Green Finance

The risk posed by climate change demands resilience and adaptability in our responses. To actualize our sustainable development strategy, we support net-zero initiatives and direct funding towards investment in green industries.

Green Finance Products

Green Investment

The general public is increasingly concerned with economic activities and the associated risks on the environment and natural resources as global climate change intensifies, giving rise to the concept of a low-carbon economy, which is considered to play a key role in maximizing long-term economic growth. Meanwhile, green investment has also emerged as a popular theme. KGI Financial mainly invests in green industries with its two major subsidiaries, KGI Life and CDIB Capital, and actively responds to government policies. The total amount of proprietary investment in the six core strategic industries of National Development Council amounted to NT$195.3 billion, of which approximately 70% of the investments are in green power and renewable energy.

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According to the provisions outlined in Taipei Exchange Operation Directions for Sustainable Bonds, the scopes for sustainable bonds include the green bonds, social responsibility bonds and sustainability bonds accredited by Taiwan Exchange. KGI Securities acted as the underwriter (as well as financial advisor) for a total of 19 sustainable bonds in 2025, including 14 green bonds, 1 social bond, 4 sustainability bonds, with a total of NT$17.097 billion.

KGI Securities independently identifies companies whose business philosophies align with energy conservation and carbon reduction, energy and water resource management, recycling and reuse, green processes and product innovation, and environmental certifications. These companies also actively align with the Sustainable Development Goals (SDGs) to reduce environmental impact while taking into account employees, society, and sustainable governance. Such criteria are used as KGI Securities’ disclosure standards for sustainable equity underwriting projects, financial advisory, and consulting service engagements. In 2025, KGI Securities executed a total of 18 sustainable equity underwriting cases, accounting for approximately 50% of all equity underwriting cases for the year. The aggregate underwriting value of these sustainable equity transactions amounted to NT$15.564 billion, accounting for approximately 59% of the total equity underwriting volume in 2025.

Policy and Goal

The most direct and engaging way for KGI Financial to advance corporate social responsibility is through its core business, namely responsible investment and financing. We not only focus on the financial performance of our investment targets and financing clients but also take a macro perspective on evaluating their ESG performance, aiming to pursue long-term and stable profitability while leveraging financial influence to create a positive impact. In addition, in order to promote financial inclusion, we continue to pay close attention to climate change issues, promote actively for green finance, and care for social enterprises and underprivileged communities. Under the latest technological trends and user requirements prompted by the swift pace of global digitization, digital finance is used to rapidly satisfy customer needs. Through the power of technology and outstanding services, KGI Financial could enhance customer experience and create value for our customers. At the same time, we encourage innovation and support new startups to inspire young entrepreneurs. This will hopefully solve the “unemployment or underemployment” problem faced by the younger generation.

