
 
member of the GEB were female employees.
Our workforce
 
inclusion strategy
 
is reinforced
 
by our
 
public commitments
 
to support
 
all employees,
 
including, but
 
not
limited to, the UN Women’s Empowerment Principles,
 
the Valuable 500 and the Race
 
at Work Charter (UK). Of particular
note
 
is
 
our
 
commitment
 
to
 
the
 
Valuable
 
500,
 
a
 
global
 
business
 
collective
 
of
 
CEOs
 
and
 
their
 
companies
 
focused
 
on
advancing
 
disability
 
inclusion
 
that
 
we
 
have
 
partnered
 
with
 
since
 
2021.
 
Disability-focused
 
initiatives
 
in
 
2024
 
included
making
 
improvements
 
to our
 
recruitment
 
processes
 
for
 
candidates,
 
sponsoring
 
disability-focused
 
employee
 
networks,
enhancing training and
 
awareness efforts for
 
all employees, and
 
continuing to increase
 
physical and digital
 
accessibility
for employees and clients alike.
›
Refer to the Supplement to this report, available at
ubs.com/sustainability-reporting
, for more information about our workforce
1
 
Credit Suisse data reflects only Swiss absences.
 
Sustainability Report 2024
| Social
 
66
Hire
We aim to hire
 
the best people for
 
the right roles with
 
meritocracy at the
 
forefront of any
 
decision we make, to
 
deliver
for our clients,
 
our businesses, our
 
shareholders and
 
the communities
 
we serve.
 
We offer
 
a wide range
 
of programs to
attract a diverse talent slate. Our junior talent programs, such as our apprenticeship programs in Switzerland and the UK
and
 
our
 
global
 
internship
 
program,
 
prepare
 
young
 
talent
 
for
 
successful
 
careers
 
with
 
us.
 
Our
 
UBS
 
Career
 
Comeback
program supports candidates on career
 
breaks who want to re-enter the corporate
 
world.
›
Refer to the Supplement to this report, available at
ubs.com/sustainability-reporting
, for more information about our workforce
 
Develop
We
 
provide
 
employees
 
the
 
visibility
 
and
 
opportunities
 
to
 
enable
 
successful
 
and
 
thriving
 
careers.
 
Mentorship
 
and
sponsorship, embedded in
 
(and supplemental to) talent
 
development programs
 
help ensure employees
 
have a range
 
of
development
 
opportunities.
 
Through
 
a
 
mix
 
of
 
online
 
and
 
in-person
 
training,
 
self-directed
 
learning
 
and
 
coaching,
 
we
further support our employees’ career journeys and aspirations. For example,
 
in 2024, our Growth Alignment Experience
for Associate Director-
 
and Director-level employees in the US doubled in size
 
to 100 participants, who had applied to be
part of the program. Over a six-month period, participants worked with external
 
coaching professionals to enhance their
strategic
 
planning
 
skills,
 
expand
 
their
 
networks
 
and
 
build
 
connections.
 
Employees
 
in
 
the
 
UK
 
and
 
Switzerland
 
at
 
the
Authorized Officer,
 
Associate Director
 
and Director
 
levels were
 
offered
 
programs including
 
Not in
 
Your
 
Image, a
 
nine-
month career development program for building
 
skills and leadership readiness.
In the
 
US, we
 
work with
 
the Executive
 
Leadership Council’s
 
Institute for
 
Leadership Development
 
and Research,
 
along
with organizations like the Hispanic Association on Corporate Responsibility,
 
to support leadership-development-focused
opportunities across our workforce,
 
facilitating individual growth that in turn builds our talent
 
pipeline.
 
Belong
A sense of
 
belonging helps
 
drive engagement
 
and is important
 
for overall
 
well-being. Inclusive
 
leadership and
 
fair and
transparent policies and practices provide organizational support for
 
belonging, and vital to these efforts are our various
employee network chapters
 
across the firm
 
that connect employees
 
on a variety
 
of employee-led topics. Our
 
networks,
which are open to
 
all employees, also supplement
 
members’ awareness, development
 
and support through
 
mentoring,
reverse mentoring and allyship programs.
 
›
Refer to
ubs.com/inclusion,
 
for additional information about inclusion topics
 
and status
›
Refer to
ubs.com/employees
or
ubs.com/careers,
for more topics of interest to employees and potential applicants We aim to support the transition to an economy that considers the well-being of people and planet.
 
Sustainability Report 2024
| Social
 
67
Driving social impact
 
Through the UBS
Optimus network
 
of foundations
 
(the UBS
 
Optimus Foundation),
 
which is an
 
independent network,
 
and in
 
partnership
with
 
philanthropists,
 
employees,
 
implementation
 
organizations
 
and
 
institutional
 
partners,
 
we
 
want
 
to
 
find
 
innovative
ways to drive systemic and catalytic impact
 
for marginalized communities at scale, both globally and
 
locally, especially for
children and young people. In 2021, we set a goal of mobilizing USD 1bn in
 
philanthropic capital (which was reached in
2024) and reaching more than 26.5 million people by the
 
end of 2025 (cumulative total since 2021).
We know
 
working together
 
is key
 
to achieving
 
this impact
 
and systemic
 
change. That
 
is why,
 
in addition
 
to providing
insights, advice
 
and execution
 
services to
 
clients and
 
prospective clients,
 
we have
 
increased our
 
efforts in
 
the areas
 
of
blended
 
finance,
 
collaborative
 
philanthropy
 
and
 
impact
 
transparency.
1
 
In
 
blended
 
finance,
 
we
 
have
 
facilitated
opportunities and
 
partnerships
 
in innovative
 
financing structures
 
leveraging public
 
and private
 
capital. In
 
collaborative
philanthropy, we
 
have brought
 
together clients
 
and partners
 
on joint
 
initiatives addressing global
 
issues, such
 
as improving
the quality of primary school education
 
in Ghana and Colombia. Additionally,
 
our new impact rating tool,
 
introduced in
2024, simplifies
 
assessment
 
of impact
 
across projects,
 
sectors
 
and solutions,
 
aligning
 
with established
 
methodologies,
such as the Impact Management Project’s dimensions of
 
impact.
 
Our clients and partners are invited to be part of our impact ecosystem by supporting various initiatives and approaches.
Blended finance
The
 
UBS
 
Optimus
 
Foundation
 
partners
 
with
 
clients,
 
governments,
 
development
 
finance
 
institutions
 
and
 
our
 
business
divisions to promote
 
and launch blended
 
finance initiatives that use
 
catalytic capital from
 
public and philanthropic
 
sources
to increase private-sector investment in sustainable development.
UBS Collectives
Our
 
three
UBS
 
Collectives
 
bring
 
philanthropists
 
together
 
to
 
co-fund
 
programs,
 
share
 
knowledge
 
and
 
join
 
a
 
unique
learning journey. This
 
includes insight trips,
 
where the philanthropists
 
work and exchange
 
knowledge with experts
 
and
experience the impact on the ground.
The
UBS Collectives
 
were launched in 2020 and focus on issues
 
central to our strategy: innovative financing of education
and health outcomes (the
UBS Accelerate Collective
), catalyzing the
 
blue-carbon market (the
UBS Climate Collective
), and
promoting and implementing family-based care (the
UBS Transform Collective
). The first cohorts concluded their journey
at the end of 2024, contributing their time and expertise to
 
support 23 UBS partners across eight countries.
›
Refer to the UBS Optimus Foundation Annual Review
 
2023, available at
ubs.com/optimus-foundation/annual-review,
for more
information
 
UBS Global Visionaries
Through
 
our UBS
 
Global Visionaries
 
program,
 
we aim
 
to accelerate
 
the impact
 
of social
 
entrepreneurs
 
by: (i)
 
creating
opportunities
 
for
 
the
 
entrepreneurs
 
to
 
connect
 
with
 
our
 
clients,
 
prospective
 
clients
 
and
 
employees;
 
(ii) increasing
 
the
entrepreneurs’
 
abilities
 
through
 
learning
 
and
 
coaching
 
programs;
 
and
 
(iii) raising
 
awareness
 
of
 
the
 
entrepreneurs’
endeavors by leveraging our
 
brand and platforms. Since
 
the program started in
 
2016, we have onboarded
 
and supported
90 entrepreneurs to accelerate their impact.
Helping our clients structure their philanthropy: donor
 
-advised funds
Donor-advised funds offer clients
 
an alternative charitable-giving vehicle
 
to set up
 
their own foundations, offering
 
greater
choice and personalization,
 
and are managed
 
in line with
 
their usual investment
 
approach. UBS
 
offers these
 
services in
Switzerland, Singapore, the UK and,
 
since 2023, the Hong Kong
 
SAR. In 2024, USD 329m in
 
donations was received into
these UBS charitable entities (2023: USD 318m).
2,3
The UBS Optimus Foundation
In
 
2024,
 
the
 
UBS
 
Optimus
 
Foundation
 
raised
 
USD 366m
 
in
 
donations
 
(2023:
 
USD
 
328m),
 
including
 
UBS
 
matching
contributions, and committed USD 310m (2023: USD 306m)
 
in grants from the foundations.
2,4
In
 
2024,
 
the
 
UBS
 
Optimus
 
Foundation
 
celebrated
 
its
 
25th
 
anniversary
 
by
 
launching
 
four
 
initiatives
5
that
 
build
 
on
 
our
achieved impact and
 
strategic partnerships. These
 
initiatives will be
 
supported by a
 
USD 25m gift from
 
UBS that will
 
be
used to provide matching contributions of up to 100%
6
and seed capital to launch them.
In addition to mobilizing our clients’ resources to advance the missions of our portfolio of partners, we also seek to ensure We have provided direct cash contributions through our affiliated foundations in Switzerland, through partnerships in
both
 
the
 
firm
 
and
 
employees
 
are
 
engaged
 
in
 
our
 
Social
 
Impact
 
strategy.
 
We
 
do
 
this
 
mainly
 
through
 
charitable
contributions and employee volunteering.
 
 
Sustainability Report 2024
| Social
 
68
Charitable contributions
the communities where we
 
operate and through contributions
 
to the UBS Optimus
 
Foundation. The combined value
 
of
these contributions in 2024 was USD 74m.
Employee volunteering
We have global
 
targets for employee
 
engagement through volunteering,
 
which are built
 
from the bottom
 
up and on
 
a
best-efforts basis. In
 
2024, we successfully engaged
 
32%
 
of our global
 
workforce in volunteering (2023:
 
38%), and 39%
of the 230,258 volunteer hours were skills based (2023:
 
45% of 199,633 volunteer hours).
7,8
1
Currently, our impact transparency focus is on ensuring that all grants and investments supported by the UBS Optimus Foundation
 
undergo consistent and transparent diligence, approval, management and reporting
processes, in line with industry standards.
2
Figures provided for
 
the UBS Optimus
 
Foundation and
 
donor-advised funds
 
are based on
 
unaudited management accounts
 
and information available
 
as of January
 
2025.
 
Audited financial statements
 
for the UBS
Optimus Foundation and donor-advised foundation entities are produced and available
 
per local market regulatory guideline.
3
 
2023 figures exclude Credit Suisse.
4
 
The UBS Optimus Foundation receives donations from all of the business divisions,
 
with the majority coming from Global Wealth Management.
5
 
Blue economy, innovative financing in tertiary education, scaling primary education and reaching the last mile for quality health
 
care.
6
 
100% up to USD 10,000 and 25% thereafter.
7
 
2023 figures exclude Credit Suisse-led volunteering programs.
8
 
Reported employee volunteering hours include volunteering activities completed both during
 
and outside of working hours. In the
 
case of hours committed outside of working hours,
 
in line with Business for Societal
Impact (B4SI) guidelines, these are only counted where volunteering can be attributed to UBS support or encouragement
 
for the employee to commit their time.
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Social
 
69
Charitable contributions
UBS’s
 
overall
 
charitable
 
contributions
 
are
 
measured
 
using
 
the
 
Business
 
for
 
Societal
 
Impact
 
(B4SI)
 
framework
 
and
 
are
broken down as follows.
1
Cash
This category
 
includes direct
 
cash contributions
 
from the
 
firm, including
 
through partnerships
 
in the
 
communities that
we
 
operate
 
in, support
 
given
 
through
 
its
 
affiliated
 
foundations
 
in
 
Switzerland
 
and
 
contributions
 
to
 
the
 
UBS
 
Optimus
network of foundations.
2
Employee time
This is the cost to UBS of
 
the time that employees spend
 
on community programs during working
 
hours. It is calculated
by multiplying the number of volunteer hours during working
 
hours by the average hourly salary.
In-kind
These are contributions
 
of products, equipment,
 
services and other
 
non-cash items from
 
UBS to communities,
 
primarily
the cost of making our premises available to our partner charities
 
for events.
1
 
From 2024, all
 
charitable contributions reporting
 
has been integrated,
 
reflecting contributions made
 
across the UBS Group.
 
The
 
2023 and 2022
 
comparative figures reflect
 
contributions made across
 
UBS AG pre-
integration of Credit Suisse.
2
 
All direct cash contributions
 
are recognized on a
 
cash rather than accrual
 
basis. Separately,
 
we recognize contributions made
 
by the UBS Optimus
 
network of foundations
 
on an accrual basis,
 
reflecting committed
grants made in the reporting period. The cash contribution does not include contributions totaling USD 5.8m in 2024
 
that are required by law (in India and South Africa). This is consistent with B4SI
 
methodology. Lower
cash contributions in 2023 compared with
 
2022 were due to the
 
decision to exclude business-related
 
contributions, since these are
 
donations made outside of our
 
strategic social impact strategy
 
and do not support
the longer-term impact we are striving to achieve with our strategic grantee and
 
volunteering partners.
Contributions by type (UBS Group AG consolidated)
1
USD m
2024
2023
2022
Cash contributions
2
73.90
62.58
76.15
 
Time contributions
23.13
16.64
15.53
 
In-kind contributions
0.01
0.08
0.06
 
Total
97.05
79.30
91.74
 
1
 
From 2024, all charitable contributions reporting
 
has been integrated, reflecting contributions
 
made across the UBS Group.
 
The
 
2023 and 2022 comparative figures
 
reflect contributions made across UBS
 
AG pre-
integration of Credit Suisse.
 
2
 
All direct cash contributions are recognized on a cash rather than accrual basis. Separately, we recognize contributions made by the UBS Optimus network of foundations on an accrual
basis, reflecting committed grants made in the reporting period. The
 
cash contribution does not include contributions totaling USD 5.8m in 2024 that are required
 
by law (in India and South Africa). This is consistent
with B4SI methodology. Lower cash contributions in 2023 compared with
 
2022 were due to the decision to
 
exclude business-related contributions, since these are donations made outside of our
 
strategic social impact
strategy and do not support the longer-term impact we are striving to achieve with our strategic
 
grantee and volunteering partners.
 
 
Sustainability Report 2024
| Social
 
70
Respecting human rights
UBS is
 
committed to
 
respecting and
 
promoting human
 
rights, as
 
set out
 
in the
 
UN Guiding
 
Principles on
 
Business and
Human Rights.
 
When assessing
 
the firm’s
 
potential
 
human rights
 
impacts,
 
we focus
 
on three
 
key stakeholder
 
groups
(employees, clients and vendors), as well as society at large.
 
›
Refer to the “General information” section of
 
this report for more information about our interactions with stakeholders,
 
including
civil society groups
Employees
:
 
UBS is committed to
 
respecting human rights
 
standards through its
 
human resources policies
 
and practices,
and to meeting the
 
obligations that a
 
responsible company is required
 
to comply with.
 
These are reviewed
 
on a regular
basis in an effort to make sure we continue to respect human
 
and labor rights.
 
›
Refer to the “People and culture make the difference” section
 
above and to “Key policies and practices”
 
in the appendix to this
report for more information about UBS’s human resources policies and practices
 
Clients
:
 
UBS aims to provide
 
its clients with innovative
 
investment solutions on
 
themes related to
 
human rights, such as
health, education, gender and / or equality. In
 
addition, we take human rights risks into account in
 
solutions that address
a broader range of
 
sustainability issues. We
 
identify and manage
 
actual and potential adverse
 
impacts on human rights
to which
 
our clients’
 
assets
 
and our
 
own assets
 
are exposed,
 
most notably
 
through
 
our sustainability
 
and climate
 
risk
policy
 
framework
 
(including
 
human
 
rights).
 
Our
 
clients
 
also
 
have
 
access
 
to
 
solutions
 
that
 
help
 
them
 
to
 
realize
 
their
philanthropy goals, including those related to human rights.
›
Refer to the “Strategy”
 
section of this report for more details about our sustainability and
 
impact strategy, key aspirations and
progress
 
›
Refer to the Supplement to this report, available at
ubs.com/sustainability-reporting
, for more information about the
“Sustainability and climate risk policy framework”, including
 
SCR assessments undertaken in 2024 (including
 
human rights-
related)
›
Refer to the “Driving social impact” section of
 
this report for more details about our approach to philanthropy
 
services
Vendors
:
 
UBS is committed to reducing the negative societal impacts of the goods and services it purchases. That is why,
when we
 
are establishing
 
new contracts
 
or renewals,
 
we identify
 
high-impact vendors
 
based on
 
whether they
 
provide
goods and services that either have a
 
substantial social impact or are sourced
 
in markets with potentially high social risks.
Vendors that
 
do not
 
meet the
 
minimum applicable standard,
 
because they are
 
associated with actual
 
and potential
 
human
rights risks, have to agree to and comply with a remediation
 
plan before signing a contract with us.
›
Refer to the “Responsible Supply Chain Standard“ and
 
the “UBS Supplier Code of Conduct” for
 
more details about our responsible
supply chain management and assessments, available
 
at
ubs.com/sustainability-reporting
, for more information
UBS’s human-rights-related
 
commitments and
 
actions are
 
set out
 
in the
 
UBS Human
 
Rights Statement.
 
The statement
shows the structures (governance and policies) and
 
mechanisms (procedures and processes) UBS has in
 
place to support
its
 
commitments.
 
UBS
 
also
 
publishes
 
a
 
Modern
 
Slavery
 
and
 
Human
 
Trafficking
 
Statement
 
pursuant
 
to
 
the
 
UK
 
2015
Modern Slavery Act and to the Australian 2018 Modern
 
Slavery Act.
 
›
Refer to the UBS Human Rights Statement and the
 
UBS Modern Slavery and Human Trafficking Statement, available at
ubs.com/sustainability-reporting, for more information
›
Refer to the Supplement to this report, available at
ubs.com/sustainability-reporting
, for more information about “UBS Group’s
approach to the Swiss Ordinance on Due Diligence and Transparency in relation to Minerals and Metals from Conflict-Affected At UBS, the security of our clients’ assets and data is one of our top priorities.
Areas and Child Labor”
 
Sustainability Report 2024
| Social
 
71
Cyber and information security
 
As cyber threats to systems and data
increase in volume and
 
sophistication, we continually
 
focus resources and investments
 
on critical cyber and
 
information
security capabilities, with specialist teams working to safeguard our clients’
 
assets and data.
Our principles and policies guide
 
how we develop and deploy
 
technological solutions. The cyber and information security
(CIS) program is
 
designed to identify,
 
prevent, detect and
 
respond to CIS
 
events, with the
 
goal of maintaining
 
the integrity
and availability of our technology infrastructure. Appropriate
 
technical and organizational measures are implemented
 
to
ensure that data remains
 
confidential and protected
 
against accidental, unauthorized
 
or unlawful destruction, and
 
loss,
alteration, disclosure or access.
Additionally, UBS has
 
a Group-wide incident
 
response process designed
 
to detect, investigate,
 
and respond
 
to information
security threats and incidents
 
that have a potential
 
impact on UBS systems
 
and data. This process enables
 
any UBS person
to report
 
incidents and
 
data breaches,
 
and it
 
also includes
 
processes such
 
as notifying
 
impacted clients
 
about
 
relevant
incidents, in line with all applicable laws and regulations.
In 2024,
 
we have
 
enhanced the
 
CIS awareness
 
and education
 
program for
 
all UBS
 
employees and
 
external workforce,
including an increase in staff testing, refreshed mandatory training, including for highly privileged users, and a firm-wide
Cyber Awareness Month campaign.
›
Refer to the “Cyber and information security”
 
section of UBS Group Annual Report 2024, available
 
under “Annual reporting” at
ubs.com/investors,
for more information
Helping clients stay cybersafe
UBS
 
invests
 
in
 
critical
 
cyber
 
and
 
information
 
security
 
capabilities
 
to
 
protect
 
clients'
 
assets
 
and
 
data
 
and
 
provides
cybersafety tips through its website and mobile applications.
›
Refer to Cyber Security at UBS for more information,
 
available at
ubs.com/global/en/our-firm/cybersafe.html
, and to
Cybersecurity, information security and data privacy at UBS, available at Finance has an important role to play as companies and individuals consider how best to approach the transition to a
ubs.com/global/en/sustainability-impact/sustainability-
reporting.html
 
Sustainability Report 2024
| Supporting opportunities
 
72
Supporting opportunities
Our sustainable finance ambitions
 
more sustainable, lower-carbon
 
world. Banks and
 
investment managers
 
can support this
 
transition by
 
allocating capital
effectively and efficiently and helping to mobilize the
 
vast amounts of investment and financing required. In
 
addition, we
are committed to
 
supporting our clients’
 
sustainability ambitions, whether their
 
focus is on
 
reducing the carbon
 
emissions
footprint of their businesses or portfolios or on encouraging a
 
fairer and more prosperous society.
We provide
 
a broad
 
range of
 
sustainability and
 
impact products
 
and services
 
across our
 
core business
 
areas, targeting
four key objectives in serving our clients:
–
The power of choice:
 
we want to give
 
our investing clients
 
the choices they
 
need to meet
 
their specific sustainability
objectives.
 
–
An
 
orderly
 
transition:
 
we
 
aim
 
to
 
support
 
our
 
clients
 
through
 
the
 
world’s
 
transition
 
to
 
a
 
low-carbon
 
economy,
 
for
instance, by offering innovative sustainable financing and
 
investment solutions.
 
–
Managing risks
 
and identifying
 
opportunities: we
 
offer research
 
and thematic
 
insights, as
 
well as
 
data and
 
analytics
services. Combined with targeted
 
advice, these are designed to
 
help clients better understand
 
and mitigate risks and
identify new opportunities.
 
–
Making
 
sustainable
 
finance
 
an
 
everyday
 
topic:
 
we
 
want
 
to
 
make
 
sustainability
 
topics
 
tangible
 
throughout
 
our
interactions with clients. To help us do that, we provide support
 
in the form of tools, platforms and education.
Assessing sustainable finance opportunities
The regulatory environment continues to evolve, and so do the associated business and investment opportunities for our
clients, as well as for us. As part
 
of the UBS Group sustainability and impact annual strategic review and objective setting
process, our business
 
opportunities are assessed
 
on a Group
 
and divisional level
 
and also through
 
a topical lens
 
(e.g. in
thematic priority areas, such as climate, nature or impact).
 
Furthermore, since 2021
 
we have performed
 
a dedicated
 
climate opportunities materiality
 
assessment on an
 
annual basis,
looking at financial and impact materiality related
 
to our firm-wide climate-related product and
 
services offering. In order
to ensure that climate aspects are reflected in
 
our forward-looking business strategy, business divisions formulate specific
commercial objectives for climate during the objective-setting process.
 
›
Refer to “Supporting our approach to climate – climate-related
 
materiality assessment”
 
in the “Environment” section of this
report for a description and results of the climate opportunities
 
materiality assessment
Our approach to sustainable finance
 
It is important
 
to set out
 
how we define
 
sustainable finance,
 
as no uniformly
 
accepted definition
 
currently exists
 
in the
financial industry.
 
In accordance
 
with our
 
ambitions, our
 
sustainable finance
 
product offering
 
is organized
 
across three
key areas:
–
Investing
: sustainable investing solutions for private and institutional
 
investors;
–
Financing
: sustainable financing solutions for real estate and corporate
 
purposes;
 
and
–
Research, advisory,
 
data, platforms
 
and client
 
interactions
: solutions
 
guiding our
 
clients on
 
their sustainability
objectives, such as sustainability-related analytics, scoring, reporting, tools and client support through our interactions
with them.
Sustainable investing
Our approach to
 
sustainable investing is
 
defined in our
 
Group Sustainable Investing
 
Policy.
 
For us, sustainable
 
investing
includes any product or service with
 
an underlying investment strategy that, in
 
addition to targeting market-rate financial
returns, aims to explicitly:
 
i) align with one or more specific sustainability-related objectives;
 
or
 
ii) contribute to achieving one or more specific sustainability
 
-related objectives,
 
while also considering
 
corporate governance
 
factors (e.g. sound management
 
structures, remuneration of
 
staff and tax
compliance) and potential adverse impacts on broader sustainability,
 
where relevant.
 
Our sustainable investing approaches are “Sustainability focus” and “Impact investing”. These categories,
 
as they stand,
are part of our global sustainable investing framework,
 
which is not tailored to or defined by
 
any specific local regulatory
requirements or definitions. Specifically, the “Sustainability focus” approach refers only to our framework definition, and The way that we define sustainable investing is being review ed to ensure that it appropriately considers evolving market
not to existing regulations.
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Supporting opportunities
 
73
practice, client expectations and relevant regulatory guidance. For
 
an investment product or service to
 
be considered part
of our
 
sustainable
 
investing
 
offering,
 
the
 
explicit
 
alignment
 
with or
 
contribution
 
to
 
one
 
or more
 
sustainability-related
objectives must
 
be demonstrated
 
within the underlying
 
investment strategy.
 
