In a recent announcement, Deutsche Bank released its initial Transition Plan, underscoring its trajectory towards achieving net-zero emissions by 2050.

The plan encompasses the bank's operations (Scope 1 and 2), its supply chain (Scope 3), and the financing it provides to clients (also Scope 3).

With the addition of sector-specific targets for shipping, coal mining, and cement, Deutsche Bank's US$112.8 billion corporate loan portfolio now addresses 55 per cent of the emissions generated by financed activities.

These disclosed financed emissions amount to 34.4 million tonnes of CO2 annually, covering 60 per cent of the bank's total loan exposure as of December 31, 2022.

The Transition Plan delineates specific objectives for each of these sectors. For instance, it outlines a 49 per cent reduction in Scope 3 financed emissions from coal mining by 2030 and a substantial 97 per cent reduction by 2050.

In the cement sector, the plan aims for a 29 per cent reduction in physical emission intensity (Scope 1 and 2) by 2030 and an impressive 98 per cent reduction by 2050.

In the case of shipping, the target is to achieve a Scope 1 score of zero per cent by 2030 and 2050, in alignment with the Poseidon Principles Portfolio Level Alignment Score.

Deutsche Bank's strategy for implementation encompasses three fundamental approaches. Firstly, it involves financing clean energy technologies' development and scaling up.

Secondly, it focuses on engaging with high-emission clients to support and finance their transition towards sustainability.

Lastly, it entails a gradual phase-out of businesses associated with non-abatable industries, such as thermal coal, and clients unwilling to align with the bank's transition pathway.