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BNP Paribas Asset Management

PRI reporting framework 2017

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Innovation

SG 17. Innovative features of approach to RI

17.1. Indicate whether any specific features of your approach to responsible investment are particularly innovative.

17.2. Describe any specific features of your approach to responsible investment that you believe are particularly innovative.

In  2013, BNPP IP's CEO called for the creation of ESG correspondents community with ESG correspondent in each investment team or location (as of today 40+).

Their missions are:

  • Participating in a monthly conference call with the Head of ESG Integration (+Access to dedicated area in BNPP IP intranet).
  • Disseminating to portfolio managers new initiatives and updated lists.
  • Answering or centralizing questions from PM related to Responsible Investment Policy.
  •  Facilitating dialogue with companies: to make PM become “actors” in our engagement.
  • Working with portfolio managers to integrate progressively ESG research elements; improving access to research conducted by the Sustainability Research team.

In parallel, BNPP IP has been pioneering in publishing extra financial indicators for its SRI Funds directly included in the financial quarterly reports. With more than 5 years of experience, BNPP IP received special awards by Novethic, the French SRI label organisation, for the release of ESG indicators.

 

In  2013, THEAM, the BNP Paribas Investment Partners’ (BNPP IP) specialist in index, systematic and alternative investments, has reached a new milestone in its commitment as a Responsible Investor by becoming the first industry player to adopt the MSCI Global ex Controversial Weapons Indices (which exclude companies involved in controversial weapons) as the benchmarks for its range of open-ended funds (Parworld2 indexed equity sub-funds). This initiative is part of BNPP IP’s broader commitment as a Responsible Investor, and follows the April 2013 recommendations of the French Asset Management Association (Association Française de Gestion, AFG) to exclude companies involved in the supply or manufacturing of cluster munitions and landmines from indexed fund portfolios. It is also the result of THEAM’s discussions with and support for an appeal made by the international association, Handicap International.

 

In 2015, BNPP IP became the first global asset manager to sign the Montreal Carbon Pledge, which is a strong message given to our industry that we must acknowledge the need for the economy to shift towards a 2°C trajectory. It is also a commitment by BNPP IP to taking action towards tackling climate change in line with our fiduciary duty to protect the value of our clients' investments. Our newly adopted climate change strategy si three fold : (1) allocation of capital, (ii) responsible stewardship and (iii) commmitment & transparency.

 

Allocation of capital : BNPP IP is committed to developping a low-carbon product offer, currently amounting to €25 bn and including Thematic equity funds, best in class funds, low carbon ETF, and green bonds. We also offer customised investment solutions to institutional investors engaged in decarbonising their portfolios.

 

Responsible stewardship: implementation of sector policies (four sectors linked to climate change angle are affected: mining, palm oil, agriculture and coal-fired power generation) plus our signature to the PRI Montreal Carbon Pledge (measuring and publicly disclosing the carbon footprint of our funds) and our commitment to the Portfolio Decarbonization Coalition taking action to decarbonize portfolio and divesting our SRI funds from thermal coal mining and some utilities.

 

In 2016, we adapted our voting approach by integrating climate change issues in our decisions. BNPP IP decided to abstain on financial accounts or statement if a company does not report properly on its carbon footprint or when a company does not communicate or does not want to engage with us in relation to its business strategy to mitigate and adapt to climate change.

In terms of product innovation and new investments made available to our clients, we launched in 2016 a new thematic approach on equity investments based on responsible dividends. Over the year 2016, we have been promoting a sustainable and responsible dividend in our voting policy and have applied this policy into our fund “Parvest Sustainable Equity High Dividend Europe”. The fund focuses on stocks of the high ESG rated companies offering high, sustainable and growing dividends. By sustainable dividend we mean a dividend with reasonable pay-out ratio that does not undermine the capacity to invest for the company, and does not affect the remuneration of other stakeholders.

 

 

 

17.3. Additional information.


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