Strategies focused
 
only on the
 
integration
of
 
sustainability
 
risks
 
and
 
/
 
or
 
exclusions
 
and
 
/
 
or
 
active
 
ownership,
 
without
 
a
 
contribution
 
to
 
sustainability-related
objectives, would not qualify as sustainable investing for
 
us.
 
Our investing approaches can be summarized as follows:
Traditional investing
Sustainable investing
Sustainability focus
Impact investing
–
Targets market-rate investment returns
 
–
No explicit sustainability objectives
–
Manages sustainability and all risks related to
investment performance
–
May use sustainability-related tools, but these do
not drive the strategy
–
Targets market-rate investment returns
–
Has explicit sustainable intentions or
objectives that drive the strategy
–
Underlying investments may contribute to
positive sustainability outcomes through
products, services and / or proceeds
–
Targets market-rate investment returns
–
Has explicit intentions to generate
measurable, verifiable, positive sustainability
outcomes
–
Impact attributable to investor action and /
or contribution
›
Refer to the Supplement to this report, available at
 
ubs.com/sustainability-reporting
, for more information about ESG integration
and exclusion
The legacy
 
Credit Suisse
 
sustainable
 
investment
 
framework
1
 
(the SIF)
 
continues to
 
be in
 
operational
 
use for
 
portfolios
that have
 
not been
 
fully onboarded to
 
the UBS
 
product shelf.
 
This framework
 
will be
 
phased out over
 
time and
 
in line
with integration
 
progress, without
 
any bearing
 
on our established
 
sustainable investing
 
approach and
 
governance. We
no longer report Group-level invested assets information
 
associated with the SIF, as the migration is ongoing.
Sustainable financing
Our
 
sustainable
 
financing
 
instruments
 
are
 
governed
 
by
 
our
 
Sustainable
 
Finance
 
Guideline,
 
which
 
is
 
part
 
of
 
the
sustainability and climate risk
 
policy framework. The guideline
 
defines criteria for labeled financing
 
instruments (e.g. for
marketing or promotion
 
purposes).
The main financing instruments we offer to our clients include green,
 
sustainable, sustainability-linked and social bonds.
All are
 
subject
 
to specific
 
criteria,
 
aligned to
 
commonly
 
used industry
 
and market
 
standards (e.g.
 
those
 
issued
 
by
 
the
International
 
Capital Market
 
Association
 
(ICMA),
 
the Loan
 
Market
 
Association
 
(LMA), the
 
Loan Syndication
 
&
 
Trading
Association (LSTA), the Asia Pacific Loan Market Association
 
(APLMA)) and regulatory requirements such as the EU Green
Bond Standard (EuGB).
›
Refer to “Key terms and definitions” in the “Appendix
 
3 - Other supplemental information” section of
 
this report and to the
“Sustainability and climate risk policy framework“ section
 
of the Supplement to the UBS Group Sustainability
 
Report 2024,
available at
ubs.com/sustainability-reporting
, for our definitions of sustainable bonds and
 
loans
Meeting diverse needs
 
We serve a
 
broad range of
 
clients across our
 
four main business
 
divisions. The
 
table below provides
 
an illustrative overview
of sustainable finance products and services offered to clients by each of those divisions. While a
 
good illustration of the
breadth of products and services available to clients across UBS’s business
 
activities, it is not an exhaustive representation
of our sustainable finance and investing
 
offering, which varies by jurisdiction,
 
booking center and client domicile,
 
and is
also subject to client eligibility and preference considerations. Not all products and services are available to all clients and
/ or in all regions.
1
The SIF was established in 2020 and is utilized to classify investment solutions in an effort to seek consistency and set minimum
 
standards across different asset classes, locations and regulatory regimes.
Classification can also help match clients’ interests with relevant investment solutions. The
 
SIF classification does not supersede any regulatory commitment, nor does it determine or indicate whether an investment
solution will be labeled as “sustainable” (or any other such term) under any given regulatory regime.
 
The SIF focuses on:
 
Exclusion: positions assessed not to be significantly involved in controversial business fields or incidents;
Integration: positions assessed to be integrating ESG into their strategy;
Thematic: positions assessed to be in alignment with specific United Nations Sustainable Development Goals (the SDGs); and
Impact: positions assessed to be explicitly and intentionally contributing toward specific SDGs.
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Supporting opportunities
 
74
A sustainable finance offering for all our clients
Investing
Financing
Research, advisory, data analytics,
platforms and other services
Global Wealth Management
–
Sustainable discretionary mandates
–
Sustainable modules for traditional
discretionary mandates
–
Sustainable investing solutions for
advisory mandates
–
Sustainable separately managed
accounts (SMA)
1
–
Sustainable public market investment
funds (actively managed and
indexed)
–
Sustainable private market funds
(including infrastructure and real
estate)
–
Sustainable hedge funds
–
Sustainable structured products
–
Direct investments in sustainable
equities and bonds
–
Real-estate-related
financing
2
–
Sustainable investing research and
thought leadership
–
Sustainability reporting
–
Philanthropy solutions
–
Renovation journey, tools,
partnerships and ecosystems
2
Personal & Corporate
–
Sustainable discretionary mandates
–
Sustainable modules for traditional
discretionary mandates
–
Sustainable public market investment
funds (actively / passively managed)
–
Sustainable private market funds
(including infrastructure and real
estate)
–
Real-estate-related financing
–
Green, social, sustainability
and sustainability-linked
bonds
 
–
Sustainability-linked loans
–
Sustainable deposits solution
 
–
Carbon footprint sizing
–
Renovation journey, tools,
partnerships and ecosystems
–
Sustainability reporting and analysis
–
Sustainability research and thought
leadership
–
Philanthropy solutions
Investment Bank
–
Thematic sustainability-related
products (e.g. carbon, climate)
–
Green, social, sustainability
and sustainability-linked
bonds
–
Green, social, sustainability
and sustainability-linked
loans
–
ESG advisory
–
ESG research
Asset Management
–
Sustainable separately managed
accounts (SMA)
1
–
UBS sustainable public market funds
(actively managed and indexed)
–
UBS sustainable private market funds
(including infrastructure and real
estate)
–
UBS sustainable hedge funds
–
Sustainable mandate solutions
(actively managed and indexed)
–
Sustainability thought leadership
–
Sustainability analytics and reporting
for clients (standardized and
customized)
Disclaimer: Sustainable offering varies by jurisdiction, booking center and client domicile and is subject to client eligibility and preferences.
 
Not all products and services are available to all clients.
1
 
Clients booked in the US.
 
2
Clients booked in Switzerland.
 
›
Refer to the “Basis of preparation”
 
section of the Supplement to the UBS Group Sustainability
 
Report 2024, available at
ubs.com/sustainability-reporting
, for details on products that are included in sustainable product
 
metrics
 
Developments in 2024
 
–
Our total sustainable investing invested assets reached USD
 
296bn, representing an increase of 5% year on year.
1
–
The sustainable investing portion of our total invested assets
 
was 4.9%
(2023: 6.3%).
2
–
 
In the Investment Bank, we facilitated
 
96 green, social, sustainability or sustainability-linked
 
(GSSS) bond transactions
globally (2023: 102).
3
–
 
We are the second
 
-largest manager of
 
open-ended funds and
 
exchange-traded funds (ETFs)
 
by sustainable investing
invested assets, using Morningstar’s classification.
 
1
 
Figures do not include invested assets classified under the Credit Suisse SIF but include invested assets
 
of Credit Suisse portfolios, which have been migrated
 
onto UBS platforms and vetted against UBS’s sustainable
investing policies or merged with existing UBS sustainable investing portfolios. This process
 
is being carried out in waves and will continue until at least the end of 2025.
2
 
In line with the progressing integration,
 
for 2024 we report the share
 
of sustainable investing assets as
 
a percentage of UBS Group total
 
invested assets. For
 
2023, we report the sustainable investing
 
proportion of
UBS AG total invested assets, excluding any invested assets booked by and for
 
Credit Suisse AG.
3
These metrics include transactions meeting the UBS Sustainable Finance Guideline, as described in the ”Sustainability and climate risk policy framework“ section of the Supplement to this report, available at supported by strong market performance in the third quarter.
ubs.com/sustainability-reporting.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Supporting opportunities
 
75
Sustainable investing
Sustainability-oriented
 
public
 
market
 
funds
 
recorded
 
a
 
new
 
high
 
of
 
USD 3.2trn
1
 
as
 
of
 
the
 
end
 
of
 
December
 
2024,
Europe remains by far the largest market, with an 84%
market
 
share.
 
European
 
investors
 
also
 
continued
 
to
 
allocate
 
the
 
most
 
into
 
sustainability-oriented
 
funds
 
and
 
ETFs,
although
 
the
 
volume
 
of
 
inflows
 
decelerated
 
compared
 
to
 
previous
 
years.
 
Higher
 
interest
 
rates
 
continued
 
to
 
drive
allocations into global
 
fixed income and
 
money market investments in
 
2024, supporting demand
 
for sustainable investing
fixed income funds, which attracted the majority of sustainable
 
investing inflows last year.
2
While sustainability-oriented funds and ETFs
 
continued to attract net inflows
 
in 2024, they were
 
outpaced by inflows into
traditional products
 
for the
 
first time
 
since 2021.
 
In our
 
view, this
 
was largely
 
driven by
 
the relatively
 
small number
 
of
available sustainable
 
fixed income
 
products as
 
compared to
 
equity products
 
specifically for
 
private and
 
retail investors.
Ongoing developments in terms of
 
sustainable investment product regulations
 
and classifications led to
 
continued fund
renaming
 
and
 
reclassifications
 
in
 
the
 
industry,
 
further
 
blurring
 
the
 
line
 
between
 
sustainability-oriented
 
and
 
traditional
investment products
 
offered in
 
the market
 
and allocated
 
by investors.
 
Furthermore,
 
in recent
 
years, some
 
jurisdictions
have developed
 
rules restricting
 
the consideration
 
of sustainability
 
factors in
 
investment and
 
business decisions.
 
Under
these
 
anti-ESG
 
rules,
 
companies
 
that
 
are
 
perceived
 
as
 
boycotting
 
or
 
discriminating
 
against
 
certain
 
industries
 
may
 
be
restricted
 
from
 
doing
 
business
 
with
 
certain
 
governmental
 
entities.
 
Sustainability-oriented
 
investments
 
are
 
and
 
will
continue to be adversely affected by these existing and
 
upcoming rules.
In
 
addition
 
to
 
public
 
market
 
funds,
 
sustainable
 
investments
 
into
 
alternative
 
asset
 
classes,
 
including
 
hedge
 
funds,
 
real
estate
 
or
 
infrastructure,
 
continued
 
with
 
strong
 
momentum
 
throughout
 
the
 
year.
 
According
 
to
 
Preqin,
3
 
the
 
share
 
of
sustainable investing products
 
in private market
 
fundraising reached an
 
all-time high of
 
21% in 2024, through
 
the end
of April.
 
Sustainability
 
remains
 
a
 
key
 
consideration
 
for
 
our
 
clients.
 
According
 
to
 
the
 
2024
 
UBS
 
Billionaire
 
Ambitions
 
Report,
4
representing opinions
 
from billionaires
 
with a combined
 
wealth of USD
 
14trn, the percentage
 
of respondents investing
for impact has more than doubled over the past 10 years,
 
rising from 13% to 28%.
 
In addition to investing considerations, our clients are increasingly incorporating
 
sustainability aspects from an operating
business perspective. Investors and companies are
 
acutely aware that sustainability in general and
 
topics such as climate
and nature have real-world
 
impacts on their
 
financial performance (e.g. the availability
 
of natural resources such
 
as water,
physical climate risks
 
or supply chain
 
resilience) and are
 
actively looking to
 
address these
 
topics. According to
 
the 2024
UBS Global
 
Family Office
 
report,
5
 
more than
 
half (57%)
 
of family
 
offices with
 
an operating
 
business are
 
either already
taking sustainability
 
considerations into
 
account or
 
planning to
 
do so
 
in the
 
future. Echoing
 
this, almost
 
half (49%)
 
of
respondents say that
 
finding the right
 
approach to addressing
 
the net-zero
 
transition and reducing
 
emissions will be
 
of
key importance to their operating businesses over the next
 
one to three years.
 
Over the course
 
of 2024,
 
our sustainable investing
 
invested assets rose
 
to USD 296bn
 
as of 31
 
December 2024, compared
with USD
 
282bn at
 
the end
 
of 2023,
 
representing a
 
year-on-year increase
 
of 5%.
 
The positive
 
growth benefited
 
from
market performance
 
and Credit
 
Suisse integration-related
 
impacts, partially
 
offset by
 
foreign exchange
 
effects and
 
net
new money
 
outflows. Sustainable
 
investing invested
 
assets accounted
 
for 4.9%
 
of UBS
 
Group total
 
invested assets
 
at
year-end 2024.
The table below provides additional detail on sustainable investing
 
invested assets for UBS.
Sustainable investments
1
For the year ended
% change from
USD bn, except where indicated
31.12.24
31.12.23
31.12.22
31.12.23
UBS Group invested assets
6,086.8
5,714.1
3,980.9
7
Sustainable investing invested assets
2,3,4,5
Sustainability focus
276.1
259.8
234.0
6
Impact investing
20.3
21.8
19.2
(7)
Sustainable investing invested assets
296.4
281.6
253.2
5
Sustainable investing proportion of UBS Group invested assets (%)
6
4.9
6.3
6.4
 
1
 
The table above
 
details UBS Group’s
 
sustainable investing invested
 
assets and the
 
evolution thereof.
 
This table does
 
not contain invested
 
assets classified under
 
the Credit Suisse
 
SIF.
 
UBS sustainable investing
invested assets contain invested assets of Credit Suisse portfolios which have been migrated onto UBS platforms and vetted against UBS’s
 
sustainable investing policies or merged with existing UBS SI portfolios. This
process is being
 
carried out in
 
waves and will
 
continue until at least
 
the end of 2025.
 
The Credit Suisse
 
integration-related impact to
 
sustainable investing invested
 
assets in 2024
 
was approximately USD
 
9bn, of
which USD 8.2bn in Asset Management and USD 0.7bn in Global Wealth
 
Management.
 
2
 
For additional detail on UBS's sustainable investment definition
 
and categories, see section “Our approach to sustainable
finance” above.
 
3
 
Certain products have been reclassified during 2024 for reasons including, but not limited to, an evolving regulatory environment, periodic monitoring of the product shelf, and developing internal
classification standards. The impact of these
 
reclassifications on sustainable investing invested
 
assets was immaterial in 2024.
 
4
 
Invested assets reported as
 
sustainable investing include limited amounts
 
of instruments
not classified as sustainable
 
investments. This includes cash and cash-like instruments
 
that each fund and
 
portfolio holds for liquidity
 
management purposes, as well as
 
client-directed investments included in sustainable
investing mandates managed
 
by UBS Asset
 
Management.
 
5
 
2024 figures exclude
 
USD 13.2bn of
 
invested assets relating
 
to Global Wealth
 
Management’s US
 
business that are
 
undergoing additional validation
procedures to ensure alignment with internal UBS frameworks and standards. Prior periods have been restated to exclude USD 10.6bn and USD 12.9bn as of 31 December 2023 and 31 December 2022, respectively.
 
6
 
In line with the progressing integration, for 2024 we report the share of sustainable investing assets as a percentage of UBS Group total invested
 
assets. For 2023, we report the sustainable investing proportion of
UBS AG total invested assets, excluding any invested assets booked by and for
 
Credit Suisse AG.
 
1
Morningstar. Figures as published by Morningstar using their Sustainable Investing framework
 
and definitions.
2
Morningstar, Global Sustainable Fund Flows: Q3 2024 in Review.
3
 
Preqin, ESG in Alternatives 2024.
4
 
UBS, Billionaire Ambitions report 2024.
5
 
UBS, Global Family Office report 2024.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Supporting opportunities
 
76
Sustainable financing
In sustainable
 
financing
 
markets, global
 
thematic sustainable
 
bond markets
 
(comprising
 
green,
 
social, sustainable
 
and
sustainability-linked bonds,
 
jointly referred
 
to as
 
labeled bonds)
 
saw issuance
 
volumes increase
 
by 16%
1
 
year on
 
year,
nearly reaching the
 
record level achieved
 
in 2021,
 
which at
 
the time
 
strongly benefited from
 
COVID-related supply factors.
Sovereign, Supranational
 
and Agency
 
(SSA) issuers
 
remain the
 
largest source
 
of labeled
 
bond issuance,
 
accounting for
38% of supply in
 
2024. Green bond
 
issuance continues to
 
dominate with a 12%
 
year-on-year increase,
 
accounting for
58% of total labeled bonds priced in 2024.
The number of bond transactions facilitated by UBS Investment
 
Bank in 2024 remained strong at 96 (2023: 102).
2
Labelled transactions facilitated by UBS
1
For the year ended
% change from
USD bn, except where indicated
31.12.24
31.12.23
31.12.22
31.12.23
Total labelled transactions
Number of green, social, sustainability, and sustainability-linked (GSSS) bond deals
96
102
77
(6)
Total deal value of green, social, sustainability, and sustainability-linked (GSSS) bond deals
56.0
53.7
47.6
4
UBS-apportioned deal value of above
12.4
12.8
9.8
(3)
 
of which climate-related transactions
Number of green, sustainability and sustainability-linked bond deals
85
93
69
(9)
Total deal value of green, sustainability and sustainability-linked bond deals
48.1
49.3
42.4
(2)
UBS-apportioned deal value of above
 
11.2
11.6
8.8
(3)
1
 
These metrics
 
include transactions
 
meeting the
 
UBS Sustainable
 
Finance Guideline,
 
as described
 
in the
 
”Sustainability and
 
climate risk
 
policy framework“
 
section of
 
the Supplement
 
to this
 
report, available
 
at
ubs.com/sustainability-reporting. For 2023 figures, UBS performed an assessment for Credit Suisse green, social, sustainability and sustainability-linked bonds and in the UBS Sustainability Report 2023 included those
deemed to be aligned to UBS sustainable bond guidelines.
1
Bloomberg (all values in this paragraph).
2
These metrics include transactions meeting the UBS Sustainable Finance Guideline, as described in the ”Sustainability and climate risk policy framework“ section of the Supplement to this report, available at Building on our unrivaled global scale and footprint in wealth management, with invested assets exceeding USD 4.1trn,
ubs.com/sustainability-reporting.
 
 
Sustainability Report 2024
| Supporting opportunities
 
77
Global Wealth Management
we aim to help private clients and family offices achieve their
 
sustainability objectives in line with their targeted financial
performance.
 
We
 
do
 
this
 
via
 
an
 
end-to-end
 
research-driven
 
investment
 
value
 
chain.
 
The
 
starting
 
point
 
is
 
dedicated
sustainability-focused investment research,
 
including strategic asset
 
allocation, thematic and
 
asset-class views, which
 
then
translates
 
into high-conviction instrument selection and advice.
 
This approach aims to
 
provide insights for clients
 
about sustainability risks and
 
opportunities and how
 
to consider them
within a
 
portfolio
 
context.
 
These research
 
views
 
inform
 
our sustainable
 
and
 
impact investing
 
solutions, which
 
include
multi-asset investment portfolios and a suite of advisory options across
 
equities, bonds and alternative investments.
 
Integration of Credit Suisse
The
 
acquisition
 
of
 
the
 
Credit
 
Suisse
 
Group
 
offers
 
Global
 
Wealth
 
Management
 
several
 
opportunities
 
to
 
enhance
 
our
existing
 
sustainable
 
investing
 
offering
 
with
 
potentially
 
complementary
 
capabilities
 
and
 
resources.
 
These
 
opportunities
include tools
 
designed
 
to enhance
 
transparency
 
and reporting
 
on
 
the
 
sustainability
 
characteristics
 
of investments
 
and
portfolios,
 
and
 
bringing
 
selected
 
Credit
 
Suisse
 
sustainable
 
and
 
impact
 
investing
 
solutions
 
onto
 
the
 
merged
 
platform.
These solutions will
 
be subject
 
to existing Global
 
Wealth Management
 
sustainable investing frameworks,
 
diligence and
instrument selection
 
approaches. Deviations
 
in these approaches
 
were identified
 
in 2023,
 
with findings
 
integrated into
the
 
migration
 
throughout
 
2024
 
and
 
going
 
into
 
2025.
 
We
 
will
 
phase
 
out
 
dual
 
governance
 
during
 
the
 
migration
 
of
solutions, clients and
 
assets, with the
 
aim of aligning
 
under the existing
 
Global Wealth Management sustainable
 
investing
governance.
 
2024 highlights
–
Our clients’ impact investing assets reached USD 10.5bn
 
(2023: USD 11.2bn).
1
–
Our clients’ discretionary assets
 
aligned to a
 
sustainable investing strategic asset
 
allocation reached USD 20.6bn (2023:
USD 21.8bn).
2
Delivering actionable investment insights
 
The
 
Global
 
Wealth
 
Management
 
Chief
 
Investment
 
Office
 
(CIO)
 
identifies
 
actionable
 
sustainability-related
 
investment
opportunities,
 
including
 
strategies
 
across
 
real
 
assets
 
(renewables
 
infrastructure),
 
shareholder
 
engagement,
 
carbon
markets,
 
sustainable
 
bonds
 
and
 
thematic
 
areas
 
such
 
as
 
the
 
blue
 
economy,
 
the
 
energy
 
transition(s)
 
and
 
artificial
intelligence (AI).
 
We publish
 
a regular
 
series of sustainable
 
investment views,
 
including a monthly
Sustainable Investing
Perspectives
 
series
 
and
 
longer-term-focused
 
quarterly
Sustainable
 
InSights
 
and
Sustainable
 
Investing
 
in
 
Charts
publications.
 
Furthermore, we extensively addressed implications
 
for sustainable investing stemming from
 
the elections that took
 
place
in 2024, including in the EU and the US, and
 
from international debates, including UN
 
Climate Week 2024, COP29 and
COP16. We
 
also enhanced
 
the methodology
 
underpinning the
 
CIO Sustainability
 
Scores for
 
issuers, which
 
now covers
approximately 13,000
 
issuers, informs
 
our investment
 
process within
 
specific strategies
 
and enables
 
issuer-, fund-,
 
and
portfolio-level transparency to be delivered
 
to clients by addressing controversies and their materiality
 
across industries.
The underlying sustainable investing research views
 
are integrated into the CIO House
 
View and are accompanied, where
relevant, by media such as videos or podcasts to facilitate
 
client reach and accessibility.
Building sustainable portfolios
Our flagship cross-asset
 
sustainable investing portfolio –
 
based on our CIO bespoke
 
sustainable investing strategic
 
asset
allocation (SI SAA)
 
– continued to deliver
 
competitive financial performance.
 
This was supported
 
by allocations to
 
high-
quality bonds
 
across
 
the multilateral
 
development bank
 
and thematic
 
sustainable fixed
 
income strategies,
 
and by
 
ESG
leader equities. We
 
also introduced
 
a dedicated
 
tactical allocation
 
to investments
 
linked to AI
 
as part of
 
our thesis that
AI is a key enabler for sustainable solutions.
 
Changes in our
 
clients’ sustainable investing invested
 
assets reflect private investors’
 
broad concerns
 
about capital market
performance
 
outside
 
of
 
the
 
US
 
technology
 
sector
 
and
 
the
 
slower-than-expected
 
interest
 
rate
 
cuts,
 
which
 
are
 
yet
 
to
positively impact small- and medium-sized
 
companies. The latter represent
 
a meaningful share of sustainable
 
portfolios.
In addition, the change in
 
our clients’ impact investing assets reflect the
 
return of capital to investors
 
in our earlier private
market impact investing solutions, which have now started
 
to mature.
1
Figures do not include invested
 
assets classified under the
 
Credit Suisse SIF but
 
include invested assets
 
of Credit Suisse portfolios
 
that have been migrated
 
onto UBS platforms and
 
vetted against UBS’s
 
sustainable
investing policies or merged with existing UBS sustainable investing portfolios.
 
This process is being carried out in waves and
 
will continue until at least the end of 2025. The impact
 
on the 2024 changes is negligible.
Figures include limited amounts of instruments not classified as sustainable investment, including cash and cash-like instruments
 
that each portfolio holds for liquidity management purposes.
2
 
Figures include some Credit Suisse discretionary
 
mandates that are managed according to
 
the sustainable investing SAA and
 
are included in the UBS
 
Global Product Catalogue (GPC) while
 
still being booked in
 
the
Credit Suisse systems. The
 
amount attributed to these products in
 
2024 was USD 1.7bn. 2024 figures
 
exclude USD 0.6bn of invested assets
 
relating to Global Wealth Management’s
 
US business that are undergoing
additional validation procedures to ensure alignment with internal
 
UBS frameworks and standards. Year
 
-end 2023 values have been restated to exclude USD 0.7bn.
 
