ProCredit : Impact Report Appendix 2021

IMPACT REPORT APPENDIX 2021

Part of the Impact Report Package 2021

GRI content index 2021

CONTENTS

Navigating the Impact Report Appendix 2021

2	Sustainability goals
	and achievements
Green loan portfolio development	2
Carbon neutrality	3
Staff competence	4

5	Materiality and impact reporting
Reporting approach	5
Stakeholder engagement
and materiality analysis	6
Overview of our material topics,
related impacts and boundaries	8
9	Our material topics -
	management approach and

overview

23 SDGs, material topics and targets

31 International principles, standards and memberships

32 UNEP FI Portfolio Impact Analysis

35 Accounting of the GHG emissions linked to our loan portfolio

38 UNEP FI Principles for Responsible Banking (PRB) - Self-assessment reporting

46 Analysis of the portfolio in terms of E&S risk

47

List of abbreviations

64

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This document is part of a set of three that jointly comprise our Impact Report Package 2021 and complement our Annual Report. The three documents are closely interrelated and cover the period from 1 January to 31 December 2021. Please also refer to the following documents for comprehensive insight into our sustainability approach:

Impact Report 2021

Our Impact Report can be accessed separately; it discloses our approach to sustainability and our philosophy on the issues that matter the most to our stakeholders. In the three sections structured around the material topics identified through our sustaina- bility, materiality and impact assessment, this report provides information about our non-financial performance progress and initiatives.

Impact Report Datasheet 2021

The Impact Report Datasheet is a downloadable spreadsheet that allows our stakeholders to easily search for, compare and analyse our sustainability key performance indicators.

The Impact Report Package and the GRI content index included in the present document have been prepared in accordance with the Global Reporting Initiative (GRI) Standards: Core option.

Our full reporting suite, including annual reports and the full Impact Report Package, can be found at: https://www.procredit-holding.com/downloads

Our Approach

Green Finance

Our Staff

Appendix

SUSTAINABILITY GOALS AND ACHIEVEMENTS

In 2018, the ProCredit group set itself three ­specific medium-term goals. This section summarises the progress made in attaining these goals over the last year.

20% GREEN LOANS BY 2023

Goal: Increase the relative size of the group's green loan portfolio to 20% of the total loan portfolio, while at the same time maintaining the high quality of our green lending activities

goal 20%

		18.7%	19.0%
	16.6%
15.4%
15%
2018	2019	2020	2021

Note: In previous reports, the share of green loans in our total portfolio was expressed as a whole number. To increase precision, we are now showing the figures with one decimal place.

The share of green loans in our portfolio has been rising consistently since 2015, and although we had anticipated reaching the 20% threshold by the end of 2021 in all our countries of operation, our green loan portfolio currently represents 19% of our total loan portfolio. Although we met or even exceeded the 20% goal in two regions (South Eastern Europe and Germany), we still need to focus our efforts on increasing the share of green loans, taking into ­account the challenges and limitations, such as regulations­ and infrastructure, for each country. Over the last year, the green loan portfolio grew by 14.5% and we anticipate a similar growth rate for the coming year. Once we achieve our goal, we intend to revise and update it in order to continue institutionalising green finance within ProCredit.

For more information, see

• Impact Report Datasheet 2021, Sustainable lending
• Impact Report 2021, Our approach to green finance, pages 40f.

Specific achievements as of the end of 2021:

Size of green loan portfolio as of the end of 2021: EUR 1,128.1m

Increase of share of green loan portfolio in total portfolio in 2021: 0.3%

Green investment loans as a share of total investment loans: 25%

Increase in both the number and the volume of loans in all three green lending categories: energy efficiency (EE) investments that reduce energy usage by at least 20%, renewable energy (RE) investments into distributed or utility-scale RE generation sys- tems, and other environmentally friendly investments (GR) such as in waste management or organic agriculture.

