Commerz Real Legal certainty following court ruling on klimaVest website

Commerz Real welcomed a recent decision by the Stuttgart District Court regarding advertising on the website of its klimaVest impact fund. In its judgement of 31 January 2022 (file reference: 36O92/21KfH), the court upheld a complaint by the Baden-Württemberg consumer association, Verbraucherzentrale Baden-Württemberg, and prohibited, among other things, the establishment of a direct link between a certain investment amount and a defined alleged reduction in the personal carbon dioxide (CO₂) footprint. Moreover, it was not made clear enough that the greenhouse gas emissions actually avoided by the solar parks and wind farms in the fund portfolio can differ from the target. 

“This has enabled us to achieve the legal certainty we were aiming for,” says Henning Koch, Chairman of the Commerz Real Management Board. “We had already made the corresponding changes to the website at the end of last year.” The original direct link between the investment in the fund and the personal carbon (CO₂) footprint was therefore removed. The avoidance target and its conditions were presented in a more transparent and clear manner.

With klimaVest, Commerz Real launched the first impact fund for retail investors, which focuses on investments in tangible assets, in autumn 2020. During its term of at least 50 years, it is expected to build a portfolio consisting of investments in renewable energy generation, sustainable infrastructure, mobility and forestry assets totalling at least 25 billion euros. Unlike conventional sustainability funds, klimaVest invests in assets that make a measurable and thus demonstrable contribution to reducing CO₂ emissions. 

In addition, other strict sustainability parameters apply in accordance with the applicable EU Taxonomy Regulation. The fund management aims to achieve an annual return (using the BVI method) of between 3.0 and 4.0 percent. Investors can participate from 10,000 euros and receive regular reports on the fund assets’ climate impact achieved in addition to its performance. In August 2021, the rating agency Scope gave klimaVest a preliminary rating of a+ (AIF alternative investment fund).

klimaVest promotes electricity generation from renewable energies. The feed-in priority of renewable energies in accordance with the German Renewable Energies Act means that electricity from renewable sources is used in the electricity grid as a priority. Each kilowatt-hour produced by renewable energies thus displaces a corresponding kilowatt-hour of electricity produced using fossil fuels. At European level, the feed-in priority is set out in the EU’s internal electricity market regulation. The aim of klimaVest is to avoid at least 3.5 tonnes of CO₂ per year per 10,000 euros invested in renewable energies (target value).

The avoidance measurement is based on internationally valid calculation methods. For example, the country-specific avoidance factor (tonnes of CO₂ per megawatt-hour) is calculated using the combined margin approach of the United Nations Framework Convention on Climate Change (UNFCCC), a globally recognised standard of the Clean Development Mechanism (CDM). The factor is published by the Technical Working Group of International Financial Institutions (IFI). The CO₂ emissions of the materials and the construction of the plants are also taken into account in the calculation.