Figures include limited amounts of instruments not
classified as sustainable investment, including cash and cash-like instruments that each portfolio holds for liquidity management purposes, as well as client-directed investments included in sustainable investing Providing investment solutions for climate, nature and social challenges
mandates.
 
Sustainability Report 2024
| Supporting opportunities
 
78
In 2024, Global Wealth Management continued to increase the number of investment
 
solutions across asset classes and
strategies to support clients’ decarbonization objectives. Included among the
 
new climate solutions we launched were a
multi-thematic climate-change-focused equity module
 
and the Macquarie Energy Transition
 
Infrastructure Fund,
 
a clean
energy infrastructure solution. We also continued our credit research
 
coverage of individual green bonds, expanding the
available universe
 
for clients
 
who prefer
 
direct investments
 
to fund
 
solutions. These
 
complement our
 
existing solutions
offering and investment tools that allow for building customized and
 
bespoke allocations. Examples include using water
consumption and
 
pollution and
 
waste data
 
to address
 
nature-related
 
risks and
 
opportunities
 
in single
 
stock and
 
bond
portfolios.
 
We
 
continue to
 
explore
 
ways
 
to develop
 
nature-related
 
products
 
and solutions
 
in
 
our wealth
 
and asset
 
management
businesses.
 
In
 
2024,
 
we
 
launched
 
the
 
UBS
 
Rockefeller
 
Ocean
 
Engagement
 
Fund
 
in
 
a
 
collaborative
 
approach
 
with
Rockefeller Asset Management. It
 
seeks to provide financial
 
returns and positive impact
 
by engaging with
 
companies that
address ocean health
 
issues. This complements our
 
existing strategies that focus
 
on nature drivers, such
 
as the UBS
 
Future
of Earth fund.
Within social investments, we continued to
 
raise capital for the UBS
 
Gender Equality ETF, which builds on
 
our partnership
with index provider Solactive and expert data
 
provider Equileap. In addition, in 2024
 
our clients in the Americas had the
opportunity
 
to
 
invest
 
in
 
early-stage
 
education
 
technologies
 
and
 
affordable
 
housing,
 
alongside
 
other
 
impact
 
investing
solutions. This
 
complements our
 
advancement in
 
social investing,
 
where we
 
previously raised
 
USD 1bn of
 
client assets
toward
 
oncology
 
research.
 
In
 
2024,
 
we
 
saw
 
some of
 
these
 
innovative
 
therapies
 
advance
 
in their
 
stages
 
of regulatory
approval, leading to potentially broader applications in the
 
future.
Educating our clients and their advisors
 
An important part of
 
the advice we provide is
 
supporting our clients, prospective clients and
 
advisors with timely research
and education on sustainable investing.
 
Given the rapidly evolving environment around
 
sustainability and investments, it is crucial
 
for advisors to stay up to date
on industry trends, regulatory developments and investment ideas. During 2024, we continued to engage with advisors,
for example through the regular
 
Let’s Talk SI events for
 
Global Wealth Management product
 
and client-facing staff. We
have accelerated training programs for our client-facing
 
staff. For example, approximately 400 of our Asia Pacific
 
Global
Wealth Management employees have benefited from certified
 
training from the University of Zurich.
 
We supplement this
with Lunch and Learn
 
events to discuss
 
topical interests, to
 
ensure sustainable investing
 
remains relevant even
 
after the
training.
Our educational work with investors has also
 
continued to evolve. We conduct dedicated Next Generation and
 
Emerging
Successors client sessions
 
on sustainable and
 
impact investing. Sustainable
 
investing is also
 
integrated into many
 
of our
core flagship
 
client events,
 
with a
 
focus on
 
actionable
 
investment ideas.
 
It is
 
also featured
 
in our
 
Global Family
 
Office
Forums
 
and
 
Philanthropy
 
Roundtable
 
events.
 
In
 
addition,
 
in
 
Asia
 
Pacific,
 
we
 
introduced
 
a
 
new
 
format
 
of
 
CIO-driven
investor engagements, in collaboration
 
where relevant with our
 
Chief Sustainability Office and
 
Investment Bank, covering
specific themes
 
such as
 
carbon removals
 
or impact
 
investing portfolio
 
construction. In
 
the US,
 
we hosted
 
an event
 
on
“Standing Up for the
 
Planet: Conversation with women focused
 
on solutions to climate change”
 
in addition to dedicated
discussions
 
on
 
“Seeking
 
alpha:
 
Integrating
 
a
 
Gender-lens
 
in
 
Climate
 
Investing”
 
(during New
 
York
 
Climate
 
Week)
 
and
roundtables on affordable housing.
›
Refer
to ubs.com/global/en/wealth-management/sustainable-investing
 
for more information about Global Wealth Management’s
sustainable investing insights
›
Refer to the UBS Group Annual Report 2024, available
 
under “Annual reporting” at
ubs.com/investors
 
for more information about
the overall business and financial profile of Global
 
Wealth Management as important context for the product
 
and financial
information provided here
›
Refer to the “Supporting opportunities” section
 
of this report for more information about the proportion
 
of sustainable
investment assets as part of our total invested assets In our home market, we aim to be the most progressive financial institution when it comes to providing sustainable and
 
 
Sustainability Report 2024
| Supporting opportunities
 
79
Personal & Corporate Banking
sustainability-linked financial advice and
 
solutions. We are
 
well-positioned to capture transition
 
finance opportunities and
contribute to the decarbonization ambitions of our clients.
Integration of Credit Suisse
We formally completed
 
the merger of
 
UBS Switzerland
 
AG and Credit
 
Suisse (Schweiz) AG
 
on 1 July 2024,
 
marking an
important milestone.
 
The merger
 
of the
 
Swiss legal
 
entities facilitated
 
the ongoing
 
migration of
 
clients and
 
operations
from
 
Credit
 
Suisse
 
platforms
 
to
 
UBS
 
platforms,
 
following
 
business
 
and
 
client-
 
and
 
product-specific
 
requirements.
 
The
transfer of Swiss-booked Credit Suisse banking relationships and
 
products to UBS systems is planned for
 
2025 and 2026.
We are monitoring the integration
 
of sustainability-related activities and
 
products of former Credit
 
Suisse (Schweiz) AG,
ensuring compliance with the UBS Sustainable Finance
 
Guideline.
2024 highlights
–
The sustainable investing products share of clients’ investment assets (excluding cash deposits
 
and savings) in Personal
Banking stood at 43.4% (2023: 46.5%).
1
–
The total on-balance sheet drawn exposure of sustainable
 
loans granted to corporate and institutional clients booked
on the UBS Switzerland AG platform amounted to USD
 
2.0bn as of the end of 2024 (excluding mortgages).
2
Private clients
Assisting our clients in meeting their sustainability ambitions remained a focus in 2024. Our clients continued to allocate
to
 
sustainable
 
investment
 
solutions
 
during
 
the
 
year,
 
facilitated
 
by
 
access
 
to
 
relevant
 
product
 
offerings
 
such
 
as
 
a
sustainable savings account, sustainable investment funds and sustainable pension
 
solutions via our mobile banking app,
UBS key4. In addition, clients who use UBS key4 banking can
 
also track the CO
2
 
footprint of their account transactions.
Corporate and institutional clients
We support companies on three
 
levels. Firstly,
 
we integrate sustainability into
 
strategic client dialogues, taking a
 
holistic
view
 
of
 
a
 
client’s
 
business
 
operations.
 
This
 
includes
 
identifying
 
key
 
business
 
drivers
 
and
 
obstacles,
 
assessing
 
relevant
regulations and understanding the expectations
 
of customers, employees, investors and civil society.
Secondly, we provide
 
practical solutions tailored
 
specifically to a company’s
 
needs. Smaller businesses
 
that have not
 
yet
addressed sustainability
 
can benefit
 
from simple and
 
cost-effective tools,
 
such as the
 
online platform esg2go
 
or energy
management consulting from EnAW (Energie-Agentur der Wirtschaft – Energy Agency of the Economy). More advanced
companies, which already have anchored sustainability in their corporate strategy and publish a sustainability report, can
leverage sustainable financing options.
 
Thirdly, we promote partnerships
 
that extend beyond traditional
 
banking, such as in
 
the area of cyber security.
 
Our
UBS
Marketplace
 
platform offers
 
access to
 
a variety of
 
services that,
 
among others,
 
support companies on
 
their journey toward
greater sustainability. Additionally,
 
through sector-specific regional
 
client roundtables, we
 
aim to
 
provide a
 
platform where
challenges
 
and
 
opportunities
 
related
 
to
 
sustainability
 
can
 
be
 
discussed
 
among
 
clients
 
and
 
best
 
practices
 
shared
 
in
 
a
targeted manner and facilitated by us.
Introducing sustainability-linked loans for commodity trade
 
finance and corporate clients
Following the successful
 
launch of sustainability-linked loans
 
for multinational corporations in
 
2023, in 2024
 
we launched
sustainability-linked loans
 
(bilateral and syndicated
 
loans) for commodity
 
trade finance
 
and corporate clients
 
(small and
medium-sized enterprises). We closed several
 
such transactions. For example, we became
 
the banking partner of choice
for Retripa,
 
a leading
 
Swiss company
 
specializing in
 
waste disposal
 
and recycling,
 
and we
 
were appointed
 
as the
 
bank
partner
 
of
 
choice
 
by
 
neustark,
 
the
 
ETH
 
Zurich
 
university
 
spin-off
 
and
 
start-up
 
specializing
 
in
 
the
 
petrification
 
of
atmospheric CO₂ in recycled concrete.
Continuing to support investing needs of institutional clients
 
Swiss pension funds and insurance companies are aiming to increase their sustainable investments. To
 
support this goal,
we are offering tailored
 
sustainable investment solutions made available
 
by Asset Management. In addition, we
 
provide
these clients with
 
innovative reports
 
that offer extensive
 
transparency about
 
their portfolio with
 
regard to
 
sustainability
aspects.
1
Products booked on Credit Suisse platforms are not included as
 
they have not been migrated onto UBS platforms and
 
vetted against UBS sustainable investing policies or merged with
 
existing UBS sustainable investing
portfolios.
2
Loans booked on the Credit Suisse platform are not within the scope of this metric. As Credit Suisse loans migrate to the UBS infrastructure, due diligence against the UBS sustainable product guidelines framework properties in a climate -transition-friendly manner.
will be performed.
 
Sustainability Report 2024
| Supporting opportunities
 
80
Swiss real estate
We
 
further
 
developed
 
our
 
Swiss
 
real
 
estate
 
offering
 
to
 
support
 
clients
 
who
 
are
 
renovating
 
and
 
refurbishing
 
their
Examples are listed below, including the launch of new products and
the creation of new partnerships.
 
UBS Loan Green
With the
 
rollout
 
of
 
this
 
new
 
product,
 
we
 
aim
 
to
 
support
 
sustainability
 
in
 
investment
 
and
 
commercial
 
properties.
 
It
 
is
designed
 
for
 
clients
 
who
 
are
 
planning
 
new
 
low-energy
 
constructions
 
or
 
energy-efficient
 
renovations
 
or
 
purchasing
energy-efficient
 
properties.
 
The
 
product
 
provides
 
tailored
 
financing
 
and
 
expert
 
advice
 
and
 
accepts
 
various
 
building
certifications. In addition,
 
we support our
 
clients with
 
a contribution
 
to the cost
 
of securing
 
a building certification
 
,
 
up
to a maximum amount of CHF 4,000 per client.
The power of partnerships
In 2024, we started to offer a new Switzerland
 
-wide advisory solution, UBS Renovation Service,
 
with Wincasa,
 
a leading
Swiss
 
property
 
service
 
provider,
 
to
 
incentivize
 
more
 
sustainable
 
renovation
 
of
 
buildings
 
in
 
the
 
country.
 
The
 
solution
supports owners of investment properties throughout an entire renovation project, offering tailored advice, construction
coordination and financing services from a
 
single source with the focus on safeguarding
 
the property’s long-term value.
Moreover, through our new partnership
 
with Norm Technologies AG,
 
a provider of innovative digital
 
solutions, we offer
homeowners a digital and
 
easy-to-use energy analysis
 
and a concrete
 
roadmap for sustainable
 
renovation. In just a
 
few
steps, clients can order a tailor-made digital energy certificate
 
by uploading the relevant basic data about their property.
 
›
Refer to the UBS Group Annual Report 2024, available
 
under “Annual reporting” at
ubs.com/investors
 
for more information about
the overall business and financial profile of Personal &
 
Corporate Banking as important context for the
 
product and financial
information provided here
 
 
›
Refer to the “Supporting opportunities” section
 
of this report for more information about the proportion
 
of sustainable
investment assets as part of our total invested assets of sustainable investing expertise, we continue to offer a range of strategies and customized solutions
 
 
 
 
Sustainability Report 2024
| Supporting opportunities
 
81
Asset Management
With over
 
20 years
1
that aim
 
to deliver
 
sustainable outcomes
 
alongside financial
 
returns. Our
 
sustainable investing
 
capabilities cover
 
active
and passive styles
 
of investing and
 
span asset classes.
 
There is rarely
 
a one-size-fits-all
 
solution for clients,
 
which is why
we incorporate
 
a variety
 
of approaches.
 
These include
 
active ownership,
 
impact-
 
and transition-focused
 
strategies. We
integrate
 
data
 
science
 
into
 
our
 
sustainable
 
investing
 
processes
 
to
 
drive
 
innovation
 
and
 
create
 
more
 
efficient
 
alpha
opportunities.
 
Integration of Credit Suisse
Significant progress was
 
made in 2024 as
 
part of the
 
integration of Asset
 
Management (Credit Suisse).
 
We continue to
align our governance structures and
 
policies and are bringing
 
together our processes and
 
teams to enhance collaboration
and
 
leverage
 
our
 
combined
 
strengths.
 
We
 
have
 
successfully
 
onboarded
 
the
 
initial
 
migration
 
waves
 
of
 
Credit
 
Suisse
products onto the UBS shelf.
In 2025, we will continue progressing in our integration and with the onboarding of Credit Suisse products into the UBS
portfolio.
 
Our
 
focus
 
remains
 
on
 
client
 
portfolios
 
in
 
terms
 
of
 
the
 
delivery
 
of
 
sustainability
 
and
 
investment
 
outcomes,
creating opportunities and expanding client offerings where
 
possible thanks to our combined organization.
2024
 
highlights
–
Supporting our clients
 
to achieve their
 
sustainable investing goals:
 
20% of Asset
 
Management’s fund offering
2
 
globally
will be sustainable
 
investing products, providing
 
choice for
 
clients. At the
 
end 2024, 23.4%
 
of Asset Management’s
fund offering consisted of sustainable investing products.
–
At
 
the
 
end
 
of
 
2024,
 
Asset
 
Management
 
managed
 
sustainable
 
investing
 
invested
 
assets
 
of
 
USD 220.4bn
 
(2023:
USD 203.4bn).
3
–
At the
 
end of
 
2024, Asset
 
Management had
 
49 (2023:
 
35) net-zero
 
ambition portfolios
 
available for
 
clients with
 
a
combined invested assets value of USD 64.4bn (2023: USD
 
35.5bn).
4
–
Asset Management actively engaged
 
with 321 companies on
 
sustainability-related topics. Of the
 
total of 473
 
meetings
undertaken on
 
sustainability-related topics,
 
300 included
 
dialogue regarding
 
environmental and
 
social issues
 
(2023:
373 companies, 536 total meetings and 304 meetings on
 
environmental and social issues)
–
Asset Management’s corporate
 
engagements with investee
 
companies on sustainability-related topics
 
achieved 66.7%
positive progress against preset objectives (2023: 56.5%).
Our sustainable investing offering
Asset Management has
 
a broad sustainable
 
investing product shelf
 
that includes traditional
 
and alternative
 
funds, ETFs
and mandates with broad sustainability
 
and climate orientations. Examples of such
 
products include strategies that invest
in climate solutions, the energy transition, infrastructure debt,
 
green real estate and more. To meet
 
our client preferences
and demand we constantly review our suite of sustainability
 
and climate-related portfolios.
Notable climate-related offering developments in 2024
 
We
 
expanded
 
our
 
offering
 
in
 
the
 
net-zero
 
fixed
 
income
 
space
 
to
 
cover
 
both
 
corporate
 
and
 
sovereign
 
issuers.
 
We
partnered
 
with
 
Bloomberg
 
to
 
create
 
The
 
Bloomberg
 
Global
 
Treasury
 
Net
 
Zero
 
Progress
 
Index,
 
a
 
net-zero
 
sovereign
progress index. This methodology
 
served as the
 
benchmark index to
 
convert two of
 
our existing funds
 
to net-zero-aligned
strategies: the
 
UBS (CH)
 
Investment Fund
 
– Bonds
 
Global ex
 
CHF Government
 
Net Zero
 
Ambition Index,
 
and the
 
UBS
(CH) Investment Fund – Bonds Global Corporate Climate
 
Aware Hedged NSL.
We added two
 
low-carbon ETFs
 
to support the
 
preferences of
 
clients that wish
 
to reduce carbon
 
emissions in
 
their ETF
investments: the UBS (Irl) ETF plc – MSCI Canada ESG Universal
 
Low Carbon Select UCITS ETF, and the UBS (Irl)
 
ETF plc –
S&P
 
500
 
Climate
 
Transition
 
ESG
 
UCITS
 
ETF.
 
These
 
strategies
 
target
 
investee
 
companies
 
reducing
 
carbon
 
emission
intensities alongside exclusions in fossil fuel extraction and
 
thermal coal power.
 
1
 
UBS Asset Management (Americas) Inc. started its first sustainability strategy in 1997.
 
2
Measured over a three-year rolling period. The
 
scope includes traditional and alternative funds
 
sponsored and managed by Asset Management. Mandates,
 
white label, Asset Management single investor
 
and feeder
funds are excluded. As of 2024, products managed by Credit Suisse Asset Management that are categorized in accordance with the legacy Credit Suisse SIF are within the scope of the
 
total number of funds but not the
total number of UBS Asset Management sustainable
 
investing funds. They will
 
only be included once migrated onto
 
UBS Asset Management product shelves,
 
i.e. once corresponding data has been
 
onboarded to UBS
systems, they are fully
 
meeting the requirements of UBS’s
 
Group Sustainable Investing Policy,
 
and are classified as a
 
UBS sustainable investing product.
 
This process is being
 
carried out in waves
 
and will continue at
least until the end of 2025.
3
Figures do not include invested
 
assets classified under the
 
Credit Suisse SIF but include
 
invested assets of Credit
 
Suisse portfolios that have
 
been migrated onto
 
UBS platforms and vetted
 
against UBS’s sustainable
investing policies or merged with existing UBS sustainable investing portfolios. This
 
process is being carried out in waves and will continue at least until the end of 2025. The
 
Credit Suisse integration-related impact to
sustainable investing invested assets in 2024 was
 
USD 8.2bn. Invested assets reported as sustainable investing
 
include limited amounts of instruments not classified
 
as sustainable investments. This includes
 
cash and
cash-like instruments that each fund and portfolio holds for liquidity management purposes,
 
as well as client-directed investments included in sustainable investing mandates.
4
Credit Suisse portfolios are in the process of being assessed in the context of the Asset Management's Net Zero Alignment Framework to identify portfolios with a net-zero ambition and are therefore not reflected in Other offering developments in 2024
the reported metrics.
 
Sustainability Report 2024
| Supporting opportunities
 
82
We
 
expanded our
 
range of
 
sustainability-related
 
options across
 
our ETFs
 
strategies in
 
fixed income
 
and equities.
 
New
launches included the UBS
 
(Irl) ETF plc –
 
EUR Ultra-Short Bond ESG
 
UCITS ETF,
 
the UBS (CH) Investment
 
Fund – Equities
Switzerland
 
Small
 
&
 
Mid
 
Cap
 
ESG
 
Passive
 
II,
 
and
 
the
 
UBS
 
(Irl)
 
ETF
 
plc
 
–
 
MSCI
 
Emerging
 
Markets
 
ex
 
China
 
Socially
Responsible
 
UCITS
 
ETF.
 
These
 
strategies
 
require
 
investee
 
companies
 
to
 
exceed
 
minimum
 
ESG
 
rating
 
thresholds
 
and
minimize or exclude exposure to companies involved in activities that include
 
tobacco production, controversial weapons
and severe ESG controversies.
Active ownership
 
In
 
2024,
 
we
 
continued
 
our
 
programs
 
of
 
engagement
 
with
 
investee
 
companies,
 
focusing
 
on
 
outcomes
 
that
 
benefit
companies, their shareholders and
 
wider society. During the year,
 
we expanded our
 
approach to escalation actions
 
where
engagements
 
are
 
making
 
insufficient
 
progress
 
including
 
two
 
instances
 
where
 
we
 
participated
 
in
 
the
 
co-filing
 
of
shareholder resolutions. Some highlights from the perspective of our specific environmental
 
and social engagements are
included below.
Climate
In the sixth
 
year of our
 
climate engagement program,
 
we expanded the scope
 
from six carbon intensive
 
sectors to include
financial institutions.
 
Beyond decarbonization
 
and transition
 
planning,
 
we are
 
also
 
engaging with
 
companies
 
on their
plans to build resilience and adapt to chronic
 
physical risks and extreme weather events.
Social
 
We engage
 
with investee
 
companies on
 
social topics
 
in three
 
focus areas:
 
human capital,
 
human rights
 
and health.
 
In
our
 
human
 
rights
 
engagements,
 
we
 
focus
 
on
 
worker
 
safety
 
in
 
vulnerable
 
regions,
 
responsible
 
wage
 
levels,
 
working
conditions
 
under extreme
 
heat
 
and flooding,
 
and
 
just
 
transition
 
for
 
workers
 
exposed
 
to climate
 
change
 
transition.
 
In
these
 
areas
 
we
 
also
 
worked
 
through
 
the
 
Investor
 
Alliance
 
on
 
Human
 
Rights
 
and
 
FAIRR.
 
In
 
our
 
human
 
capital
engagements,
 
we
 
broadened
 
our
 
focus
 
to
 
include
 
both
 
gender
 
diversity
 
and
 
other
 
diversity
 
issues
 
with
 
a
 
view
 
to
enhancing the innovation
 
capability of companies.
 
We also engaged
 
on human capital
 
development for AI
 
and human
resources challenges.
 
In our health
 
engagements, we
 
observed good progress
 
on company disclosure,
 
and we focused
on the strategic direction of healthier products,
 
in part by working through the Access to Nutrition
 
investor network.
›
Refer to the “Environment” section of this report for
 
more information about the climate program
 
Impact measurement
 
Asset Management
 
has formed
 
a
 
collaboration
 
with the
 
Sustainable
 
Development
 
Investments
 
Asset Owner
 
Platform
(SDI
 
AOP) to
 
develop
 
impact
 
measurement
 
metrics
 
that
 
may
 
be used
 
for
 
listed
 
equity
 
and fixed
 
income
 
portfolios.
 
In
2024,
 
Asset
 
Management
 
contributed
 
proprietary
 
models
 
to
 
the
 
initiative
 
in
 
order
 
to
 
accelerate
 
the
 
development
 
of
datasets that can inform investment decisions and help set
 
a market standard for outcomes reporting.
›
Refer to the UBS Group Annual Report 2024, available
 
under “Annual reporting” at
ubs.com/investors
, for more information
about the overall business and financial profile of
 
Asset Management as important context for the
 
product and financial
information provided here
 
›
Refer to the “Supporting opportunities” section
 
of this report for more information about the proportion
 
of sustainable
investment assets as part of our total invested assets The Investment Bank offers clients global advice and access to the world’s primary, secondary and private capital markets.
 
 
Sustainability Report 2024
| Supporting opportunities
 
83
Investment Bank
 
 
In 2024, we continued to hone our
 
capabilities through initiatives across Global
 
Markets, ESG Research, Global Banking
and data-led offerings.
2024 highlights
–
We facilitated 96 GSSS bond transactions globally (2023: 102).
1
–
The Investment Bank retained first place in GSSS bond issuance
 
in Brazil.
2
–
 
We successfully completed two pilot transactions on the
 
Carbonplace platform.
Global Research
In
 
2024,
 
ESG
 
Research
 
delivered
 
thematic
 
reports
 
on
 
topics
 
including:
 
nuclear
 
energy;
 
the
 
EU,
 
US
 
and
 
Asia
 
Pacific
sustainability-related
 
regulatory
 
landscape; views
 
on the
 
ESG and
 
sustainable investing
 
landscape; advanced
 
recycling;
biomass; and
 
desalination.
 
More generally,
 
through
 
our research
 
we addressed
 
ways in
 
which ESG
 
factors connect
 
to
individual
 
markets,
 
sectors
 
and
 
companies
 
in
 
our
 
coverage.
 
ESG
 
research
 
is
 
supported
 
by
 
UBS
 
Evidence
 
Lab,
 
which
provides data-driven insights into ESG-relevant questions, and by UBS HOLT, which provides a clear, objective framework
for comparing and valuing over 20,000 companies worldwide.
Global Markets
Within
 
Global
 
Markets,
 
our
 
capabilities
 
include
 
developing
 
products
 
and
 
solutions
 
that
 
aim
 
to
 
support
 
our
 
clients
 
in
accessing carbon
 
credits
 
(i.e.
 
emission
 
allowance,
 
reduction
 
and
 
/ or
 
removal)
 
and thematic
 
exposure
 
to sustainability
sectors.
 
