Kalium Bank Investment Philosophy

Below are the core investment principles that guide Kalium Bank’s financing activities. Each section states the principle and provides context and operational guidance explaining what our principle means in practice.

Principle 1 — Discounted Financing for Climate-Friendly Initiatives

Statement: Kalium Bank prioritises and discounts the cost of financing for verified climate-friendly projects to ensure they consistently receive more affordable capital than comparable market alternatives.

Context & Implementation:

Discounted issuance of financial services reduces the cost of capital for projects that demonstrably deliver climate benefits, accelerating deployment and scaling.
Discounts are conditional on compliance with Kalium verification, reporting, and governance standards (see Principles 4, 7 and 8).
This approach is intended to stimulate growth in proven, high-impact climate solutions by making them financially more attractive than non-climate alternatives.

Principle 2 — Primary Market First

Statement: Kalium Bank requires that new investments occur on the primary market so that capital flows directly to the project originator or developer.

Context & Implementation:

Primary market allocation ensures financing reaches the entity delivering the emissions reductions or removals (not merely secondary holders).
Secondary market trades are permitted for liquidity and price discovery but do not substitute for primary financing commitments.
Contracts and underwriting will prioritise instruments and offerings that channel funds to project originators.

Principle 3 — Centralised Mediation of Exchanges and Price Action

Statement: All exchange activity, contract terms, and transactional confirmations related to Kalium credits and financed projects must be mediated or approved by Kalium Bank.

Context & Implementation:

Kalium Bank approves contractual terms for regulatory conformity and centralised confirmation; the Bank acts as a market facilitator and market-maker where appropriate.
Mediation ensures consistent enforcement of Kalium standards (verification, realisation, execution, retirement) and prevents fragmentation or regulatory arbitrage.
This role does not preclude interoperable trading venues, but all ancillary platforms must integrate with Kalium’s registry and compliance processes.

Principle 4 — Evidence-Based Investment: Scientific, Numeric, and Economic Proof Required

Statement: All investments must be supported by rigorous scientific evidence, quantifiable metrics, and demonstrable economic benefit.

Context & Implementation:

Projects must present validated methodologies, monitoring plans, and measurable outcomes (GHG reductions/removals in CO₂e and other relevant KPIs).
Economic proof (business case, revenue model, cost curves) is required to demonstrate viability and impact per unit of capital invested.
Independent verification and auditability are prerequisites for funding approval.

Principle 5 — No Funding for Pure R&D or Unproven Concepts

Statement: Kalium Bank will not finance projects that are solely in the research or early experimental phase; investments are reserved for proven, deployable solutions or scale-ready innovations.

Context & Implementation:

The urgency of climate mitigation prioritises deployment and scaling of existing solutions with proven impact.
Capital that would otherwise be allocated to unproven R&D is directed toward improving, scaling, and de-risking existing projects.
Exceptions may be considered only under tightly defined, exceptional governance approvals with clear commercialisation pathways.

Principle 6 — Trusted Carbon Intensity Assessment and Accounting

Statement: All investment targets must undergo trusted assessment of carbon intensity and be accounted for relative to revenue, output, or an appropriate denominated metric.

Context & Implementation:

Carbon intensity metrics (e.g., tCO₂e per unit revenue, per MWh, per ton product) enable comparability across companies and projects.
Independent and trusted assessments are required to ensure accuracy and consistency with recognised accounting standards.
Investment preference is given to lower-intensity activities or those with credible, time-bound plans to reduce intensity.

Principle 7 — Only Invest in Entities with Clear Transition Plans and Science-Based Targets

Statement: Kalium Bank funds only projects or companies that have transparent, credible transition plans and science-based decarbonization targets (e.g., net-zero targets with interim milestones).

Context & Implementation:

Transition plans must include timelines, interim goals, governance oversight, and verifiable milestones.
Targets should align with accepted scientific pathways and be independently assessed where possible.
Ongoing financing is contingent upon demonstrated progress against these plans.

Principle 8 — Prioritise Solutions That Enable Decarbonisation, Not Merely “Less Harm”

Statement: Investments prioritise solution providers that actively enable decarbonization (renewables, electrification, energy-efficiency, sustainable agriculture, green infrastructure), while maintaining sectoral diversification.

Context & Implementation:

Funding favours projects that create downstream emissions reductions at scale, not merely activities that reduce incremental harm.
Portfolio diversification across complementary sectors reduces concentration risk and increases systemic impact.
Selection criteria balance technological potential, systemic leverage, and alignment with consensus decarbonization pathways.

Principle 9 — Zero Tolerance for Greenwashing

Statement: Kalium Bank will not invest in projects or firms that make unsubstantiated green claims or rely on marketing without measurable climate actions and verifiable outcomes.

Context & Implementation:

All climate claims must be supported by data, independent verification, and transparent reporting.
Any evidence of misrepresentation triggers immediate review, potential divestment, or remediation requirements.
Anti-greenwashing measures include contract clauses, audit rights, and reputational/financial penalties.

Principle 10 — Stringent and Regular Emissions Reporting

Statement: All portfolio companies and projects must submit frequent, comprehensive emissions reports covering scope 1, 2 and material scope 3 sources, with regular Kalium approved verification.

Context & Implementation:

Reporting cadence and scope are defined in financing agreements and must meet Kalium’s disclosure standards.
Supply-chain and product-use emissions, which often represent majority impacts, must be estimated and progressively improved.
Transparency supports investor due diligence, compliance, and impact measurement.

Principle 11 — Sound Financial Fundamentals and Growth Potential Required

Statement: Even climate-positive projects must demonstrate robust financial fundamentals and credible growth potential; Kalium invests only where commercial viability and scale prospects are evident.

Context & Implementation:

Investment decisions consider unit economics, market size, competitive positioning, and growth forecasts.
Capital is allocated to initiatives likely to outpace market returns while delivering measurable climate outcomes.
Financial discipline mitigates risk and preserves the sustainability of the funding vehicle.

Principle 12 — Political and Financial Impartiality

Statement: Kalium Bank maintains political and financial impartiality; financing is non-discriminatory and will not be used to promote partisan or destabilising activities.

Context & Implementation:

Kalium will not finance projects that materially contribute to political instability, conflict financing, or partisan agendas.
The Bank’s impartiality preserves neutrality and protects capital deployment from geopolitical risk.
Governance documents codify exclusions, compliance checks, and escalation procedures for potential political/financial conflicts.

Closing Note

These investment principles form Kalium Bank’s operational ideology: accelerate proven climate solutions, ensure direct capital flows to impact originators, enforce rigorous scientific and financial standards, and protect market integrity through centralised mediation and transparent reporting. Together they create a resilient framework for deploying capital where it can deliver the greatest measurable climate benefit.