Key Strategy, Targets and Progress

Strategy/Relevant Material Topics	Asset/Methodology(Note 1) and 2025 Progress	Short-term Goals 2026
【Strategy】Engagement Targets 【Relevant Material Topics】ESG risks and opportunities in investment and financing	【Asset/Methodology】Listed stock and bond investment portfolio (common stock, preferred stock, corporate bonds, ETFs, REITs, mutual funds)/ PC 【2025 Progress】32.6% of the Group's listed stock and bond portfolio by invested value setting SBTi-validated targets.	36.0% of the Group's listed stock and bond portfolio (common stock, preferred stock, corporate bonds, ETFs, REITs, mutual funds) by invested value setting SBTi-validated targets
【Strategy】Engagement Targets 【Relevant Material Topics】ESG risks and opportunities in investment and financing	【Asset/Methodology】Corporate loans – Other industries/PC 【2025 Progress】46.6% of the Group’s corporate loan portfolio within the fossil fuel and electronic components manufacturing sectors by loan value setting SBTi-validated targets.	29.8% of the Group’s corporate loan portfolio within the fossil fuel and electronic components manufacturing sectors by loan value setting SBTi-validated targets
【Strategy】Sector Targets 【Relevant Material Topics】Climate/Nature Opportunity and Risk Management	【Asset/Methodology】Investment and Financing 【2025 Progress】The Company's investment and financing ratio in high-carbon industries stands at 11.18%.	The investment and financing ratio for high-carbon industries is below 23.0%.
【Strategy】Sector Targets 【Relevant Material Topics】Climate/Nature Opportunity and Risk Management	【Asset】Investment and Financing 【2025 Progress】Starting from January 1, 2025, the Group's subsidiaries did not hold new direct project investment or financing positions related to thermal coal and unconventional oil/gas (including new projects or expansion of existing projects), as well as companies engaged in the ongoing expansion of thermal coal and unconventional oil/gas-related businesses (Note 3).	Continue to ceased (Note 2) direct project investment and financing support for projects related to thermal coal and unconventional oil/gas (including new extraction projects and the continued expansion of existing projects), as well as for companies engaged in the ongoing expansion of thermal coal and unconventional oil/gas businesses (Note 3).
【Strategy】Portfolio Emission Targets 【Relevant Material Topics】Climate/Nature Opportunity and Risk Management	【Asset/Methodology】Electricity generation project investment and finance /SDA 【2025 Progress】Reduce GHG emissions from the electricity generation project investment and finance portfolio 39.1% per MWh from a 2022 base year.	Reduce GHG emissions from the electricity generation project investment and finance portfolio 37.5% per MWh from a 2022 base year.
【Strategy】Transitions Targets 【Relevant Material Topics】ESG risks and opportunities in investment and financing, Climate/Nature Opportunity and Risk Management	【Asset】Investment and Financing 【2025 Progress】 KGI Life - Proportion of green or sustainable investments increased by 44.4% compared to a 2022 base year. KGI Bank - Renewable energy project financing increased by 97.3% compared to a 2022 base year. KGI Securities – The par value of investment in sustainability bonds increased by 7.8% compared to a 2024 base year. KGI SITE – The procurement of third party data to implement ITR methodology has been completed, and continues to monitor and evaluate the temperature trajectory of its investment portfolios. CDIB - Amount of new green investment increased by 122.8% by 2025 compared to a 2023 base year.	KGI Life - Proportion of green or sustainable investments increased by 20% compared to a 2022 base year. KGI Bank - The balance of green credit increased by 120% compared to a 2022 base year. KGI Securities – The par value of investment in sustainability bonds increased by 6% compared to a 2024 base year. KGI SITE – The proportion of proprietary trading counterparties setting SBTi-validated targets reach 35.95% by 2026, increased by 9.15% compared to a 2024 base year. CDIB – Increase amount of new green investment by 5% compared to a 2023 base year.
【Strategy】IFRS S2/TCFD 【Relevant Material Topics】Climate/Nature Opportunity and Risk Management	【Asset】Investment and Financing 【2025 Progress】Implemented IFRS S2 climate-related disclosures in accordance with regulations Completed the climate and nature-related report and assurance by end of June	Implement the planning of the IFRS S2 climate-related disclosures Optimize the climate risk scenario analysis methodology Complete the climate and nature-related report and assurance
Note 1: Portfolio Coverage (PC); Sectoral Decarbonization Approach (SDA). Note 2: Effective January 1, 2025, no new direct project financing or investment positions shall be added by this commitment. Note 3: The percentage of revenue from related businesses is expected to grow. Note 4: A business deriving more than 30% of their revenue or generated power from thermal coal and unconventional oil and gas related industries, without putting forth a low-carbon transition project in alignment with the targets under the Paris Agreement. Note 5: Direct investment refers to the allocation of capital into an investment target where more than 10% of common shares are held. Direct financing refers to the provision of capital directly to enterprises or institutional entities in need of funding, including granting loans and purchasing more than 10% of a corporate bond issuance in the primary market.

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Society

Whether it is charity programs, emergency aid, industry-academia cooperation, or talent cultivation, the core we focus on most will never change: the positive driving force that education brings to society.