Ircantec resorts to similar process for all its investments classes :
1. Investment manager selection : each asset manager is selected through a public request for proposal (RFP). The selection team at CDC rates applicant organisations in accordance with a large number of indicators and criteria regarding the expected strategy for the forthcoming fund and regarding the applicant as a whole asset managing company. Some of the questions refer to SRI, both at the company and the fund level (including their global PRI report grades).
2. Investment manager appointment: once the asset manager has been selected, a management contract is concluded between Ircantec (and its fiduciary manager : Caisse des Depots) and the external asset manager. Several aspects refers to SRI dimensions in it, including the SRI reporting commitments (ESG performance, ESG breaches, companies grading, etc…) that the manager will have to respect in its reports (on quaterly and annual basis).
3. Investment manager monitoring : Ircantec asks its asset manager to produce monthly, quaterly and annually SRI reports. Short period ones deal more with SRI day-to-day management and current issues, whereas annually reports address SRI innovations and methodology's change of the fund. The purpose of these reports is to allow trustees and the management team to:
- appreciate the way in which the management companies integrate the Ircantec SRI principles into their investment process;
- assess the quality and evolution of SRI portfolio management;
- assess the engagement policy of the management companies;
- be the starting point of the dialogue with the management companies.
Moreover, the fiduciary manager arranges two or three management committees per year for each fund to discuss specific ESG and SRI issues. It is an opportunity to challenge managers on their processes and their results, taking into account extra-financial ratings (based on an ESG reports produced by Vigeo-Eiris twice a year).