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AP3

PRI reporting framework 2019

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Organisational Overview
Basic information [OO 01 - 09] Asset class implementation gateway indicators [OO 10 - 12] Peering questions [OO LE 01 - HF 01]
Strategy and Governance
Investment policy [SG 01 - 04] Objectives and strategies [SG 05 - 06] Governance and human resources [SG 07 - 08] Promoting responsible investment [SG 09 - 11] Outsourcing to fiduciary managers and investment consultants [SG 12] ESG issues in asset allocation [SG 13 - 15] Asset class implementation not reported in other modules [SG 16 - 17] Innovation [SG 18] Communication [SG 19]
Indirect – Manager Selection, Appointment and Monitoring
Listed Equity and Fixed Income Strategies [SAM 01] Selection [SAM 02 - 03] Appointment [SAM 04] Monitoring [SAM 05 - 07] Outputs and outcomes [SAM 08 - 09]
Direct - Listed Equity Incorporation
ESG incorporation in actively managed listed equities [LEI 01 - 10] Implementation processes [LEI 01 - 10] (A) Implementation: Screening [LEI 04 - 06] (B) Implementation: Thematic [LEI 07] (C) Implementation: Integration of ESG factors [LEI 08 - 10] ESG incorporation in passively managed listed equities [LEI 11] Outputs and outcomes [LEI 12 - 13]
Direct - Listed Equity Active Ownership
Overview [LEA 01] Engagement [LEA 02 - 08] Outputs and outcomes [LEA 09 - 11] (Proxy) voting and shareholder resolutions [LEA 12 - 21]
Direct - Fixed Income
ESG incorporation in actively managed fixed income [FI 01 - 12] Implementation processes [FI 01 - 03] (A) Implementation: Screening [FI 04 - 06] (B) Implementation: Thematic [FI 07 - 09] (C) Implementation: Integration [FI 10 - 12] Fixed income - Engagement [FI 14 - 16] Outputs and outcomes [FI 17 - 18]
Direct - Property
Overview [PR 01] Pre-investment (selection) [PR 04 - 06] Selection, appointment and monitoring third-party property managers [PR 07] Post-investment (monitoring and active ownership) [PR 08 - 14] Overview [PR 08] Property monitoring and management [PR 09 - 10] Property developments and major renovations [PR 11] Occupier engagement [PR 12 - 13] Community engagement [PR 14] Outputs and outcomes [PR 15 - 16]
Confidence building measures
Confidence building measures [CM1 01 - 07]
Export Public Responses
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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

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
15 Thematic alone
0 Integration alone
0 Screening + integration strategies
0 Thematic + integration strategies
0 Screening + thematic strategies
0 All three strategies combined
85 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.

 

The credit  portfolio is small, AuM less than 10 bn SEK end 2018.

Green Bonds are part of the overall FI portfolio. Green bond MV 16.5 bn SEK end 2018

The ESG/sustainability screening done relates to issuers the same screening results apply for both equity and fixed income, corporate bonds. Exclusions embrace all financial instruments issued by the companies/issuers  in question.

AP3 also measure/analyse  the carbon footprint for the Credit portfolio (FI Corporate (EV method) and also the Green Bond Impact.

The portfolio managers integrate sustainability issues (risk and opportunities) in their Analytics and  investment decisions when it is relevant and material and should be able to explain their decisions.

For example, the investment process ahead an investment in credit can include both screening, can make the manager aware of potential issues, the questions raised are then discussed and evaluated both with the issuer, the company itself,  in meetings and with sale side analysts and others. In the cases where there is  limited information on the issuer, the manager has to turn directly to the company/issuer  and then evaluate the information given to questions regarding ESG issues.

01.3. Additional information [Optional].

 

AP3  Green Bond portfolio, AuM ca SEK 16.5 bn. This portfolio holds green bonds issued by SSA, municipalities and corporates. when a company issue a green bond AP3 has specific routines and requirements based on Green Bonds Principles (GBP) in place that should be met. The managers are free to buy any  bond but it will not be tagged as a Green Bond unless the criteria and requirements are met.

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.

03.3. Additional information. [Optional]

AP3 has no formal investment committees but the investment staff, the PMs are expected to bring up ESG information on issuers in the investment process and decisions.

When there are uncertainties the issuer is approached to explain and make clear. Nowadays it happens quite often that the issuers are ahead of what the research show and a strongly growing number of issuers have good coverage and documentation on ESG issues.

ESG Information is available to all PMs via MSCI ESG Manager and Bloomberg accesses
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