Company: BCDRF
Filing Date: 2025-02-28
Form Type: 20-F
Source: 0000891478-25-000054
Chunk: 45

Company: Banco Santander, S.A.
Filing Date: 2025-02-28
Form: 20-F
Chunk 45
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 analysing climate risk, we can better understand the assets we invest in, identify the issuers best positioned to overcome future challenges, seize new opportunities and create value for businesses and broader society. 
 The climate-related risks that SAM’s ESG analysis model considers are:                                                                                                                                                                                                                                                                                                                                        
 •regulatory risks related to greenhouse gas (GHG) emissions, such as higher prices;                                                                                                                                                                                                                                                                                                                           
 •the risk of new, more efficient low-carbon technology alternatives that may render existing technologies obsolete; and                                                                                                                                                                                                                                                                                       
 •market risks stemming from increased costs and shifting consumer demand, which could result in stranded assets; higher operating costs; lower demand for products and services; and the higher cost of, and limited access to, capital.                                                                                                                                                                      |     |                        |

2.3.1 Resilience of our strategy and business model to climate change Managing climate and environmental risk factors is key to continue strengthening the resilience of the Group's strategy and business model for climate change. To enhance such resilience, we embed climate and environmental risk factors in each stage of the risk management cycle through which we analyse our own facilities and customer's financing process. The risks derived from these factors is also included in our policies, procedures, tools, metrics, governance and culture. Embedding climate and environmental factors in our risk management includes the identification, planning, assessment, monitoring, mitigation and reporting, across different climate scenarios and time horizons defined, see further detail in the next section. Additionally, the risk function works to strengthen our strategy via the following processes:

• We carry out an analysis and challenge of the strategic plan (Risk Challenge) to identify potential threats that may compromise the achievement of the Group's objectives. • We have a risk management control model to identify, assess, mitigate, monitor and report all material risks, including ESG, that could materialize and affect our strategy and/or business model. • Santander regularly conducts an emerging risks exercise to identify key threats to our strategic plan under theoretical stress scenarios with low likelihood of occurrence. In this sense, we aim to identify, assess and monitor physical, transition and regulatory risks that may have an impact on our business model, profitability or solvency, improving the resilience of our strategy. The monitoring of the material issues related to the ESG risks identified in the described processes, as well as the main lines of action for their management, are periodically reviewed through the corresponding risk governance bodies which participate in the definition of the business model and the Group's strategy in this matter. Santander understands how climate-related and environmental