Nokia doubles down on ESG

Finnish kit vendor Nokia has announced a new initiative designed to demonstrate how virtuous it is.

Hot on the heels of the latest WEF elite-fest at Davos, Nokia’s announcement is littered with stakeholder capitalism buzzwords. The new bright idea is called the Sustainable Finance Framework which, according to the press release, “reinforces Nokia’s commitment to sustainable growth by ensuring its financing strategy supports the company’s recently enhanced ESG strategy.”

ESG, for those new to the corporate virtue-signalling game, stands for Environmental, Social and Governance (formerly known as CSR). As the name implies it’s a box-ticking framework through which companies can acquire ethical indulgences by demonstrating how green they are, how much they care about protected classes, and generally play by an arbitrary set of non-commercial rules, apparently agreed at these WEF jamborees.

Stakeholder capitalism seeks to replace old-fashioned metrics such as revenue, profit, and tall, shiny HQ buildings as the primary way in which the value of companies is measured. Of course nobody is interested in virtuous companies that make no money, so the best the likes of the WEF can hope for is that the two concepts coexist in some kind of equilibrium.

“Complementing our enhanced ESG strategy with the Framework is a logical next step in our progress to strengthen the connection between our ESG and financing strategies,” said Marco Wirén, Chief Financial Officer of Nokia. “We linked the margin of our EUR 1.5 billion revolving credit facility to our sustainability targets already in 2019 and signed our first sustainability-linked guarantee facility in 2022. As we accelerate our growth, we remain deeply committed to be part of the solution to the world’s biggest challenges.”

“Sustainability is core to Nokia’s purpose of creating technology that helps the world act together,” said Melissa Schoeb, Chief Corporate Affairs Officer of Nokia. “We’re delighted that Sustainalytics’ opinion aligns with our view regarding the strength of our Framework and that our target to reduce greenhouse gas emissions across our value chain was assessed as highly ambitious.”

Sustainalytics eh? That’s a new one to us but the name is a classic of the genre. It’s not rocket-science; get a word that broadly encapsulates what you do and then give it an ESG buzzword prefix. Nokia is also a big fan of a company called Ethisphere, which anoints the most virtuous companies in the world once per year. The smart money is on Nokia winning an award again this year, so we have that press release to look forward to in a few weeks.

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