Nuestra política de SFDR

Nuestra política de SFDR

El Reglamento de la UE 2019/2088 sobre la presentación de informes de sostenibilidad en el sector de los servicios financieros (SFDR), que entró en vigor el 10 de marzo de 2021, exige a sus actores que publiquen sus políticas con respecto a:

  • La integración de los riesgos de sostenibilidad en su proceso de toma de decisiones de inversión,
  • La consideración de los principales impactos negativos de las decisiones de inversión en los factores de sostenibilidad,
  • La integración de los riesgos de sostenibilidad en su política de remuneración.

Información relativa al grupo Indosuez Wealth Management:

 

(EN) Our SFDR policy for former Banque Degroof Petercam Luxembourg clients

Description of our approach for our discretionary management

This obligation applies to most of our "Core strategy", "Multi-funds", "Conviction mandate" and "Personalised" discretionary management mandates, which in most cases are products covered by Article 8 of the SFDR Regulation.

As each client may have their own sustainability preferences in the context of MiFID II, Degroof Petercam is not in a position, and is not authorized for confidentiality reasons, to provide more detailed information on the website for each mandate.
Consequently, the information below is limited to a description of our overall approach to discretionary management. Please refer to the pre-contractual information and SFDR reporting sent to you by Degroof Petercam, which provide specific information about your managed portfolio.

a. Summary

Except in a few specific cases, our discretionary management mandates are by default aligned with the requirements under "Article 8" within the meaning of the SFDR Regulation. They highlight environmental and social characteristics, but do not have a sustainable investment objective.

In the composition of products that incorporate environmental and/or social characteristics or have sustainable objectives, our rule is to hold a minimum of 33.5% of "ESG" instruments (i.e. meeting environmental and/or social characteristics with an “best-in-class”* ESG integration) and a maximum of 10% of "non-ESG" instruments (instruments that are not the best in their sector in terms of ESG).

In the EFIP, companies and countries are analysed from 3 different angles:

  • The first is the eligibility of the financial instrument. In practice, we apply basic exclusions and more extensive exclusions in certain cases. In addition, Degroof Petercam has a policy regarding the commitment of third-party funds.
  • The second is the financial instrument's ESG integration, which measures how its issuer is exposed to ESG risks and manages environmental, social and governance issues.
  • The third is instrument impact, which measures how the issuer's products and services contribute to environmental and social objectives.

We use information and data from third-party data providers to support our extra-financial classification methodology.

* The concept of Best-In-Class is used to identify companies with superior ESG characteristics. Selection is always based on a comparison with peers. Following the "best-in-class" principle does not necessarily mean excluding the most controversial sectors or industries, but the aim is to invest as a priority in companies that make the greatest effort to respect ESG criteria in their respective sectors.

b. No sustainable investment objectives

Our financial products emphasize environmental and/or social characteristics, but do not have a sustainable investment objective.

The products concerned do not have a sustainable investment objective per se, but they do commit to investing a minimum proportion sustainably. This proportion of sustainable or impact investments in our discretionary management mandates is at least 20% or 50%, depending on the sustainability strategy expressed in the sustainability questionnaire.

The concept of "do not significantly harm" as defined by the SFDR regulation applies to the part of the portfolio that is invested in a sustainable manner (20 or 50% of the portfolio). The SFDR principle also forms part of our extra-financial investment process.

The identification and measurement of these sustainable investments is carried out through an analysis of issuers whose core business is the development of products and services that contribute to the achievement of one or more of the 17 environmental or social Sustainable Development Goals ("SDGs"), as defined by the United Nations (UN) (e.g. healthcare products and services, education-related services, water saving and access solutions, energy efficiency solutions, or services enabling digitalization, sustainable mobility services, etc.).

We ensure that the financial product considers the main negative indicators.

Addressing principal adverse impacts on sustainability factors (hereafter referred to as 'PAI') is achieved through a commitment to reduce the negative impact of the product's investments by avoiding activities or behaviours that can significantly undermine sustainable and inclusive growth. In concrete terms, PAI are incorporated into the various stages of product construction via exclusions and via the investment process, in which issuers are analysed and controversies monitored.

Degroof Petercam considers all mandatory PAI and has selected a list of PAI for issuing companies that will be monitored on a priority basis. The specific PAI are as follows:

  • greenhouse gas emissions;
  • carbon footprint;
  • breaches of the principles of the United Nations Global Compact and the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises;
  • exposure to controversial weapons (landmines, cluster munitions, chemical and biological weapons).

