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Pensioenfonds Metaal en Techniek

PRI reporting framework 2020

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You are in Direct - Listed Equity Incorporation » ESG incorporation in actively managed listed equities » Implementation processes

Implementation processes

LEI 01. Percentage of each incorporation strategy

01.1. Indicate which ESG incorporation strategy and/or combination of strategies you apply to your actively managed listed equities; and the breakdown of your actively managed listed equities by strategy or combination of strategies.

ESG incorporation strategy (select all that apply)

Percentage of active listed equity to which the strategy is applied — you may estimate +/- 5%
100 %
Total actively managed listed equities 200%

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

The strategy for listed real estate has recently been transformed. Listed real estate at MN encompasses several active mandates in which fund managers use their extensive sector knowledge to generate a return for the client that is above that of the benchmark. Since the transformation, the mandate of the fund managers has changed from alpha creation to ESG integration, thus placing sustainability issues on a higher priority than financial return. At MN, the listed real estate team has developed a proprietary methodology which incorporates the client investment beliefs with regards to sustainability. The active fund management focusses on researching the sustainability of all eligible investment companies as well as overweighting those stocks that have above average ESG performance and underweighting those with below average ESG performance.

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

The assets in the listed real estate portfolio are managed with a main focus on sustainability. This means the fund managers are mandated to establish an ESG score for the various companies in the investment universe. This ESG score is then used to rank companies in four quartiles. Only the highest quartile companies are allowed to be overweighted, financed by underweighting the bottom half of the companies. The goal is to achieve a higher ESG score in the portfolio than the benchmark.


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 exclude based on the following criteria:

  • Controversial weapons
  • Arms Trade
  • Engagement-led-divestment
  • Tobacco
  • Civilian firearms
  • Adult Entertainment
  • Tar sands
  • Coal
  • Fur

This accounts for all asset classes, including LE. 

Screened by

Description

We apply positive screening on our active listed equity portfolio on the basis of all above mentioned factors. On the one hand by looking at more traditional factors such as product, activity, sector and region. On the other hand we positively screen for themes such as:

  • Affordable housing
  • Sustainable and affordable housing

Our screens further include exclusion of companies that score more than two standard deviations lower on their overall ESG score than the average of the investment universe.

Screened by

Description

We take the above mentioned standards of business practices and international norms into account when selection our benchmarks.

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

Our beneficiaries are consultated on which topics they find important when it comes to exclusion. We inform our beneficiaries by publishing changes in our RI policy on our website and in our yearly (RI-)report.


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

05.1. Indicate which processes your organisation uses to ensure ESG 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.

05.4. Indicate how frequently you review internal research that builds your ESG screens.

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 proportion of actively managed listed equity portfolios where E, S and G factors are systematically researched as part of your investment analysis.

ESG issues

Proportion impacted by analysis
Environmental

Environmental

Social

Social

Corporate Governance

Corporate Governance

08.2. Additional information. [Optional]

For all our actively managed listed equity portfolios, E, S and G factors are systematically researched as part of the investment analysis.


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 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.

09.4. Indicate how frequently you review internal research that builds your ESG integration strategy.

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

          The portfolio team interacts/discusses ESG themes with the RI team frequently.
        

09.6. Additional information. [Optional]


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


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