In
 
2024,
 
we
 
successfully
 
completed
 
two
 
pilot
 
transactions
 
on
 
the
 
Carbonplace
 
platform,
 
a
 
carbon
 
credit
transaction network
 
we co-founded in
 
2022 as part
 
of a consortium
 
of nine banks.
 
We will continue
 
to drive adoption
of the platform and advance our carbon portfolio trading
 
offering to clients.
 
We
 
have
 
also
 
focused
 
on
 
establishing
 
the
 
groundwork
 
for
 
green
 
structured
 
issuance,
 
blended
 
finance,
 
emission
allowances and project-based carbon removals financing offerings. Building out this product suite is an
 
important step in
offering clients ESG-aligned investment solutions
 
alongside the more traditional product
 
set, particularly as it enables us
to demonstrate our origination capabilities.
 
In
 
this
 
area,
 
we
 
can
 
differentiate
 
ourselves
 
meaningfully
 
from
 
competitors
 
through
 
our
 
collaboration
 
with
 
the
 
UBS
Optimus Foundation and our Chief Sustainability Office, with many leading non-governmental organizations and project
developers
 
across
 
the
 
climate
 
and
 
nature
 
sectors.
 
It
 
is
 
critical
 
that
 
we
 
realize
 
our
 
ambitions
 
by
 
concentrating
 
on
 
the
opportunities our
 
clients will
 
find compelling.
 
That will
 
require us
 
to continue
 
increasing the
 
level of
 
engagement with
clients and to drive more product innovation in 2025.
›
Refer to the “Driving social impact” section of
 
this report for more information about UBS Optimus
 
Foundation
 
1
These metrics include transactions meeting the UBS Sustainable Finance Guideline, as described in the ”Sustainability and climate risk policy framework“ section of the Supplement to this report, available at Our Global Banking teams, leveraging the expertise of the Corporate Shareholder Advisory group (“CSA”), supported
ubs.com/sustainability-reporting.
 
2
Bloomberg.
 
 
Sustainability Report 2024
| Supporting opportunities
 
84
Global Banking
 
 
our clients globally by assessing their sustainability profile from the point of view of investors and other stakeholders and
linking these profiles to investor demand and valuation.
2024 deal highlights
–
Financial advisor
 
to a
 
US-based manufacturing
 
company in
 
connection with
 
a spin-off
 
of its
 
power, renewables
 
and
electrification subsidiary.
 
Global Banking
 
helped the
 
company navigate
 
the ESG
 
market and
 
regulatory trends
 
in the
EU, assessed the
 
subsidiary’s positioning with ESG
 
funds by developing
 
an equity story featuring
 
sustainability to target
investor demand, and identified strategic merger and acquisition
 
and growth activities.
 
–
Global coordinator for the USD 2.7bn follow-on green equity offering of a Brazilian water and sanitation company on
the
 
Sao
 
Paulo
 
Stock
 
Exchange
 
(B3).
 
The
 
company
 
is
 
the
 
first
 
outside
 
Europe
 
to
 
be
 
granted
 
a
 
“green
 
equity”
designation, defined in Brazil by
 
the B3 exchange, with
 
100% of its revenues and
 
96% of its capex defined
 
as green
by S&P Cicero.
Leveraged and debt capital markets
 
The Investment Bank arranged USD 56.0bn
1
 
GSSS financing through 96 bond deals
 
during 2024 (2023: USD 53.7bn and
102
 
deals).
 
We
 
continued
 
to
 
solidify
 
our
 
market-leading
 
position
 
in
 
the
 
Swiss
 
franc-denominated
 
market,
 
with
 
the
Investment Bank’s market
 
share at 31%.
2
 
Next to
 
Switzerland, our
 
transaction activity in
 
the GSSS bond
 
market continued
to be particularly strong in Australia and Brazil. In Australia,
 
we led nine SSA Australian dollar-denominated
 
transactions
in 2024.
Among
 
these
 
key
 
transactions,
 
we
 
structured
 
and
 
executed
 
the
 
Australian
 
government’s
 
inaugural
 
AUD
 
7bn
 
green
treasury
 
bond, the
 
first to
 
be launched
 
from its
 
green bond
 
program as
 
part of
 
its wider
 
sustainable finance
 
strategy.
Green
 
treasury
 
bonds
 
are
 
designed
 
to
 
enable
 
investors
 
to
 
back
 
public-sector
 
projects
 
that
 
drive
 
Australia’s
 
net-zero
transformation forward,
 
support environmental objectives and help finance high-quality sovereign projects with targeted
environmental outcomes.
 
They also boost the scale and credibility of the domestic green finance market while attracting
green capital to the country.
 
In July 2024,
 
our joint venture
 
in Brazil, UBS
 
BB Investment
 
Bank, acted as
 
global coordinator and
 
sustainability advisor
to a Brazilian cosmetics and personal care company on its
 
BRL 1.3bn sustainability-linked debenture. This was the largest
debt
 
instrument
 
ever
 
linked
 
to
 
the
 
Amazon.
 
Its
 
specific
 
key
 
performance
 
indicator
 
focused
 
on
 
the
 
level
 
of
 
inputs
sustainably sourced from the Amazon.
›
Refer to the UBS Group Annual Report 2024, available
 
under “Annual reporting” at
ubs.com/investors
 
for more information about
the overall business and financial profile of the Investment
 
Bank as important context for the product and
 
financial information
provided here
1
 
Total face value of GSSS financing.
2
 
Bloomberg.
 
Sustainability Report 2024
| Supporting opportunities
 
85
Group Treasury activities
In
 
2024,
 
Group
 
Treasury
 
continued
 
to
 
invest
 
its
 
high-quality
 
liquid
 
assets
 
portfolios
 
(HQLA)
 
under
 
a
 
dedicated
 
ESG
investment
 
framework.
 
This
 
framework
 
guides
 
the
 
integration
 
of
 
ESG
 
considerations
 
into
 
the
 
investment
 
process
alongside
 
more
 
traditional
 
economic
 
and
 
risk
 
dimensions.
 
The
 
framework
 
supports
 
investments
 
in
 
green,
 
social
 
and
sustainability labeled bonds.
 
At
 
the
 
end
 
of
 
2024,
 
Group
 
Treasury
 
held
 
USD 7.9bn
 
of
 
green,
 
social
 
and
 
sustainability
 
labeled
 
bonds
 
in
 
its
 
HQLA
portfolios, compared with the USD 8bn it held in 2023.
Green Funding Framework
Our Group-wide Green Funding Framework
 
sets out how we intend to
 
connect our sustainability objectives
 
with access
to financial markets through a variety of funding products.
›
Refer to
ubs.com/greenbonds
 
for more details about the UBS Green Funding Framework,
 
external reviews and annual reporting
(including impact and allocation reporting)
 
Sustainability Report 2024
| Managing sustainability and climate risks
 
86
Managing sustainability and
climate risks
Introduction
 
Managing sustainability and climate risks is a
 
key component of our corporate responsibility. We define
 
sustainability and
climate risk as
 
the risk that
 
we negatively impact
 
on,
 
or are impacted
 
by, climate change,
 
natural capital, human
 
rights
and
 
other
 
environmental
 
and
 
social
 
matters.
 
Sustainability
 
and
 
climate
 
risks
 
may
 
manifest
 
as
 
credit,
 
market,
 
liquidity,
business or non-financial risks for UBS, resulting in potential
 
adverse financial, liability or reputational impacts.
 
Group Risk Control (GRC) is
 
responsible for our firm-wide sustainability and
 
climate risk framework and the
 
management
of
 
exposure
 
to
 
sustainability
 
and
 
climate
 
(financial)
 
risks
 
on
 
an
 
ongoing
 
basis
 
as
 
a
 
second
 
line
 
of
 
defense.
 
Group
Compliance, Regulatory & Governance (GCRG) monitors the adequacy of our control environment for
 
non-financial risks
(NFR), applying
 
independent
 
control and
 
oversight.
 
We
 
manage
 
sustainability
 
and climate
 
risk within
 
a
 
dedicated
 
risk
management framework. In 2024, the UBS Group (including
 
Credit Suisse) was managed under the same framework.
Our sustainability
 
and climate
 
risk framework
 
continues to
 
evolve through
 
our multi-year
 
initiative focused
 
on meeting
regulatory requirements and enhancing core processes, such
 
as reporting and disclosures.
 
›
Refer to the “Sustainability and climate risk
 
policy framework” section of the Supplement
 
to the UBS Group Sustainability Report
2024, available at
ubs.com/sustainability-reporting,
for more information
Sustainability and climate risk management
framework
Our firm-wide sustainability and climate risk
 
management framework and related policies, standards
 
and guidelines form
the basis of our
 
management practices and
 
control principles. They
 
enable us to identify
 
and manage potential
 
adverse
impacts on
 
the climate,
 
the environment
 
and human
 
rights, as
 
well as
 
related risks
 
affecting us
 
and our
 
clients, while
supporting the transition to a low-carbon economy.
Overseen by senior management, the framework applies to
 
the balance sheet, our own operations
 
and our supply chain.
It consists
 
of four
 
different phases: (i)
 
risk identification and
 
measurement; (ii) monitoring and
 
risk appetite setting;
 
(iii) risk
management and control; and (iv) risk reporting and
 
disclosure.
›
Refer to “Our investment management approach to
 
sustainability and climate risks” in this section
 
for a description of our
sustainability and climate risk investment approach
›
Refer to the “Sustainability and climate risk policy framework” section of the Supplement to the UBS Group Sustainability Report | Managing sustainability and climate risks 87
2024, available at
ubs.com/sustainability-reporting,
for more information
 
ubsgroupsustainabilitp91i0
Sustainability Report 2024
The Group Chief Risk Officer is responsible for the development of the sustainability and climate risk framework and risk
appetite, along with its integration into existing Group frameworks. The Chief Risk Officer for Sustainability supports the
Group
 
Executive
 
Board
 
by
 
providing
 
leadership
 
on
 
sustainability
 
in
 
collaboration
 
with
 
business
 
divisions
 
and
 
Group
functions and is supported by the sustainability and climate risk unit. In addition, the Risk Committee
 
and the Corporate
Culture and
 
Responsibility
 
Committee
 
of the
 
Board of
 
Directors
 
jointly monitor
 
the
 
progress of
 
our efforts
 
to address
sustainability and climate risk.
›
Refer to the “Supplement to Governance”
 
section of the Supplement to the UBS Group Sustainability
 
Report 2024, available at
ubs.com/sustainability-reporting
, for further details on the sustainability governance
 
at UBS
 
Our
 
multi-year
 
sustainability
 
and
 
climate
 
risk
 
initiative
 
(the
 
SCR
 
Initiative),
 
launched
 
in
 
2020
 
by
 
the
 
sustainability
 
and
climate risk
 
unit, continues
 
to build
 
capacity through
 
expertise, collaboration,
 
technology and
 
data. This
 
initiative was
created
 
to
 
integrate
 
sustainability
 
and
 
climate
 
risk
 
considerations
 
into
 
our
 
traditional
 
financial
 
and
 
non-financial
 
risk
management frameworks, which address
 
these traditional risks across our
 
business divisions and legal
 
entities, in an ever-
changing regulatory environment.
In 2024,
 
the SCR
 
Initiative further
 
advanced its
 
efforts toward
 
the goal
 
of fully
 
integrating qualitative
 
and quantitative
sustainability and climate
 
risk considerations into
 
the firm’s traditional
 
risk management and
 
stress-testing frameworks.
Developments
 
in
 
2024
 
included
 
introducing
 
climate-driven
 
risk
 
analytics
 
into
 
the
 
credit
 
decision-making
 
process
 
for
selected
 
portfolios,
 
introducing
 
climate-driven
 
quantitative
 
risk
 
appetite
 
where
 
mandated,
 
developing
 
climate
 
risk-
adjusted stress models
 
and scenario analysis
 
capabilities, expanding climate risk
 
monitoring internally, and
 
further refining
processes, governance and methodologies to drive forward more comprehensive sustainability and climate risk reporting
and
 
disclosures.
 
Furthermore,
 
to
 
monitor
 
and
 
control
 
the
 
utilization
 
of
 
the
 
divisional
 
contributions
 
toward
 
the
 
2030
corporate lending
 
sector decarbonization targets,
 
a decarbonization control
 
framework has
 
been established
 
with defined
thresholds per sector and business division
 
and at a Group level.
 
These thresholds are defined annually and
 
the utilization
against the agreed thresholds is monitored on a quarterly
 
basis.
Sustainability and climate
 
risk management activities
 
conducted in 2024
 
are described below,
 
across the four
 
phases of
the sustainability and climate risk framework.
 
›
Refer to the “Supplement to Governance”
 
and “Supplement to Managing risks“ sections
 
of the Supplement to the UBS Group
Sustainability Report 2024, available at
ubs.com/sustainability-reporting,
for more details about our sustainability and climate risk | Managing sustainability and climate risks 88
policy framework
 
 
Sustainability Report 2024
Risk identification and measurement
We
 
assess
 
the
 
materiality
 
of
 
our
 
sustainability-
 
and
 
climate-driven
 
risks
 
and
 
impacts
 
on
 
an
 
annual
 
basis.
 
This
 
is
underpinned by an assessment of
 
how key risk drivers may
 
impact us through financial and non-financial
 
risks (e.g. credit
losses or reputational incidences resulting
 
in lost revenues) and
 
by assessing the proximity of
 
our activities to the
 
potential
negative impact on the environment (including climate)
 
and human rights.
We aim to identify sustainability and
 
climate risks at divisional and cross-divisional
 
levels, both through the sustainability
and
 
climate
 
risk
 
materiality
 
assessment
 
mentioned
 
above
 
and,
 
increasingly,
 
by
 
integrating
 
them
 
into
 
the
 
firm-wide
traditional risk identification and measurement processes.
 
›
Refer to the “Environment” section of this report for details
 
about our climate-related materiality assessment
 
and the underlying
methodology
 
Our risk identification
 
methodologies collectively define
 
our focus areas and
 
key risk drivers.
 
The results of
 
these efforts
contribute to our sustainability and climate risk management
 
strategy by:
 
–
identifying concentrations
 
of climate-sensitive
 
exposure that
 
may make
 
us vulnerable
 
to financial
 
and non-financial
risks, facilitating resource prioritization to enhance risk quantification
 
and subsequent management actions; and
–
supporting the implementation
 
of a
 
client-centric business strategy, in
 
which we support
 
clients with their
 
sustainability
transition and identify clients who can benefit from sustainability
 
-focused UBS products and services.
 
The outputs
 
of the
 
above process
 
supports senior
 
management in
 
taking informed
 
decisions about
 
sustainability-
 
and
climate-related risks and provides stakeholders with key information
 
through our external disclosures.
Transition risk
Climate-driven transition risks, which
 
arise from the efforts
 
to mitigate the effects
 
of climate change, may
 
contribute to
a
 
structural
 
change
 
across
 
economies
 
and
 
consequently
 
affect
 
banks and
 
the
 
stability
 
of the
 
broader
 
financial
 
sector.
These risks extend to the value of investments and may also affect
 
the value of collateral (e.g. real estate).
In
 
2024,
 
UBS
 
developed
 
a
 
transition
 
risk
 
rating
 
model
 
(TR
 
RM),
 
aligned
 
with
 
the
 
transition
 
risk
 
heatmap
 
(TR
 
H)
 
and
designed to
 
provide a
 
company-level rating
 
of transition
 
risk, where
 
input data
 
is available
 
The TR
 
RM mainly
 
relies on
two inputs:
 
(i) the
 
output of
 
the transition
 
risk heatmap
 
(TR H)
 
and (ii)
 
the Company
 
Transition Assessment
 
Scorecard
(CTAS), an
 
internal UBS
 
tool that
 
systematically categorizes listed
 
companies based on
 
publicly available
 
data from
 
external
third-party data sources into climate transition readiness categories. Whenever CTAS does not provide an assessment for
a company, the model falls back to an existing transition risk heatmap
 
(TR H).
The climate transition
 
risk profile chart
 
shows that, at
 
the end of
 
2024, the exposure
 
of the UBS
 
Group to climate-sensitive
sectors and
 
related business
 
activities has
 
decreased
 
due to
 
accelerated winddown
 
of Non-core
 
and Legacy
 
corporate
exposures.
 
Climate-driven
 
transition-risk
 
sensitive
 
exposure
 
accounted
 
for
 
17.1%
 
of
 
the
 
total
 
gross
 
lending exposure,
down from 19.2% in 2023. Key sectors contributing to sensitive exposure continues to be same as 2023 (i.e. real estate,
industrials
 
and
 
transportation).
 
Compared
 
to
 
last
 
year,
 
our
 
sensitive
 
exposure
 
to
 
Services
 
and
 
Technology
 
sector
 
has
increased, in
 
line with
 
a methodology
 
change where
 
certain business
 
activities that
 
were previously
 
rated non-sensitive
are now rated sensitive due to increased reliance on
 
artificial intelligence (AI) and data center operations requiring higher
use of power.
›
Refer to the “Supplement to Managing sustainability
 
and climate risks” and the “Basis of preparation” sections
 
of the Supplement
to the UBS Group Sustainability Report 2024, available at | Managing sustainability and climate risks 89
ubs.com/sustainability-reporting
, for details on methodologies
 
ubsgroupsustainabilitp93i0
Sustainability Report 2024
 
Sustainability Report 2024
| Managing sustainability and climate risks
 
90
Physical risk
Climate-driven physical risks arise from acute
 
hazards, which are increasing in
 
severity and frequency, and chronic climate
risks arise
 
from an
 
incrementally changing
 
climate. Climate
 
-driven physical
 
risks may
 
contribute to
 
a structural
 
change
across economies
 
and consequently
 
affect banks
 
and the
 
stability of
 
the broader
 
financial sector.
 
These risks
 
extend to
the value of investments and may also affect the value of collateral
 
(e.g. real estate).
In 2024, UBS developed a physical risk rating model (PR RM), aligned with the physical risk heatmap model
 
(PR HM). The
PR RM is designed
 
to provide a company-level
 
indication of physical
 
risk while both models
 
are designed to provide
 
the
UBS Group exposure to
 
climate-driven physical risks. The
 
PR RM and
 
PR HM measure how
 
four acute physical risk
 
hazards
(wildfires, heatwave, floods and tropical cyclones) may drive
 
physical risk of the companies.
 
The climate physical risk profile chart shows that,
 
at the end of 2024, the exposure of
 
the UBS Group to climate-sensitive
sectors and
 
related business
 
activities has
 
decreased
 
due to
 
accelerated winddown
 
of Non-core
 
and Legacy
 
corporate
exposures. Climate-driven physical-risk sensitive exposure accounted for 9.8% of the total gross lending exposure, down
from 11.7%
 
in 2023.
 
Geographically,
 
the majority
 
of the
 
sensitive exposure
 
is from
 
the Americas
 
region, followed
 
by
Switzerland and
 
other geographical
 
locations. Most
 
of the
 
year-on-year reduction
 
in sensitive
 
exposure is
 
due to
 
Non-
core and Legacy
 
exposure winddown
 
in the Americas
 
region. At Group
 
level, most of
 
the climate-sensitive
 
physical risk
exposure is located within
 
countries that have a
 
relatively high adaptive capacity
 
to manage physical risk
 
hazards resulting
in a moderately low risk
 
profile at regional level.
›
Refer to the “Supplement to Managing sustainability
 
and climate risks” and the “Basis of preparation”
 
sections of the Supplement
to the UBS Group Sustainability Report 2024, available at | Managing sustainability and climate risks 91
ubs.com/sustainability-reporting
, for details on methodologies
 
ubsgroupsustainabilitp95i0
Sustainability Report 2024
 
Sustainability Report 2024
| Managing sustainability and climate risks
 
92
Climate scenario analysis
We use scenario-based approaches to
 
assess our exposure to physical
 
and transition risks stemming from
 
climate change.
We have
 
introduced several in-house
 
assessments facilitated by
 
industry collaborations to
 
tailor approaches for
 
addressing
methodological and data
 
challenges.
 
We have utilized
 
dedicated risk models
 
incorporating systematic
 
and idiosyncratic
effects to carry out stress testing exercises covering short-,
 
medium- and long-term horizons.
The work
 
performed includes
 
regulatory scenario
 
analysis and
 
stress test
 
exercises such
 
as the
 
Bank of
 
England’s (BoE)
2021 Climate Biennial Exploratory Scenario (CBES), the 2022 Climate Risk Stress Test
 
(CST) of the European Central Bank
(the ECB),
 
which assesses
 
banks’ preparedness
 
for dealing
 
with financial
 
and economic
 
shocks stemming
 
from climate
risk; and
 
the 2024
 
Swiss Financial
 
Market
 
Supervisory Authority
 
(FINMA)
 
/ Swiss
 
National Bank
 
(SNB) climate
 
scenario
analysis exercise.
 
These exercises
 
enabled the
 
identification of
 
financial risks
 
from climate
 
change and
 
made it
 
possible
for UBS to assess management
 
actions in response to
 
different scenario results
 
and perform counterparty-level
 
analysis.
While these exercises showed mild losses and low exposure to climate risk for the entities within scope, given the limited
impact to
 
the macroeconomic financial
 
environment,
 
the analysis allowed
 
UBS to
 
enhance its climate
 
risk scenario analysis
and stress testing, further developing our capabilities for
 
assessing risks and vulnerabilities from climate change.
 
In 2024,
 
we also
 
advanced
 
our capabilities
 
surrounding internal
 
climate risk
 
scenario analysis
 
and stress
 
testing for
 
the
UBS Group. We refined and expanded our internal climate risk
 
scenarios with a focus on both transition and physical risk
projections across a 30-year time frame.
 
In addition, we developed additional climate risk
 
methodologies to enhance and
broaden portfolio coverage.
Over the last few
 
years,
 
we have also leveraged
 
industry-wide initiatives, such
 
as the Paris Agreement
 
Capital Transition
Assessment (PACTA) exercise launched by the Swiss Federal Office
 
for the Environment (FOEN) in 2020, 2022 and 2024.
Through
 
this
 
exercise,
 
we
 
assessed
 
the
 
climate
 
alignment
 
of
 
our
 
listed
 
investments
 
(including
 
equities
 
and
 
bonds),
mortgages
 
and
 
direct
 
real
 
estate
 
portfolios.
 
The
 
assessment
 
enabled
 
us
 
to
 
compare
 
our
 
results
 
with
 
the
 
aggregated
performance of all participating banks’ portfolios, showing the
 
progress made over time and the efforts still needed.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Managing sustainability and climate risks
 
93
Monitoring and risk appetite setting
Our sustainability and climate risk
 
policy framework defines the qualitative
 
and quantitative risk appetite for
 
sustainability
and climate risk and is subject to periodic updates and enhancements.
 
As part of the
 
sustainability and climate risk monitoring
 
process, we have developed methodologies and
 
metrics to assess
our continued exposure to carbon-related assets and climate-related risk-sensitive sectors. When developing our metrics,
we consider the inputs and guidance provided by standard-setting organizations,
 
as well as new or enhanced regulatory
requirements for climate
 
disclosures. In 2024,
 
we continued working
 
on methodologies covering
 
climate-driven transition
and physical risks.
 
The
 
table
 
below includes
 
climate-related
 
risk metrics
 
for
 
the
 
UBS Group
 
AG,
 
UBS AG
 
on a
 
standalone
 
basis
 
and UBS
Switzerland AG and UBS Europe SE, both on a standalone basis. The trend analysis of exposure is available starting 2023
as UBS Group exposures were reported on a consolidated
 
basis post Credit Suisse integration.
The
 
proportion of
 
the
 
UBS Group’s
 
total
 
gross
 
lending
 
exposure accounted
 
for
 
by carbon-related
 
assets
 
decreased
 
to
10.9% in
 
2024 compared
 
to 12.1%
 
in 2023.
 
The UBS
 
Group metrics
 
were reported
 
on a
 
consolidated basis
 
including
Credit Suisse exposures starting 2023.
 
