1. Shares and corporate bonds
- Reference framework : Ircantec will assess companies' social responsibility in particular by examining their ratification to key organisations and their different measures (in terms of remuneration policy, health & safety, ...)
- Exclusion : Companies are excluded from investments when they are exposed to ILO and others UN conventions' restrictions (forced labour, child labour, corruption, environmental pollution, manufacture and market internationally prohibited weapons).
Coal and utilities companies which fall under specific criteria are also excluded :
- Regarding mining companies, exclusion of any company with a coal-related turnover exceeding 1% of the world market share;
- Regarding power-generating companies, exclusion of any company with an energy mix including more than 30% of coal or with a carbon intensity exceeding 500 gCO²/KWh;
- For both sectors, coal-related turnover must not be over 20% of the total turnover of the company;
- On a case-by-case basis, a company could be considered for investment opportunities if it shows significant improvements and involvement for its energy transition. For instance, Ircantec could invest in a green bond issued bv a company under exclusion if it contributes to a better energy mix.
In 2017, the Board of Trustees has also voted the divestment and exclusion of the tobacco sector.
Concerning the year 2018, Ircantec has unveiled an action plan in line with its socially responsible investment approach. The pension scheme intends to:
- Divestment from traditional oil and gas sector bonds and reallocate the proceeds to green bonds;
- Divestment from specialized oil and gas companies due to their limited capacity to adapt their model to the ecological and energy transition, as well as in non-European equities and integrated companies whose investment expenditure is not compatible with a 2°C trajectory. The proceeds will be reinvested in green funds;
- Recalculate its strategic asset allocation over the next two years so as to be able by 2020 to review its exposure to the oil and gas sector based on its alignment with a 2°C trajectory.
- ESG selection : Ircantec puts forward best-in-class strategies in its investment process, even if the scheme has worked with its asset managers to improve the ESG quality of its funds by integrating other approaches.
2. Sovereign bonds : values of the Institution tend to lead it towards supporting long-term public policies to ensure resources for future generations. Investments are focused on States that promote social progress and climate/environmental protection. Our datas on climate and ESG indicators cover this asset class, with methodologies mainly provided by Beyond Ratings.
3. Real Estate : Property investments are carried out by taking into account social criteria (health facilities, student residences, affordable housing) as well as environmental ones.