REPORT REVIEW
Deutsche Bank Impact Reporting Methodology report
Impact Reporting Methodology Deutsche Bank
12 October 2023
VERIFICATION PARAMETERS
Type(s) of reporting
Relevant standard(s)
Scope of verification
Lifecycle
Validity
- Impact Reporting Methodology
- Harmonised Framework for Impact Reporting (HFIR), updated June 2023, as administered by International Capital Market Association (ICMA)
- Harmonised Framework for Impact Reporting for Social Bonds (HFIRSB), updated June 2023, administered by the International Capital Market Association (ICMA)
- Deutsche Bank's Impact Reporting Methodology (as of October 5, 2023)
- Deutsche Bank's Sustainable Instruments Framework (as of October 5, 2023)
- Pre-issuanceverification
- As long as no changes are undertaken by the Issuer to its Impact Reporting Methodology as of October 5, 2023
© 2023 | Institutional Shareholder Services and/or its affiliates
R E P O R T R E V I E W
Impact Reporting Methodology
Deutsche Bank
C O N T E N T S | |
PART I: ALIGNMENT WITH COMMITMENTS SET FORTH IN THE SUSTAINABLE INSTRUMENTS | |
PART III: DISCLOSURE OF PROCEEDS ALLOCATION AND SOUNDNESS OF THE IMPACT REPORTING | |
INDICATORS | 14 |
ANNEX 1: Methodology | 22 |
ANNEX 2: Quality management processes | 23 |
About this Report Review | 24 |
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R E P O R T R E V I E W
Impact Reporting Methodology
Deutsche Bank
SCOPE OF WORK
Deutsche Bank AG ("the Issuer" or "Deutsche Bank") commissioned ISS Corporate Solutions (ICS) to provide a Report Review1 on its Impact Reporting Methodology by assessing:
- The alignment of the Deutsche Bank's Impact Reporting Methodology with the commitments set forth in Deutsche Bank Sustainable Instruments Framework (as of October 5, 2023) 2.
- Deutsche Bank's Impact Reporting Methodology - benchmarked against Harmonised Framework for Impact Reporting (HFIR) and Harmonised Framework for Impact Reporting for Social Bonds (HFIRSB), administered by the International Capital Market Association (ICMA) updated as of June 2023.
- The disclosure of proceeds allocation and soundness of reporting indicators - whether the impact metrics align with best market practices and are relevant to the Sustainable Instruments to be issued.
- A limited or reasonable assurance is not provided on the information presented in Deutsche Bank Impact Reporting Methodology. A review of the use of proceeds' impact reporting methodology is solely conducted against ICMA's Standards (Harmonised Framework for Impact Reporting for Green Bond and Social Bond ) core principles and recommendations where applicable, and the criteria outlined in the underlying Framework. The assessment is solely based on the information provided in the impact reporting methodology. The Issuer [Deutsche Bank] is responsible for the preparation of the report including the application of methods and internal control procedures designed to ensure that the subject matter information is free from material misstatement.
- The Deutsche Bank Sustainable Instruments Framework was assessed as aligned with the GBP and SBP (as of June 2021 with June 2022 Appendix 1) as of October 5, 2023.