Following
 
the
 
mergers
 
of
 
UBS
 
AG
 
and
 
Credit
 
Suisse
 
AG
 
in
 
May
 
2024
 
and
 
of
 
UBS
 
Switzerland
 
AG
 
and
 
Credit
 
Suisse
(Schweiz)
 
AG
 
in
 
July
 
2024,
 
the
 
total
 
gross
 
lending
 
exposures
 
of
 
UBS
 
AG
 
standalone
 
and
 
UBS
 
Switzerland
 
AG
 
have
increased due to the inclusion of legacy Credit
 
Suisse exposure. Consequently, the climate-driven transition risk, physical-
risk-sensitive exposure and carbon-related assets have increased
 
on an absolute basis, as expected.
Risk management – Climate-related metrics
For the year ended
% change from
31.12.24
31.12.23
31.12.23
Climate-related metrics (USD bn)
1, 2, 3, 4
Carbon-related assets: UBS Group AG consolidated
1, 2, 3, 4, 5, 6
76.5
93.9
(18.5)
Carbon-related assets proportion of total gross lending exposure, UBS Group
 
AG consolidated (%)
1, 2, 3, 4, 5, 6
10.9
12.1
Carbon-related assets: UBS AG (standalone)
1, 2, 3, 4, 5, 6
30.3
9.2
228.3
Carbon-related assets: UBS Switzerland AG (standalone)
1, 2, 3, 4, 5, 6
46.6
27.4
69.8
Carbon-related assets: UBS Europe SE (standalone)
1, 2, 3, 4, 5, 6
0.0
0.0
0.0
Total exposure to climate-sensitive sectors, transition risk, UBS Group AG consolidated
1, 2, 3, 4, 6, 7, 8
120.3
149.0
(19.3)
Climate-sensitive sectors, transition risk, proportion of total gross lending exposure, UBS
 
Group AG consolidated (%)
1, 2, 3, 4, 6, 7, 8
17.1
19.2
Total exposure to climate-sensitive sectors, transition risk, UBS AG (standalone)
1, 2, 3, 4, 6, 7, 8
36.6
12.8
186.4
Total exposure to climate-sensitive sectors, transition risk, UBS Switzerland AG (standalone)
1, 2, 3, 4, 6, 7, 8
83.0
49.8
66.6
Total exposure to climate-sensitive sectors, transition risk, UBS Europe SE (standalone)
1, 2, 3, 4, 6, 7, 8
0.0
0.0
0.0
Exposure to climate-sensitive sectors, transition risk, Traded products, UBS Group AG consolidated
1, 2, 3, 4, 7, 8, 9
2.1
Exposure to climate-sensitive sectors, transition risk, Issuer risk, UBS Group
 
AG consolidated
1, 2, 3, 4, 7, 8, 10
6.8
Total exposure to climate-sensitive sectors, physical risk, UBS Group AG consolidated
1, 2, 3, 4, 6,7,8
68.9
90.7
(24.0)
Climate-sensitive sectors, physical risk, proportion of total gross lending exposure, UBS
 
Group AG consolidated (%)
1, 2, 3, 4, 6, 7, 8
9.8
11.7
Total exposure to climate-sensitive sectors, physical risk, UBS AG (standalone)
1, 2, 3, 4, 6, 7, 8
65.7
52.5
25.2
Total exposure to climate-sensitive sectors, physical risk, UBS Switzerland AG (standalone)
1, 2, 3, 4, 6, 7, 8
22.6
15.1
50.0
Total exposure to climate-sensitive sectors, physical risk, UBS Europe SE (standalone)
1, 2, 3, 4, 6, 7, 8
0.0
0.0
0.0
Exposure to climate-sensitive sectors, physical risk, Traded products, UBS Group AG consolidated
1, 2, 3, 4, 7, 8, 9
3.3
Exposure to climate-sensitive sectors, physical risk, Issuer risk, UBS Group
 
AG consolidated
1, 2, 3, 4, 7, 8, 10
12.6
1
 
Methodologies for assessing climate-related risks are emerging and may change over time. As the methodologies, tools and data availability improve, we will further develop our risk identification and measurement
approaches. Lombard lending rating is
 
assigned based on the average riskiness of
 
collateral.
 
2
 
Metrics for 2023 are recalculated and restated based
 
on the 2024 methodology for comparison purpose.
 
Percentage
change is calculated based on the
 
full underlying exposure, which may result in small deviations
 
when calculated using reported figures that
 
are rounded to one decimal.
 
3
 
Over the last year, the UBS Group continued
its effort to
 
integrate Credit
 
Suisse systems
 
and data.
 
As a result,
 
the metric
 
calculation process
 
benefits from
 
data enhancement
 
even when
 
the methodology
 
remains the same
 
year on year.
 
At the same
 
time,
integration work is ongoing and expected to bring in further data alignment in future, which may require restatement of reported metrics.
 
4
 
UBS continues to collaborate to resolve methodological and industry data
challenges, and seeks to integrate both impacts to and dependencies on a changing natural and climatic environment, into how UBS evaluates its risks and opportunities.
 
5
 
As defined by the Task Force on Climate-
related Financial Disclosures (the TCFD), in its expanded definition published in
 
2021, UBS defines carbon-related assets through industry-identifying attributes of the firm’s banking book. UBS further includes the four
non-financial sectors addressed by the TCFD,
 
including, but not limited to,
 
fossil fuel extraction, carbon-based power
 
generation, transportation (air,
 
sea, rail, and auto manufacture),
 
metals production and mining,
manufacturing industries,
 
real estate development,
 
chemicals, petrochemicals,
 
and pharmaceuticals,
 
building and construction
 
materials and activities,
 
forestry, agriculture,
 
fishing, food and
 
beverage production,
including trading companies that
 
may trade any of
 
the above (e.g. oil
 
trading or agricultural commodity
 
trading companies). This
 
metric is agnostic of risk
 
rating, and therefore may
 
include exposures of companies
that may be
 
already transitioning or
 
adapting their business
 
models to climate
 
risks, unlike
 
UBS climate-sensitive sectors
 
methodology, which
 
takes a risk
 
-based approach to
 
defining material exposure
 
to climate
impacts.
 
6
 
Gross lending exposure consists of total on balance sheet loans and advances to customers and off-balance sheet guarantees and irrevocable loan commitments (within the scope of expected credit loss)
and is based on consolidated IFRS numbers (inclusive of purchase price allocation adjustments recorded in UBS Group as a result of the acquisition of Credit Suisse in compliance with IFRS 3, Business Combinations).
 
7
 
Climate-related risks are scored between 0 and 1,
 
based on sustainability and climate risk transmission channels. Risk ratings represent a range of scores
 
across five rating categories: low, moderately low, moderate,
moderately high, and high. The climate-sensitive exposure metrics are determined based upon the top three of the five rated categories, i.e.
 
moderate to high.
 
8
 
As the transition and physical risk rating models and
physical risk heatmap model are embedded
 
further into the risk management framework, we
 
may identify new use cases that
 
could trigger validation of the model for
 
identified use cases and associated enhancements.
As a consequence,
 
restatement of
 
reported metrics
 
may be required.
 
9
 
For traded
 
products, the
 
metric is
 
calculated using
 
over-the-counter (OTC)
 
derivatives, exchange-traded
 
derivatives (ETDs)
 
and securities
financing transactions (SFTs), consisting of securities borrowing and lending, and repurchase and reverse repurchase agreements.
 
10
 
For issuer risk, the metric is calculated upon HQLA assets, debt securities, bonds,
liquidity buffer securities. After the parent bank merger,
 
the issuer risk in legacy Credit Suisse entities is less than 4% of overall UBS Group and considered non-material and excluded
 
from reported metrics.
The table
 
below presents
 
a view
 
of our
 
risk profile
 
and changes
 
year on
 
year (YoY),
 
within sectors
 
and across
 
climate
risks. It first shows
 
our total exposure
 
to each sector
 
(and whether that
 
has increased
 
or decreased
 
compared to 2023),
followed
 
by
 
an
 
exposure-weighted
 
risk
 
rating.
 
The
 
table
 
also
 
shows
 
the
 
YoY
 
weighted
 
average
 
transition
 
risk
 
trend
followed by sensitive
 
exposure for
 
each of climate
 
transition risk and
 
physical risk. Overall,
 
the UBS Group
 
continues to
have an average rating of moderate for transition risk and
 
moderately low for physical risk.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Managing sustainability and climate risks
 
94
Risk exposures by sector for UBS Group
1,2,3,4,5, 6, 7
Transition risk
Physical risk
Sector / Subsector
2024
exposure
(USD bn)
YoY exposure
trend
8
Weighted average
risk rating 2024
9
YoY weighted
average risk trend
8
2024 climate-
sensitive exposure
(USD bn)
5
Weighted average
risk rating 2024
9
YoY weighted
average risk trend
8
2024 climate-
sensitive exposure
(USD bn)
5
Agriculture
Agriculture, fishing and forestry
0.93
↓
Moderate
→
0.42
Moderately low
→
0.54
Food and beverage
6.51
↓
Moderately high
→
6.51
Moderate
→
3.93
Financial services
Financial services
82.75
↓
Moderately low
→
0.03
Moderately low
→
18.85
Fossil fuels
Downstream refining, distribution
0.54
↓
Moderately high
↓
0.54
Moderately low
↑
0.26
Integrated oil and gas
0.32
→
Moderate
↓
0.32
Moderately low
→
0.00
Midstream transport, storage
0.10
↓
Moderate
→
0.10
Moderate
↑
0.10
Trading fossil fuels
6.72
→
Moderately high
→
6.72
Moderately low
→
0.73
Upstream extraction
0.24
↓
High
→
0.24
Moderately low
↓
0.02
Industrials
Cement or concrete manufacture
0.24
↓
High
→
0.24
Moderately low
→
0.03
Chemicals manufacture
3.80
↓
High
→
3.80
Moderately low
↓
1.27
Electronics manufacture
5.29
↓
Moderate
↓
4.48
Moderately low
↓
1.47
Goods and apparel manufacture
5.13
↓
Moderately high
→
5.11
Moderately low
→
2.94
Machinery manufacturing
8.04
↓
Moderately high
→
8.02
Moderately low
→
1.21
Pharmaceuticals manufacture
3.64
↓
Moderately high
→
3.64
Moderately low
↓
1.06
Plastics and petrochemicals manufacture
1.81
↓
Moderately high
→
1.81
Moderately low
↓
0.69
Metals and mining
Mining conglomerates (incl. trading)
2.83
↓
Moderately high
→
2.83
Moderately low
→
0.07
Mining and quarrying
1.10
↓
Moderate
↑
0.66
Moderately low
→
0.59
Production of metals
0.87
↓
Moderately high
→
0.87
Moderate
→
0.39
Private clients
Lombard
151.50
↓
Moderately low
→
0.00
Moderately low
→
0.00
Real estate
Development and management
11.64
↑
Moderately high
→
11.04
Moderately low
↓
0.68
Real estate financing
10
83.34
↓
Moderate
→
36.28
Moderately low
→
2.48
Private clients with mortgages
10
250.59
↓
Moderately low
→
0.00
Low
→
0.00
Services and technology
Services and technology
35.93
↓
Moderately low
→
9.31
Moderately low
→
18.85
Sovereigns
Sovereigns
2.91
↓
Moderate
↓
0.34
Moderately low
→
0.04
Transportation
Air transport
2.98
↓
Moderately high
→
2.84
Moderate
→
2.50
Automotive
1.20
↓
Moderate
↓
0.23
Moderate
→
1.08
Rail freight
0.90
↑
Low
→
0.00
Moderate
→
0.77
Road freight
1.32
↑
Moderately high
→
1.32
Moderately low
↓
0.64
Transit
0.49
↓
Moderately low
→
0.00
Moderately low
↓
0.33
Transportation parts and equipment
 
supply
1.10
↓
Moderately high
→
1.10
Moderate
→
0.64
Water transport
8.55
→
Moderately high
→
8.55
Moderately low
→
5.21
Utilities
Power generation
2.76
↓
High
↑
2.24
Moderately low
↓
1.42
Waste treatment
0.68
↓
Moderately high
→
0.68
Moderately low
↑
0.19
Not classified
11
15.07
↓
Not classified
→
0.00
Not classified
→
0.00
Grand Total
701.80
↓
Moderate
→
120.25
Moderately low
→
68.94
1
 
Methodologies for assessing climate-related risks are emerging and may change
 
over time. As the methodologies, tools, and data availability improve, we will further develop our risk identification and measurement
approaches. Lombard lending rating is assigned based on the average riskiness of loans.
 
2
 
Metrics for 2023 are recalculated and restated based on the 2024 methodology for comparison purpose.
 
3
 
Gross lending
exposure consists of total on balance
 
sheet loans and advances to customers and
 
off-balance sheet guarantees and irrevocable loan commitments (within the
 
scope of expected credit loss) and
 
is based on consolidated
IFRS numbers (inclusive
 
of purchase price
 
allocation adjustments
 
recorded in
 
UBS Group
 
as a result
 
of the acquisition
 
of Credit
 
Suisse in compliance
 
with IFRS
 
3, Business Combinations).
 
4
 
UBS continues to
collaborate to resolve methodological
 
and industry data challenges,
 
and seeks to integrate
 
both impacts to and
 
dependencies on a changing
 
natural and climatic environment,
 
into how UBS evaluates
 
its risks and
opportunities.
 
5
 
Climate-related risks are scored between 0 and
 
1, based on sustainability and climate risk
 
transmission channels. Risk ratings represent a range of scores across five
 
rating categories: low, moderately
low, moderate,
 
moderately high,
 
and high. The
 
climate-sensitive exposure
 
metrics are
 
determined based
 
upon the top
 
three of the
 
five rated
 
categories i.e.
 
moderate to
 
high.
 
6
 
Over the last
 
year,
 
UBS Group
continued its
 
effort to
 
integrate Credit
 
Suisse systems
 
and data.
 
As a
 
result, metric
 
calculation process
 
benefits from
 
data enhancement
 
even when
 
methodology remains
 
same year-on-year.
 
At the
 
same time,
integration work is ongoing and
 
expected to bring in further data
 
alignment in future which may require
 
restatement of reported metrics.
 
7
 
As transition and physical risk rating
 
models and physical risk heatmap
model are embedded
 
further into the
 
risk management framework,
 
we may identify
 
new use cases
 
that could trigger validation
 
of model for
 
identified use cases
 
and associated enhancements.
 
As a consequence,
restatement of reported metrics
 
may be required.
 
8
 
A material change in
 
the risk profile (discrete
 
risk score, weighted
 
average per sub-sector)
 
is considered as
 
>5% shift up,
 
or down year on
 
year. Similarly,
 
for
absolute exposure.
 
9
Displayed ratings represent exposure-weighted averages
 
for a given sector scope.
 
10
 
The real estate segments have been aligned
 
with the expected credit loss segments UBS
 
applies under
IFRS. Real estate financing includes rental or income-producing real estate financing
 
to private and corporate clients secured by real estate.
 
Private clients with mortgages include lending to private clients secured
 
by
owner-occupied real estate and personal account overdrafts of those clients.
 
11
Not classified represents the portion of UBS’s business activities where methodologies and data are not yet able to provide
 
a rating.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Managing sustainability and climate risks
 
95
Risk management and control
In 2024,
 
we continued
 
to develop
 
solutions to
 
integrate sustainability
 
and climate
 
risks into
 
traditional risk
 
categories,
such as our credit, market,
 
liquidity, non-financial and reputational risk frameworks. We
 
progressively enhanced our four-
stage approach (defined above in
 
the sustainability and climate risk
 
management framework) by leveraging
 
research on
how sustainability and climate
 
risk drivers may be
 
transmitted to our clients
 
(and their assets)
 
and ultimately to
 
the firm
in the form
 
of financial
 
and non-financial
 
risks. Our
 
approach supports
 
the ongoing
 
management of
 
sustainability and
climate risks as
 
they manifest
 
across traditional risk
 
categories and has
 
been built in
 
line with principles
 
outlined by the
Basel
 
Committee
 
on
 
Banking
 
Supervision
 
(the
 
BCBS)
 
and
 
the
 
Task
 
Force
 
on
 
Climate-related
 
Financial
 
Disclosures
 
(the
TCFD,
 
now
 
organized
 
under
 
the
 
ISSB).
 
As
 
Swiss
 
financial
 
regulator
 
FINMA
 
has
 
mandated
 
financial
 
institutions
 
to
implement
 
nature-related
 
financial
 
risks
 
in
 
their
 
due
 
diligence
 
processes
 
by
 
2028
 
(FINMA
 
Circular
 
2026/1
 
on
 
nature-
related
 
financial
 
risk),
 
UBS
 
is
 
building
 
its
 
capabilities
 
to
 
embed
 
the
 
management
 
of
 
these
 
risks
 
in
 
its
 
due
 
diligence
processes.
Our progress is summarized in the following table.
 
Managing sustainability and climate risks
 
within traditional risk categories
 
Traditional risk
category
 
Sustainability and climate risk
transmission channels.
Key developments
Credit risk
 
Our potential credit losses driven by
risks from a changing physical climate,
the transition to a low-carbon
economy.
Climate-related risk drivers can impact
household, corporate or sovereign
income and / or wealth. Physical and
transition risk drivers increase our
potential losses as soon as they have a
negative effect on a borrower’s ability
to repay and / or fully recover the value
of a loan in the event of default.
In 2024, we further embedded climate-related
 
risks into our credit risk management framework.
 
By collaborating
across business divisions and between both the first and second
 
lines of defense, we developed innovative
solutions tailored to the risk profiles and material drivers of
 
risk within our businesses:
 
Investment Bank:
 
The current credit-granting process has been amended to identify and
 
measure the potential for
credit losses driven by climate-related risks for corporate lending and
 
leveraged finance. At the transaction level,
this is achieved by integrating tools such as sector-level climate-related
 
risk heatmaps and company-level due
diligence scorecards into the credit approval analysis and decision-making
 
process. In addition, where mandated,
concentration triggers have been set up and are monitored and reported
 
on a quarterly basis for all relevant
counterparties. Furthermore, at the divisional level, progress has been made to enhance
 
and automate reporting of
the full Investment Bank lending portfolio, on a quarterly basis.
Global Wealth Management:
 
The current credit-granting process identifies and assess potential
 
credit losses driven
by climate-related risks for Lombard lending in Switzerland
 
and international locations by integrating climate-
related due diligence questions and leveraging the climate risk heatmaps
 
in the credit assessment at a transaction
level. The approach encompasses Lombard loans to operating companies
 
and those backed by concentrated equity
posted as collateral and we aim to further enhance the scope across
 
regions and products in future. Furthermore,
progress was made to enhance and automate reporting of
 
the combined Global Wealth Management Lombard
lending portfolio, on a quarterly basis.
Personal & Corporate Banking:
 
The current credit-granting process identifies and assesses potential
 
credit losses
driven by climate-related risks by integrating climate-related due diligence
 
questions and leveraging the climate
risk heatmaps in the credit assessment at a transaction level. This approach was rolled
 
out in 2023 to the P&C
Multinationals business and expanded in 2024 to include
 
a wider coverage of the corporate client portfolio as well
as the commodity trade finance business. Furthermore, at the divisional level progress was made to
 
enhance and
automate reporting of the combined Personal and Corporate lending portfolio, on a quarterly basis.
Market risk
(traded and
not traded)
 
Potential financial impacts on the firm
from price shifts and / or market
volatility. A changing physical
environment (including climate
change) may affect the value of
companies reliant on the natural
environment and / or how the market
perceives such companies. The
transition to a low-carbon economy
through climate policies, low-carbon
technologies, demand shifts and / or
market perception may also impact the
value of our positions and / or lead to
a breakdown in correlations between
risk factors (e.g. prompting a change
in market liquidity and / or challenging
assumptions in our model).
 
In 2024, we assessed the risk from planned portfolios, in line with our multi-year
 
sustainability and climate risk
initiative, and established solutions for integrating climate-related risks into our market risk management
framework. Progress on integrating climate-related risks into our market risk management
 
was incrementally
driven by enhancing analytical capacity, applying the climate risk rating model
 
in our market-risk monitoring
systems and developing stress testing capabilities. We have adapted our in-house
 
long-term scenarios to the
specifics of short-term market risk analytical requirements.
 
Enhancing analytical capacity:
Leveraging existing sector-level heatmap methodologies
 
and our in-house scenario
development capacity, we sought to perform a loss-driven materiality assessment.
 
By linking the risk ratings with
adverse-scenario-driven shocks, we were able to further examine the correlations
 
between risk factors and
understand the short-term loss potentials for climate. In 2024, we were
 
able to introduce a climate risk rating
model for the first time.
Automation:
Market risks systems facilitate for daily monitoring, reporting and control.
 
By integrating these with
our centralized climate sector-level heatmap together with climate
 
risk rating model, we are able to understand
and react to drivers of climate impacts on our portfolios
 
through regular assessments and monitoring.
Quantitative risk appetite:
For selected legal entities, climate risk concentration triggers were introduced in 2023
based on the sector-level climate risk heatmaps.
 
The solution facilitates daily monitoring of positions that are
considered inherently sensitive to climate risks, including an automated
 
breach escalation process along with the
market risk escalation path for concentration limits, providing an opportunity for remediation
 
actions. The triggers
cover credit delta and equity delta aggregated in accordance with the “sensitivity,” as defined through our | Managing sustainability and climate risks 96
heatmapping methodology.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
Managing sustainability and climate risks
 
within traditional risk categories
 
Liquidity risk
 
The potential impact on liquidity
adequacy is driven by risks from a
changing physical climate, the
transition to a low-carbon economy.,
Climate events have been proven to
affect funding conditions, and
therefore liquidity buffers across
broader banks. Climate-related risks
are considered an additional driver of
liquidity risk. As such, they may impact
our liquidity adequacy, directly or
indirectly, through our ability to raise
funds, liquidate assets and / or our
customers’ demand for liquidity. This
could result in net cash outflows or
depletion of our liquidity buffer.
In 2024, we further integrated climate risk into our liquidity framework
 
for planned portfolios, in line with the
multi-year sustainability and climate risk initiative. Climate risk stress
 
testing and climate risk reporting were
introduced for the first time in 2024, leveraging the heatmap and climate
 
risk rating model. The identification of
material climate-related risks and the integration of those potential
 
risks into the internal liquidity risk
management framework will be an iterative process as we continuously
 
improve the methodology, along with
improving the availability and quality of required data in the industry
 
and enhanced analytics and insights over
time.
Non-financial
risk
 
This is the non-financial impact on UBS
(compliance, operational risk and
financial crime) from inadequate or
failed internal processes, people and
systems and / or externally due to
physical climate events or stakeholder
legal action.
Alignment with the BCBS Principles for the effective
 
management and supervision of climate-related (non-
financial) risks has been key in 2024 and is subject to on-going monitoring
 
as of 2025.
 
We have completed work to embed ESG (environmental, social
 
and governance)-related risks, including climate
considerations as a standalone risk indicator to the Group non-financial
 
risk identification model governance used
as the basis for scenario coverage and non-financial risk regulatory
 
/ economic capital determination.
We will continue to evolve the framework in alignment with our commercial
 
strategy and industry expectations,
with work ongoing to assess the results of ESG risk integration
 
more broadly into non-financial risk taxonomy risk
appetite statements.
Reputational
risk
 
This is the risk of an unfavorable
perception, or a lessening of our
reputation, from the point of view of
clients, industries, shareholders,
regulators, employees or the general
public, which may lead to potential
financial losses and / or loss of market
share.
 
 
Reputational risk is considered across
all business activities, transactions and
decisions and includes sustainability-
related reputational risks, such as
greenwashing risk.
 
We continue to assess the design of our reputational risk framework
 
as generally robust in terms of roles and
responsibilities, escalation requirements, and review and approval authorities for sustainability-related
 
risks.
 
Relevant sustainability-related standards have been set, including for the
 
appropriate consideration of high
inherent reputational risks, by leveraging existing firm-wide risk identification
 
and review and approval processes.
 
Our 2030 lending sector decarbonization targets for specified
 
sectors at Group level come with agreed
contributions by the individual business divisions (BDs)
 
for the corporate lending sectors.
To monitor and control the utilization of the BDs’ contributions toward the 2030
 
corporate lending sector
decarbonization targets, a decarbonization control framework was operationalized in 2024,
 
with defined
thresholds per sector and business division and at Group
 
level. These thresholds are defined annually and the
utilization against the agreed thresholds is monitored on a quarterly
 
basis.
Additionally, a material transaction, as defined in the credit approval process, within in-scope business activities
 
is
subject to the pre-deal assessment process. The first line of defense is responsible for
 
identifying and referring an
in-scope transaction to the second line of defense sustainability
 
function for a detailed assessment. Based on
 
the
calculated utilization level, a transaction is subject to the defined
 
approval path.
We manage and escalate
 
material climate-related risks,
 
in accordance with our
 
standard financial and
 
non-financial risk
processes and
 
defining key responsibilities
 
and tools,
 
both at the
 
Group level
 
and across our
 
business divisions. To
 
facilitate
the implementation
 
of consistent risk
 
management practices
 
across the Group,
 
we have
 
conducted climate-risk-related
training for employees across the business divisions and Group functions.
 
Sustainability Report 2024
| Managing sustainability and climate risks
 
97
Risk reporting and disclosure
Sustainability and climate
 
risk considerations are
 
an integral part
 
of topics included
 
in our quarterly
 
risk reporting cycle.
Information exchanged during this process includes the number of transactions referred to the sustainability and climate
risk
 
unit
 
with
 
outcomes
 
and
 
underlying
 
reasons,
 
and
 
an
 
associated
 
breakdown
 
by
 
category.
 
The
 
report
 
includes
information on
 
exposure to
 
climate-sensitive sector
 
activities (our
 
climate-related risk
 
heatmaps and
 
climate risk
 
rating
models), leveraging
 
a fully
 
automated
 
process. The
 
heatmaps and
 
climate rating
 
models are
 
also included
 
in quarterly
internal risk reports for key legal entities and business divisions.
 
