Global frameworks

Our policy for the environment and sustainability

Our Environmental and Sustainability Policy sets out the commitments, principles and obligations of Nefco’s financing activities and internal operations.

The policy, which was updated in 2022, reflects Nordic priorities and global frameworks to support concrete actions toward achieving carbon neutrality and a sustainable, circular and biodiversity-positive economy.

It also defines projects that we cannot finance, with exclusions related to fossil fuel, forestry and husbandry, as well as ethical, legal and convention matters. One objective is to increase the share of EU Taxonomy-aligned projects in our portfolio and set clear boundaries for activities to which Nefco is unwilling to make commitments.

• Read more in Nefco’s Environmental and Sustainability Policy

EU Taxonomy assessment of the active investment portfolio

Nefco has adopted the EU Taxonomy for Sustainable Financing framework as its primary classification system to identify and assess projects. The EU Taxonomy is a common classification of economic activities contributing significantly to environmental objectives using science-based criteria. Created by the European Commission in 2020 as part of the implementation of the EU Green Deal, it is a way to showcase whether a company, asset, project, product or service is contributing substantially to a sustainable economy. The classification is done according to the six environmental objectives.

‘Green’ is not defined by the EU Taxonomy alone. For economic activities that are not yet covered by the EU Taxonomy, we use our own definitions based on the spirit and logic of the EU Taxonomy.

Aligning with global and Nordic goals

Our activity aligns with common global and Nordic goals for a sustainable future.

Agenda 2030 and its Sustainable Development Goals, adopted by all UN Member States in 2015, provide an action plan to achieve a better and more sustainable future for all. The goals address the global challenges we face, including those related to climate, environmental degradation, inequality and prosperity.

As a Nordic institution, we also follow the goals set out in the Nordic Vision 2030. The roadmap for Nordic cooperation activities aims to make the Nordics the most sustainable and integrated region in the world by 2030. Therefore, we prioritise sectors and activities to which we can add the most value. The green transition remains the greatest challenge in the Nordic Region, and Nefco is ready to accelerate it by providing financing for the scale-up of Nordic green solutions and businesses on global markets.

Sustainable Development Goals

Our financing activities contribute to most of the SDGs. Download our Annual Report 2023 to learn more about our contribution to common Nordic and global goals.

In 2024, our financing activities contributed particularly to the Sustainable Development Goals highlighted below. The image shows the number of projects contributing to each
goal and their percentage of our project portfolio.

Nefco manages the Modern Cooking Facility for Africa programme, which supports women’s participation in clean cooking and fuel value chains, offering new business and employment opportunities that support the economic empowerment of women.

Nefco has financed numerous projects related to wastewater management. Apart from addressing the removal of nutrients, Nefco assesses how to reduce other threats such as pharmaceuticals and persistent organic pollutants.

Accumulated reduction over the years: over 11,700 tonnes phosphorus and 56,200 tonnes nitrogen
discharge, of which Nefco’s share has been about 2,332 and 11,359 tonnes, respectively.

A significant part of our financing activity relates to energy efficiency and renewable energy. At the end of 2024:

370,000 energy service connections in underserved regions in Sub-Saharan Africa, benefiting 3.1 million people across five countries within the BGFA programme.

Supporting small and medium-sized enterprises to grow is a priority for Nefco.

Number of active projects at the end of 2024:
68 active investments in Nordic SMEs
126 feasibility studies by Nordic SMEs through Nopef
30 energy service providers within the BGFA programme
13 clean cooking service providers within the MCFA programme

The majority of projects financed by Nefco contribute to climate change mitigation. Energy-efficiency and renewable energy projects have a direct impact on GHG emissions.

Accumulated reductions over the years:
Nefco has contributed to the reduction or avoidance of over 37 million tonnes CO2, and 9.5 million tonnes when prorated to Nefco’s share in the projects.

The ecological state of the Baltic Sea has been a main priority since Nefco was established in 1990. Sustainable use and protection of water and marine resources is still a high priority area for us.

Accumulated reductions over the years:
over 11,700 tonnes phosphorus and 56,200 tonnes nitrogen discharge, of which Nefco’s prorated share has been about 2,332 and 11,359 tonnes respectively