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R E P O R T R E V I E W
Impact Reporting Methodology
Deutsche Bank
ASSESSMENT SUMMARY
REVIEW SECTION | SUMMARY | EVALUATION | ||||||||||
Part 1. | Deutsche Bank confirms to follow the commitments set forth in the | |||||||||||
Sustainable Instruments Framework. | ||||||||||||
Alignment with the | ||||||||||||
Issuer's commitments | ||||||||||||
set forth in the | ||||||||||||
Framework | ||||||||||||
Part 2. | The Impact Reporting Methodology is in line with | |||||||||||
ICMA's HFIR and HFIRSB. The Issuer follows core | ||||||||||||
Alignment with the | principles | and | where | applicable | key | |||||||
Harmonised | recommendations. | |||||||||||
Framework for Impact | Aligned | |||||||||||
Reporting (HFIR) And | ||||||||||||
Harmonised | ||||||||||||
Framework for Impact | ||||||||||||
Reporting for Social | ||||||||||||
Bonds (HFIRSB) | ||||||||||||
Part 3. | The allocation of the bond's proceeds will be disclosed, | |||||||||||
with a detailed breakdown across different eligible | ||||||||||||
Disclosure of proceeds | project categories as proposed in the Framework3. | |||||||||||
allocation and | ||||||||||||
soundness of | The Deutsche Bank's Sustainable Instruments | Positive | ||||||||||
reporting indicators | Framework has adopted an appropriate methodology | |||||||||||
to report the impact generated by providing | ||||||||||||
comprehensive disclosure on data sourcing, | ||||||||||||
calculations methodologies and granularity reflecting | ||||||||||||
best market practices. | ||||||||||||
3 The assessment is based on the information provided in the Issuer's report. The Issuer is responsible for the preparation of the report including the application of methods and procedures designed to ensure that the subject matter information is free from material misstatement.
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R E P O R T R E V I E W
Impact Reporting Methodology
Deutsche Bank
REPORT REVIEW ASSESSMENT
PART I: ALIGNMENT WITH COMMITMENTS SET FORTH IN THE SUSTAINABLE INSTRUMENTS FRAMEWORK4
The following table displays the Issuer's commitment in the allocation and impact report against the commitments set forth in Deutsche Bank's Framework, which are based on the core requirements of the Green Bond Principles and Social Bond Principles as well as best market practices.
GBP AND SBP
OPINION
1. | Use of Proceeds | Deutsche Bank confirms to follow the Use of Proceeds' description | ||||
provided by Deutsche Bank's Sustainable Instruments Framework. The | ||||||
report will be in line with the initial commitments set in the Deutsche | ||||||
Bank's Sustainable Instruments Framework. | ||||||
2. | Process for | Deutsche Bank confirms to follow the Use of Proceeds' description | ||||
provided by Deutsche Bank's Sustainable Instruments Framework. The | ||||||
Project | ||||||
report will be in line with the initial commitments set in the Deutsche | ||||||
Evaluation and | ||||||
Bank's Sustainable Instruments Framework. | ||||||
Selection | ||||||
3. | Management of | Deutsche Bank confirms to follow the Use of Proceeds' description | ||||
provided by Deutsche Bank's Sustainable Instruments Framework. The | ||||||
Proceeds | ||||||
report will be in line with the initial commitments set in the Deutsche | ||||||
Bank's Sustainable Instruments Framework. | ||||||
4. | Reporting | Deutsche Bank confirms to follow the Use of Proceeds' description | ||||
provided by Deutsche Bank's Sustainable Instruments Framework. The | ||||||
report will be in line with the initial commitments set in the Deutsche | ||||||
Bank's Sustainable Instruments Framework. | ||||||
5. | Verification | Deutsche Bank commits to engage an independent external auditor or any | ||||
other verifier to provide a limited assurance on the annual allocation | ||||||
reporting of proceeds from Sustainable Financing Instruments to Eligible | ||||||
Assets | ||||||
4 The Deutsche Bank Sustainable Instruments Framework was assessed as aligned with the GBP and SBP (as of June 2021 with June 2022 Appendix 1) as of October 5, 2023.
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R E P O R T R E V I E W
Impact Reporting Methodology
Deutsche Bank
PART II: ASSESSMENT AGAINST THE ICMA HARMONISED FRAMEWORK FOR IMPACT REPORTING (HFIR) AND HARMONISED FRAMEWORK FOR IMPACT REPORTING FOR SOCIAL BONDS (HFIRSB)
FOR GREEN BONDS
Reporting is a core component of the GBP and transparency is of particular value in communicating the expected and/or achieved impact of projects in the form of an annual reporting. Green bond Issuers are required to report on both the use of green bond proceeds, as well as the environmental impacts at least on an annual basis until full allocation or maturity of the bond. Harmonised Framework for Impact Reporting (HFIR) has been chosen as benchmark for this analysis as it represents the most widely adopted standard.