For external climate-related
 
risk reporting, we
 
have prepared our
 
annual disclosures
 
across the key
 
areas recommended
by the Task Force on Climate-related Financial Disclosure.
The automated reporting
 
capabilities for
 
climate-related risk
 
were enhanced to
 
include combined
 
(legacy- UBS
 
and legacy-
Credit Suisse)
 
Group-wide climate
 
risk views
 
for internal
 
and external
 
reporting. In
 
addition, the
 
outputs of
 
the CRRM
have been implemented
 
to generate year-end
 
2024 metrics for further
 
granularity. Internal and
 
external climate-related
risk metrics will continue to evolve in the coming years, as a part of
 
our sustainability and climate risks roadmap, to meet
regulatory expectations and ensure leading practices in this area.
›
Refer to the “Sustainability and climate risk policy framework” section of the Supplement to the UBS Group Sustainability Report | Managing sustainability and climate risks 98
2024, available at
ubs.com/sustainability-reporting,
for more information
 
Sustainability Report 2024
Our investment management approach to
sustainability and climate risks
Assessing climate-related financial risks in client portfolios
As a global financial
 
institution, we help
 
our clients navigate
 
the challenges of the
 
transition to a
 
low-carbon economy.
We address
 
this by
 
establishing
 
climate
 
risk monitoring
 
and management
 
systems across
 
our Asset
 
Management
 
and
Global Wealth
 
Management
 
business divisions,
 
offering innovative
 
products and
 
services in
 
investment and
 
financing,
and providing transparent reporting and disclosures.
We strive to integrate
 
climate-related financial risk
 
considerations into our
 
decision-making and
 
processes pertaining to
services, strategies
 
or products
 
offered or
 
employed by
 
third parties,
 
including delegates.
 
In doing
 
so, we
 
demonstrate
our commitment to
 
implementing the recommendations
 
of the Task
 
Force on Climate
 
-related Financial Disclosures
 
(the
TCFD). We perform
 
climate risk
 
assessments on
 
discretionary portfolios
 
managed in
 
Singapore and
 
in-scoped collective
investment
 
schemes
 
managed
 
in
 
Hong
 
Kong,
 
respectively,
 
in
 
line
 
with
 
the
 
Monetary
 
Authority
 
of
 
Singapore
 
(MAS)
Guidelines on Environmental Risk Management for Asset Managers and
 
the Securities and Futures Commission of Hong
Kong (SFC) Climate Risk regulations.
 
We also disclose portfolio risk
 
across climate scenarios in the
 
UK, in line with TCFD
recommendations.
›
Refer to the “Specific climate risk disclosure for
 
client investment assets in Singapore and Hong
 
Kong” section and to the “UK
climate and sustainability disclosures” section of the Supplement
 
to the UBS Group Sustainability Report 2024, available
 
at
ubs.com/sustainability-reporting,
for more information
 
We
 
work
 
across
 
our
 
industry
 
and
 
with
 
our
 
clients,
 
ensuring
 
they
 
have
 
access
 
to
 
best
 
practice,
 
robust
 
science-based
approaches, standardized methodologies and quality data for
 
measuring and mitigating climate risks.
In the following sections,
 
we outline the UBS approach to
 
quantifying climate risk in clients’ assets
 
as well as how climate
risk information is applied to Asset Management and Global
 
Wealth Management.
Quantifying climate risk: data and metrics
In
 
order
 
to
 
evaluate
 
climate
 
risks
 
at
 
issuer
 
level,
 
we
 
utilize
 
physical
 
and
 
transition
 
climate
 
risk
 
data
 
from
 
various
 
data
providers.
 
Physical
 
climate
 
risk
 
arises
 
from
 
the
 
impact
 
of
 
weather
 
events
 
and
 
long-term
 
or
 
widespread
 
environmental
 
changes.
Higher levels of
 
physical risks imply
 
higher probability
 
of an issuer
 
or direct assets
 
being impaired
 
in value. Our
 
physical
risk assessment considers
 
the potential impact
 
of extreme climate
 
events on an
 
issuer’s assets or
 
our direct assets,
 
with
each physical risk score representing a sensitivity-adjusted,
 
weighted average of risk scores linked to all associated assets
across different climate hazards, such
 
as heat / cold waves, water stress,
 
flooding, sea level rises, hurricanes,
 
wildfires and
drought.
Transition risk arises
 
from the process
 
of adjusting to
 
an environmentally sustainable
 
economy, including changes
 
in public
policies,
 
disruptive
 
technological
 
developments
 
and
 
shifts
 
in consumer
 
and investor
 
preferences.
 
One
 
of the
 
ways we
assess transition
 
risk
 
is
 
by
 
using
 
a
 
“carbon
 
earnings
 
at
 
risk” approach,
 
which
 
analyzes
 
the
 
unpriced
 
carbon
 
cost
 
to a
company as a
 
percentage of its
 
earnings before interest,
 
taxes, depreciation and
 
amortization (EBITDA).
 
We see carbon
earnings at risk as one of the more directly quantifiable and comparable metrics across industries globally, which is more
suitable for reflecting the reach and complexity of our investments.
For both physical and transition
 
risks, the projections are
 
typically built upon publicly reported
 
company data, restricting
coverage
 
to
 
corporate
 
issuers,
 
which
 
form
 
the
 
bulk
 
of
 
our
 
public
 
markets
 
portfolios.
 
Consequently,
 
exposures
 
to
sovereigns or structured products, for example, are not covered
 
at this point.
Climate risk data remains an evolving area, and best practice standards or norms are still being developed. This results in
acknowledged limitations in data coverage and
 
quality, such as issuer
 
type and the use
 
of proxy or estimation
 
techniques.
Financial models also typically
 
project up to three
 
years into the future,
 
with significant deterioration
 
in visibility beyond
one year. As such, long-term projections used to generate
 
data, even for 2030, may have limited accuracy.
We work closely with our
 
data providers to continuously
 
enhance the scope and quality
 
of data available to us.
 
Climate
risk data
 
continued to
 
improve over
 
2024, including,
 
for example,
 
improved financial
 
integration and
 
market-adjusted
carbon price
 
assumptions. As
 
our data
 
providers continue
 
to improve
 
on their
 
data methodology
 
and coverage,
 
in line
with industry best practice, these changes may be reflected
 
in climate risk analytics on the client portfolios we
 
manage.
 
Sustainability Report 2024
| Managing sustainability and climate risks
 
99
Application in Asset Management
Asset Management’s
 
ESG
 
(environmental,
 
social
 
and
 
governance)
 
integration
 
approach
 
identifies
 
climate-related
 
risks
and
 
opportunities
 
that
 
can
 
be
 
applied
 
in
 
managing
 
existing
 
investment
 
strategies
 
and
 
constructing
 
new
 
portfolios.
Portfolio construction criteria are
 
applied based on the intended
 
objectives of the given strategy.
 
Portfolios are classified
based
 
on
 
their
 
sustainability
 
characteristics,
 
including
 
sustainability-related
 
key
 
performance
 
indicators
 
and
 
minimum
sustainability safeguards. Exclusion criteria address elevated sustainability risks and the
 
scope of portfolios to which such
exclusions
 
are
 
applied
 
is
 
described
 
in
 
the
 
Asset
 
Management
 
exclusion
 
policy.
 
The
 
investment
 
policies
 
in
 
fund
documentation
 
describe
 
the
 
extent
 
to
 
which
 
a
 
strategy
 
targets
 
particular
 
risk
 
or
 
opportunity
 
outcomes.
 
Asset
Management
 
discloses
 
various
 
climate-related
 
metrics
 
in
 
line
 
with
 
the
 
TCFD’s
 
Supplemental
 
Guidance
 
for
 
Asset
Managers. We publish aggregated figures for total emissions, carbon footprint and
 
weighted average carbon intensity in
the “Environment” section of this report. Asset
 
Management includes disclosure of portfolio-level metrics for sustainable
investment portfolios in its fund factsheets and in client reporting.
 
In
 
Asset
 
Management,
 
our
 
overall
 
strategy
 
for
 
managing
 
climate
 
risks
 
is
 
to
 
integrate
 
risk
 
data
 
and
 
insights
 
into
 
our
investment management
 
processes. In
 
our public
 
markets investments,
 
this begins
 
with assessing
 
ESG issues
 
based on
our ESG
 
material issues
 
framework.
 
This identifies
 
the most
 
relevant issues
 
by sector,
 
making the
 
connection with
 
key
value drivers that may
 
impact the investment
 
thesis across sectors.
 
Our ESG material
 
issues framework reflects
 
a sector-
based view of exposures to
 
physical and transition climate risks. Our
 
climate risk assessment also uses issuer-level
 
physical
risk data
 
for a
 
range of
 
climate hazards,
 
and transition
 
risk data
 
assessing exposure
 
to changes
 
in carbon
 
pricing. This
assists with identifying issuers with higher levels
 
of risk, which are then subjected to
 
qualitative assessment,
 
including the
location and business
 
segments at risk,
 
and mitigation,
 
including board oversight,
 
company risk assessment,
 
mitigation
and adaptation actions, and
 
engagement with suppliers,
 
customers and local stakeholders.
 
This climate risk assessment
is an
 
additional
 
consideration
 
in the
 
overall
 
assessment
 
of the
 
sustainability
 
performance
 
of the
 
issuer,
 
which
 
informs
investment decisions.
In our Global Real Assets business,
 
we consider key transition risks using our proprietary,
 
in-house ESG dashboard,
 
which
assesses the
 
environmental performance of
 
directly controlled
 
real estate assets
 
against pathways
 
and targets.
 
Assessment
of
 
transition
 
risk
 
using
 
the
 
International
 
Energy
 
Agency
 
framework
 
is
 
applied
 
for
 
some
 
of
 
our
 
direct
 
infrastructure
investments. On
 
the physical
 
risk side,
 
for our
 
direct investments
 
in both
 
real estate
 
and infrastructure,
 
we use
 
a third-
party
 
location
 
risk
 
intelligence
 
tool
 
to
 
analyze
 
asset-level
 
physical
 
risk.
 
We
 
also
 
use
 
third-party
 
data
 
to
 
inform
 
our
assessment of physical risk in our indirect real estate investments.
 
These tools identify each asset’s potential physical risks
under a variety of climate change scenarios and timelines.
Active ownership
The
 
transition
 
of
 
investment
 
portfolios
 
will
 
require
 
real-economy
 
emission
 
reductions.
 
We
 
see
 
our
 
active
 
ownership
strategy as a powerful tool in influencing corporate and
 
other stakeholder behavior to achieve real-economy
 
outcomes.
 
Asset
 
Management
 
has
 
had
 
a
 
dedicated
 
climate
 
engagement
 
program
 
in
 
place
 
for
 
more
 
than
 
five
 
years,
 
addressing
climate-related
 
risks
 
in
 
companies,
 
with
 
measurable
 
progress
 
tracked.
 
It
 
covers
 
high-emitting
 
companies
 
in
 
our
 
listed
equity and
 
corporate bond
 
universe, taking
 
into account
 
a range
 
of sectors
 
and geographies.
 
This includes
 
companies
from the oil and gas, electricity and other utilities, metals and mining, construction materials, and chemicals sectors. The
program
 
is
 
focused
 
on
 
driving
 
ambitious
 
and
 
credible
 
transition
 
strategies
 
across
 
portfolio
 
holdings.
 
It
 
covers
 
climate
governance, targets, transition plans
 
and relevant business model
 
objectives. Since the start
 
of our engagement
 
program,
we have increased the
 
range of our
 
expectations to include more
 
ambitious emissions reduction target setting,
 
quantified
disclosures on
 
decarbonization
 
actions, capital
 
deployment
 
in line
 
with a
 
net-zero pathway,
 
and reporting
 
of progress
toward stated commitments.
 
In our Global Real Assets business we typically hold a majority in our direct real assets, and thus it is possible to
 
positively
influence
 
outcomes
 
through
 
active
 
ownership;
 
this
 
includes
 
collaboration
 
with
 
tenants,
 
third-party
 
companies,
employees, communities
 
and other
 
stakeholders (via,
 
for example,
 
green lease
 
clauses, tenant
 
satisfaction surveys
 
and
tenant reach-outs)
 
to drive
 
and achieve
 
emission reductions
 
and other
 
climate risk
 
mitigations. Where
 
we do
 
not have
control,
 
we
 
actively
 
engage
 
with
 
owners
 
and
 
stakeholders
 
to
 
address
 
climate-related
 
risks
 
and
 
monitor
 
progress
accordingly. This
 
engagement
 
includes physical
 
risk exposure
 
and mitigation,
 
transition plans,
 
disclosures and
 
net-zero
alignment.
Application in Global Wealth Management
Our overall
 
investment
 
decision-making
 
process
 
is largely
 
driven
 
from the
 
top. Although
 
corporate-level
 
data
 
sourced
from
 
S&P
 
Global
 
has
 
been
 
chosen
 
for
 
Global
 
Wealth
 
Management
 
portfolios,
 
given
 
its
 
credibility,
 
complexity
 
and
coverage, this bottom-up dataset cannot be
 
directly integrated into Global Wealth
 
Management’s investment processes
without the use of significant aggregation and proxies.
 
Considering the above, at this point in time climate
 
risk analyses
are not used to inform investment decisions at either the asset allocation or the instrument selection levels within Global
Wealth
 
Management,
 
due
 
to
 
investment
 
scope,
 
limitations
 
of
 
data
 
availabilities,
 
modeling
 
uncertainties
 
and
implementation hurdles. We actively monitor industry best practice and data
 
developments to ensure we are prepared to
further integrate climate risks into core investment processes, should
 
these bottlenecks be resolved. In the meantime, we
continue to review implied climate risk in our portfolios and continue to make progress on capacity building and making
climate risk assessment findings available across the investment
 
value chain.
 
Sustainability Report 2024
| Managing sustainability and climate risks
 
100
Industry engagement
 
Most of
 
our discretionary
 
portfolios consist
 
of investment
 
funds from
 
third-party
 
fund managers,
 
including UBS
 
Asset
Management,
 
which runs independent processes.
 
Generally,
 
Global Wealth Management
 
acts as an asset allocator
 
and
manager of these portfolios, but it does
 
not control portfolio construction and
 
management within the underlying fund
investment
 
solutions.
 
Therefore,
 
in
 
addition
 
to
 
developing
 
a
 
climate
 
risk
 
assessment
 
management
 
framework
 
for
portfolios
 
based
 
on
 
underlying
 
investment
 
holdings,
 
we
 
aim
 
to
 
understand
 
the
 
climate
 
risk
 
management
 
practices
established by the managers of the underlying funds.
To
 
that
 
end,
 
we
 
regularly
 
ask
 
investment
 
fund
 
partners
 
of
 
approved
 
investment
 
funds
 
for
 
information
 
about
 
their
approach to climate
 
risk issues, including the
 
extent to which climate
 
risk management processes
 
have been developed
and
 
implemented
 
within
 
their
 
businesses,
 
with
 
relevance
 
to
 
frameworks
 
such
 
as
 
TCFD
 
and
 
the
 
MAS
 
Guidelines
 
on
Environmental
 
Risk
 
Management
 
for
 
Asset
 
Managers,
 
where
 
required
 
by
 
relevant
 
regulators.
 
We
 
are
 
committed
 
to
continuing regular communication with
 
our fund partners
 
about the development of
 
climate risk management
 
processes,
as relevant to their strategies.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Appendix 1 | Governance
 
101
Appendix
Appendix 1 – Governance
Sustainability governance at Credit Suisse
Sustainability governance at Credit Suisse
 
Active sustainability governance bodies (as of 31 December
 
2024)
Governance body
Lead
Meeting frequency
Purpose and responsibilities
 
Sustainability
Classification Forum (SCF)
(formerly Sustainability
Classification Committee)
 
Co-chaired by Chief
Sustainability Office
(CSO), GWM CIO IM,
AM SI
Ad hoc (approx.
monthly)
 
Sustainability Classification Committee (SCC)
 
transformed into a forum
(SCF) in July 2024 to align with UBS Group Governance
 
Standards
Governing body of the Credit Suisse Sustainable
 
Investment
Framework, oversees the investment product sustainability
classification
Amended governance with escalation
 
path into UBS since January
2024
Retired sustainability governance bodies in 2024
Governance body
Lead
Meeting frequency
Purpose and responsibilities
 
ESG Disclosure and
Reporting Committee
(retired in September
2024)
Co-chaired by CFO
and CSO
 
Ad-hoc as required
1H24 meetings:
2
 
 
Retired in September 2024, and responsibilities integrated
 
into UBS
governance, controls and procedure
Provided oversight to ensure that appropriate levels of control and
governance were in place for Credit Suisse’s ESG
 
disclosures
Amended governance with escalation
 
path into UBS since March
2024
Green Finance Committee
(retired in June 2024)
Chaired by CSO
Ad-hoc as required
1H24 meetings: 1
 
Retired in June 2024, as the underlying framework
 
was
decommissioned with Credit Suisse Green Liabilities
 
having been
absorbed by the UBS Green Funding Framework
Acted as the governing body of the
 
Green Finance Framework and
oversaw the issuance of green finance products and green
 
asset pool,
and the reporting related to green issuances
Amended governance with escalation path into UBS since December | Appendix 1 | Governance 102
2023
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
Key policies and principles
 
Sustainable finance
Name of policy
Description
Group Sustainable
Investing Policy
Defines the minimum standards to address transparency around
 
sustainability-related investment product and / or service classification
 
and corporate
and financial disclosure. Applicable to all UBS employees globally involved
 
in the processes of manufacturing, distributing, labeling,
 
marketing or
promoting investment products or services that are positioned
 
as sustainable investing, which are sold or provided
 
to clients.
 
The policy provides a
basis for ensuring that environmental, social and governance
 
(ESG) or sustainability-related statements, declarations, actions or communications made
by UBS can be substantiated and consistently
 
communicated so as to protect UBS and / or its clients.
The owner of this policy is Group Sustainability and Impact (GSI).
 
Sustainable Finance
Guideline
 
These guidelines set Group-wide minimum requirements when labelling,
 
marketing and distributing sustainable financing, green equity, carbon and
environmental market instruments.
The owner of these guidelines is Group Risk Control (GRC).
Carbon and
Environmental Markets
Guideline
Regulatory compliance
Data privacy and data ethics
Name of policy
Description
Group Data Protection
Policy
Describes the minimum global standards for processing personal
 
data in accordance with data privacy laws and regulations. This
 
policy applies to
all staff involved in personal data (i.e. all information relating to an
 
identified or identifiable natural person) processing activities globally. This
includes information relating to UBS clients, prospects, UBS employees and candidates.
The owner of this policy is Group Compliance, Regulatory & Governance (GCRG).
Group Data Ethics Policy
Sets out UBS’s data ethics principles and requirements, in line with the Code of Conduct and
 
Ethics of UBS. This policy, which applies to all UBS
staff globally involved in data processing through artificial
 
intelligence and / or data analytics involving client-identifying
 
data and / or personal
data, provides the framework to identify, manage and control data usage by UBS in an
 
ethical and responsible manner.
The owner of this policy is GCRG.
Client and product suitability
Name of policy
 
Description
Group Suitability
Principles
Sets out the principles that UBS applies in assessing the
 
suitability of financial products and services and
 
transactions sold to or entered into with
clients in order to achieve regulatory compliance and consistency
 
of approach across business divisions in making such suitability
 
assessments. This
Group-wide policy also sets out the principles that UBS applies
 
in assessing the suitability of financial products and
 
services to always be regulatory
compliant and act in the best interests of our clients. The principles underpin the divisional
 
suitability-
 
and product-related policies.
The owner of these principles is GCRG.
 
Access to products and services
Name of policy
Description
Guideline on Client
Vulnerability
 
Ensures that, in order to deliver excellent client experience
 
for all types of clients, staff understand how to identify and
 
respond to client vulnerability.
This is because a client’s abilities or decision-making may be impaired compared to their
 
usual situation or compared to other clients. This guideline,
which applies to all roles in Global Wealth Management (GWM)
 
and Personal & Corporate Banking (P&C), helps to ensure that clients
 
with a
vulnerability are treated appropriately and fairly.
The owner of this guideline is GCRG.
Web Accessibility
Guideline
Ensures that electronic documents and information
 
available on the web can be accessed and used by people with disabilities
 
and that all web
content managed by Communications and Branding, Marketing Platforms (C&B, MP), such
 
as websites and web applications,
 
are free of barriers that
limit access for people who are blind, have low vision, are deaf
 
or hard of hearing, have mobility disabilities or experience
 
other types of disabilities.
 
The owner of this guideline is Group Human Resources and Corporate Services
 
(GHRCS).
Digital Accessibility
Guidelines
Offers standards for all UBS digital platforms and provides guidance
 
on the scope, requirements and the accessibility evaluation operating model to
follow. These include UBS Digital Accessibility Technical Standard; UBS Digital Accessibility Handbook;
 
WMPC Digital Accessibility Guide.
Global Inclusive
Accessibility Standard
 
Describes the design principles and standards that should
 
be applied to all premises Group-wide to deliver physical
 
accessibility. This relates to UBS’s
commitment to removing physical barriers across locations
 
and improving accessibility for everyone, frequently going beyond compliance
 
and
exceeding the local disability laws and standards that
 
are already in place.
The owner of this standard is GHRCS.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Appendix 1 | Governance
 
103
Responsible marketing practices
Name of policy
Description
Group Marketing
Communications
Governance
Prescribes, based on the UBS Brand Policy, the overall approach to producing and using marketing communications, clarifies roles and
 
responsibilities,
outlines processes and controls that must be adhered to
 
and offers supportive tools. These guidelines are intended to ensure effective
 
and efficient
cooperation among the various stakeholders.
The owner of this document is GHRCS.
GWM and P&C Policy on
Marketing Materials
 
Helps to ensure that any reputational, legal, regulatory or
 
liability risks arising from the use of marketing material are appropriately
 
and consistently
addressed by GWM and P&C, and all employees producing or using marketing material
 
for distribution to the UBS Group entity’s clients, or prospects
or any third party. That means,
 
among other things, enabling UBS to comply with its obligations
 
to provide existing and potential clients with
information that is fair, balanced, clear and not misleading and to have adequate controls
 
in place that ensure consistent adherence to the respective
standards.
The owner of this policy is GCRG.
AM Marketing
Communications Policy
Establishes common principles on the identification of marketing communications
 
and ensures that marketing communications created and used by all
AM employees globally are clear, fair, balanced and not misleading.
The owner of this policy is GCRG.
IB Marketing Materials
Global Policy
Provides information for all producers and approvers of IB
 
marketing materials on their content,
 
including minimum standards, country-specific
content and issues that need to be escalated to IB C&ORC and /
 
or Group General Counsel (GGC).
The owner of this policy is GCRG.
Market Conduct Policy
Sets out our minimum expected standards for market conduct, providing
 
guidance on prohibited conduct and conduct requiring
 
escalation. Addresses
greenwashing or ESG risks by setting minimum standards for
 
all communications by the IB and Non-core and Legacy (NCL).
 
When making an ESG or
sustainability claim about an investment product, fund
 
or company’s financial instruments or the company and its products and services, there should
be relevant, sourced and credible evidence to back the claim up. Additionally,
 
when referencing a third-party product (e.g. ESG index, externally
issued green bond), it must be ensured that the ESG or sustainable
 
characteristics of such a product can be clearly set out, including
 
how an investor
can obtain more information about the index or asset.
 
The owner of this policy is GCRG.
Climate and nature
Name of policy
Description
Group Sustainability and
Impact Strategy &
Governance Document
1.1.1
Provides an overview of the sustainability and impact strategy
 
and governance at UBS,
 
including the description of our sustainability and impact
strategy and related key activities, our aspirations and goals and progress toward them, relevant governance bodies
 
and key roles in the
organization, along with key topics and working groups related to sustainability
 
and impact. A key topic within this document is our approach to
climate. It outlines our ambition to support clients through the world’s transition to a low-carbon economy
 
and embed considerations of climate
change risks and opportunities across the bank for the benefit
 
of our stakeholders. The framework is subject to regular audits by Group Internal
Audit.
The owner of this policy is GSI.
Sustainability and
Climate Risk Policy
Framework
 
Sustainability and climate risk (SCR) is defined as the
 
risk that UBS negatively impacts, or is impacted by, climate change, natural capital, human
rights and other environmental and social matters. Group Risk Control
 
(GRC) is responsible for our firm-wide SCR policy framework and
 
the
management of exposure to sustainability and climate (financial)
 
risks on an ongoing basis as a second line of defense, while GCRG monitors
 
the
adequacy of our control environment for non-financial risks, applying independent
 
control and oversight.
 