In addition, the two PAIs for sovereign and supranational issuers ("greenhouse gas intensity" and "investment countries subject to social breaches") will also be part of Degroof Petercam's priority list.
Investments in our discretionary management mandates do not breach international standards, such as the principles of the United Nations Global Compact, the UN guidelines on Business and Human Rights, the OECD Guidelines for Multinational Enterprises, and the Conventions of the International Labour Organization (ILO).

c. Environmental or social characteristics of the financial product

Except in a few specific cases, our discretionary management mandates promote environmental, social and governance (ESG) characteristics through Degroof Petercam's methodology, as described in the "Investment strategy" section.

The issuers and financial instruments included in our eligible universe for discretionary management are evaluated on different levels:

  • The environment: global warming and the fight against greenhouse gas emissions, taking into account characteristics such as Scope 1, 2 and 3 carbon footprint and carbon intensity (Scope 1, 2 and 3).
  • Social matters: application of the characteristics of compliance with Global Standards, such as respect for human rights, labour rights and the prevention of corruption, and taking into account social controversies linked to social issues, i.e. society and community, the client and employees, and controversies linked to governance issues such as business ethics.
  • Good corporate governance: the structure and integrity of boards of directors and management, shareholder rights and remuneration policies.

d. Investment strategy

The products emphasise environmental and social characteristics through our methodology which aims at:

  • Not financing companies that do not comply with certain international standards such as the United Nations Global Compact and/or are involved in controversial activities or incidents (normative reviews). For more information, please refer to our exclusion policy.
  • Promoting best ESG practices and efforts using a best-in-class approach to environmental and/or social characteristics. In doing so, Degroof Petercam identifies companies that are best-in-class compared to their peers in their sector in terms of environmental or social characteristics, and no worse in their category on the other dimension. In the case of sovereign issuers, the same approach is pursued with a focus on the management of environmental issues in relation to the risk inherent in their existence.

When investing in funds under our discretionary management mandates, we carry out a look-through analysis of the underlying investments to ensure that we select UCIs that meet Degroof Petercam's standards in terms of environmental and social promotion.

Respect for international standards includes companies that comply with the United Nations Global Compact. Companies are assessed against the ten principles of the UN Global Compact on a quarterly basis. Non-financial rating agencies carry out a compliance check to detect companies facing serious controversies and incidents in one of the four areas of the UN Global Compact (human rights, labour rights, respect for the environment and the fight against corruption).

The seriousness of the allegations is assessed based on national and international law. Following this assessment, companies are classified as compliant, non-compliant or are placed on a watch list.

Names placed on the watch list are monitored over an extended period to determine whether structural progress in risk management or performance is taking place or whether the impact of the controversy is less significant than initially expected.

Degroof Petercam evaluates the good governance of issuers (companies and governments) on several levels. As good governance is fundamental to effectively manage the environmental and social impacts of economic activities over the long term, this assessment is carried out systematically, regardless of the environmental or social score obtained by the issuer. For each business sector, the most significant governance risk exposures are identified, and the issuer is assessed in terms of its management of this specific risk. We analyse the structure and integrity of boards of directors and management, shareholder rights, compensation policies, the reliability of financial information, as well as transparency regarding ESG issues and the ability to manage them.

In the normative review, this allows for the exclusion of companies or states that demonstrate poor governance. For investments made through other UCIs, this review will rather be carried out through engagements with the manager of the UCI. Finally, the quality of an issuer's governance will enable it to be categorized as ESG, neutral or non-ESG. In discretionary management mandates, Degroof Petercam is committed to favouring ESG investments and limiting non-ESG investments.

e. Proportion of investments

Our discretionary mandates have a minimum proportion of instruments with best-in-class ESG integration (referred to as “ESG”). This minimum proportion represents 33.5% of the assets. On the other hand, mandates are limited to investing a maximum of 10% in companies or issuers with a low level of ESG integration that are not best ranked on ESG topics compared to their sector ("non-ESG").

The proportion of sustainable or impact investments is a minimum of 20% or a minimum of 50%, depending on the sustainability strategy expressed in the sustainability questionnaire.

