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Colonial First State Global Asset Management (including First State Investments)

PRI reporting framework 2016

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Fixed income - Engagement

FI 18. Engagement overview and coverage

18.1. Indicate if you engage on your fixed income assets. Please exclude any engagements carried out solely in your capacity as a shareholder.

Category
Proportion of assets
SSA

18.2. Indicate your motivations for conducting engagement.

Corporate (financial)

18.2. Indicate your motivations for conducting engagement.

Corporate (non-financial)

18.2. Indicate your motivations for conducting engagement.

Securitised

18.3. Additional information.[OPTIONAL]


FI 19. Engagement method

19.1. Indicate how you typically engage with issuers as a fixed income investor, or as both a fixed income and listed equity investor. (Please do not include engagements where you are both a bondholder and shareholder but engage as a listed equity investor only.)

Select all that apply
Type of engagement
SSA
Corporate (financial)
Corporate (non-financial)
Individual/Internal staff engagements
Collaborative engagements
Service provider engagements

19.2. Indicate how your organisation prioritises engagements with issuers

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
Based on potential materiality of ESG factors
Based on systemic risks to global portfolios
Based on our exposure (holdings) to ESG risks
Other,describe

19.3. Indicate when your organisation conducts engagements with issuers.

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
Engagements are conducted pre-investment
Engagements are conducted post-investment 
Other, describe

19.4. Indicate how your organisation conducts engagements with issuers.

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
We systematically engage prior to ESG-related divestments
We engage proactively in anticipation of specific ESG risks and/or opportunities
We engage in reaction to ESG issues which have already affected the issuer
Investment and ESG analysts systematically conduct ESG-related engagements together 
Other, describe

19.5. Indicate what your organisation conducts engagements with issuers on.

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
We conduct engagements with individual issuers
We conduct engagements across sectors and industries
We conduct engagements on specific ESG themes (e.g. human rights)
Other, describe

19.6. Indicate how your organisation shares the outcomes of the engagements internally.

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
We have a systematic process to ensure the outcomes of engagements are made available
We occasionally make the outcomes of engagements available
Other, describe
We do not make this information available

19.7. Additional information.[OPTIONAL]

In reklation to 19.4

EMD Team

Engagement

We believe it is important for the analysts to spend time on the ground and observe country conditions first-hand to verify whether the statistics or the news is giving the full picture. This time spent on the ground can include meetings with government officials where ESG issues can be raised. However a great deal can also be gauged simply by observing the surrounding environment.

The team recognises the evolving nature of RI and stewardship for fixed income investments, and in particular for sovereign issuers. In order to develop our own understanding as well as to contribute to improvements in industry practices we have been involved in the United Nations Environmental Programme Finance Initiatives E-RISC project phase 2, which is developing methods for investors to incorporate environmental factors into the assessment of sovereign issuers. 

Fixed Income and Credit Teams

Engagement

Issues for engagement are identified following our thorough company research. 

The team’s key engagement is with banks and counterparties to understand their ESG risks and their approach to managing those risks. For example, climate change and other environmental risks relating to the bank’s loan book and financing, and aspects of their lending policies.

A challenge for responsible credit investors has been effective ESG engagement with issuers. This is in part due to the contractual nature of bond investments and the fact that a majority of securities are purchased on secondary markets. We do actively incorporate questions into meetings with primary issuers. Our brokers are aware of our ESG focus and facilitate ESG discussions where possible. We continue to build on this program of engagement over time. 

 


FI 20. Engagement policy disclosure

20.1. Indicate if your publicly available policy documents explicitly refer to fixed income engagement separately from engagements in relation to other asset classes.

20.2. Please attach or provide a URL to your fixed income engagement policy document. [Optional]

20.3. Additional information [OPTIONAL]


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