Sustainable framework

Purpose

Government, business, and society must contend with tremendous changes that are occurring at an increasingly faster pace. Besides the three megatrends of climate change, digitalisation, and demographic change, we also have to deal with sudden and unexpected shocks. This is not a transitory phase: It is our new normality. It affects Rentenbank just as much as our business partners and end customers. We need to make transformative adjustments in order to survive in the medium to long term and be resilient in the face of extreme volatility. This transformation requires tremendous effort on the part of everyone involved. As a task for all society, it demands action across economic sectors and necessitates sizable investments. Rentenbank promotes and supports this transformation with targeted services and solutions. But to do this, we too must undergo a radical transformation. As a promotional bank, we must position ourselves for the future so that we can continue to meet the demands placed on us from without and within. Precisely in such a fast-changing world, we are guided by our purpose: “We promote the sustainable development of agribusiness and rural areas”. This statement of purpose, which we formulated in late 2022 in the course of our transformation project, expresses Rentenbank’s benefit to society, as well as the reason and purpose of our activities.

Future vision and corporate values

Our future vision forms the basis for our strategy and annual planning in the coming years through 2028. It serves as a compass for the further development of our organisation. It formulates ambitious goals, explicit aspirations, and guiding principles. Guided by our future vision, we will set binding targets and devise appropriate measures every year anew. The strategic targets are annual milestones to realise our future vision. They will drive changes to transform our organisation and ensure the achievement of our long-term goals in the form of key performance indicators.

To summarise, our future vision is rooted in the following strategic principles:

We are the transformation bank for agribusiness and rural areas.
We are an attractive and coveted employer.
We are adaptable, efficient, and digital.
We are constantly evolving.

As part of our transformation project, we also defined our corporate values anew with the involvement of all our employees in 2024:

Drive – We cultivate the future together.
Appreciation – We grow with each other.
Responsibility – We rely on each other.
Innovation – We plant the seeds of the future.
Consistency – We appreciate our roots.

Our values serve as a common thread and compass for the conduct and decisions of all employees and help establish a shared understanding of goals and expectations. Our values together with our Code of Conduct and our risk culture will form the basis for ethically correct behaviour at Rentenbank. The Code of Conduct can be viewed in Rentenbank’s sustainability portal.

Basic parameters of sustainability management

We promote agribusiness and rural areas on the basis of our statutory mandate. We are especially committed to promoting investments in the progressive and sustainable development of agribusiness. We want to play a role in the development of a sustainable and liveable future. We support the sustainability goals of the Federal Republic of Germany, the European Union, and the international community. We are committed to the Sustainable Development Goals (SDGs) of the United Nations and the goals of the Paris Climate Agreement and contribute to the attainment of these goals. As a promotional bank, we are committed to sustainable finance, meaning the use of finance to promote climate-friendly and sustainable business practices. In addressing this question, we rely on the guidance provided by the EU Action Plan on “Financing Sustainable Growth” and those aspects of the European Green Deal that are relevant to us and our stakeholders.

Sustainability Guidelines

We introduced our Sustainability Guidelines in 2021 with the goal of embedding sustainability issues more firmly into our business strategy. These guidelines reflect the bank’s understanding and level of ambition relative to its central goal of acting as a sustainable enterprise and transformation bank in the field of agriculture in Germany. The guidelines also define the key areas of activity and the long-term objectives and measures in this area.

Climate Strategy¹

Rentenbank formulated and published its first-ever Climate Strategy in 2024. We are committed to the 1.5 degree Celsius target of the Paris Climate Agreement and our banking activities and internal operations are geared to achieve this target. In our banking activities, we strive to align our Climate Strategy with the goal of ensuring access to financing for the agricultural sector. Our agriculture portfolio is the strongest lever we have to reduce greenhouse gas emissions through our lending activities.

In line with the reduction paths set out in the German Climate Protection Act, we have set ourselves the goal of reducing the emissions intensity of our agricultural lending activities by 18% from the current level of 1.26 kg CO₂e/EUR to 1.03 kg CO₂e/EUR by the year 2030.