The "Core Strategy", "Multi-funds" and "Conviction" mandates invest solely in funds and therefore have no direct exposure to the entities in which they are invested.

Personalised mandates can invest in funds as well as in direct lines, and therefore potentially have both direct and indirect exposure to the entities in which Degroof Petercam invests.

Within our "Personalised" discretionary management mandates, derivatives may be used for efficient portfolio management and hedging purposes. In addition, all our discretionary mandates may also hold liquid assets or invest in cash-like instruments. These instruments are not used to achieve the environmental and social characteristics promoted by the financial product.

f. Control of environmental or social characteristics

Degroof Petercam will implement appropriate controls to ensure compliance with SFDR criteria in its discretionary management mandates.

These controls will consist of an ex-ante control framework managed by the IT system that will define access to certain financial instruments. These blocking controls define the instruments eligible for the discretionary management mandates concerned as part of an exclusion control. In addition, controls are in place to ensure compliance with defined thresholds:

For ESG characteristics:

  • Minimum 33.5% of ESG instruments (i.e. with environmental and/or social characteristics with an “best-in-class” ESG integration) and
  • Maximum of 10% "non-ESG" instruments (instruments that are not the best in their sector in terms of ESG).

For sustainable investment thresholds:

  • The sustainable investment strategy defines a minimum of 20% (moderate) or a minimum of 50% (strong) of the portfolio of financial instruments classified by Degroof Petercam as sustainable.

Ex-post controls have been developed based on criteria to be defined by Private Banking and Risk Management. If necessary, the financial product will be adjusted based on these checks.

g. Methods applicable to environmental or social characteristics

Degroof Petercam has chosen to comply with the regulations by using an extra-financial investment process (EFIP) which provides investment teams with an extra-financial classification methodology.

This process is systematically applied to the following asset classes:

  • Funds (internal funds and funds from third-party fund providers).
  • Bonds or other fixed-income products issued by companies or governments.
  • Equities.

In the EFIP framework, companies and countries are analysed from three different angles:

  • The first is the eligibility of the financial instrument. In practice, we make exclusions on controversial activities and behaviours for companies and states via a basic and extended analysis. It is during this analysis that we identify the funds with which we are going to engage with their managers.
  • The second is the analysis of the degree of ESG integration of the financial instrument, which measures how its issuer is exposed to ESG risks and manages environmental, social and governance issues.
  • The third is the sustainability of the instrument, which measures how the issuer’s products and services contribute to environmental and social objectives.

This process is applied to the financial instruments that form part of Degroof Petercam's investment services universe and leads to the identification of the appropriate sustainable for each issuer.

Derivatives, structured products, and physical gold, however, are not assessed or screened because, by their nature, ESG integration is difficult to determine for these instruments or because we were unable to collect sufficient data to make a proper categorisation. They will be classified as “no category”.

h. Data sources and processing

Degroof Petercam manages sustainability risk by systematically and thoroughly selecting and classifying financial instruments according to ESG criteria.

This process is based on objective information and market data, provided by data providers specialized in ESG/sustainability issues such as ISS, Sustainalytics, MSCI and TruCost (non-exhaustive list).

Data relating to the ESG and sustainability characteristics of the underlying financial instruments are incorporated into Degroof Petercam's data systems and made available to the relevant departments.

Degroof Petercam has developed internal classification systems based on sources from data providers, which focus on themes of importance to the bank.

i. Limits to methods and data

The data used may have the following limitations:

  • Lack of data (or audited data) disclosed by companies (limitations on the existence and sometimes the quality of data).
  • The complexity of certain ESG indicators and the difficulty of quantifying them in a uniform manner.
  • Different specialist data providers.

Our extra-financial investment process (EFIP) may evolve and be adapted to take account of regulatory and technical advances.

j. Due diligence

The principles of due diligence concerning the underlying instruments of our discretionary management mandates are described in our sustainable investment policy. A dedicated team checks the ESG and sustainability classifications for each new instrument entering the discretionary management universe and also periodically monitors this data.

k. Commitment policy

All our discretionary mandates have the possibility to invest in funds. In order to limit the negative impact within the third-party funds we market, Degroof Petercam has an engagement policy with external fund managers to allow them to modify their investments, to provide any additional explanations they may have or, if they do not react accordingly, to exclude these funds from our selection.

l. Designated benchmark

No benchmark is used for the environmental and social characteristics promoted by these financial products.