Principles: Commitment to responsible action

Identity

Since its founding in 1850, LUKB has pursued a long-term business policy with the aim of generating significant benefits for the people and economy of the Canton of Lucerne. This also includes value creation for the majority shareholder (Canton of Lucerne) and for the more than 33,000 other LUKB shareholders. A key aspect of this policy is sustainability: conserving limited resources, helping to shape a viable long-term society and furthering social justice. As the market leader in the Lucerne economic region and as a major employer, LUKB is conscious of its special responsibility and acts proactively and with a focus on the future as a result.

LUKB has therefore firmly embedded the topic of sustainability at an organisational level to ensure systematic sustainability management and appropriate reporting throughout the Group.

LUKB's commitment to long-term value creation is also reflected in its mission (‘Purpose’):

‘With us, opportunities become reality.
Today and for future generations, we act responsibly
to create real value from financial opportunities.
For people, for companies, for our economic region.’

Sustainability strategy

Sustainability was already a key component of the ‘LUKB25’ corporate strategy (strategy period 2020 to 2025) and remains firmly enshrined in the new ‘LUKB30’ overall bank strategy for the period 2026 to 2030. As part of the overarching strategy principles, the LUKB sustainability strategy forms the basis for responsible action and sustainable value creation in all business areas.

Strategy approach

Sustainability is managed within a clearly defined framework:

Stakeholder dialogue: LUKB maintains an ongoing dialogue with its stakeholders to understand their expectations and needs.
Identification and management of material topics: LUKB regularly analyses the sustainability topics of relevance to it and manages them in a targeted manner. Sustainability management is based on the reference framework below.
External reporting: LUKB reports transparently in accordance with legal requirements, the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and the standards of the Global Reporting Initiative (GRI).

Strategic priorities

The strategic priorities for 2026 to 2030 (’LUKB30’ strategy period) are:

Assumption of responsibility towards society and the environment in all business activities
Achievement of the defined greenhouse gas reduction targets and the other environmental targets
Ensuring a high level of attractiveness as an employer and ongoing employee promotion and development. This includes measures to attract, retain and develop talent, as well as training and career development programmes.
Further strengthening of corporate governance and risk and compliance management
Ensuing the defined minimum ratings for all sustainability/ESG ratings relevant to LUKB

In 2025, LUKB continued various activities from the previous year and focused on the following areas:

Strategic development: review and adjustment of LUKB's overall strategy for the 2026 to 2030 period, including the sustainability strategy
Maintenance of sustainability/ESG ratings: ongoing management of sustainability/ESG ratings, including dialogue with rating organisations
Compliance with regulatory requirements: implementation of the expanded FINMA reporting requirements on climate risks, start of implementation of FINMA Circular 2026/01 ‘Nature-related financial risks’
Further development of data sources and technologies: further development of the database and technological infrastructure for effective and efficient sustainability management and reporting

Reference framework

LUKB bases its sustainability management and corporate responsibility on the following reference framework:

Statutory foundations

Article 964a et seq. Swiss Code of Obligations (indirect counterproposal to the Responsible Business Initiative): provisions on reporting on non-financial matters, and on minerals and metals from conflict-affected areas and child labour. These have been in force since 1 January 2022. LUKB has once again implemented these requirements in this 2025 Sustainability Report. The ‘Report on non-financial matters’ section of this Sustainability Report shows which information is available in the different sections of the 2025 Sustainability Report and Annual Report.
Ordinance on Climate Disclosures, on the basis of Article 964a et seq. of the Swiss Code of Obligations, including the safe harbour provision on the application of the recommendations of the Task Force on Climate- related Financial Disclosures (TCFD). This Ordinance entered into force on 1 January 2024. This 2025 Sustainability Report once again contains the TCFD reporting in accordance with these requirements. LUKB implemented TCFD reporting for the first time in the 2024 Sustainability Report. The ‘Report on non-financial matters’ section of this Sustainability Report shows where the TCFD disclosures are included in the 2025 Annual and Sustainability Report.

