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Elo Mutual Pension Insurance Company

PRI reporting framework 2017

Export Public Responses

You are in Strategy and Governance » Implementation not in other modules

Implementation not in other modules

SG 12. ESG issues in strategic asset allocation

New selection options have been added to this indicator. Please review your prefilled responses carefully.

12.1. Indicate if your organisation executes scenario analysis and/or modelling in which the risk profile of future ESG trends at portfolio level is calculated.

12.2. Indicate if your organisation considers ESG issues in strategic asset allocation and/or allocation of assets between sectors or geographic markets.

12.3. Additional information. [OPTIONAL]

We conducted a scenario analysis on carbon price increase for European companies.


SG 13. Long term investment risks and opportunity (Private)


SG 14. Allocation of assets to environmental and social themed areas (Private)


SG 15. ESG issues for internally managed assets not reported in framework

15.1. Describe how you address ESG issues for internally managed assets for which a specific PRI asset class module has yet to be developed or for which you are not required to report because your assets are below the minimum threshold.

Asset Class

Describe what processes are in place and the outputs or outcomes achieved

Private equity

Responsible investment principles are applied throughout the whole investment process. Own independent analysis of the company is always conducted at the pre-investment stage to make sure that the company meets our investment quality standards. Responsibility is emphasized in our criterias and processes. Companies' responsibility, environmental aspects, independence and experience of the Board and that the company is managed according to corporate governance principles are analysed among other things. Companies are followed up and monitored continuously.

Inclusive finance

ESG can best be addressed at an early stage of the project when we evaluate the financial project and do a comprehensive analysis of the company. Responsibility is emphasized in credit granting and processes. In addition, Elo's policyholders have the right to get a loan. Portfolio companies' responsibility including environmental aspects, Governments' experience, professionalism and independence as well as the treatment and safety of workers are factors, which are explained as part of the credit approval. The company's environmental risk analysis is included as part of the analysis, as well as
collateral management.
 

15.2. Additional information [Optional].


SG 16. ESG issues for externally managed assets not reported in framework

16.1. Describe how you address ESG issues for externally managed assets for which a specific PRI asset class module has yet to be developed or for which you are not required to report because your assets are below the minimum threshold.

Asset Class

Describe what processes are in place and the outputs or outcomes achieved

Hedge funds

ESG issues are integrated into all our investment processes including hedge funds.We put lot of emphasis on Operational Due Diligence when conducting manager selection. ESG issues supplement our overall analysis of an individual manager.We feel that Governance issues are the most prevalent. Environmental and Social aspects are equally important but far more difficult to analyze with the same degree of confidence. This is because vast majority of hedge funds in our portfolio utilize high turnover of underlying securities and they use derivative instruments extensively.Our strict hedge fund investment strategy deviates significantly from traditional market indices. Activist and Equity long/short investment strategies have relatively small weight in our portfolio. These strategies have traditionally exhibited the majority of ESG issues in investors’ hedge fund portfolios.We take our fiduciary duty very seriously. We extend Governance also to the way how we invest in hedge funds and conduct business with our counterparties. We analyze each and every hedge fund managers business model. Specifically compensation schemes, risk management, board of directors’ independence, insider trading rules etc.     

Forestry

Investments in infrastructure are often associated with the exploitation of people's basic needs (such as clean water and heat) or natural resources. Infrastructure, forest and agricultural land are direct or indirect investments. Our aim is that >50% of infra and real asset invesments have a positive impact to environment or society by 2025 and thus they would be aligned with the UN's Sustainable Development Goals. We calculate our forest investments carbon sink which is the positive impact to environment.

16.2. Additional information.


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