The owner of this policy framework is GRC.
Responsible Supply
Chain Management
(RSCM) Framework
 
1.1.2
Is based on identifying, assessing and monitoring vendor
 
practices in the areas of human and labor rights, the environment, nature, health and safety
and anti-corruption. Central to our RSCM framework is the RSCM Policy, to which our direct vendors
 
are bound by contract and which sets out UBS’s
expectations toward vendors and their subcontractors regarding legal compliance,
 
environmental protection, avoidance of child and forced
 
labor,
non-discrimination, diversity, equity and inclusion, remuneration, hours of work, freedom
 
of association, humane treatment, health and safety, anti-
corruption measures, and whistleblowing protection for employees. In 2024, this framework
 
was rolled out to also cover Credit Suisse.
1.1.3
The owner of this framework is GHRCS.
Client experience
Name of policy
Description
Clients Complaints
Handling (GWM and P&C)
 
Outlines the principles and minimum standards
 
for handling client complaints in GWM and P&C by all staff
 
in these divisions who either receive or
are involved in the handling of complaints received from clients
 
or prospects. Client complaints serve as an early warning indicator for
 
problems
with a service or product offered and, when professionally
 
applied, can improve client retention and make the relationship stronger.
The owner of this policy is Global Wealth Management.
AM Complaints
Management
 
Sets out principles for the handling of client and / or investor
 
complaints that Asset Management (AM) expects
 
its employees to adhere to. Client
and / or investor complaints are an important source of information
 
on AM’s products and services. The policy, which applies to all AM employees,
articulates the requirements to identify, record, investigate and respond promptly
 
to complaints and outlines standard principles for recording,
processing and reporting AM complaints.
The owner of this policy is GCRG.
IB & Non-core and Legacy
(NCL) Policy on Client
Complaints
 
Sets out principles for managing Investment Bank (IB) client complaints
 
so they can be captured consistently and are therefore
 
reportable to
management and to regulators, if applicable. It applies to all UBS IB and IB-aligned
 
employees,
 
including NCL employees, consultants and
temporary employees interacting with clients and prospective clients
 
on UBS products or services.
 
The owner of this policy is GCRG.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
| Appendix 1 | Governance
 
104
Cyber und Information Security
Name of policy
Description
Cyber and Information
Security Policy
 
Defines the Cyber & Information Security (CIS) mandate across
 
the firm. CIS is a firm-wide business risk management
 
responsibility. Failure to secure
UBS’s information and services against the risk posed by CIS threats could severely
 
impact clients, constitute a breach of laws and regulations and
negatively affect the reputation, brand and financial stability of
 
the firm. The CIS principles established in this policy, which applies to all UBS
persons accessing or owning UBS information and IT assets, set the firm-wide
 
minimum baseline requirements necessary for meeting
 
key
operational, legal and regulatory requirements. Additional requirements may
 
be established by business divisions and Group functions
 
as necessary
for achieving the goal of CIS.
 
The owner of this policy is Group Operations and Technology Office (GOTO).
GenAI Cyber and
Information Security
(CIS) Guideline
Documents the firm-wide Generative AI (GenAI) Security Framework,
 
including control requirements to mitigate cyber and
 
information security (CIS)
risks associated with the adoption of GenAI solutions. It provides detailed implementation
 
guidance and covers GenAI applications operated in-
house or within third-party solutions.
The owner of this policy is GOTO.
Employees
Name of policy
Description, scope, accountability, pertinent third-party standards or initiatives
Employee Assistance
Program (EAP)
Provides confidential individual support to permanent
 
UBS employees (and where applicable to household
 
and / or family members) with any
personal or work-related issues that may affect their well-being.
 
The owner of this policy is GHRCS.
Employee Handbooks
 
Provides information on the policies, practices, procedures and benefits applicable to a specific
 
location or country. Where applicable, employee
handbooks (along with a contract / offer letter and, if applicable, personnel
 
regulations) are the principal sources of information on
 
the terms and
conditions of employment and applicable HR programs, policies and procedures. Subject to
 
local legal requirements, failure to comply with any of
the requirements of the relevant employee handbook may result in disciplinary
 
action, up to and including dismissal.
The owner of the handbooks is GHRCS.
Employee Incidents
Policy
Sets out the principles for assessing breaches of UBS policies
 
in a consistent manner. All UBS persons as defined by the policy are expected
 
to
comply. All UBS policies are in scope, unless defined by the respective Chief Operating Officer
 
as out of scope and approved by the GCRG
Employee Incidents team. The scope of UBS policies will be applied to the
 
Credit Suisse policies that have not yet been integrated.
 
The owner of this policy is GCRG.
Employment of Staff
within UBS Policy
Applicable to all UBS employees, this policy establishes minimum hiring
 
and employment standards and provides fair, consistent and transparent
treatment of employees, while taking account of local legal and market practice requirements and shareholder
 
interests. Where applicable, the
policy is supplemented by Employee Handbooks providing
 
local information and clarification. Breaches may be dealt
 
with in line with
the Employee Incidents Policy and could result in disciplinary action, including
 
dismissal, in serious cases.
The owner of this policy is GHRCS.
 
Global Block Leave
Policy
Applicable to all UBS employees and UBS external staff as
 
required by their role or legislative requirements, this policy ensures that
 
all employees
are aware of their block leave requirements to mitigate fraud risk
 
and to meet local legislative requirements.
 
The owner of this policy is GHRCS.
Global Staff Vetting
Policy
Defines the global minimum standards for background checks
 
to be undertaken during onboarding for all members of staff and provides
requirements for periodic re-vetting of existing staff. These global mandatory standards guarantee a globally
 
consistent vetting approach for UBS
staff. Non-compliance may have a negative impact on legal, regulatory, financial or reputational risks. The policy outlines who (UBS
 
third-party
vetting vendors, suppliers) is accountable for conducting the checks. HR and other functions
 
are engaged, as needed, to ensure any adverse
findings or policy changes are within UBS’s risk appetite.
Group Investigations
Policy
 
Sets out the framework for the conduct and governance of all internal
 
investigations of actual, alleged or suspected breaches of
 
law, regulation or
policy involving UBS and / or its employees.
The owner of this policy is GCRG.
 
Group Physical Security
Policy
 
Defines the physical security governance structures, principles and high-level
 
measures that ensure UBS people, information, infrastructure,
valuable assets and business operations are effectively protected from
 
physical security threats that may otherwise cause loss, damage or harm.
Failure to effectively mitigate the risks posed by security threats could
 
impact clients and staff, constitute a breach of laws or regulations and
negatively affect the firm’s reputation, brand or financials. Breaches of policy may be dealt with in
 
line with the Employee Incidents Policy and
could result in disciplinary action, including dismissal.
The owner of this policy is GCRG.
 
Group Policy on Conflict
of Interest
 
Sets out the principles, minimum requirements and roles and responsibilities
 
that all UBS staff must adhere to in identifying, preventing,
 
escalating
and managing conflicts of interest (CoI). This policy covers all UBS persons
 
internal and external staff and any other individuals
 
who provide
services for UBS.
 
The owner of this framework is GCRG.
Health and Safety
Statement
Details UBS’s commitment to a working environment that protects the health, safety
 
and well-being of all employees, contractors, clients and
visitors on UBS premises.
The owner of this statement is GHRCS.
 
Mandatory Learning
Policy
Covers topics important for all staff and for the firm, and
 
all staff must complete the modules assigned to
 
them by the due date.
Non-completion or failure to complete in a timely manner is systematically
 
tracked and subject to an escalation and disciplinary process.
The owner of this policy is GHRCS.
Total Reward Principles
Underpins UBS’s approach to compensation and defines UBS’s compensation framework. These principles apply to all employees
 
globally (with
variations in certain locations due to local legal requirements, regulations and
 
practices) and are periodically reviewed and approved by
 
the
Compensation Committee. The principles are fully aligned with our strategy and our three
 
keys to success.
 
In the short to medium term, they also
enable UBS to drive the economic and cultural integration of Credit Suisse
 
and the long-term value creation of the combined firm.
 
The owner of these principles is GHRCS.
Whistleblowing
Protection for
Employees
Establishes dedicated whistleblowing channels for UBS
 
employees to raise concerns in a safe, confidential and, if preferred, anonymous
 
way
without fear of retaliation. It applies to the UBS employees,
 
all business divisions and Group functions, all regions and all UBS entities, including
their branches and representative offices.
The owner of this policy is GCRG.
 
Sustainability Report 2024
| Appendix 2 | Social
 
105
Appendix 2 – Social
Regulatory compliance
How we ensure suitability
Clients expect
 
to be
 
provided with
 
products and
 
services that
 
are suitable
 
for them.
 
This is
 
particularly the
 
case in
 
the
business divisions,
 
where
 
we serve
 
personal clients
 
as opposed
 
to institutions.
 
In nearly
 
all the
 
countries where
 
we do
business, this expectation
 
has been turned
 
into a legal
 
or regulatory
 
requirement for
 
banks acting as
 
financial advisors.
Most jurisdictions
 
also require
 
systematic assessment
 
and documentation
 
of the
 
suitability of
 
products (including
 
third-
party
 
products)
 
and
 
services,
 
including
 
compliance
 
with
 
applicable
 
eligibility
 
criteria,
 
investment
 
preferences
 
(e.g.
sustainability
 
criteria)
 
and
 
sales
 
restrictions.
 
These
 
standards
 
are
 
reflected
 
in
 
local
 
policies
 
and
 
procedures
 
and
 
in
 
the
respective
 
local
 
control
 
framework.
 
The
 
European
 
Union’s
 
Markets
 
in
 
Financial
 
Instruments
 
Directive
 
and
 
the
 
Swiss
Financial Services Act are examples of how we reflect and implement specific standards required
 
by regulators as part of
a local control framework. Other locations apply
 
similar standards as required by the relevant
 
local regulators.
To meet both client
 
expectations and regulatory requirements, we have
 
established comprehensive rules for assessing
 
the
suitability of
 
products and
 
services and
 
these are
 
further supported
 
by regular
 
training across
 
the firm.
 
These rules
 
are
designed to align the assets in a client’s portfolio with their defined risk profile, and the client is advised in line with
 
their
needs
 
(i.e.
 
client
 
suitability).
 
In
 
addition,
 
the
 
rules
 
require
 
product
 
documentation
 
to
 
contain
 
appropriate
 
and
 
easily
understandable information
 
on the
 
product’s features,
 
target audience
 
and the
 
scenarios in
 
which the
 
product can
 
be
used, along
 
with a
 
balanced representation
 
of the
 
associated
 
opportunities
 
and risks
 
(i.e. product
 
suitability).
 
We also
recognize
 
the
 
importance
 
of
 
fair
 
and
 
transparent
 
marketing
 
of
 
our
 
products
 
and
 
services
 
and
 
have
 
internal
 
policies
supporting their responsible sale and marketing.
Suitability framework
In
 
our
 
Global
 
Wealth
 
Management
 
and
 
Personal
 
&
 
Corporate
 
Banking
 
business
 
divisions,
 
a
 
comprehensive
 
suitability
policy framework is in place and is
 
reviewed on a yearly basis. This sets out the structured advisory process governing the
way we advise
 
and implement
 
agreed solutions
 
and also
 
documents the
 
steps taken during
 
this process.
 
In addition to
other purposes, it includes requirements
 
for monitoring and controlling activities that
 
aim to capture tail risks.
Our Investment Bank and Asset Management business
 
divisions take their guidance from UBS’s suitability
 
principles and
have implemented processes and policies to ensure appropriate
 
oversight of suitability requirements where applicable.
In our framework,
 
we distinguish between client
 
and product suitability. Client
 
suitability refers to
 
the alignment between
the investor profile of the client and the products
 
and services that are recommended or
 
made available to the client (or
already held
 
in the client’s
 
portfolio), including
 
risk information
 
and disclosure.
 
Product suitability
 
refers to
 
a consistent
set of standards applied by a product management unit to define
 
which specific investors a product may be suitable
 
for.
Client suitability
Global Wealth Management and Personal & Corporate Banking have established a structured advisory process with four
distinct steps:
 
understand, propose,
 
agree and
 
implement, and
 
review.
 
This process
 
is supported
 
by a
 
number of
 
tools
and forms
 
that are
 
available to
 
client advisors.
 
In the
 
first step
 
(understand),
 
these forms
 
and tools
 
support
 
the initial
identification of a
 
client’s investor profile, including
 
but not limited
 
to investment objectives, risk
 
tolerance and risk ability.
In the further steps, they help client advisors match a client’s investment
 
strategy with appropriate investment proposals
(propose) and agree with the client on
 
the implementation, such as providing mandatory documentation and
 
signing the
necessary agreements
 
(agree and implement).
 
Furthermore, the
 
established tools and platforms
 
also support the
 
fourth
step (review). The Investment Bank and Asset Management have established cross-functional governance committees to
ensure oversight for client suitability where
 
specific criteria or triggers are met.
Product suitability
Advisory platforms and tools divide
 
products according to their risk characteristics
 
and, in doing so, help
 
clients and client
advisors to
 
properly assess
 
the impact
 
of investment
 
products and
 
services on
 
a client’s
 
portfolio. Additional
 
processes
are
 
in
 
place
 
to
 
make
 
product
 
documentation
 
available
 
to
 
both
 
client
 
advisors
 
and
 
clients.
 
Finally,
 
specific
 
legal
documentation is required for certain products
 
with specific risks (e.g. hedge funds).
Divisional approach to suitability
Primary ownership of suitability risk and the responsibility for addressing it rests
 
with the business. The suitability policies
applicable to Global Wealth Management,
 
Personal & Corporate Banking, the Investment
 
Bank and Asset Management
make
 
this
 
clear.
 
Accordingly,
 
we
 
have
 
pursued
 
a
 
divisional
 
approach
 
to
 
ensure
 
compliance
 
with
 
rapidly
 
changing
regulatory regimes,
 
while also addressing
 
particular suitability obligations
 
and remediation of
 
identified gaps relating
 
to
the business divisions.
Monitoring and controls
Monitoring
 
and
 
controls
 
for
 
suitability
 
follow
 
a
 
three-tiered
 
approach.
 
The
 
first-level
 
controls
 
are
 
conducted
 
by
 
the
business risk management
 
team under its origination
 
control framework, a set
 
of controls designed to
 
prevent and detect
operational risks that arise within the front unit
 
and to ensure that residual risk corresponds
 
to risk appetite.
 
 
Sustainability Report 2024
| Appendix 2 | Social
 
106
The second-level controls are
 
performed by Compliance
 
& Operational Risk
 
Control as global
 
minimum control standards,
which are
 
part of
 
the overall
 
operational risk
 
framework.
 
These controls
 
focus on
 
both a
 
check-the-checker
 
approach
and thematic deep-dive reviews. The third-level
 
controls are exercised by Group Internal Audit as part
 
of its annual audit
plan.
After-sales communications
The UBS client experience also includes after-sales communication. Again, this communication is supported by a number
of tools and platforms, including ready-to-use reporting
 
and presentation material.
Responsible marketing practices
At
 
UBS,
 
responsible
 
marketing
 
means
 
our
 
marketing
 
materials,
 
and
 
materials
 
from
 
third
 
parties
 
that
 
we
 
are
 
merely
distributing, must
 
be fair,
 
clear,
 
balanced and
 
not misleading.
 
Our policies
 
and guidelines,
 
across all
 
business divisions,
ensure that marketing
 
materials provided to
 
our clients and
 
prospects adhere
 
to both regulatory
 
requirements and
 
UBS
standards on
 
marketing communications.
 
Our aim
 
is to
 
have a
 
globally consistent
 
divisional framework
 
for preparing,
reviewing and approving,
 
and retaining
 
marketing materials to
 
address and
 
mitigate reputational,
 
legal, regulatory
 
and
liability risks.
Accessibility of our products and services
At
 
UBS,
 
we
 
are
 
committed
 
to
 
ensuring
 
that
 
all
 
clients,
 
including
 
those
 
with
 
vulnerabilities,
 
have
 
fair
 
and
 
appropriate
access to
 
our products
 
and services.
 
To
 
deliver an
 
excellent client
 
experience for
 
all types of
 
clients, staff
 
are trained
 
to
know how to identify and respond to
 
client vulnerability.
 
Client-facing employees generally have more
 
client interaction
and therefore are more likely to identify potential vulnerabilities.
1
 
Our approach to accessibility encompasses both digital
and physical aspects,
 
and we
 
continually work to
 
identify and remove
 
barriers, ensuring
 
that our services
 
and products
meet the needs of our clients, including those with disabilities.
 
›
Refer to
ubs.com/global/en/legal/accessibility.html
 
for more information on Accessibility and feedback
 
options
›
Refer to
ubs.com/global/en/our-firm/our-culture/diversity-and-inclusion/disability-inclusion.html
 
for more information on our
inclusion initiatives
Digital accessibility
 
The UBS
 
internal digital
 
accessibility guidelines
 
are based
 
on the
 
Web Content
 
Accessibility Guidelines
 
(WCAG), which
help us ensure that all people, including
 
individuals with disabilities, can fully and
 
independently use our digital platforms
and website.
 
The WCAG
 
are developed
 
by a
 
working group
 
of stakeholders,
 
including experts,
 
regulators, academics,
and businesspeople worldwide, who capture vulnerable
 
clients’ interests and needs by proxy.
 
›
Refer to WCAG for more information, available at
w3.org/TR/WCAG22
In 2024,
 
we
 
led an
 
engineering
 
Hackathon
 
featuring
 
digital accessibility
 
as a
 
key
 
category
 
where
 
over
 
300 engineers
globally developed cutting
 
edge solutions
 
that promote accessibility
 
and inclusivity. The
 
winning project is
 
underway to
be implemented and will support visually impaired users by turning
 
images and graphs into spoken text.
Physical accessibility
We
 
are
 
committed
 
to
 
removing
 
physical
 
barriers
 
across
 
our
 
locations,
 
frequently
 
exceeding
 
local
 
disability
 
laws
 
and
standards. Our Global Inclusive Accessibility
 
Standard outlines design principles to
 
ensure that our premises are accessible
to everyone. This commitment is part of our broader
 
strategy to enhance accessibility and inclusivity in all aspects
 
of our
operations.
Financial literacy
We view this topic as
 
mainly relevant in Switzerland,
 
the only country where
 
we offer comprehensive financial
 
products
and
 
services
 
to
 
retail
 
and
 
small
 
and
 
medium-sized
 
enterprises
 
(SME)
 
clients.
 
Many
 
of
 
our
 
services
 
that
 
contribute
 
to
enhancing financial
 
literacy are
 
therefore limited to
 
our Swiss clients.
 
Examples for young
 
people and students
 
include:
financial check-ups, saving tips and a budget calculator.
Moreover,
 
with the
 
Women’s Wealth
 
Academy
1
as well
 
as the
 
Female
 
Impact Program
 
for female
 
entrepreneurs,
 
UBS
helps
 
women
 
acquire
 
or
 
consolidate
 
extensive
 
financial
 
know-how.
 
Furthermore,
 
the
 
UBS
 
Entrepreneur
 
Hub
 
and
 
the
download center for SMEs include a broad range of publications, documents and resources, such as succession planning
checklists and basic knowledge of business administration topics,
 
such as accounting, payrolling and payment solutions.
2
Responsible use of AI
The pace of innovation and
 
emerging technology adoption continues
 
to accelerate in our industry.
 
Artificial intelligence
(AI) in particular
 
is creating an opportunity to
 
significantly enhance employee efficiency and
 
reshape how we do
 
business.
Financial institutions
 
are finding
 
ways to
 
accelerate the
 
adoption of
 
AI in
 
a risk
 
and regulatory
 
compliant manner,
 
and
with ethical and sustainability considerations in place.
1
 
https://www.ubs.com/ch/en/wealth-management/womens-wealth/mission.html
2
https://www.ubs.com/ch/en/services/digital-banking/marketplace.html
 
Sustainability Report 2024
| Appendix 2 | Social
 
107
Managing potential risks to clients
 
The potential risks
 
arising from the
 
use of AI
 
have been
 
categorized under various
 
non-financial risk taxonomies,
 
including
model risk, privacy, data ethics and records management,
 
cyber and information security, data management, third
 
-party
management,
 
and inter
 
-entity outsourcing.
 
These
 
risks are
 
addressed
 
in the
 
risk frameworks
 
of the
 
respective
 
control
functions, as well as Group Legal, and are reviewed
 
regularly to ensure completeness, accuracy and that the risks are
 
up
to date.
 
In 2024 we
 
have enhanced
 
our AI governance
 
framework and
 
published the
 
Group AI
 
Strategy. The
 
newly established
AI Operating Committee
 
and Group AI
 
Forum support
 
the use of
 
AI in a
 
responsible and
 
sustainable manner
 
and also,
we have
 
guidelines in
 
place with
 
details on
 
how to
 
identify uses
 
of AI
 
that are
 
prohibited or
 
considered high
 
risk and
thus, subject to more stringent controls.
Alongside this, we
 
have launched a
 
training on
 
the responsible use
 
of generative AI
 
for all employees
 
to ensure employees
understand this technology, including how to identify and mitigate risks
 
to UBS and / or its clients
 
associated with AI use.
›
Refer to “Emerging Technologies” in the “Our environment” section of UBS Group Annual Report
 
2024, available under “Annual
reporting” at
ubs.com/investors
, for more information
Data privacy
 
Handling data
Our data protection policy
 
framework covers the standards
 
we commit to when processing
 
personal data. This includes
a requirement
 
that data is
 
processed only for
 
specific and explicit
 
purposes and is
 
adequate, relevant
 
and not excessive
(data minimization). Other
 
key principles include
 
ensuring that data
 
subjects are informed
 
of how their personal
 
data is
processed and that it is
 
not processed for longer than necessary
 
for the given processing purposes. UBS
 
has implemented
processes to respond to data subjects exercising
 
their rights, while adhering to applicable legal requirements.
 
We communicate
 
our client
 
personal data processing
 
activities and
 
seek clients’
 
consent as required
 
by applicable
 
local
privacy law. In these
 
communications,
 
we are clear what this
 
consent means and which use-cases
 
do not require consent,
for example due to certain legal
 
obligations. We provide reasonable options
 
for clients to be able to revoke
 
this consent
as required.
 
Key privacy-related information is contained in
 
client privacy notices published on
 
ubs.com and translated into the
 
official
languages of the specific country it applies to.
 
›
Refer to the document “Cybersecurity, information security and data privacy at UBS” for more information, available at | Appendix 3 | Other supplemental information 108
ubs.com/sustainability-reporting
, for more information
 
Sustainability Report 2024
Appendix 3 – Other supplemental information
Information on non-financial disclosures
 
Risk evaluation
Pursuant to the requirements of the Swiss Code of Obligations
 
Art. 964b, this section includes an evaluation of the risks
that have a high probability of potential negative impacts upon
 
the “aspects” covered by said laws.
Developments in sustainability, climate, environmental
 
and social standards and regulations
 
may affect our business and
impact our ability to
 
fully realize our goals.
 
We are subject
 
to separate, and sometimes
 
conflicting, ESG (environmental,
social and governance) regulations and regulator expectations in the various
 
jurisdictions in which UBS AG operates. For
example, in
 
certain jurisdictions,
 
we are
 
required to
 
set diversity
 
targets or
 
other ESG-related
 
goals that
 
are considered
illegal or contrary to
 
regulatory expectations in other jurisdictions. In
 
addition, with respect to decarbonization mandates,
there is substantial uncertainty as to the scope of actions that may be required of us, governments and others to achieve
the goals we have set, and many of our goals and objectives are only achievable with a combination of government and
private
 
action.
 
National
 
and
 
international
 
standards
 
and
 
expectations,
 
industry
 
and
 
scientific
 
practices,
 
regulatory
taxonomies,
 
and
 
disclosure
 
obligations
 
addressing
 
these
 
matters
 
are
 
relatively
 
immature
 
and
 
are
 
rapidly
 
evolving.
 
In
addition, there are significant limitations in the data available to measure
 
our climate and other goals. Although we have
defined and
 
disclosed
 
our goals
 
based on
 
the standards
 
existing at
 
the time
 
of disclosure,
 
there
 
can be
 
no assurance
(i) that the various
 
ESG regulatory
 
and disclosure regimes
 
under which we
 
operate will not
 
come into conflict
 
with one
another;
 
(ii) that the current standards will not be
 
interpreted differently than our understanding
 
or change in a manner
that substantially increases the
 
cost or effort for
 
us to achieve such
 
goals; or (iii) that additional data
 
or methods, whether
voluntary or
 
required by
 
regulation, may
 
substantially change
 
our calculation
 
of our
 
goals and
 
ambitions. It
 
is possible
that such goals
 
may prove
 
to be
 
considerably more
 
difficult or even
 
impossible to achieve.
 
The evolving
 
standards may
also require us
 
to substantially change
 
the stated goals
 
and ambitions. If
 
we are not
 
able to achieve
 
the goals we
 
have
set, or can only do so at significant expense
 
to our business, we may fail to meet
 
regulatory expectations, incur damage
to our reputation or be exposed to an increased risk of litigation
 
or other adverse action.
While ESG regulatory regimes and
 
international standards are being developed, including
 
to require consideration of ESG
risks in investment decisions,
 
some jurisdictions, notably in
 
the US, have developed rules
 
restricting the consideration
 
of
ESG factors in
 
investment and business decisions.
 
Under these anti-ESG rules,
 
companies that are perceived
 
as boycotting
or discriminating against certain industries may be
 
restricted from doing business with certain governmental
 
entities. Our
businesses
 
may
 
be
 
adversely
 
affected
 
if
 
we
 
are
 
considered
 
as
 
discriminating
 
against
 
companies
 
based
 
on
 
ESG
considerations, or if further anti-ESG rules are developed
 
or broadened.
A major focus of US and other countries’ governmental
 
policies relating to financial institutions in recent years has
 
been
on
 
fighting
 
money
 
laundering
 
and
 
terrorist
 
financing.
 
