Sustainable Finance

The transformation towards a sustainable society is the most pivotal challenge of our times. KfW promotes this transformation process with the objective of a sustainable development that takes the dimensions economy, environment and social equally into account. As a promotional bank operating worldwide on behalf of the German Federal Government and Federal States, KfW supports the sustainability goals defined by the international community, the European Union and those of the Federal Republic of Germany.

KfW wants to take on a pioneering role in the financial sector on how banks respectively promotional banks can substantially contribute to achieving the UN Sustainable Development Goals and to the Paris Climate Agreement with the means available to them. In doing so, a change in the strategic bank steering plays an essential role, for which KfW has developed a comprehensive Sustainable Finance concept which is currently gradually being implemented throughout KfW Group.

KfW’s ambitions as wells as their Sustainable Finance concept are also reflected in the first German strategy for sustainable financing activities (“Sustainable Finance”) set out by the German Government. It elaborates “The German Government supports KfW’s implementation of their Sustainable Finance concept, with which KfW, in accordance with the mandate specified in the Climate Protection Programme 2030, further develops towards a transformative promotional bank for a sustainable and greenhouse gas-neutral future.”

All business divisions within KfW have been consistently implementing the Sustainable Finance concept since January 2021 and continue to do so. Significant new management approaches result from adjustments already implemented in KfW’s strategic target system: The newly defined primary goal emphasizes the necessary transformation and to strengthen the promotional principle “sustainability”, two new goals have been formulated: “KfW’s financing activities’ SDG-contribution” and “Paris compatibility of KfW’s financing activities”.

Significant Sustainable Finance mechanisms within KfW Group are the mapping of promotional activities based on the UN Sustainable Development Goals (SDG-Mapping), a comprehensive impact management (including greenhouse gas accounting) as well as the newly introduced sector guidelines to guarantee the compatibility of our financing activities with the goals set out in the Paris Climate Agreement.