Robeco’s distribution and marketing is organized around its three client segments (institutional, wholesale and retail) in order to maintain a clear focus on the best way to serve these distinctly different groups. Robeco ensures intensive personal interaction between institutional clients and distribution partners on the one hand, and senior management, account managers, client servicing teams and portfolio managers on the other.
To improve the servicing of wholesale and institutional clients, Robeco either performs in-house studies or buys ad-hoc surveys on specific topics. In 2018, the topics that clients showed an interest in included factor investing, ESG integration and active versus passive investing. Any expected changes or changes to our sustainability methodology are communicated to clients via personal interaction, via articles on the website, KIIDS and factsheets and via our quarterly newsletter. Changes in the exclusion policy or any of the other SI policies are published on our website.
One of our key strategic aims for Robeco Retail is to make sustainability investing accessible for everyone by allowing low entry amounts and providing easy-to-use websites and services. This strategy will guide our efforts in the coming years.
In addition to 4.1:
We employ three different types of ESG screening in the context of our engagement and sustainability investing activities:
- Screening to identify thematic engagement opportunities on ESG issues (picking themes and selecting companies): The identification and prioritization of themes and candidates for engagement involves rigorous research and analysis to determine the relevance of a particular theme, the sectors and companies being mostly impacted by that theme and the performance of companies in that respect. Our screening process is backed by proprietary research as well as external analyses provided by specialized parties.
- Screening for enhanced engagement and exclusion: Our enhanced engagement program is applied to companies violating the ten principles of the United Nations Global Compact in the areas of human rights, labour rights, environmental issues and anti-corruption. The screening on such controversies is carried out through several databases as well as other research sources. Our generic exclusions policy entails the exclusion of companies that manufacture products that do not comply with broadly accepted international treaties, in particular treaties on controversial weapons. The screening of companies on controversial weapons involvement is carried out by (among others) our data provider Sustainalytics and conforms to Dutch law.
- Screening in sustainability investing: Furthermore, Robeco systematically incorporates analysis of ESG factors into both its quant and its fundamental investment processes. We are convinced that taking ESG criteria into account results in better-informed investment decisions and is necessary to fully grasp the opportunities that are associated with the businesses. In quant investing the choice of ESG variables in the models is based on back testing. We inform clients if we make a change to the model. In fundamental equity the choice of the ESG variables is based on the ESG materiality matrix. This matrix and the company profile is reviewed every two years. Changes are incorporated into the valuation of companies.
Furthermore, Robeco is committed to measuring the carbon footprint of its investment products (for more information on the companywide approach please see the section on climate change). RobecoSAM's Environmental Impact Monitoring tool measures the impact of investors' portfolios in terms of greenhouse gas emissions, energy and water consumption and waste production. Robeco and RobecoSAM have further developed tools for actively managing the reduction of the greenhouse gas emissions footprint associated with its portfolios while also controlling for other environmental impacts. Based on these tools Robeco has adopted a comprehensive approach to reducing emissions with respect to the relevant benchmark. We are also able to respond to specific client requirements in optimizing investment portfolios to meet absolute targets. All Robeco SI Focus funds optimize their carbon footprint. These funds have at least a 20% target on carbon reduction towards the benchmark.
All Robeco SI Focus funds are divested from mining companies with more than 10 percent of thermal coal revenues, and from power producers with more than 20 percent of thermal coal related revenues.
Thermal coal is a product that is predominantly used in power generation and is a more carbon intensive source of energy than any of the alternatives such as oil and natural gas. We focus on thermal coal because we consider that power generators have a choice of technologies and we expect them to move towards the lower carbon alternatives. We expect to see companies reducing their dependence on thermal coal in the future and aim to adjust our threshold lower in the coming years.
Robeco's climate change policy can be found here:
Please find additional information below. For an overview of relevant codes and principles:
In 2019 Robeco subscribed to the Eurosif Transparency Guidelines for its Sustainability Focus range, increasing transparency: http://www.eurosif.org/transparency-code/signatories-and-responses/netherlands/
Also a document was published on ESG integration per strategy: https://www.robeco.com/docm/docu-esg-integration.pdf