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Edmond de Rothschild Asset Management (France) (EDRAM)

PRI reporting framework 2018

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Asset class implementation gateway indicators

OO 10. Active ownership practices for listed assets

10.1. Select the active ownership activities your organisation implemented in the reporting year.

Listed equity – engagement

Listed equity – voting

Fixed income SSA – engagement

Please explain why you do not engage directly and do not require external managers to engage with companies on ESG factors.

          For the engagement with the issuers from the SSA category, we consider that we are not a legitimate market  player to organise an ESG dialogue with them.

Regarding our expertise in the selection of external funds managed in-house, we cannot ask external fund managers to engage with companies on our behalf, as this would amount to interfering in their management approach, going against our investment strategy in terms of multi-management/fund selection. However, as part of the ongoing ESG dialogue with the management companies referenced for the SRI mandate, we ensure that an ESG dialogue is conducted with the companies  invested into their funds’ portfolio.
        

Fixed income Corporate (financial) – engagement

Fixed income Corporate (non-financial) – engagement


OO 11. ESG incorporation practices for all assets

11.1. Select the internally managed asset classes in which you addressed ESG incorporation into your investment decisions and/or your active ownership practices (during the reporting year).

Listed equity

Fixed income - SSA

Fixed income - corporate (financial)

Fixed income - corporate (non-financial)

Other (1)

Other (2)

'Other (1)' [as defined in OO 05]

          Asset Allocation/Balanced/Diversified
        

'Other (2)' [as defined in OO 05]

          Overlay/Structured Products/Alternative/UCITS/FSP
        
Select the externally managed assets classes in which you and/or your investment consultants address ESG incorporation in your external manager selection, appointment and/or monitoring processes.
Asset class
ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes
Listed equity

Listed equity - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Fixed income - SSA

Fixed income - SSA - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Fixed income - corporate (non-financial)

Fixed income - corporate (non-financial) - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Hedge funds

Hedge funds - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Cash

Cash - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Other (1)

Other (1) - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

Other (2)

Other (2) - ESG incorporation addressed in your external manager selection, appointment and/or monitoring processes

11.4. Provide a brief description of how your organisation includes responsible investment considerations in your investment manager selection, appointment and monitoring processes.

Concerning the external managers, two categories can be distinguished:

=> the 4 asset management firms for which we delegate the management of three of our open-ended funds and one dedicated fund: the three partners that managed equity and monetary funds on behalf Edmond de Rothschild Asset Management (France) are accountable to implement at this stage our negative screening approach related to the exclusion of companies whose business is related to cluster bombs and anti-personnel mines - in compliance with an internal policy applicable to all Edmond de Rothschild Asset Management (France)'s funds (managed in house or sub-advised).

For delegated outsourced management, we have not made any specific ESG requirements in terms of engagement so far. Only two of our four management delegations are equity funds; that said, the management companies that manage these two funds (i.e. EDR Japan and EDR US Growth) apply their own voting policy, but one of them has been reporting to us on its voting statistics for several years, and the other since the end of 2017. For the other two management delegations, one is a money market fund and the other a traditional multi-management fund - in their cases, asking them to carry out ESG engagement on our behalf with the underlying stocks would not be appropriate.

 

=> the asset management firms for which at least one fund is currently approved for investment within Edmond de Rothschild Asset Management Multi-Management / Funds selection and Asset allocation in external funds activities activity: for this category, as we are an investor among others within their funds, we cannot impose the implementation of an ESG incorporation policy but we are asking for a qualitative information related to their responsible investment practices in order to open a constructive dialogue with them.

In addition, after introducing its first ESG and SRI questionnaire and sending it to 257 funds managed by 117 asset management companies in 2016, in 2017 the Funds Selection team formalised an advanced ESG integration process in which the questionnaire is completed every two years and active, constructive ESG dialogue is held with asset management companies based on the analysis of information provided in the questionnaire.

This influence strategy is intended to encourage asset management companies whose funds are selected by our team to commit to responsible investment, by signing up to the PRIs for example. In 2018, through this close dialogue, we are seeking to encourage adoption of RI best practice, particularly in terms of transparency regarding key information such as the carbon footprint of selected funds.

Also in 2017, the team developed the sustainable fund selection expertise that formed the basis, in winter 2017, of the newly launched SRI mandate for the Edmond de Rothschild Group’s private clients.


OO 12. Modules and sections required to complete

12.1. Below are all applicable modules or sections you may report on. Those which are mandatory to report (asset classes representing 10% or more of your AUM) are already ticked and read-only. Those which are voluntary to report on can be opted into by ticking the box.

Core modules

RI implementation directly or via service providers

Direct - Listed Equity incorporation

Direct - Listed Equity active ownership

Direct - Fixed Income

RI implementation via external managers

Indirect - Selection, Appointment and Monitoring of External Managers

Closing module

12.2. Additional information. [Optional]


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