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IFC

PRI reporting framework 2019

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

ESG incorporation in actively managed fixed income

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
100 Screening alone
0 Thematic alone
0 Integration alone
0 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
0 Screening + integration strategies
0 Thematic + integration strategies
0 Screening + thematic strategies
100 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.

IFC's Sustainability Framework articulates our strategic commitment to sustainable development and is an integral part of our approach to risk management. The Sustainability Framework does not cover IFC's liquid assets (Fixed income - SSA, corporate (financial), corporate (non-financial), and securitised - and Cash, as per above). IFC's Sustainability Framework does apply to the portion of "Fixed income - corporate (non-financial)" that includes Private Debt, i.e. loans.

Our Sustainability Framework promotes sound environmental and social practices, encourages transparency and accountability, and contributes to positive development impacts. Link to IFC's Sustainability Framework:

http://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/sustainability+and+disclosure/environmental-social-governance/sustainability+framework

01.3. Additional information [Optional].


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]


(A) Implementation: Screening

FI 04. Types of screening applied

04.1. Indicate the type of screening you conduct.

Select all that apply
SSA
Corporate (non-financial)
Negative/exclusionary screening
Positive/best-in-class screening
Norms-based screening

04.2. Describe your approach to screening for internally managed active fixed income

IFC's Sustainability Framework articulates our strategic commitment to sustainable development and is an integral part of our approach to risk management. The Sustainability Framework does not cover IFC's liquid assets (Fixed income - SSA, corporate (financial), corporate (non-financial), and securitised - and Cash, as per above). IFC's Sustainability Framework does apply to the portion of "Fixed income - corporate (non-financial)" that includes Private Debt, i.e. loans.

Our Sustainability Framework promotes sound environmental and social practices, encourages transparency and accountability, and contributes to positive development impacts. Link to IFC's Sustainability Framework:

http://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/sustainability+and+disclosure/environmental-social-governance/sustainability+framework

04.3. Additional information. [Optional]


FI 05. Examples of ESG factors in screening process (Private)


FI 06. Screening - ensuring criteria are met

06.1. Indicate which systems your organisation has to ensure that fund screening criteria are not breached in fixed income investments.

Type of screening
Checks
Negative/exclusionary screening?
Positive/best-in-class screening
Norms-based screening

06.2. Additional information. [Optional]


(B) Implementation: Thematic

FI 07. Thematic investing - overview (Private)


FI 08. Thematic investing - themed bond processes

08.1. Indicate whether you encourage transparency and disclosure relating to the issuance of themed bonds as per the Green Bonds Principles, Social Bond Principles, or Sustainability Bond Guidelines..

          IFC's Sustainability Framework articulates our strategic commitment to sustainable development and is an integral part of our approach to risk management. The Sustainability Framework does
        

08.2. Describe the actions you take when issuers do not disburse bond proceeds as described in the offering documents.

IFC's Sustainability Framework articulates our strategic commitment to sustainable development and is an integral part of our approach to risk management. The Sustainability Framework does not cover IFC's liquid assets (Fixed income - SSA, corporate (financial), corporate (non-financial), and securitised - and Cash, as per above). IFC's Sustainability Framework does apply to the portion of "Fixed income - corporate (non-financial)" that includes Private Debt, i.e. loans.

Our Sustainability Framework promotes sound environmental and social practices, encourages transparency and accountability, and contributes to positive development impacts. Link to IFC's Sustainability Framework:

http://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/sustainability+and+disclosure/environmental-social-governance/sustainability+framework

08.3. Additional information. [Optional]


FI 09. Thematic investing - assessing impact

09.1. Indicate how you assess the environmental or social impact of your thematic investments.

09.2. Additional information. [Optional]


(C) Implementation: Integration

FI 10. Integration overview

10.1. Describe your approach to integrating ESG into traditional financial analysis.

IFC's Sustainability Framework articulates our strategic commitment to sustainable development and is an integral part of our approach to risk management. The Sustainability Framework does not cover IFC's liquid assets (Fixed income - SSA, corporate (financial), corporate (non-financial), and securitised - and Cash, as per above). IFC's Sustainability Framework does apply to the portion of "Fixed income - corporate (non-financial)" that includes Private Debt, i.e. loans.

Our Sustainability Framework promotes sound environmental and social practices, encourages transparency and accountability, and contributes to positive development impacts. Link to IFC's Sustainability Framework:

http://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/sustainability+and+disclosure/environmental-social-governance/sustainability+framework

10.2. Describe how your ESG integration approach is adapted to each of the different types of fixed income you invest in.

Corporate (non-financial)

IFC's Sustainability Framework articulates our strategic commitment to sustainable development and is an integral part of our approach to risk management. The Sustainability Framework does not cover IFC's liquid assets (Fixed income - SSA, corporate (financial), corporate (non-financial), and securitised - and Cash, as per above). IFC's Sustainability Framework does apply to the portion of "Fixed income - corporate (non-financial)" that includes Private Debt, i.e. loans.

Our Sustainability Framework promotes sound environmental and social practices, encourages transparency and accountability, and contributes to positive development impacts. Link to IFC's Sustainability Framework:

http://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/sustainability+and+disclosure/environmental-social-governance/sustainability+framework

10.3. Additional information [OPTIONAL]


FI 11. Integration - ESG information in investment processes

11.1. Indicate how ESG information is typically used as part of your investment process.

Select all that apply
Corporate (non-financial)
ESG analysis is integrated into fundamental analysis
ESG analysis is used to adjust the internal credit assessments of issuers.
ESG analysis is used to adjust forecasted financials and future cash flow estimates.
ESG analysis impacts the ranking of an issuer relative to a chosen peer group.
An issuer's ESG bond spreads and its relative value versus its sector peers are analysed to find out if all risks are priced in.
The impact of ESG analysis on bonds of an issuer with different durations/maturities are analysed.
Sensitivity analysis and scenario analysis are applied to valuation models to compare the difference between base-case and ESG-integrated security valuation.
ESG analysis is integrated into portfolio weighting decisions.
Companies, sectors, countries and currency and monitored for changes in ESG exposure and for breaches of risk limits.
The ESG profile of portfolios is examined for securities with high ESG risks and assessed relative to the ESG profile of a benchmark.
Other, specify

11.2. Additional information [OPTIONAL]

IFC screens investments to ensure they do not fall under IFC's Exclusions List found here:

https://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/sustainability-at-ifc/company-resources/ifcexclusionlist

IFC is currently evaluating and pilot testing tools to track ESG information related to porfolio bonds.


FI 12. Integration - E,S and G issues reviewed

12.1. Indicate the extent to which ESG issues are reviewed in your integration process.

Environment
Social
Governance
Corporate (non-financial)

Environmental

Social

Governance

12.2. Please provide more detail on how you review E, S and/or G factors in your integration process.

Corporate (non-financial)

IFC's Sustainability Framework articulates our strategic commitment to sustainable development and is an integral part of our approach to risk management. The Sustainability Framework does not cover IFC's liquid assets (Fixed income - SSA, corporate (financial), corporate (non-financial), and securitised - and Cash, as per above). IFC's Sustainability Framework does apply to the portion of "Fixed income - corporate (non-financial)" that includes Private Debt, i.e. loans.

Our Sustainability Framework promotes sound environmental and social practices, encourages transparency and accountability, and contributes to positive development impacts. Link to IFC's Sustainability Framework:

http://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/sustainability+and+disclosure/environmental-social-governance/sustainability+framework

12.3. Additional information.[OPTIONAL]


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