The table below evaluates Deutsche Bank Impact Reporting Methodology against ICMA Harmonised Framework for Impact Reporting (HFIR).
CORE PRINCIPLES
ICMA HFIR | IMPACT REPORTING METHODOLOGY | ASSESSMENT | |||||||||
Reporting on an annual | Deutsche Bank commits to report within one year | ||||||||||
from | issuance. The report | will | be available on | ||||||||
basis | |||||||||||
Deutsche Bank's website. | |||||||||||
The assessment and measurement of the impacts | |||||||||||
generated by Deutsche Bank Green Bond(s) will | |||||||||||
cover the following areas: | |||||||||||
1. | Renewable Energy | ||||||||||
▪ (Expected) annual GHG emissions | |||||||||||
reduced/avoided (metric | tons of | ||||||||||
CO2e) | |||||||||||
▪ Annual | renewable | energy | |||||||||
generation (MWh) | |||||||||||
Illustrating the | ▪ | Installed capacity | of renewable | ||||||||
environmental impacts | |||||||||||
energy constructed or rehabilitated | |||||||||||
or outcomes | |||||||||||
(MW) | |||||||||||
2. Clean Transportation- Electric vehicles (EVs) | |||||||||||
▪ (Expected) annual GHG emissions | |||||||||||
reduced/avoided (metric | tons of | ||||||||||
CO2e) | |||||||||||
▪ Optional: Number of EVs financed | |||||||||||
3. Clean Transportation- Electric vehicles (EVs) | |||||||||||
▪ (Expected) annual GHG emissions | |||||||||||
reduced/avoided (metric | tons of | ||||||||||
CO2e) | |||||||||||
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R E P O R T R E V I E W
Impact Reporting Methodology
Deutsche Bank
▪ For passenger travel: | pkm | (i.e. | ||
transport of one passenger over one | ||||
kilometer) and/or passengers | ||||
i. | For cargo transport: ton-km | |||
(i.e. the transport of one ton | ||||
over one kilometre/ ton- | ||||
km) and/or metric tons | ||||
ii. | Optional: | Total | in | |
kilometers | of | new | or | |
improved train lines | ||||
- Green Building
- Residential Real Estate (RRE)
- Expected energy savings in MWh per year
- (Expected) annual GHG emissions avoided (metric tons of CO2e)
- Commercial Real Estate (CRE)
- Expected energy savings in kWh per year
- (Expected) annual GHG emissions avoided (metric tons of CO2e)
- Energy Efficiency
- (Expected) annual energy consumption saved through measures in kWh
- (Expected) annual GHG emissions reduced/avoided (metric tons of CO2e)
- Information and Communications Technology (ICT)
- (Expected) annual energy consumption saved through measures in kWh
- (Expected) annual GHG emissions reduced/avoided (metric tons of CO2e)
- Design average annual PUE
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R E P O R T R E V I E W
Impact Reporting Methodology
Deutsche Bank
Deutsche Bank commits to evaluate potential | ||||
environmental and social risks that could arise from | ||||
ESG Risk Management | potentially eligible projects against the Issuer's | |||
Environmental and Social Policy Framework, in line | ||||
with the commitment set forth in the Sustainable | ||||
Instruments Framework. | ||||
Deutsche Bank does not report on individual | ||||
Allocation of proceeds - | projects since the project data is confidential. The | |||
Transparency on the | reporting is at portfolio level. The Issuer commits to | |||
currency | be transparent on reporting the cash flows in one | |||
currency. | ||||
RECOMMENDATIONS
ICMA HFIR | IMPACT REPORTING METHODOLOGY | ASSESSMENT | ||
Define and disclose | Deutsche Bank will define and disclose period and | |||
period and process | process for Project Evaluation and Selection | |||
for Project | ||||
Evaluation and | ||||
Selection | ||||
Disclose total | Deutsche Bank will disclose the total amount of | |||
amount of proceeds | proceeds raised and allocated to eligible | |||
allocated to eligible | disbursement. | |||
disbursements | ||||
Formal internal | Deutsche Bank will follow a transparent process for | |||
process for the | the allocation of proceeds. | |||
allocation of | ||||
proceeds and to | ||||
report on the | ||||
allocation of | ||||
proceeds | ||||