Other relevant regulations

‘Guidelines for mortgage providers on the promotion of energy efficiency’ of the Swiss Bankers Association SBA.¹⁾ With a transitional period until 1 January 2024, these have been binding for the SBA member banks since 1 January 2023.
‘Guidelines for the financial service providers on the integration of ESG preferences and ESG risks and the prevention of greenwashing in investment advice and portfolio management’ of the Swiss Bankers Association SBA.¹⁾ Applying implementation deadlines, these have been binding for SBA member banks since 1 January 2023.
Self-regulation on transparency and disclosure for sustainability-related collective assets, published by the Asset Management Association Switzerland (AMAS)²⁾, which entered into force on 30 September 2023. An expanded version of this self-regulation entered into force on 1 September 2024 with transitional periods.

1) https://www.swissbanking.ch/en

2) https://www.am-switzerland.ch/en

LUKB-specific reference framework

LUKB Act and Articles of Association¹⁾
The 2025 Ownership Strategy of the Canton of Lucerne, which was approved and put into effect by the Government Council of the Canton of Lucerne on 17 April 2025 and replaces the previous 2021 Ownership Strategy²) (in German)
The climate and energy policy of the Canton of Lucerne with the goal of net-zero greenhouse gas emissions by 2050 and in particular the requirements derived from it in the 2025 Ownership Strategy (Chapter B. III)²⁾
LUKB Code of Conduct¹⁾
LUKB's mission statement on sustainability in the investment business³) (in German)
‘LUKB30’ strategy (see LUKB 2025 Annual Report, ‘Business model and strategy’ in the ‘About LUKB’ section)
LUKB Supplier Code of Conduct¹⁾

1) https://lukb.ch/english-window

²⁾ https://lukb.ch/eignerstrategie

3) https://lukb.ch/nachhaltig-anlegen

Reference frameworks set by various sustainability initiatives

UN Principles for Responsible Investment (PRI): United Nations Principles for Responsible Investment
Climate Action 100+ targets
Swiss Sustainable Finance (SSF) targets
Swiss Stewardship Code targets, as published by the Asset Management Association Switzerland (AMAS)
Selected goals of the United Nations 2030 Agenda for Sustainable Development (Sustainable Development Goals, or SDGs). Further information on the SDGs can be found in the Annex to this Sustainability Report.
Global greenhouse gas accounting and disclosure standards for the financial industry of the Partnership for Carbon Accounting Financials (PCAF)

LUKB sustainability/ESG ratings

LUKB has the following sustainability/ESG ratings, which are part of LUKB's internal strategic target system (balanced scorecard):

		2023	2024	2025
MSCI	ESG risk¹⁾	AA	AA	AA
Inrate	ESG impact²⁾	B–	B	B
Inrate	Corporate governance (zRating)³⁾	70	72	74
ISS	ESG impacts, risks & opportunities⁴⁾	Not Prime D+	Not Prime D+	Prime C
Sustainalytics (Morningstar)	ESG risk⁵⁾	Medium	Medium	Medium

1)Scale: AAA (best rating), AA, A, BBB, BB, B, CCC

2)Scale: A+ (best rating), A, A–, B+, B, B–, C+, C, C–, D+, D, D–

3)Scale from 100 points (best rating) to 1 point

4)Scale: A+ (best rating), A, A–, B+, B, B–, C+, C, C–, D+, D, D–

5)Scale: «Negligible ESG Risk» (best rating), «Low ESG Risk», «Medium ESG Risk», «High ESG Risk», «Severe ESG Risk»

LUKB has also been assigned a WWF rating on its environmental impact. This is based on a study carried out in 2024 by WWF Switzerland in collaboration with INFRAS Ltd and Inrate Ltd. In this study, LUKB – together with several other major Swiss retail banks – placed in the middle of the pack (with an ‘average’ rating). At the same time, the study confirmed that LUKB had made the greatest progress compared to the previous evaluation in 2021.