We
 
are
 
required
 
to
 
maintain
 
effective
 
policies,
 
procedures
 
and
controls to detect,
 
prevent and report
 
money laundering and
 
terrorist financing, and
 
to verify the identity
 
of our clients
under the
 
laws of
 
many of
 
the countries
 
in which
 
we operate.
 
We are
 
also subject
 
to laws
 
and regulations
 
related to
corrupt and illegal payments to government officials by others, such as the
 
US Foreign Corrupt Practices Act and the UK
Bribery Act. We have implemented policies, procedures and internal controls that are designed to comply with such laws
and regulations.
 
Notwithstanding
 
this,
 
regulators
 
have found
 
deficiencies
 
in the
 
design and
 
operation
 
of anti-money-
laundering programs
 
in our
 
US operations.
 
We have
 
undertaken a
 
significant program
 
to address
 
these regulatory
 
findings
with the objective
 
of fully meeting
 
regulatory expectations for our
 
programs. Failure to
 
maintain and implement
 
adequate
programs to combat
 
money laundering, terrorist
 
financing or corruption,
 
or any failure
 
of our programs
 
in these areas,
could
 
have
 
serious
 
consequences
 
both
 
from
 
legal
 
enforcement
 
action
 
and
 
from
 
damage
 
to
 
our
 
reputation.
 
Frequent
changes
 
in
 
sanctions
 
imposed
 
and
 
increasingly
 
complex
 
sanctions
 
imposed
 
on
 
countries,
 
entities
 
and
 
individuals,
 
as
exemplified by
 
the breadth
 
and scope
 
of the
 
sanctions imposed
 
in relation
 
to the
 
war in
 
Ukraine, increase
 
our cost
 
of
monitoring and complying with sanctions requirements and increase the risk that we will not identify in a timely manner
client activity that is subject to a sanction.
The financial
 
services
 
industry
 
is characterized
 
by intense
 
competition,
 
continuous
 
innovation,
 
restrictive,
 
detailed
 
and
sometimes
 
fragmented
 
regulation
 
and
 
ongoing
 
consolidation.
 
We
 
face
 
competition
 
at
 
the
 
level
 
of
 
local
 
markets
 
and
individual business lines and from global financial institutions that are comparable to us in their size and breadth, as well
as competition from new
 
technology-based market
 
entrants, which may not
 
be subject to
 
the same level of
 
regulation.
Barriers to entry in individual markets and pricing
 
levels are being eroded by new technology. We
 
expect these trends to
continue and
 
competition to
 
increase. Our
 
competitive strength
 
and market
 
position could
 
be eroded
 
if we
 
are unable
to
 
identify
 
market
 
trends
 
and
 
developments,
 
do
 
not
 
respond
 
to
 
such
 
trends
 
and
 
developments
 
by
 
devising
 
and
implementing adequate
 
business strategies,
 
do not
 
adequately develop
 
or update
 
our technology,
 
including our
 
digital
channels and tools, or are unable to attract or retain the
 
qualified people needed.
The
 
amount
 
and
 
structure
 
of
 
our
 
employee
 
compensation
 
is
 
affected
 
not
 
only
 
by
 
our
 
business
 
results
 
but
 
also
 
by
competitive factors and regulatory considerations.
 
 
Sustainability Report 2024
| Appendix 3 | Other supplemental information
 
109
In response
 
to the
 
demands of
 
various stakeholders,
 
including regulatory
 
authorities and
 
shareholders, and
 
in order
 
to
better
 
align
 
the
 
interests
 
of
 
our
 
staff
 
with
 
other
 
stakeholders,
 
we
 
have
 
increased
 
average
 
deferral
 
periods
 
for
 
stock
awards, expanded forfeiture provisions and, to a more limited
 
extent, introduced clawback provisions for certain awards
linked to business
 
performance. We
 
have also
 
introduced individual
 
caps on
 
the proportion
 
of fixed
 
to variable
 
pay for
the members
 
of the
 
Group Executive
 
Board (the
 
GEB), as
 
well as
 
certain other
 
employees. UBS
 
will also
 
be required
 
to
maintain and enforce
 
provisions requiring
 
UBS to recover
 
from GEB members
 
and certain
 
other executives a
 
portion of
performance-based incentive compensation in the event that the
 
UBS Group or another entity with securities listed on a
US national securities exchange, is required to restate
 
its financial statements as a result of a material error.
›
Refer to the “Risk factors” and “Risk management
 
and control” sections of our UBS Group Annual Report
 
2024, available under
“Annual reporting” at
ubs.com/investors
, for more information
Resilience of our UBS’s strategy regarding its capacity
 
to address material impacts and risks
 
Identification of material risks
UBS has
 
a structured
 
risk identification
 
process in
 
place designed
 
to support
 
the firm’s
 
ongoing risk
 
management
 
and
control efforts and aligned with global regulatory expectations. The process of identifying the material risks to which our
businesses
 
at
 
UBS
 
are
 
exposed
 
is
 
a
 
key
 
component
 
of
 
risk
 
management. A
 
comprehensive
 
risk
 
identification
 
and
assessment process contributes
 
to an
 
enhanced understanding of
 
the top
 
vulnerabilities impacting the
 
organization under
various conditions, enabling management to better capture, measure, monitor and control risk
 
exposure, as appropriate.
As
 
part
 
of
 
the
 
risk
 
identification
 
process,
 
risks
 
identified
 
as
 
material
 
are
 
then
 
considered
 
within
 
the
 
risk
 
coverage
assessment and the development of stress scenarios
 
,
 
ultimately being used in the assessment of adequacy
 
of post-stress
capital levels
 
and capital
 
actions as
 
part of
 
the Group
 
internal capital
 
adequacy assessment.
 
Climate and
 
environment
considerations are assessed for their viability as root
 
causes of potential risks throughout the process.
Resilience of our strategy and business model in relation
 
to climate change
UBS employs different
 
tools, assessments and
 
processes to
 
identify and manage
 
climate-related
 
risks and opportunities
and
 
understand
 
the
 
impact
 
of
 
climate
 
change
 
on
 
our
 
business.
 
Relevant
 
outcomes
 
are
 
considered
 
when
 
annually
reviewing and setting
 
our sustainability
 
and impact strategy
 
and objectives, which
 
are subsequently
 
integrated into our
standard financial planning process with
 
a three-year strategic plan.
 
By
 
continuously
 
assessing
 
climate-related
 
risks
 
and
 
opportunities
 
through
 
various
 
assessments
 
and
 
scenario-based
approaches
 
and
 
by
 
embedding
 
this
 
information
 
into
 
our
 
business
 
strategy
 
and
 
financial
 
planning,
 
we
 
continuously
enhance our resilience against climate change.
›
Refer to the “Managing sustainability and climate
 
risks” section in this report for more information
Integrating climate-related impacts in our financial planning
UBS operates a multi-year
 
financial planning process.
 
This process reflects
 
our business position, corporate
 
strategy and
prospective economic environment. Sustainability
 
is a core component of that strategy and planning
 
process.
 
At divisional
 
level, the
 
underlying
 
drivers of
 
our sustainability
 
investments are
 
also considered.
 
These include
 
our own
corporate
 
commitments,
 
regulatory and
 
other external
 
requirements, and
 
client-servicing
 
opportunities.
 
The changing
global
 
outlook
 
regarding
 
sustainability,
 
and
 
climate
 
change
 
in
 
particular,
 
is
 
reflected
 
in
 
the
 
process,
 
with
 
the
 
risks
associated with climate change being reflected in our capital
 
requirement planning calculations.
 
Formal guidance on capital
 
-framework calculations is
 
subject to ongoing
 
market and regulatory
 
discussion, and we
 
will
continue to reflect this in our planning processes.
 
Business continuity management
 
UBS
 
has
 
a
 
business
 
continuity,
 
resilience
 
and
 
crisis
 
management
 
(BCR)
 
framework
 
in
 
place
 
to
 
minimize
 
the
 
financial,
regulatory,
 
reputational and market impact of unplanned disruptive events,
 
including those that are climate-related.
 
We
conduct regular BCM reviews, which include assessments of potential loss of premises, compromised buildings and data
centers, loss of staff, loss of technology,
 
loss of third parties and the need for risk mitigation. Department recovery plans
are in
 
place for
 
loss of
 
premises and
 
loss of
 
staff incidents
 
due to
 
disruptive events,
 
such as
 
severe weather
 
situations.
The
 
plans
 
are
 
not
 
specifically
 
climate-related,
 
but
 
rather
 
agnostic
 
to
 
the
 
cause
 
of
 
disruption.
 
Crisis
 
management
committees
 
are
 
trained accordingly
 
to react
 
on any
 
materializing
 
threat.
 
A country
 
risk profiling
 
process
 
is in
 
place
 
to
identify any location-specific material risks
 
and plans exist for mitigating
 
acute weather conditions. In the
 
case of material
climate-related
 
exposures,
 
this
 
would
 
be
 
captured
 
accordingly.
 
We
 
have
 
conducted
 
stress
 
tests
 
and
 
climate-related
scenario analyses
 
to assess
 
the potential
 
impacts of
 
climate-related
 
physical and
 
transition risks
 
on selected
 
portfolios.
Through our comprehensive business continuity planning and
 
physical climate risk identification process, we
 
consider the
risk to our
 
own physical assets.
 
UBS is committed
 
to ensuring continuity
 
of service for
 
our clients and
 
the broader financial
markets.
 
The
 
activities
 
described
 
in
 
the
 
above
 
paragraph
 
are
 
governed
 
by
 
the
 
BCR
 
framework,
 
which
 
ensures
 
that
 
the
 
firm’s
residual
 
operational
 
risk
 
remains
 
within
 
risk
 
appetite.
 
The
 
Group
 
BCR
 
framework
 
enables
 
divisions
 
and
 
functions
 
to
analyze their services to understand the associated continuity and resilience risks and develop effective recovery strategies | Appendix 3 | Other supplemental information 110
and solutions.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability Report 2024
The Group’s main hubs span
 
APAC (mainly Singapore /
 
Hong Kong / Tokyo), EMEA
 
(mainly London / Zurich /
 
Frankfurt /
Madrid) and the
 
US (mainly New
 
York City). Each
 
of these areas
 
is assessed for climate
 
-related threats and
 
may present
climate
 
change
 
risks
 
in
 
the
 
form
 
of
 
extreme
 
weather
 
conditions
 
and
 
the
 
potential
 
for
 
natural
 
disasters
 
(earthquakes,
hurricanes, typhoons, tidal anomalies, rising temperatures,
 
etc.) and increased threat of disease outbreaks. Note that the
legacy Credit Suisse Group
 
Non-Financial Risks Scenarios
 
team that performed
 
global climate scenario stress
 
testing has
been integrated into
 
Group Risk Control;
 
BCR impacts are also
 
considered in this
 
context. Where vulnerabilities have
 
been
identified, additional assessments are carried
 
out and appropriate planning is put in
 
place to mitigate the risk of impact.
Key
 
first
 
line
 
of
 
defense
 
controls
 
take
 
the
 
form
 
of
 
key
 
procedural
 
controls
 
that
 
monitor
 
the
 
overall
 
conformance
 
of
divisions and functions to the BCR program and process
 
controls designed to identify more specific threats.
 
Non-financial disclosures pursuant to the Swiss Code
 
of Obligations Art. 964b.
This report
 
comprises the
 
“non-financial” disclosures
 
required for
 
UBS Group
 
AG, and
 
its subsidiaries,
 
under the
 
Swiss
Code of
 
Obligations Art.
 
964b. These
 
disclosures can
 
be found in
 
the sections
 
and the
 
pages indicated
 
below. The material
topics listed in
 
the index are
 
limited to the
 
matters addressed
 
by the Swiss
 
Code of Obligations
 
Art. 964b. For
 
material
matters,
 
we assess
 
the effectiveness
 
of our
 
management
 
approaches
 
through
 
a
 
number of
 
measures
 
as described,
 
in
particular, in the “Business conduct and corporate culture” and “Key policies and principles
 
”
 
sections of this report, and
“Approach to grievances” in the supplementary document
 
to this report.
›
Refer to the “Supplement to Managing sustainability
 
and climate risks” section of the Supplement
 
to the UBS Group
Sustainability Report 2024, available at
ubs.com/sustainability-reporting
, for more information about “Information on UBS
 
Group
AG pursuant to the Swiss Ordinance on Due Diligence
 
and Transparency in relation to Minerals and Metals from Conflict-Affected
Areas and Child Labor”
Section in Sustainability Report 2024 (SR
 
2024)
 
Page(s)
About this report (including
framework)
 
About this report
 
SR 2024 / 6–8
Description of the business model
1
Our sustainability and impact strategy
Our business model
SR 2024 / 29
SR 2024 / 10
–
11
Material risks
Risk evaluation
SR 2024 / 111-112
Non-financial aspects
Section in Sustainability Report 2024 (SR
 
2024)
 
Page(s)
Broad thematic issues affecting all
non-financial aspects
The importance of sustainability and culture to UBS
SR 2024 / 4–5
Governance
SR 2024 / 19–23
Key policies and principles
SR 2024 / 105–107
Supporting opportunities
SR 2024 / 75–88
Our key aspirations and progress
SR 2024 / 30–31
Environmental and human rights
matters
Our sustainability and impact strategy
SR 2024 / 29
Our stakeholder engagement
SR 2024 / 12–14
Managing our supply chain responsibly
SR 2024 / 54–56
Environment
SR 2024 / 32–64
Driving social impact
 
SR 2024 / 70–72
Respecting human rights
SR 2024 / 73
Reducing our own environmental impact
SR 2024 / 47–53
Social and employee matters
Our sustainability and impact strategy
SR 2024 / 29
People and culture make the difference
SR 2024 / 65–69
Anti-corruption and bribery matters
Combating financial crime
SR 2024 / 26
Prevention and detection of corruption and bribery
SR 2024 / 26
–
28
1
 
Further information on our business model can be found in the UBS Group Annual Report 2024 section “Our strategy,
 
business model and environment,”available at ubs.com/investors
 
.
 
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112
 
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Key terms and definitions
Sustainability
 
Commonly defined as “meeting
 
the needs of
 
the present without compromising the
 
ability of future generations to
 
meet
their own needs“ (United Nations (UN) Brundtland Commission,
 
1987). In this way,
 
we sometimes refer to sustainability
to imply a broader scope of resources
 
that may be exhausted beyond those that impact climate change. Our ambition
 
is
to conduct business
 
and operations
 
without negatively
 
impacting the environment,
 
society or the
 
economy as a
 
whole
and, through our sustainability disclosure, to
 
be transparent about how we are pursuing this.
 
Sustainable Development Goals (the SDGs)
The 2030 Agenda for
 
Sustainable Development, adopted
 
by all UN member
 
states in 2015, provides
 
a shared blueprint
for peace and prosperity for people and the planet. At its heart
 
are the
17 UN Sustainable Development Goals
(available
at sdgs.un.org/goals),
 
the SDGs,
 
which are
 
an urgent call
 
for action
 
by all countries
 
– developed
 
and developing
 
– in a
global partnership. They recognize that ending
 
poverty and other deprivations must
 
go hand-in-hand with strategies that
improve
 
health
 
and
 
education,
 
reduce
 
inequality
 
and
 
spur
 
economic
 
growth
 
–
 
all
 
while
 
tackling
 
climate
 
change
 
and
working to preserve our oceans and forests.
 
ESG (Environmental, Social, Governance)
A framework to
 
help stakeholders understand
 
how an organization
 
is managing risks
 
and opportunities related
 
to ESG
criteria or factors. It is often used in the context of investing, but – beyond
 
the investment community – clients, suppliers
and employees are also increasingly interested
 
in how sustainable an organization’s operations are.
Sustainable finance
Sustainability focus:
 
strategies that
 
have explicit
 
sustainable intentions
 
or objectives
 
that drive
 
the strategy.
 
Underlying
investments may contribute to positive sustainability outcomes through
 
products / services / use of proceeds.
Impact
 
investing:
 
investment
 
strategies
 
that
 
have
 
an
 
explicit
 
intention
 
to
 
generate
 
measurable,
 
verifiable
 
and
 
positive
sustainability outcomes. Impact generated is attributable
 
to investor action and / or contribution.
Green, social
 
and sustainability
 
loans and
 
bonds are
 
instruments made
 
available exclusively
 
to finance
 
or re-finance,
 
in
whole or in
 
part, new and
 
/ or existing
 
eligible green and
 
/ or social
 
projects that form
 
part of a
 
credible program from
the borrower / issuer to improve their environmental and
 
/ or social footprint.
 
Sustainability-linked loans and bonds
 
are any types of instruments that
 
incentivize the borrower’s / issuer’s
 
achievement
of ambitious,
 
predetermined
 
Sustainable
 
Performance
 
Targets
 
(SPTs) that
 
are measured
 
using predefined
 
sustainability
KPIs.
Low-carbon economy
Refers to a
 
type of decarbonized
 
economy that is
 
based on low
 
energy consumption
 
and low levels
 
of greenhouse
 
gas
(GHG) emissions:
Scope 1: accounts for GHG emissions by UBS.
Scope 2:
 
accounts
 
for indirect
 
GHG emissions
 
associated
 
with the
 
generation of
 
imported /
 
purchased electricity
 
(grid
average emission factor), heat or steam.
Scope
 
3:
 
accounts
 
for
 
GHG
 
emissions
 
resulting
 
from
 
activities
 
from
 
assets
 
not
 
owned
 
or
 
controlled
 
by
 
the
 
reporting
organization, but that the organization indirectly impacts
 
in its value chain.
Net zero: refers to cutting GHG emissions to as close to zero as possible, with any remaining emissions re-absorbed from
the atmosphere.
GHG key vendor: a top
 
GHG scope 3 emitter relative to
 
UBS’s overall scope 3 supply
 
chain emissions and with which UBS
has a long-term ongoing relationship.
 
Sustainability disclosure
Task
 
Force
 
on
 
Climate-related
 
Financial
 
Disclosures
 
(TCFD):
 
provider
 
of
 
climate-related
 
financial
 
disclosure
recommendations designed to help companies provide
 
better information to support informed capital allocation.
Materiality assessment
The TCFD requires companies to conduct a double materiality assessment that looks at both the inside-out impact the | Appendix 3 | Other supplemental information 124
company
 
has
 
on
 
the
 
environment
 
and
 
the
 
outside-in
 
impact
 
climate-related
 
activities
 
may
 
have
 
on
 
the
 
company
performance.
 
 
Sustainability Report 2024
Abbreviations frequently used in our sustainability report
A
AMAS
 
Asset Management Association Switzerland
AML
 
anti-money laundering
AuM
 
assets under management
B
BCBS
 
Basel Committee on Banking Supervision
BD(s)
 
Business division(s), organizational units of the UBS business: (i) Global Wealth Management, (ii) Personal & Corporate
Banking, (iii), Asset Management and (iv) the Investment Bank
B4SI
 
Business Investment for Societal Impact
BoD
 
Board of Directors
BoE
 
Bank of England
C
CCRC
 
Corporate Culture and Responsibility Committee
CDP
 
formerly the Carbon Disclosure Project
CDR
 
carbon dioxide removal
CFO
 
Chief Financial Officer
CHF
 
Swiss franc
CIC
 
Corporate & Institutional Clients
CIO
 
Chief Investment Office
C&ORC
 
Compliance & Operational Risk Control
CSRD
 
Corporate Sustainability Reporting Directive
D
DAF
 
donor-advised fund
DJSI
 
Dow Jones Sustainability Indices
 
E
EC
 
European Commission
EMS
 
environmental management system
ESG
 
environmental, social and governance
EU
 
European Union
EUR
 
euro
ERA
 
Energy Reference Area
ETF
 
exchange-traded fund
EY
 
Ernst & Young
 
F
FINMA
 
Swiss Financial Market Supervisory Authority
FTE
 
full-time employee
FX
 
foreign exchange
G
GCFO
 
Group Chief Financial Officer
GCRG
 
Group Compliance, Regulatory & Governance
GEB
 
Group Executive Board
GHRCS Group Human Resources and Corporate Services | Appendix 3 | Other supplemental information 125
GHG
 
greenhouse gas
GIA
 
Group Internal Audit
GICS
 
Global Industry Classification Standard
GOTO
 
Group Operations and Technology
 
Office
GRC
 
Group Risk Control
GRI
 
Global Reporting Initiative
GSI
 
Group Sustainability and Impact
H
HR
 
human resources
 
Sustainability Report 2024
I
ICMA
 
International Capital Market Association
ICMM
 
International Council on Mining and Metals
IFRS
 
International Financial Reporting Standards
IPCC
 
Intergovernmental Panel for Climate Change
ISO
 
International Organization for Standardization
L
LEED
 
Leadership in Energy and Environmental Design
LoD
 
lines of defense
LTV
 
loan-to-value
M
MAT
 
Materiality Assessment Team
M&A
 
mergers and acquisitions
MiFID II
 
Markets in Financial Instruments Directive II
N
NFR
 
non-financial risks
NFRD
 
Non-Financial Reporting Directive
NGFS
 
Network for Greening the Financial System
NYSE
 
New York Stock Exchange
NZE
 
Net-Zero Emissions by 2050 Scenario
O
OECD
 
Organization for Economic Co-operation and Development
ORF
 
operational risk framework
OTC
 
over-the-counter
P
PACI
 
Partnership Against Corruption Initiative
PACTA
 
Paris Agreement Capital Transition
 
Assessment
PCAF
 
Partnership for Carbon Accounting Financials
P&L
 
profit and loss
PRA
 
UK Prudential Regulation Authority
 
R
RSCM
 
responsible supply chain management
RSPO
 
Roundtable on Sustainable Palm Oil
RW
 
risk weight
RWA
 
risk-weighted assets
S
SCR
 
sustainability and climate risk
SCS
 
Swiss Climate Score
SDA
 
Sectoral Decarbonization Approach
 
SDC
 
Swiss Agency for Development and Cooperation
SDG
 
Sustainable Development Goal
SDS
 
Sustainable Development Scenario
SEC
 
US Securities and Exchange Commission
SFDR
 
Sustainable Finance Disclosure Regulation
 
SI
 
sustainable investment
SIF
 
Credit Suisse sustainability investment framework
SIX
 
SIX Swiss Exchange
SME
 
small and medium-sized entities
SNB
 
Swiss National Bank
T
TBTF
 
too big to fail
TCFD Task Force on Climate-related Financial Disclosures | Appendix 3 | Other supplemental information 126
 
Sustainability Report 2024
U
UN
 
United Nations
UNEP FI
 
United Nations Environment Programme Finance Initiative
UNGPs
 
UN Guiding Principles on Business and Human Rights
USD
 
US dollar
Note:
 
This list of abbreviations is not deemed to be comprehensive
 
of all the abbreviations used in this report.
 
Sustainability Report 2024
| Appendix 3 | Other supplemental information
 
127
Cautionary Statement
 
Cautionary Statement |
 
This report may contain statements that constitute
 
“forward-looking statements.” Refer to the Cautionary
 
Statement Regarding
Forward-Looking Statements in the UBS Group Annual
 
Report 2024, available at ubs.com/investors,
 
for further details.
Notice to investors |
 
This report and the information contained herein are
 
provided solely for information purposes, and are not to
 
be construed as
solicitation of an offer to buy or sell any securities
 
or other financial instruments in Switzerland,
 
the United States or any other jurisdiction. No
 
investment
decision relating to securities of or relating to UBS Group AG,
 
UBS AG or their affiliates should be made on
 
the basis of this report. Refer to the UBS Group
Annual Report 2024, available at ubs.com/investors,
 
for additional information.
Rounding |
 
Numbers presented throughout this report may not add up
 
precisely to the totals provided in the tables and text.
 
Percentages and percent changes
are calculated on the basis of unrounded figures. Information
 
about absolute changes between reporting periods,
 
which is provided in text and which can be
derived from figures displayed in the tables, is calculated
 
on a rounded basis.
Tables |
 
Within tables, blank fields generally indicate
 
that the field is not applicable or not
 
meaningful, or that information is not available
 
as of the relevant
date or for the relevant period. Zero values generally indicate
 
that the respective figure is zero on an actual or rounded basis.
 
Percentage changes are presented
as a mathematical calculation of the change
 
between periods.
ubsgroupsustainabilitp132i0
UBS Group AG
P.O. Box
CH-8098 Zurich
ubs.com
 
 
 
 
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
 
registrants have duly
caused this report to be signed on their behalf by the undersigned, thereunto
 
duly authorized.
UBS Group AG
By:
 
/s/ Beatriz Martin Jimenez
Name:
 
Beatriz Martin Jimenez
 
Title:
 
Head Non-core and Legacy,
President UBS EMEA, and
Group Executive Board Lead
 
for Sustainability and Impact
By:
 
/s/ Todd Tuckner
Name:
 
Todd Tuckner
 
 
Title:
 
Group Chief Financial Officer
UBS AG
By:
 
/s/ Beatriz Martin Jimenez
Name:
 
Beatriz Martin Jimenez
 
Title:
 
Head Non-core and Legacy,
 
President UBS EMEA, and
Group Executive Board Lead
 
for Sustainability and Impact
By:
 
/s/ Todd Tuckner
Name:
 
Todd Tuckner
 
 
Title:
 
Group Chief Financial Officer
Date: 17 March 2025