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Danske Bank

PRI reporting framework 2019

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Implementation processes

LEI 01. Percentage of each incorporation strategy

01.1. Indicate (1) which ESG incorporation strategy and/or combination of strategies you apply to your actively managed listed equities and (2) the breakdown of your actively managed listed equities by strategy or combination of strategies (+/- 5%)

ESG incorporation strategy (select all that apply)

Percentage of active listed equity to which the strategy is applied
68 %
Percentage of active listed equity to which the strategy is applied
32 %
Total actively managed listed equities 100%

01.2. Describe your organisation’s approach to incorporation and the reasons for choosing the particular ESG incorporation strategy/strategies.

We use screening to apply group-wide investment resctrictions and to identify investment risks related to ESG matters. We apply group-wide investment restrictions based on Danske Bank Group's sustainability positions on ‘Climate Change’ and ‘Arms & Defence.We screen to identify companies in the investment universe with potential ESG-related risks. The identified ESG risks are analysed and incorporated into our investment processes and dialogues with portfolio companies.We use screening to apply investment criteria and thresholds for restricted products and solutions in order to meet our customers’ specific values and preferences.

Across strategies and asset classes our investment teams integrate ESG data as factors alongside financial factors into the investment process. Based on a wide set of ESG data, our ESG materiality framework, and our internal and external expertise, investment teams are able to understand more about the quality of their investments and portfolio companies; their business models, positions and how ESG issues are managed. This helps us manage both investment risks and unlock opportunities.

By having ESG inside our investment processes, we can make better-informed investment decisions that supports our mission to achieve the best possible risk-adjusted returns for customers. We call it 'ESG Inside'.

Our investment teams have access to ESG data platform, training & education and support by subject matter experts.

 

01.3. If assets are managed using a combination of ESG incorporation strategies, briefly describe how these combinations are used. [Optional]

See above.


LEI 02. Type of ESG information used in investment decision (Private)


LEI 03. Information from engagement and/or voting used in investment decision-making (Private)


(A) Implementation: Screening

LEI 04. Types of screening applied

04.1. Indicate and describe the type of screening you apply to your internally managed active listed equities.

Type of screening

Screened by

Description

We apply group-wide investment restrictions based on Danske Bank Group's sustainability positions on ‘Climate Change’ and ‘Arms & Defence.’

In March 2018 a group-wide investment restriction on Thermal Coal and Tar sand was implemented: https://danskebank.com/news-and-insights/news-archive/news/2018/27022018a

We screen to identify companies in the investment universe with potential ESG-related risks. The identified ESG risks are analysed and incorporated into our investment processes and dialogues with portfolio companies.

We use screening to apply investment criteria and thresholds for restricted products and solutions in order to meet our customers’ specific values and preferences.

Screened by

Description

Our European Corporate Sustainable Bond Fond uses a best-in-class screening, where at least 25% aims to be invested in bonds with a rating of Baa3/BBB- or higher.

Companies, which measured in a sustainability perspective is on the forefront of the development in their sector, forms the basis of the fund composition. This is done by investing in companies that in a ESG perspective is among the best half. Among these companies the best quartile is preferred. The fund invests in the best half of the companies that are active in sectors with high CO2-emission. There is room for up to 10% "watch list cases" in the fund. These are companies that do not meet the above criteria, but which we believe to have the potential for improvement. Through dialog with the companies they are expected to make improvements, otherwise they are sold out of the bond portfolio.

Invests primarily in corporate bonds issued by companies that have a strong sustainability profile in regards of environmental, social and governance, and integrates sustainable awareness about climate change and CO2-carbon economy. Each issuer must comply with international principles for responsible investments, and may not invest in controversial sectors.

Screened by

Description

We screen our investment universe to identify ESG risks related to portfolio companies with reference to industry best practice, international norms and voluntary frameworks for corporate responsibility.

04.2. Describe how you notify clients and/or beneficiaries when changes are made to your screening criteria.

Our group-wide investment restrictions are reviewed annually and all changes are communicated on our website. Furthermore, our portfolio managers are part of this process in order to ensure that clients and beneficiaries are notified

 


LEI 05. Processes to ensure screening is based on robust analysis

05.1. Indicate which processes your organisation uses to ensure screening is based on robust analysis.

05.2. Indicate the proportion of your actively managed listed equity portfolio that is subject to comprehensive ESG research as part your ESG screening strategy.

05.3. Indicate how frequently third party ESG ratings are updated for screening purposes.

05.5. Additional information. [Optional]


LEI 06. Processes to ensure fund criteria are not breached (Private)


(C) Implementation: Integration of ESG factors

LEI 08. Review ESG issues while researching companies/sectors

08.1. Indicate the ESG factors you systematically research as part of your investment analysis and the proportion of actively managed listed equity portfolios that is impacted by this analysis.

ESG issues

Proportion impacted by analysis
Environmental

Environmental

Social

Social

Corporate Governance

Corporate Governance

08.2. Additional information. [Optional]


LEI 09. Processes to ensure integration is based on robust analysis

09.1. Indicate which processes your organisation uses to ensure ESG integration is based on a robust analysis.

09.2. Indicate the proportion of your actively managed listed equity portfolio that is subject to comprehensive ESG research as part your integration strategy.

09.3. Indicate how frequently third party ESG ratings that inform your ESG integration strategy are updated.

09.5. Describe how ESG information is held and used by your portfolio managers.

09.6. Additional information.[Optional]


LEI 10. Aspects of analysis ESG information is integrated into (Private)


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