Report at project or | Deutsche Bank will report on the total amount of | |||
portfolio level | proceeds allocated per eligible project category. | |||
Describe the | Deutsche Bank will adjust the impact calculation by | |||
approach to impact | the share of financing attributable to the Issuer. | |||
reporting | ||||
Report the | ||||
estimated lifetime | Deutsche Bank does not plan to report on the | - | ||
results and/or | average portfolio lifetime results or economic life (in | |||
project economic | years). | |||
life (in years) | ||||
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R E P O R T R E V I E W
Impact Reporting Methodology
Deutsche Bank
Ex-post verification | Deutsche Bank does not plan to sample ex-post | |||
verification of specific projects and includes relevant | - | |||
of specific projects | ||||
results in the reporting | ||||
Report on at least a | Deutsche Bank will report on sector specific core | |||
limited number of | indicators, whenever the required input variables or | |||
sector specific core | external data sources are available. | |||
indicators | ||||
Deutsche Bank discloses the assumptions and | ||||
impact calculation methodologies for Renewable | ||||
Energy and Clean Transportation. | ||||
For Green Building, the Issuer will engage an | ||||
external consultant for Commercial Real Estate | ||||
(CRE) to evaluate the impacts, through a | ||||
comparison with national reference benchmarks, | ||||
e.g. Building Performance Database of USA, | ||||
National Energy Code of Canada for Buildings, and | ||||
Energy Start Portfolio Manager of USA and Canada. | ||||
For Residential Real Estate (RRE), the Issuer uses | ||||
If there is no single | real annual energy consumption and CO2 emissions | |||
commonly-used | when EPC data are available, otherwise an | |||
standard, Issuers | estimation approach. The expected GHG emissions | |||
may follow and | avoided of RRE assets will be calculated through a | |||
disclose their own | comparison with average national carbon | |||
calculation | emissions taken from PCAF database of an average | |||
methodologies | RRE portfolio of the same size and regional | |||
distribution. The expected energy savings in MWh | ||||
per year will be calculated based on the expected | ||||
GHG emission avoided and average conversation | ||||
factors. For Germany, the conversion factor is | ||||
based on the Bank's own calculations on the basis | ||||
of existing internal EPC data. | ||||
For Energy Efficiency and Information and | ||||
Communications Technology, the Issuer will | ||||
disclose the calculation methodology or data | ||||
source according to the specific type of activities | ||||
that the proceeds will be allocated to. | ||||
Disclosure on the | ||||
conversion | The Issuer will disclose on the conversion approach | |||
approach (if | for the impacts units. | |||
applicable) | ||||
Projects with partial | For projects with partial eligibility the Bank will only | |||
pro-rata count the affordable part into its asset pool | ||||
eligibility | ||||
internally and also only report impact pro-rata. | ||||
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R E P O R T R E V I E W
Impact Reporting Methodology Deutsche Bank
When the expected impacts of different project componentsmay not be reported separately,Issuers may use (and disclose) the attribution approach
The impact of Deutsche Bank's projects will be reported separately per category and sub category on an aggregated basis. In case separate impact reporting is not possible, disclosure via attributionapproach should remain an option.
OPINION
Deutsche Bank follows Harmonised Framework for Impact Reporting's core principles and key recommendations. The Issuer provides transparency on the level of expected reporting as well as on the frequency, scope and duration, aligned with best practices.
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Deutsche Bank AG published this content on 24 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 May 2024 15:57:27 UTC.