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LocalTapiola Asset Management Ltd

PRI reporting framework 2017

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You are in Direct - Listed Equity Active Ownership » Engagement

Engagement

Overview

LEA 01. Description of approach to engagement

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

01.1. Indicate whether your organisation has a formal engagement policy.

01.2. Indicate what your engagement policy covers: 

          our engagements are mostly based on company-specific issues, we also complete engagements on specific themes through all our investments

01.3. Attach or provide a URL to your engagement policy. [Optional]

URL http://public.egate.fi/lahitapiola/lahitapiola/fi/tiedostot/174703/

Attach document

LähiTapiola Rahastojen omistajapolitiikka.pdf

01.4. Provide a brief overview of your organization’s approach to engagement

Our engagement policy is a part of our RI process according to which the meetings with the management is the most important channel for engaging and influencing. Issues discussed with the management are mostly company specific and arise from company information and our own ESG analysis. Portfolio managers follow up how companies develop their processes and activities at regular meetings, by actively following the public information and by addressing specific issues by e-mails. We specifically target the companies with low ESG scoring.  Attention is given to development of KPI´s and how successful a company is in meeting its targets. In particular we look at company's ability to set more specific targets and to incorporate ESG into their strategy and throughout the entire value chain.

We also conduct engagements on a specific theme and in these cases we engage with all the companies we have invested in, if relevant. In 2015 and 2016 we have focused on environmental issues, e.g. reporting and interpreting carbon footprint information. Late 2016 we also sent an inquiry to all the companies that according to our knowledge do not report their emission, in order to encourage them to report in the future.

01.5. Additional information [optional]

LEA 02. Reasoning for interaction on ESG issues (Not Completed)

Process

Process for engagements run internally

LEA 03. Process for identifying and prioritising engagement activities

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

03.1. Indicate whether your organisation has a formal process for identifying and prioritising engagement activities carried out by internal staff.

03.2. Describe the criteria used to identify and prioritise engagement activities carried out by internal staff.

other description 

          Poor ESG score in our in-house ESG analysis

03.3. Additional information. [Optional]

Typically our engagement activities are company specific, arising from company information and our in-house ESG analysis. We prioritize cases where we see either significant risks or opportunities arising from ESG or where public information is limited (eg. small companies). In addition, we target companies that have received a poor ESG score in our in-house analysis, in order to encourage improved disclosure and to gain a better understanding of company approach to ESG issues.

We are also in contact with companies if an ESG incidence has occurred, firstly to clarify the situation and secondly to find out company action to mitigate the outcome and to prevent future incidences.

LEA 04. Objectives for engagement activities

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

04.1. Indicate if you define specific objectives for your engagement activities.

04.2. Indicate if you monitor the actions that companies take following your engagements.

04.3. Indicate whether your organisation defines milestones and goals for engagement activities carried out by internal staff.

04.5. Additional information. [Optional]

Records are kept of all company meetings and discussions, also including ESG issues. We further follow up on topics raised during the meetings and evaluate the progress in subsequent discussions with the company and through company publications. The information received at company meetings is stored in our database that is accessible to all portfolio managers. We also discuss the cases at our team meetings to share information, raise further questions, learn from each other and spread the awareness of the engagement activities performed.

Process for engagements conducted via collaborations

LEA 05. Process for identifying and prioritising collaborative engagement

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

05.1. Indicate whether your organisation has a formal process for identifying and prioritising collaborative engagements

05.3. Additional information [Optional]

We do not currently have a formal process for collaborative engagements. However, we are active if we find collaborative engagements to be relevant for our current holdings, our investment universe and the ESG themes that we consider important or are currently focusing on.

LEA 06. Objectives for engagement activities

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

06.1. Indicate if you define specific objectives for your engagement activities carried out collaboratively.

06.2. Indicate if you monitor the actions companies take following your collaborative engagements.

06.3. Indicate whether your organisation defines milestones and goals related to engagement activities carried out via collaborations.

06.5. Additional information. [Optional]

During the first half of 2016 we were involved in Labour Standards in the Agricultural Suppy Chain engagement, coordinated by PRI. The engagement was initiated in 2015. We have a relatively large exposure to Consumer Staples sectors and therefore had an interest to participate in this engagement. Our objective was to gain better understanding of various factors relating to the supply chain, identify issues we should aim to influence and to imply that knowledge to our further engagements and discussions with the companies we have invested in. For all collaberative engagements we would set similar types of objectives, stemming from our investment exposure to the theme in question. We monitor the actions taken by the companies on a case by case basis, depending on availablity of information and whether we have invested in the companies in question.

Process for engagements conducted with/on your behalf by service providers

LEA 07. Role in engagement process (Not Applicable)

LEA 08. Monitor / discuss service provider information (Not Applicable)

General processes for all three groups of engagers

LEA 09. Share insights from engagements with internal/external managers

09.1. Indicate if insights gained from your engagements are shared with your internal or external investment managers.

Type of engagement

Insights shared

Individual/Internal staff engagements

Collaborative engagements

09.2. Additional information. [Optional]

Engagements are carried out by portfolio managers and are therefore automatically incorporated in the investment process and decisions. All discussions with the companies are documented and saved in our ananlysis database and are therefore available to all portfolio managers.

The collaborative engagements we are involved in focus usually on certain specific sectors and issues. The information is passed on to portfolio managers when deemed helpful for learning and/or necessary for decision making.

LEA 10. Tracking number of engagements

10.1. Indicate if you track the number of engagements your organisation participates in.

Type of engagement
Tracking engagements

Individual / Internal staff engagements

Collaborative engagements

10.2. Additional information. [OPTIONAL]

Outputs and outcomes

LEA 11. Number of companies engaged with, intensity of engagement and effort (Private)

LEA 12. Engagement methods (Private)

LEA 13. Engagements on E, S and/or G issues (Not Applicable)

LEA 14. Companies changing practices / behaviour following engagement (Private)

LEA 15. Examples of ESG engagements (Private)

Communication

LEA 16. Disclosure of approach to ESG engagements (Not Completed)

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