Beyond the pure emission reduction targets, we have also set targets for increasing our promotional activities in certain areas that help reduce emissions. These areas include lending to support renewable energy as a means of avoiding emissions from fossil energy. And in the area of natural climate protection, we finance activities that bind carbon emissions, such as ecological farming practices.

Increased lending targets	Metric	Base Year	Actual 2024 (2023 + 2024)	Cumulative Target 2023 to 2030
Renewable energy	Saved kt CO₂e	2023	14,719	> 45,000
Natural climate protection	New lending activity in million euro	2023	> 111	> 600

We have also set emission reduction targets for our internal operations. In this respect, our targets refer to our two main emission sources: bank building and motor vehicle fleet.

Reduction targets	Absolute emissions 2019 (in t CO₂e)	Target for 2030 (in % from base year 2019)	Target for 2030 (in t CO₂e)	Target for 2040 (in % from base year 2019)
Bank building	449.7	> - 75 %	105.3	Net neutrality²
Motor vehicles	16.0	> - 70 %	4.8	Net neutrality³

Double materiality assessment and key areas of activity

The materiality assessment was revised and conducted anew according to a new methodology for the first time in 2024. The new methodology is based on the double materiality principle, which covers topics coming from the outside that affect the company financially (“outside-in”), as well as factors emanating from the company that affect the environment and society (“inside-out”).

In the first step, a list of potentially material topics was compiled particularly on the basis of Rentenbank’s strategies, activities, and business relationships. A stakeholder format was applied and external publications were considered in order to arrive at the broadest possible range of topics to consider.

In total, 16 organisational units and functions of the bank were included in the materiality assessment in 2024. Depending on the subject matter, many topics involving more than one organisational unit were considered. The organisational units assessed the list of topics both with respect to their environmental and social impacts and with respect to their financial materiality so as to address both aspects of double materiality. The former topics were assessed with respect to their scale, scope, remediability, and probability of occurrence, whereas the latter topics were assessed with respect to their scale and probability of occurrence. In computing the materiality in each instance, Rentenbank followed the recommendations of the European Financial Reporting Advisory Group (EFRAG). Rentenbank’s key areas of activity represent the outcome of this process.

Area of activity	Material according to the materiality assessment	Included in the Sustainability Guidelines
Sustainable corporate governance
Sustainable business model	Yes	Yes (“Strategy and management”, “Corporate governance”)
Corporate social responsibility	Yes	Yes
Data and IT security	Yes	No
Communication and stakeholder engagement	No	Yes
Sustainable banking activity
Climate change	Yes	Yes ("Loans and capital markets")
Ecological farming	Yes	Yes ("Loans and capital markets")
Rural development	Yes	Yes ("Loans and capital markets")
Risk management	Yes	Yes
Sustainable human resources management and diversity
Employee rights and working conditions	Yes	Yes
Sustainable operations
Operational ecology	No	Yes
Sustainable procurement	No	Yes

By reason of Rentenbank’s business model, the risk of grave violations of environmental and social concerns, as well as human rights and other applicable legal obligations across the value chain, are deemed to be minor. By virtue of our promotional mandate, our activity is focused on Germany. Moreover, we rely on relatively few suppliers and service providers outside of Germany or Europe. We have instituted extensive management processes at our sole location in Frankfurt am Main to ensure compliance with all relevant laws and regulations related to environmental and social concerns. We introduced Supplier Guidelines to our procurement organisation in 2023; they are described in detail in the “Sustainable procurement” chapter.

The risk inventory process is conducted concurrently with the materiality assessment. By means of a risk inventory, Rentenbank obtains an overview of the individual risk types and risk concentrations. This also includes sustainability risks that are not considered to belong to a separate risk type, but are regarded as drivers of traditional risk types. A precise description of Rentenbank’s management of ESG risks is provided in the Risk Report.

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