Strategic Sustainability Management

Environmental, social and governance issues are embedded in almost all areas of Aareal Bank Group. This includes anchoring quantitative and qualitative ESG targets at Group level, taking ESG aspects into account in risk management and offering ESG-compliant products on the assets and liabilities side.

The Group Sustainability Officer is responsible for the central coordination of sustainability management activities. This officer reports directly to the Chairman of the Management Board of Aareal Bank AG, who bears overall responsibility for Aareal Bank Group's sustainability strategy. In addition, the regular handling and discussion of ESG-related topics and issues is an integral part of Management Board and Supervisory Board meetings.

A dedicated "ESG & Innovation" organisational unit has been set up for the purpose of further developing Group-wide sustainability activities. This unit acts as a central point of contact for internal and external stakeholders and ensures that Aareal Bank Group's sustainability performance is presented transparently to clients, investors and other interest groups in the context of external reporting. It also represents Aareal Bank Group in specialised committees and working groups. The organisational unit is assigned to the Group Strategy division, reflecting the increasing strategic relevance of ESG issues for Aareal Bank Group's sustainable business success. It is supported in its work by experts from various departments of Aareal Bank AG. Aareal Bank AG's internal coordination of Group-wide sustainability activities is carried out by an ESG Expert Group, which generally meets monthly under the leadership of the "ESG & Innovation" organisational unit, and by the Green Finance Committee. Both fulfil different tasks:

• The ESG Expert Group serves as a cross-divisional body for addressing ESG-related topics of strategic relevance by Aareal Bank AG's ESG experts, chaired by the Group Sustainability Officer. It also serves to regularly place new regulatory developments in Aareal Bank AG's ESG environment and to permanently promote interdisciplinary dialogue between the specialist departments in the ESG context.
   
• The Green Finance Committee generally meets monthly and on an ad hoc basis. It is responsible for managing the pool of so-called green assets (loan receivables) to back so-called green capital market products (bearer bonds).