For the ESG enhanced stars funds, only companies rated B or better on a scale from A to C in our in-house analysis are investable.
Integration key to managing risk:
Since ESG issues are an increasing source of risk and opportunity, we initiated a process to integrate ESG data, both positive and negative, as a factor in assessing investments. At year's end 2013, all investments were integrated. All portfolio managers in Nordea have access to ESG research and company specific information, which they can use as a basis in their overall assessment of a company, and in the investment decision process. We have for example seen than portfolio managers that look at two rather similar companies from a performance persepctive, chose highter rated companies from an ESG perspective over lower rated companies, as a way to reduce additional risk.
The ESG data can help control risk in an investment portfolio, and is a potential indicator of better performance. Full ESG integration will strengthen Nordea's profile as one of Europe's leaders in responsible investment.