Sustainable capital investments
GIZ invests funds as part of its company pension scheme. In doing so, the company is guided by the principle of sustainability and takes into account environmental, social and governance criteria. Referred to in short as ESG, these criteria form the basis for all of GIZ’s capital investments.
GIZ also signed the ‘Frankfurt Declaration’ in May 2017, which is a joint sustainability initiative created by Deutsche Börse AG and other financial actors. It is based on the conviction that companies which act responsibly are not only committed to environmental and social sustainability but are also economically more successful in the long term. Sustainable investments perform just as well as traditional capital investments – and often even better, which investors benefit from most of all.
Criteria for GIZ’s sustainable capital investments
There are clear rules that define in what shares and securities the company invests. First, GIZ applies a number of exclusion criteria. For example, the company does not invest in enterprises that violate human and labour rights, participate in corruption or fail to comply with minimum ecological standards. The same rule applies to investments in bonds issued by states or territorial authorities. The company also identifies and excludes controversial business areas. These include the manufacture of arms and military equipment, pornography and the production of hazardous chemicals.
In a second step, GIZ divides the remaining investment options into the regional asset classes Europe, emerging economies and worldwide. It invests only in companies that are in the top 40 per cent of their industry (‘best in class’ approach). Independent experts regularly audit the company’s observance of the established sustainability criteria.