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Rothschild & co Asset Management

PRI reporting framework 2018

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You are in Direct - Fixed Income » ESG incorporation in actively managed fixed income » Implementation processes

Implementation processes

FI 01. Incorporation strategies applied

01.1. Indicate 1) Which ESG incorporation strategy and/or combination of strategies you apply to your actively managed fixed income investments; and 2) The proportion (+/- 5%) of your total actively managed fixed income investments each strategy applies to.

SSA
0 Screening alone
0 Thematic alone
0 Integration alone
100 Screening + integration strategies
0 Thematic + integration strategies
0 Screening + thematic strategies
0 All three strategies combined
0 No incorporation strategies applied
100%
Corporate (financial)
0 Screening alone
0 Thematic alone
0 Integration alone
100 Screening + integration strategies
0 Thematic + integration strategies
0 Screening + thematic strategies
0 All three strategies combined
0 No incorporation strategies applied
100%
Corporate (non-financial)
0 Screening alone
0 Thematic alone
0 Integration alone
100 Screening + integration strategies
0 Thematic + integration strategies
0 Screening + thematic strategies
0 All three strategies combined
0 No incorporation strategies applied
100%

01.2. Describe your reasons for choosing a particular ESG incorporation strategy and how combinations of strategies are used.

We are primarily an active high alpha / high conviction investment management company. Investment decisions are based on an in-depth fundamental analysis of stocks. Our ESG approach is based on screening and integration for the following reasons:

- All our investments in FI follow a screening filter which allows us to guarantee an ethical base to our investments: (i) normative exclusions of companies whose business is related to cluster bombs and anti-personnel mines, in accordance with the Oslo Treaty and the Ottawa Convention signed by the French Government and (ii) exclusions based on fundamental principles

- We started ESG integration in 2011 among our equities investments to strengthen our analysis process, we then deployed our ESG process among our FI investments. We believe that ESG analysis reinforces our understanding of long-term sectors and corporates risks and opportunities. In our investment process, ESG criteria contribute among other financial criteria to support our investment choices and to our convexity analysis

- Moreover, ESG integration supports our dialogue with TOP management on ESG issues: (i) it allows us to have precise data to discuss, (ii) it helps follow the trends in terms of ESG achievements at each companies ’level

01.3. Additional information [Optional].

Besides exclusions, our ESG process relies on both a qualitative and a quantiative approach:

- Qualitative analysis: For each sector we invest in, we identify the main ESG challenges and opportunities. We then analyze the response of companies: for each E, S, and G criteria we highlight strengths and weaknesses. We pay a particular attention to the trend in terms of initiatives and integration of E, S and G problematics by TOP management. We also identify the main carbon contributors of each portfolio and we analyze these companies specific carbon risks and trajectory.

- Quantitative analysis : an ESG score is attributed to companies (covered by MSCI ESG Research) . We have created an internal ESG rating for each company in our investment list for both European and US equity and FI. This is partly based on the independent ESG rating provided by MSCI which is enriched with our own assessment of ESG analysis for each company we cover. Our rating methodology includes both absolute criteria to take into account sector challenges and relative criteria to highlight the best / worst performers among the sectors we invest in.


FI 02. ESG issues and issuer research (Private)


FI 03. Processes to ensure analysis is robust

03.1. Indicate how you ensure that your ESG research process is robust:

03.2. Describe how your ESG information or analysis is shared among your investment team.

          Our internal IT tool allows fund managers and analysts to access ESG ratings, newsflows and internal ESG analyses
        

03.3. Additional information. [Optional]


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