Deutsche Bank help corporate clients meet their ESG goals

Thursday 2 December 2021 10:45 CET | News

Deutsche Bank has launched sustainability-linked overdrafts to help meet a growing demand for innovative ESG products in the cash management space. 

The new solution is designed to encourage businesses to improve their ESG performance by providing a pricing incentive related to an ESG KPI. For the pilot stage, this KPI will be the client’s ESG rating, as determined by a third-party ESG rating specialist. If a client’s ESG rating changes above or below a certain threshold, their pricing will be adjusted accordingly. While offering this innovation Deutsche Bank considers the clients overall sustainability strategies and targets.

The bank has already gone live with the first implementation, converting a client’s existing EUR 10 million overdraft facility into a sustainability-linked overdraft – offering flexibility in the usage of funds, with rewards tied to improvement in its overall ESG score.

The launch of this sustainability-linked overdraft solution is part of Deutsche Bank's wider sustainability strategy. It follows the announcement of the bank’s green deposits programme in March 2021, where deposited funds contrast with an equivalent amount of Deutsche Bank’s green asset pool. The bank also set itself several targets to reduce its environmental footprint, paying particular attention to energy efficiency and energy consumption. With its own operations carbon neutral since 2012, the bank aims to maintain this and to source 100% renewable electricity by 2025.

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Keywords: Deutsche Bank, green finance, ESG, sustainability
Categories: Banking & Fintech
Countries: World
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Banking & Fintech

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