Green Finance
The risk posed by climate change demands resilience and adaptability in our responses. To actualize our sustainable development strategy, we support net-zero initiatives and direct funding towards investment in green industries.
Green Finance Products
Green Investment
The general public is increasingly concerned with economic activities and the associated risks on the environment and natural resources as global climate change intensifies, giving rise to the concept of a low-carbon economy, which is considered to play a key role in maximizing long-term economic growth. Meanwhile, green investment has also emerged as a popular theme. CDF mainly invests in green industries with its two major subsidiaries, CDIB Capital and KGI Life, and actively responds to government policies. The total investment of CDF assets in the six core strategic industries of National Development Council amounted to NT$123.1 billion, of which nearly 60% of the investments are in green power and renewable energy.
Policy and Goal
To ensure that the organizational goals and key decisions in terms of environmental, social, and governance (ESG) practices are consistent with the United Nations Sustainable Development Goals (SDGs) and the Paris Agreement, CDF adopts a top-down corporate governance structure. With effective policies, management systems, and controls in place, CDF integrates SDGs into the decision-making process to create a responsible banking business model in line with the Principles for Responsible Banking (PRB). CDF is also committed to promoting green finance through green project financing, green lending, and green bond underwriting in hopes of speeding up the transformation and sustainable development of the renewable energy industry in Taiwan.
Performance and Goal 2022
Action Plan 2022 Progress Short-term Goals 2023
Promoting green industry investments
  • Nearly 60% of the investment in principal investments is invested in the green energy and renewable energy fields of the six core strategic industries.
  • KGI Life invested in green bonds issued by TSMC and Ørsted to support the development of clean energy in Taiwan, with an investment amount of NT$2.3 billion.
  • KGI Life invested NT$18.5 billion in foreign green bonds and NT$9.1 billion in sustainable bonds
Investment in high carbon emission industries lower than 26%
  • Support smart technologies or environmental innovation industries
  • Responding to the problem of an aging population
  • Support culture and innovation industry developments
  • Support innovative industries
  • Asset management operations
    • The Advantage Fund raised NT$4.54 billion
    • Raised two biomedical funds in Taiwan with a total amount of NT$4.86 billion, and raised biomedical funds totaling RMB420 million in China
    • The scale of the cultural and innovation fund is NT$1.5 billion
  • CDIB Capital Innovation Fund raised NT$1.29 billion
Continue to develop smart technologies, environmental protection innovations, potential healthcare, cultural innovations, and investments in startups.
Implement responsible investment and green finance, and incorporate ESG into investment decisions
  • KGI Life's 100% of relevant investment decision research reports have included ESG assessments.
  • KGI Life's 100% of foreign funds companies have signed PRI.
  • KGI Life participated in the shareholders' meetings of listed investee companies, with a participation rate of more than 100%.
  • KGI Securities participated in 12 ESG-related bonds, underwriting the total amount of NT$8.28 billion, up 124% compared with the NT$3.7 billion in 2021.
  • Among the equity capital raising cases organized by KGI Securities in in the capital market, 18 cases were environmental protection and green energy related, accounting for about 53% of the number of cases organized in 2022. The environmental protection and green energy funds raised more than NT$29.0 billion, accounting for about 77% of the funds raised in 2022.
  • Factor pool entry assessment procedure incorporates ESG scores. According to the target of factor model entry, factor models are reviewed quarterly, and due diligence scores provided by professional institutions are included to evaluate the business operations of investee companies that violate ESG or those with unfavorable sustainable operation risks.
  • We use the ESG database to regularly review the disputed event scores and ESG issues of Taiwanese stocks. When the disputed event scores of Taiwanese stocks decrease or are lower than a certain standard, the related matters shall be tracked and monitored
  • Deepen sustainable investment management, regularly carry out carbon inventory of investment portfolios and formulate carbon reduction targets, and deepen discussions with investment targets.
  • Establish an ESG watch list for investee companies that involve environmental pollution, social disputes and corporate governance concerns, etc., and evaluate the relevant risks before investing in the targets on the watch list.
Issue ESG Products - KGI Sustainability Series Funds
  • KGI SITE offers one ESG bond ETF and three active sustainability bond funds that have been approved by the competent authority for ESG review. KGI SITE is the investment security trust company acquiring most ESG fund certifications in 2022.
  • KGI SITE issued the first Taiwan ETF adopting Bloomberg MSCI ESG bond index – KGI 15 YR+ USD Grade BBB ESG Sustainable Corporate Bond ETF Funds in May 2021. As of the end of 2022, the fund scale reached 427 million.
  • With regards to the three active sustainable bond funds, as of the end of 2022, the fund scale reached 3,991 million.
  • Continuous issuance of sustainability series funds
  • Strengthen the promotion of ESG and sustainable development related products to investors
Issue ESG related products – KGI Bank green deposit Leading in the domestic banking industry, KGI Bank launched the "green deposit" in May 2022 to use project funds on renewable energy and energy technology, pollution prevention and control, water resource energy conservation and cleaning, or recycling and reuse, as well as other fields of green financing demand. Continue to promote ESG and sustainable development related products.
Through the encouragement of green energy upgrades and fund-raising assistance to the green energy industry, the compound annual growth rate of the overall green credit amount is expected to reach 5% in the next two years KGI Bank adopted the green credit standard marked by Taiwan Joint Credit Information Center and statistics show that the balance of 11 green credit notes reached NT$16.06 billion, substantially up 39.5% compared with previous year. Inventory of ESG risks in credit facilities, deepen the introduction of the spirit of the Equator Principles, evaluate the establishment of exclusion industries, and strengthen negotiation with customers
Whether it is charity programs, emergency aid, industry-academia cooperation, or talent cultivation, the core we focus on most will never change: the positive driving force that education brings to society.