Appendix

2

CARBON NEUTRALITY BY 2023

Goal: Become carbon neutral with regard to the group's own CO2 emissions

12,371 t CO2eq
	10,174 t CO2eq
		5,472 t CO2eq	5,486 t CO2eq
2018	2019	2020	2021

Note: The CO2 emission factors were updated with the IEA emission factor 2021. This change affects <1% the emission data shown here versus the data published in previous years.

This year, our direct carbon footprint totalled -56% of our 2018 CO2 emissions, the year in which ProCredit set the goal of becoming carbon neu- tral. The steep decline in 2020 was attributed to the almost total absence of international travel, and although we saw an increase in the number of flights in the second half of 2021, the level still lies well below pre-pandemic times. Teleconferencing and online training methods, where possible, were widely adopted in 2021 in order to reduce international travel, while still responding to the needs and desires of our teams and clients to meet in person.

Additionally, other efforts contributed to the further reduction of our direct carbon footprint: the continued greening of our premises by investing in energy-efficient equipment, sourcing renewable energy and changing our car fleet from conventional fuel to mainly electric and (plug-in) hybrid vehicles.

To maintain the downward trend, we plan to continue reducing our flights and increasing the share of e-cars in our fleet.

For more information, see

• Impact Report Datasheet 2021, Environmental performance
• Impact Report 2021, Our approach to green finance, pages 40f.

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Specific achievements
as of the end of 2021:
Investing in our own 3 MWp PV
park in Kosovo (ProEnergy) to
compensate our emissions
4 banks, ProCredit Holding,
ProCredit Academy and Quipu's
head office in Frankfurt are using
electricity from renewable energy
suppliers
8 banks and ProCredit Academy
are equipped with their own
rooftop PV systems
(installed peak capacity of about
415 kWp as of Dec. 2021)
4 bank headquarters are
EDGE-certified buildings
59% of the vehicle fleet is electric
and 12% is (plug-in) hybrid
11% reduction in energy
consumption in our office
buildings between 2018 and 2021	Appendix

STAFF COMPETENCE

Goal: Maintain and further increase the high level of social and environmental competence among our staff

SOCIAL AND ENVIRONMENTAL

STAFF TRAINING

Renewable

E&S

Impact

Green

Code

of

Environ-

Environmental

Ethics

course

Semi-annual

mental courses

Group Green

Energy

Assessment

Finance

Conduct

at PCMA and

Management

at PCBA

Finance

PCBA

Seminar

Specific achievements as of the end of 2021:

Enlargement of the training offer through the newly established ProCredit e-learning campus.

Total hours devoted to environmental training: 13,850. Sustainable agriculture was the special topic in 2021.

Total hours devoted to Code of Conduct training: 14,132.

Key elements of discussion this year: freedom of expression and education.

Courses on environmental and social topics have always formed a key component of our long-term training programmes - the Onboarding Programme, the Banker Academy and the Management Academy. They also feature prominently in the materials used in our English language courses. In addition, all ProCredit institutions hold regular training sessions dedicated to environmental awareness and various aspects of environmental and social risk assessment, operational risk, information security risk and the corporate values embodied in our Code of Conduct.

During the pandemic, the Onboarding Programme was quickly moved online, and we have been able to continuously enrol our new colleagues without any delays.

In 2020, the transition to online learning presented huge challenges, but in 2021 we had already adjusted to the changes and were able to harness the new opportunities brought by this new modality. The constant sharing of experiences, lessons learned, and reflections of the colleagues involved in training and recruitment enabled us to find creative ways to maintain the discussion-­ driven and interactive approach of our trainings.

Progress in terms of environmental competence can be seen, for example, in the excellent results of our green lending operations. All our employees receive at least one training session on green topics every year. Environmental, credit risk and business department

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staff also participate in our green seminars, which are held twice a year. Additionally, we provide continuous training for specialist employees on environ­ mental measures, green finance, management of E&S risks, among other topics.

For more information, see

Impact Report Appendix 2021

- SDGs, material topics and targets, SDG 4 > pages 23f.

• Impact Report Datasheet 2021, Employees
• Impact Report 2021

- Staff development, pages 58f.

Appendix