Deutsche Bank

Corporate Responsibility
Report 2015

Managing environmental and social risks

As a global bank, we have clients across all sectors of the economy, including those where business may have negative environmental and social (ES) impacts. These impacts pose a risk to our financial performance and reputation.

Sensitive sectors and topics

ES risks are varied and complex, ranging from pollution and threats to wildlife, to land rights and human and labor rights. They therefore require a case-by-case approach (with the exception of cluster munitions, where we have defined clear exclusion criteria), drawing on a deep understanding of wider socioeconomic and environmental trends.

We have defined a number of sectors that are more exposed to ES risk:

  • Aerospace and defense
  • Chemicals
  • Steel, metal, and mining
  • Oil and gas
  • Agriculture, incl. pulp and paper
  • Utilities
  • Other carbon-intensive sectors

Across these sectors, we look for issues that require specific ES risk management. These are addressed through our policy framework, and guidance is provided to employees when making decisions. For some issues, we have published our positions.

Our positions db.com/cr/positions

Crosscutting topics

 

Our position

Human rights

 

We are signatories to the UN Global Compact, which explicitly requires respect for human rights. Our policies and guidelines reflect our commitment to the UN Guiding Principles on Business and Human Rights. We have integrated human rights considerations into the due diligence process of companies and sovereigns required by our ES Policy Framework. Our sector-specific guidelines explain potential issues and how to respond to them. Additionally, a formal Human Rights Statement was published in 2015.

Sensitive, protected sites

 

While providing financing, we consider, where applicable, the impact of clients’ operations on sensitive areas with, for example, high biodiversity value or internationally recognized areas such as Ramsar wetlands. Transactions that might potentially impact these areas are subject to enhanced review.

We only support activities in or near World Heritage Sites if there is a prior consensus with both the government and UNESCO that such operations will not adversely affect the outstanding universal value of the site.

 

 

 

Sectors*

 

Our position

Agricultural commodities

 

Numerous studies have found no convincing evidence that financial activities have led to higher prices or increased volatility. We believe financial products are essential for markets to be efficient and we support increased transparency and appropriate legislation.

Cluster munitions

 

We have not provided direct funding for cluster munitions since 2009. Since 2011, we no longer do business with conglomerates involved with these weapons or components of these weapons banned under the Oslo Convention. We have exited some business and will not extend any existing contracts. If we are in any doubt about involvement, we require written confirmation that the client has had no involvement in cluster munitions before beginning or continuing a business relationship.

Coal

 

Coal power is still necessary to close the energy gap until renewable sources have grown sufficiently. In doing business with the coal industry, we expect companies to use the latest technologies to limit environmental impacts, meet sustainability criteria such as the IFC Performance Standards, and implement certification such as ISO 14001.

Mountaintop removal

 

Mountaintop Removal (MTR), while an established and regulated mining method, continues to be subject to political, judicial, and regulatory scrutiny. Along with other mining industry participants, we have noted the steady decline in MTR production since 2008 and are of the view that MTR is likely be phased out in the near to medium-term future. In recognition of this ongoing industry trend, we updated our policy position in relation to MTR. Accordingly, Deutsche Bank and its subsidiary undertakings have begun to phase out the provision of credit and the underwriting of debt/equity to mining companies that use MTR as an extraction method and which make a material contribution to the total annual MTR coal production in the USA.

Hydropower

 

Our ES Policy Framework requires an evaluation of the social and environmental impact of all projects, and we require appropriate sustainability standards for any project that we are considering to finance.

Industrial agriculture (e.g. palm oil)

 

We recognize the risks, but also the contribution of palm oil production to the economic development in some countries and its importance for many products. As a minimum, clients must provide a plantation or mill certification plan in accordance with the criteria imposed by the Roundtable on Sustainable Palm Oil (RSPO). We are signatory to the Soft Commodities Compact to promote further sustainable production of palm oil, timber products, soy, and beef.

Nuclear power

 

We view nuclear power as an important low-carbon energy source in the transition to a more sustainable energy mix. We therefore support financing for civil nuclear power, subject to specific country and project criteria such as compliance with international treaties and agreements as well as adherence to health, safety, environmental, and social standards.

* In alphabetical order