AFD - Universal Registration Document 2020

STATEMENT OF NON-FINANCIAL PERFORMANCE The Group’s contribution to sustainable development

Partners Committee in the first half of 2020, French and international civil society organisations (CSOs) dedicated to climate, ministries and French think tanks and commercial banks, in order to present to them the challenges of the mid-term review of the climate strategy, the role of development banks in the international agenda for 2021, the methodological changes in climate finance and the prospects for convergence between climate and biodiversity. In addition, this regular dialogue and the relationship of trust forged with civil society for the climate facilitated the involvement of these NGOs in the preparation of Finance in Common Summit. The partnership with the Institute for Climate Economics (I4CE) contributes to the development of its work, and to its implementation at the international level and in developing countries, in areas such as the management of climate finance, assessment tools for the alignment of public budgets with long-term objectives, financial regulations and the alignment of financial institutions with the Paris Agreement. Lastly, through its contribution and active participation in the Climate Action in Financial Institutions initiative (1) . AFD participates in dialogue with around fifty public and private financial institutions and thus contributes to the experience-sharing activities and technical analyses carried out within the Initiative on various topics such as financial climate risks, alignment with the Paris Agreement (2) , or the implementation of climate processes and tools within institutions. AFD holds an important dialogue on the consideration of financial climate risks with its peers and financial systemplayers, and contributes to the sharing of best practices. Since 2017, the AFD Group has been working to integrate financial climate risks into its risk analysis processes through various projects. Following an initial mapping of the AFD portfolio’s exposure to physical risks, a methodology for assessing physical risks and operational tools was rolled out in 2020 enabling the Group to systematically measure these risks when granting new loans and to engage in dialogue with its most exposed borrowers. In 2020, the Group made progress on a similar approach to transition risks with the aim of making it operational in 2021. These considerations were fuelled by the Group’s voluntary participation in the ACPR climate stress test exercise in 2020, focusing on transition risks. Based on the assumptions provided by the regulator and the macroeconomic data of a scenario leading to carbon neutrality by 2050, the potential impact on the quality of the AFD Group portfolio was studied. In 2020, the Group also made progress in integrating climate risks into the service offering to financial systems, including central banks, to identify potential collaborations and public policy dialogues on the low-carbon transition led by AFD with country authorities. 2.4.3.4 Direct environmental footprint and carbon offsetting The low-carbon trajectory is implemented internally within the AFD Group and in its value chain through operational measures to reduce the impact of its activity. The AFD Group is mobilising to control its direct greenhouse gas (GHG) emissions by taking action simultaneously to reduce these emissions and to offset

them through actions contributing to the SDGs. The annual assessment of the Group’s climate footprint makes it possible to identify the organisation’s strengths and vulnerabilities. The widespread context of teleworking due to the health crisis nevertheless made the 2020 financial year more complex, as the indicators were not adapted to this exceptional monitoring. With regard to the head office’s overall GHGemissions, the results show a reduction in emissions of 23% between 2020 (21,388 Teq CO 2 , or 12.2 Teq CO 2 per employee) and 2019 (27,939 Teq CO 2 , or 16.7 Teq CO 2 per employee). Teleworking recommendations combined with international mobility restrictions largely explain this reduction. The direct impacts of the Covid-19 pandemic are reflected in the 15% reduction in the consumption of fluids and the 63% fall in emissions related to air travel. Likewise, the less significant emissions linked to waste and home-work travel, subject to the authorised level of presence on the sites, show a downward trend, without however having any instruments for their precise estimation. Lastly, the technological agility required for business continuity, which has led to the roll out and reinforcement of digital tools, has indeed led to additional indirect consumption in the workplace, but it is difficult to measure in the absence of any data feedback. All of the carbon footprint items are part of this downward trajectory, apart from “fixed assets” (+5%) and “inputs” (+3% as a monetary ratio). These are partly the result of the increase in digital technologies in response to the health crisis. As the carbon footprint of the Group’s network is carried out each year at the end of the first half of Y+1, the figures provided here are those for 2019, not impacted by the health context. The activities of the 90 agencies included in the total scope generated around 12,600 Teq CO 2 i.e. an increase of 11% compared to emissions assessed in 2019 based on the 2018 data. The emissions ratio per branch decreased due to the extension of the network -140 Teq CO 2 on average per branch in 2019 compared to 147 Teq CO 2 in 2018 - while emissions in relation to the number of employees increased slightly -12 Teq CO 2 on average per employee in 2019 compared to 11 Teq CO 2 in 2018 - correlated with the increase in air travel (+14% in GHG emissions). The Group is working to control its environmental impact by improving the energy efficiency of its real estate portfolio and by using renewable energies. At the head office, at the Barthes and Mistral sites, 100% of the electricity consumed is produced from renewable energy sources, including in situ , the Barthes photovoltaic modules having produced 12,122 Ǿ kWh in 2020.This momentum extends to its network: the branches in Ndjamena and Accra produce the majority of their energy needs from photovoltaic panels. For low-carbon mobility in line with the objectives of the mobility guidance law, AFD strengthened its support for soft mobility by setting up bike maintenance workshops during the European Mobility Week, conducted face-to-face outside lockdown periods and in compliance with health protocols. Initiatives are also encouraged at the local level: for example, the Phnom Penh agency provides a fleet of bicycles for short trips.

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(1) https://www.mainstreamingclimate.org/ (2) https://www.mainstreamingclimate.org/mainstreaming-climate-to-align-with-paris/

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2020 UNIVERSAL REGISTRATION DOCUMENT