|Unaligned||KDB does not have a standalone climate strategy, but recognises climate change as a “challenge”|
in its overarching strategy.
|Climate strategy||Overarching strategy|
|KDB doesn’t have a standalone|
|Tackling climate change is recognised as a challenge and an integral part of sustainable development.|
KDB has set out its strategic vision as part its “Advanced Policy Bank” framework. Details can be found in its 2019 annual report . According to the Bank, an advanced policy bank “refers to a government-owned financial institution, which aims to support both industrial and social sectors by promoting the national economy and improving people’s quality of life.” This strategic vision, which is meant to provide a long-term growth perspective until 2040 does not specifically mention climate change as a challenge, but rather refers to sustainable growth at large. However, KDB integrates responding to climate change as part of its definition of sustainable growth.
Given the long-term outlook of the “Advanced Policy Bank” framework, climate change is not featured as the systemic challenge it presents to development banks.
KDB has committed to the Equator Principles, however these principles are very narrow and do not represent a climate strategy. The Korea Development Bank states that it is committed to “promoting and disseminating the concept of sustainable development […] to help its partners and borrowers achieve their development goals”, including to “engage in environmental and climate protection”.
Korean Development Bank has committed to align with the Paris Agreement as part of the International Development Finance Club.
KDB does not have a standalone climate strategy. KDB outlines its approach to sustainability on its website in a dedicated section. The section covers KDB’s general commitments to sustainability, with two climate change-focused paragraphs stating that “KDB recognizes that climate change is a serious global challenge and that climate related impacts may impede economic and social well-being and development efforts.” KDB further states that it will explore financial instruments for both adaptation and mitigation measures, as well as intentions “to consider climate-related risks and opportunities in their investment decisions.”
In December 2016, KDB was accredited as an Accredited Entity of the Green Climate Fund (GCF), the first Korean financial institution to achieve this status. It has also issued green bonds and has a dedicated credit line for eco-friendly businesses.
Recommendation: KDB should put in place a standalone climate strategy, in addition to its implementation of Korea government policy in this area. KDB should structurally integrate climate change into its overarching strategy to ensure its overall recognition as a systemic challenge to the Bank’s operation.