In addition to the so-called ESG criteria (environmental, social and governance), exclusion criteria are also integrated into our investment approach for the . Applying exclusion criteria ensures that, as a matter of principle, no funds provided by KfW to the issuers through the purchase of their bonds for the KfW liquidity portfolio can flow into projects which, from our perspective, are likely to have unacceptable negative impacts on the environment, social conditions and governance.
If the issuers are financial services providers, the exclusion criteria are applied indirectly, in the case of banks, for example, to their relevant equity participations. Exclusion criteria are not considered for bonds of sovereign issuers.
Indirect application of exclusion criteria to:
- shares held by e.g. banks of at least 10 % in an enterprise
- which generates at least 5% of its annual turnover on the basis of one or more of the products covered by the exclusion criteria, or
- which exhibits a controversy factor of 4 or 5 as determined by our research partner Sustainalytics. A rating of 4 or higher on a scale of 1-5 means that controversies or serious violations have been repeatedly identified in an enterprise.
- The amount of the equity participations must account for at least 0.5% of a bank's total assets.