• Issuing Entity

  • Application Scope

  • Geographic Area

  • Risk Type

  • Theme

  • Language

  • Clear Filters

More than

396 extracts

from 38 regulatory texts

have been identified

Add To Favorites Remove from Favorites
Impact investments intend to generate a measurable, beneficial social and / or environmental impact alongside a financial return. Important differentiating factors to other forms of sustainable investments (namely thematic investing) are the intentionality of an investment in a sector or activity that has such a positive impact, the management process that allows for a direct impact, and the measurability of the impact through relevant Key Performance Indicators (KPIs). Impact investments can be made in both emerging and developed markets and target a range of returns from below-market to above-market rates, depending upon the circumstances.
Add To Favorites Remove from Favorites
Individuals with oversight roles are those with management or governance responsibility for ensuring that the organisation implements its policies and achieves its objectives and targets in relation to sustainable investment performance. Assigning oversight to a person, team or committee should not be seen as a way to compartmentalise ESG responsibility. Instead, the purpose is to ensure accountability for embedding ESG considerations within the organisation and investment processes.
Add To Favorites Remove from Favorites
Individuals with implementation roles are those charged with implementing specific aspects of the organisation’s sustainable investment practices. For example, conducting ESG-related research, incorporating ESG issues into investment strategies, voting on shareholdings, or engaging with companies. Implementation of ESG analysis in investment decision-making does not only apply to dedicated sustainability staff but could be a part of any role or activities.
Add To Favorites Remove from Favorites
An asset manager should define the following: • Objectives: The asset manager’s objectives with regard to the consideration of ESG risks and opportunities and measures taken to achieve these objectives. For example, climate risks being one of the key sustainability topics should be covered by the asset manager’s objectives. In order to contribute to achieving the Paris Climate Agreement, the asset manager should assess climate risks along the decision-making process (e.g. investment analysis, investment decisions) and address them through active engagement. • Data quality and sourcing: The asset manager should define the process to source reliable ESG data and regularly monitor their quality and encourage a continual improvement. • Responsibilities: Who is formally in charge of applying sustainable investment practices. • Process: How ESG information is handled (e.g. from where it is obtained), how it is processed, how controversial ESG issues and ESG risks are addressed and handled (e.g. climate relevance in policy). • External fund managers: How the due diligence process for the ESG approach of external fund managers is designed. • Reporting: How to ensure regular reporting on sustainable investment activities and where to report on them. • Monitoring: How is a regular review of the process and its implementation ensured. • The approach to active ownership: – Description of how / if voting rights are exercised (e.g. regular basis or not) and if they are based on a dedicated policy. – Description of how / if the asset manager actively engages with companies.
Add To Favorites Remove from Favorites
As this is relevant to the manner in which an asset manager oversees its sustainable investment activities, this should include a description of the following items: • The board’s oversight of ESG risks and opportunities, and • The management’s role in assessing and managing ESG risks and opportunities.
Add To Favorites Remove from Favorites
The descriptions of §27 should form part of the asset manager’s investment policy. The investment policy should reflect the investment beliefs and convictions of the organisations.
Add To Favorites Remove from Favorites
In describing the board’s oversight of ESG issues, the asset manager should define and implement the following aspects: • Processes and frequency by which the board and / or board committees (e.g. audit, risk, or other committees) are informed about ESG issues. • Define the organisation’s objectives with regards to ESG and formulate an investment policy that includes its approach with regard to the consideration of ESG risks and opportunities in the investment process. • How the board monitors and oversees progress against goals and targets for addressing ESG issues. • The board’s risk tolerance and policy for overseeing ESG risks and opportunities as well as the role of management in implementing the decisions made by the board concerning the setting up, maintenance and regular review of the internal control system (ICS), including the related controls for overseeing ESG risks. • Keep track of international developments in sustainable finance and in alignment with the business model of the asset manager – adapt to these developments where necessary and useful (e.g. EU regulations in case of providing cross-border services).
Add To Favorites Remove from Favorites
The investment policy or a summary thereof should be published (e.g. via the website).
Add To Favorites Remove from Favorites
In describing executive management’s role related to assessment and management of ESG issues, the asset manager should address the following items: • Assign executive management responsibility for the sustainable investment process (e.g. to a member of the executive management or committee) and define reporting lines. • Description of the associated organisational structure(s) and required resources. • Define appropriate tools to monitor ESG issues.
Add To Favorites Remove from Favorites
The investment strategy is a high-level plan which defines how the investment is performed and embeds comprehensive consideration of all long-term trends affecting the portfolio of the asset manager. Through the integration of material sustainability factors into the investment strategy, an asset manager aims to actively manage and monitor material risks and therewith operate as efficiently as possible for the benefit of his clients and other stakeholders.
Add To Favorites Remove from Favorites
Once responsibilities are defined, an organisation should make sure relevant employees receive appropriate training to enable them to integrate sustainability factors into the investment process.
Add To Favorites Remove from Favorites
The consideration of such financially relevant sustainability factors is therefore consistent with the asset manager’s obligation to achieve the best possible risk-adjusted return on investment, taking due care and protection of the customer’s interests into account.
Add To Favorites Remove from Favorites
While the investment strategy should be reasonably generic, the individual product presentations should give a more detailed view of the application of ESG in the respective investment process. The asset manager is expected to apply one of the approaches mentioned below, a combination thereof, or a new approach with similar effects. The objectives of the sustainable investment strategy can vary and usually envisage an improved risk / return profile, an alignment to values and norms and / or a positive contribution to the achievement of a sustainable economy.
Add To Favorites Remove from Favorites
An asset manager integrating ESG factors into the investment process may wish to integrate sustainability into their vision and mission, in order to assure alignment between the overall company strategy and the investment strategy. Integrating sustainability into the overall strategy by actively managing ESG topics that are considered relevant for the whole company (e.g. energy and resource consumption, diversity, good governance) contributes to the overall credibility of the sustainable investment strategy. Furthermore, a company expresses conviction, if the assets under its control (e.g. reserves, pension fund assets) are managed in line with the sustainable investment policy, but always subject to the asset manager’s mandate given to him by the asset owner.
Add To Favorites Remove from Favorites
If an asset manager claims to have a sustainable investment process in place, it should describe which approach or combination of approaches the process is based on (referring to the different forms of sustainable investing described above) and how the respective approaches are implemented.

  • Issuing Entity

  • Application Scope

  • Geographic Area

  • Language

  • Clear Filters