Green Bond / Green Bond Programme. External Review Form

Transcription

1 Green Bond / Green Bond Programme External Review Form Section 1. Basic Information Issuer name: Deutsche Hypothekenbank (Actien-Gesellschaft) Green Bond Framework Review provider s name: oekom research AG Completion date of this form: 16 August 2017 Publication date of review publication: 16 August 2017 Section 2. Review overview SCOPE OF REVIEW The following may be used or adapted, where appropriate, to summarise the scope of the review. The review assessed the following elements and confirmed their alignment with the GBPs: Use of Proceeds Management of Proceeds Process for Project Evaluation and Selection Reporting ROLE(S) OF REVIEW PROVIDER Consultancy (incl. 2 nd opinion) Verification Certification Rating Note: In case of multiple reviews / different providers, please provide separate forms for each review. EXECUTIVE SUMMARY OF REVIEW and/or LINK TO FULL REVIEW Deutsche Hypo has defined a formal concept for its Green Bonds regarding use of proceeds, processes for project evaluation and selection, management of proceeds and reporting. This concept is in line with the Green Bond Principles. 1

2 Section 3. Detailed review Reviewers are encouraged to provide the information below to the extent possible and use the comment section to explain the scope of their review. 1. USE OF PROCEEDS Overall comment on section The proceeds of the Green Bonds (Green Pfandbriefe as well as Green Seniors) to be issued by Deutsche Hypo will be exclusively used to finance the construction, acquisition or energy efficiency renovation of energy efficient buildings. These Green Buildings serve as underlying for loans granted by or to be granted by Deutsche Hypo. Use of proceeds categories as per GBP: Renewable energy Pollution prevention and control Terrestrial and aquatic biodiversity conservation Sustainable water management Eco-efficient products, production technologies and processes Energy efficiency Sustainable management of living natural resources Clean transportation Climate change adaptation Other: Green Buildings Unknown at issuance but currently expected to conform with GBP categories, or other eligible areas not yet stated in GBPs If applicable please specify the environmental taxonomy, if other than GBPs: 2. PROCESS FOR PROJECT EVALUATION AND SELECTION Overall comment on section Deutsch Hypo has established a Green Building Commission to define minimum requirements for inclusion of an asset in the Green Bond Asset Pool. The Green Building Commission consists of members of the sustainability team who support the sustainability management. The eligibility criteria for inclusion of an asset in the Green Bond Asset Pool are regularly reassessed to ensure that they meet the minimum standards expected in the target markets. A financed building qualifies as a Green Building as defined by Deutsche Hypo if the eligibility criteria valid at the time of financing are met. Evaluation and selection Defined and transparent criteria for projects eligible for Green Bond proceeds Documented process to determine that projects fit within defined categories 2

3 Summary criteria for project evaluation and selection publicly available Information on Responsibilities and Accountability Evaluation / Selection criteria subject to external advice or verification In-house assessment 3. MANAGEMENT OF PROCEEDS Overall comment on section: The treasury department regularly verifies, whether buildings already earmarked as suitable for a Green Bond emission still meet the eligibility criteria. If an asset no longer meets the eligibility criteria, it is replaced by another asset. An asset no longer meets the eligibility criteria, if the green building or energy efficiency certificate expired or if a tenant active in controversial business areas occupies the building. Deutsche Hypo seeks to ensure that eligible assets within the Green Bond Asset Pool exceed the total proceeds of outstanding and to be issued bonds. In the case of unallocated proceeds, Deutsche Hypo will invest these in deposits of financial institutions which show a good sustainability performance validated by a recognised sustainability rating agency (i.e. financial institutions rated Prime by oekom research). Tracking of proceeds: Green Bond proceeds segregated or tracked by the issuer in a systematic manner Disclosure of intended types of temporary investment instruments for unallocated proceeds Additional disclosure: Allocations to future investments only Allocation to individual disbursements Disclosure of portfolio balance of unallocated proceeds Allocations to both existing and future investments Allocation to a portfolio of disbursements Other: 4. REPORTING Overall comment on section: Deutsche Hypo will publish a Green Bond Reporting on its websiteon an annual basis. The Green Bond Reporting will contain the following aggregated information: Volume of eligible assets in the Green Bond Asset Pool Carbon avoidance of all eligible assets in comparison to a relevant average / benchmark Information on Green Buildings (e.g. green building certificates, location, sustainability criteria) 3

4 Moreover, Deutsche Hypo will publish information on outstanding bonds on a regular basis. Use of proceeds reporting: Project-by-project Linkage to individual bond(s) Information reported: Allocated amounts Frequency: Annual Other: Impact reporting: Project-by-project Linkage to individual bond(s) Frequency: Annual Other: Information reported (expected or ex-post): GHG Emissions / Savings Other ESG indicators (please specify): Means of Disclosure On a project portfolio basis GB financed share of total investment Semi-annual On a project portfolio basis Semi-annual Energy Savings Information published in financial report Information published in sustainability report Information published in ad hoc Other: Website documents Reporting reviewed (if yes, please specify which parts of the reporting are subject to external review): Where appropriate, please specify name and date of publication in the useful links section. USEFUL LINKS (e.g. to review provider methodology or credentials, to issuer s documentation, etc.) 4

5 SPECIFY OTHER EXTERNAL REVIEWS AVAILABLE, IF APPROPRIATE Type(s) of Review provided: Consultancy (incl. 2 nd opinion) Verification / Audit Certification Rating Review provider: oekom research AG Date of publication: 16 August

6 ABOUT ROLE(S) OF REVIEW PROVIDERS AS DEFINED BY THE GBP (i) (ii) Consultant Review: An issuer can seek advice from consultants and/or institutions with recognized expertise in environmental sustainability or other aspects of the issuance of a Green Bond, such as the establishment/review of an issuer s Green Bond framework. Second opinions may fall into this category. Verification: An issuer can have its Green Bond, associated Green Bond framework, or underlying assets independently verified by qualified parties, such as auditors. In contrast to certification, verification may focus on alignment with internal standards or claims made by the issuer. Evaluation of the environmentally sustainable features of underlying assets may be termed verification and may reference external criteria. (iii) Certification: An issuer can have its Green Bond or associated Green Bond framework or Use of Proceeds certified against an external green assessment standard. An assessment standard defines criteria, and alignment with such criteria is tested by qualified third parties / certifiers. (iv) Rating: An issuer can have its Green Bond or associated Green Bond framework rated by qualified third parties, such as specialised research providers or rating agencies. Green Bond ratings are separate from an issuer s ESG rating as they typically apply to individual securities or Green Bond frameworks / programmes. 6