switching on certain non-abelian worldvolume backgrounds [@Alekseev:2000fd; @Alekseev:2002rj]. This is similar to the dielectric effect for D-branes in the presence of a non-vanishing Ramond-Ramond field strength [@Myers:1999ps].

In a separate development [@Felder:1999cv] it was suggested that the choice of conformal boundary conditions in the WZW model amounts to the insertion of (spacelike) Wilson loops in the three-dimensional Chern-Simons theory. The approach was then generalised [@Fuchs:2002cm] to all rational CFTs, with Wilson loops replaced by more general ‘topological defect lines’. These were introduced in ref. [@Petkova:2000ip] as formal bulk operators that commute with the chiral algebras of the theory. They are special cases of conformal defects, which in general only commute with the diagonal Virasoro algebra [@Oshikawa:1996dj; @Bachas:2001vj; @Quella:2002ct; @Saleur:1998hq]. Topological defects have been recently used to conjecture relations between boundary RG flows [@Graham:2003nc], and as generators of generalised Kramers-Wannier duality transformations [@Frohlich:2004ef].

Our aim in the present work will be to clarify the relation between these different approaches to the Kondo problem. We will work in the boundary state formalism [@Callan:1987px; @Polchinski:1987tu], and consider the renormalised transfer-matrix operator that perturbs the theory away from its ultraviolet fixed point. We will argue that this operator can be pushed forward smoothly into 