Greater transparency also at KfW?

Greater Transparency also at KfW?
– picture: sciondriver, publ. under CC License BY-NC 2.0 at flickr.com

The KfW transparency portal, which features an integral project database (in German only), has been online since November 28, 2013. The database provides project information in a standardized format. In addition to project descriptions, information on sectors, priorities and project partners, it also contains detailed information on the nature and makeup of financing measures. Are we witnessing a turnaround in data transparency, or is KfW only going halfway by publishing a minimal data framework to ward off the worst criticism?

The transparency portal is a significant change from the way project information was previously communicated on the KfW website. In the past, only selected projects were described in general texts geared more toward public relations than delivering tangible information. Due to the unsystematic presentation, it was not possible to associate projects with climate finance, nor to compare projects. Only a few months ago, the Heinrich Böll Foundation received confirmation from a senior KfW source that it was not the bank’s policy to publish project-specific disaggregated information on the funded portfolio, including those parts declared to be environmental and climate protection measures. The transparency portal is therefore an important step toward civil-society monitoring of KfW climate finance.

KfW likes to describe itself as “one of the largest financiers of environmental and climate protection measures in the world”. According to KfW, the environment and climate sector accounted for €29.2 billion, or around 40% of its total commitment volume for 2012. It claims that more than one in three euros of KfW funding in 2012 went to measures deemed to protect the environment and climate. With regard to the KfW Development Bank, new commitments for environmental and climate projects in 2012 amounted to approximately €2.8 billion.

However, these figures do not clearly state whether and to what extent energy production and use based on coal, oil or even unconventional fossil fuels is being declared as “environmental or climate protection”. Data from a number of sources document KfW’s significant role here: according to Climate Alliance Germany, KfW is the seventh most important financier of coal-fired power plants among public banks. Unlike the Nordic Investment Bank and others, KfW to date does not rule out the financing of coal-fired power plants.

The transparency portal is still under construction, and it is still too early to assess the quality of the information provided from a civil-society perspective. In any case, it represents an important step toward greater transparency in KfW’s development cooperation. Nevertheless, important data is missing with regard to climate finance. For example, the Rio markers are not present, as climate-related projects in other sectors and focal areas are also credited toward climate finance. The portal must also offer more information on the financing of coal-fired power plants. Furthermore, it remains to be seen whether the portal will permit conclusions to be drawn about the recipients of financing, the degree to which civil society actors are actually involved in project implementation, and whether the financed projects truly help alleviate poverty or reduce greenhouse gas emissions.

Christine Lottje and Lili Fuhr