3.2 Strategy
Contents Foreword Management report Corporate governance Consolidated Financial Statements Company Financial Statements Pillar 3
into dialogues with our stakeholders and sometimes adjust our
goals as a result. We aim to be ranked by independent rating
agencies as one of the most sustainable, globally operating,
general banks by 2020.
Growthpath
We have made meaningful progress with the implementation
of Sustainably Successful Together during this year and
are satisfied with the progress on the measurement of
progress on the targets we have set for our contribution to
sustainable development until 2020. For all KPIs we introduced
measurement, improved its quality and/or made progress on
the realisation of the targets themselves.
We aim to report in line with the expectations of our
stakeholders in a fully integrated and meaningful way about our
activities. This requires further integration in the management
of and reporting on financial and non-financial targets, activities
and results. We will therefore further integrate the management
of and reporting about Banking for Food, Banking for
the Netherlands and Sustainably Successful Together next year.
The quality of data gathering requires further improvement as
well. Software is being developed to realise this. The integration
with the management cycle for our two strategic pillars will be
strengthened to this aim. This requires further integration of
the existing management information systems and - processes.
These activities were started during this year and will be
continued upon delivery next year. In addition we will optimise
the clarity of the wording of the key performance indicators of
Sustainably Successful Together using the practical experience
in implementing them over the last two years. We expect that
the activities described will make it possible to realise both
a faster realisation of the targets set, the measurement of its
progress and the reporting about it.
At the beginning of 2016 the implementation of the
Strategic Framework 2016-2020, which describes how we
want to achieve ourambitions began. This strategy provides
a sharpened focus on improving customer service and realising
a fundamental improvement in financial performance across
Rabobank in order to safeguard our future success. To fulfil our
ambitions for 2020, we are focusing on three core objectives.
1. Excellent customer focus
In the Netherlands, we strive to be the most customer-focused
bank in the country and we aim for a sharp increase in customer
satisfaction outside the Netherlands as well. We believe that
this is where our strength and distinctiveness lie. Rabobank will
undergo a fundamental transformation in the coming years
in terms of working methods, culture, attitudes and conduct.
By doing so, we are responding to changes in customer needs,
the uncertain economic climate and the stricter requirements
of regulators. We want to become the most customer-
focused bank in the Netherlands and in the food agri sector
internationally by providing excellent basic service, being the
closest to our customers at key moments and fulfilling our role
as a financial linking pin.
2. Increased flexibility and reduction of the balance sheet
In the years to come, we anticipate a further tightening of the
regulatory environment, for example the implementation of
the proposed reforms to 'Basel III' and MREL. To maintain our
position as a rock-solid bank, it will be necessary to make our
balance sheet more flexible. We want to achieve balance sheet
optimisation by, among other things, placing parts of our loan
portfolio with external parties and maintaining a liquidity buffer
that is in line with the reduced balance sheet total. We are
carefully monitoring ongoing developments with regard to
the pending Basel regulations, the final outcome of which will
ultimately determine the extent of the required balance sheet
reduction, but without changing our other financial targets
for 2020.
3. Performance improvement
To maintain our position as a rock-solid bank we need to
realise an improvement in performance. Our aim for 2020
is a gross profit (before tax) improvement of EUR 2 billion
(excluding the effects of the reduction of our balance sheet)
compared to 2014, which will be realised by improvements
within our central organisation, the local Rabobanks and
the international organisation. The improvement should be
effected by both higher revenues and lower costs through
increasing efficiency and new ways of working. Reaching this
level of profit improvement will improve the cost/income ratio
to approximately 53-54% in 2020, and we will achieve a return
on invested capital (ROIC) of at least 8%. For more information
click here.
Accelerators
The strategy calls for a substantial transformation of the
Rabobank. In view of the challenge we face and to accelerate
implementation and realisation, we identify three accelerators
simultaneously to realise and strenghten the transformation:
304 Rabobank Annual Report 2016