This report shows public data only. Is this your organisation? If so, login here to view your full report.

Lombard Odier

PRI reporting framework 2020

Export Public Responses
Pdf-img

You are in Direct - Inclusive Finance » PIIF Principle 4: Responsible investment

PIIF Principle 4: Responsible investment

IFD 18. Tools for social performance reporting

Possible action:

Negotiate terms and conditions that are transparent, fair and reasonable, including fair break-up clauses.

18.1. Indicate if you use the following tools for social performance reporting:

Externally developed tools

During due diligence.

For monitoring and reporting purposes.

Describe the approaches used and frequency of use.

We adapt to the social performance tools that have been developed by the MIIs we are working with. A minority are using the Global Impact Investment Rating System (GIIRS). GIIRS was developed by B-Lab, the non-profit organization that certifies B Corporations and promotes the benefit corporation structure. GIIRS is an impact ratings tool and analytics platform that assesses companies and funds on the basis of their social and environmental performance. Most of our MIIs have designed their own proprietary social assessment tools. We also work with an advisor, Symbiotics, on the bonds we invest directly in and take advantage of their tools in this area.


 

In-house tools based on externally developed tools

During due diligence.

For monitoring and reporting purposes.

Describe the approaches used and frequency of use.

We adapt to the social performance tools that have been developed by the MIIs we are working with. A minority are using the Global Impact Investment Rating System (GIIRS). GIIRS was developed by B-Lab, the non-profit organization that certifies B Corporations and promotes the benefit corporation structure. GIIRS is an impact ratings tool and analytics platform that assesses companies and funds on the basis of their social and environmental performance. Most of our MIIs have designed their own proprietary social assessment tools. We also work with an advisor, Symbiotics, on the bonds we invest directly in and take advantage of their tools in this area.

Tools developed solely in-house

During due diligence.

For monitoring and reporting purposes.

Describe the approaches used and frequency of use.

We have designed our own methodology that is organised around four levels:

  1. Industry level: to what extent our fund of funds has helped to consolidate the industry and therefore indirectly contributed to expanding and strengthening social impact
  2. Consolidated portfolio: number and type of micro entrepreneurs, loan size and type, etc.
  3. Individual fund managers we work with: they are rated according to five dimensions (value alignment, social outreach, social impact integration, social impact measurement and social impact management).
  4. Portfolio companies: we use case studies, including on-site visits for a selected number of companies.

18.2. Additional information. [Optional]

In our view, it is also important to share information and best practice with our partner firms. In this context, we share information on our tools and reporting with our MIIs and MFIs so that they can compare what they do with their peers and constantly improve their own social performance.

This information is reflective of our microfinance activities.


IFD 19. Retail institutions have independent financial/social rating and/or social audit

19.1. Indicate if you require the retail institutions in which you invest to have an independent financial rating.

19.2. Indicate if you require the retail institutions in which you invest to have an independent social rating.

19.3. Indicate if you require the retail institutions in which you invest to have an independent social audit.

19.4. Additional information. [Optional]

These analysis of these three elements are carried out by the MIIs we work with, which are then reviewed by us internally.  We work with an advisor, Symbiotics, on MFIs investments that will provide us with a due diligence and advisory report as well as monitoring reports that we will then analyse internally. Financial and social ratings are part of the documents they provide. We look at these ratings as part of investment process on the bonds we invest in.

This information is reflective of our microfinance activities.


IFD 20. Due diligence on and monitoring and reporting of corporate governance among investees

Possible action:

Assist in developing appropriate references for corporate governance issues.

20.1. In relation to your due diligence on and monitoring and reporting of corporate governance among investees, indicate if you assess:

Compensation of the Board of Directors and Executive Directors (i.e. its transparency, the use of benchmarking)

Pre-investment

Post-investment

Describe what you look at and, if post-investment, the frequency of assessment. [Optional]

This work is carried out by the MIIs we work with, or by our own advisor, Symbiotics, on an annual or bi annual basis.

    

Composition of the Board (i.e. breadth and depth of experience, effective client representation, diversity)

Pre-investment

Post-investment

Describe what you look at and, if post-investment, the frequency of assessment. [Optional]

This work is carried out by the MIIs we work with, or by our own advisor, Symbiotics, on an annual or bi annual basis.

    

Whether the Board receives social performance management-related information from the management team that is analysed and contributes to Board decision making.

Pre-investment

Post-investment

Describe what you look at and, if post-investment, the frequency of assessment. [Optional]

This work is carried out by the MIIs we work with, or by our own advisor, Symbiotics, on an annual or bi annual basis.

20.2. Additional information. [Optional]

This information is reflective of our microfinance activities.


IFD 21. Training or assistance for investees on corporate governance

Possible action:

Assist in developing appropriate references for corporate governance issues.

21.1. Indicate if you provide training or assistance for your investees on corporate governance.

21.2. Additional information.

This is carried out for part of the portfolio by the MIIs we work with.

This information is reflective of our microfinance activities.


IFD 22. Percentage of investees where board seats are held (Not Applicable)


IFD 23. Procedure to integrate environmental issues in investment decision processes

Possible action:

Assist in developing appropriate references for environmental issues.

23.1. Indicate if you have a procedure to integrate the consideration of environmental issues in your investment decision processes.

23.2. Describe how your procedure to integrate the consideration of environmental issues in your investment decisions processes affect decisions pre-investment. [Optional]

This is part of the underlying MIIs’ due diligence processes when we invest in fair agriculture or access to energy.

We look at ESG factors on our investments, but when it comes to fair agriculture or access to energy this is all the more important.

When we invested in Greenlight planet, a provider of portable solar electric devices in off grid regions in Africa & India, for example, we focused on the fact it was replacing toxic gasoline portable devices that are emit more CO2 as well as toxic fumes and are highly flammable.

We also invested in REC Electricity bonds, an Indian government agency, providing electricity to rural populations. The bond is a green bond, with the proceeds exclusively dedicated to green projects.

23.3. Describe how your procedure to integrate the consideration of environmental issues in your investment decisions processes affect decisions post- investment. [Optional]

We have a clear objective to increase the impact our investments create each year. We measure the environmental impact of each of our MIIs and/or investments. If the impact deteriorates we may decrease our allocation, and if no progress is made we may remove it completely.

23.4. Indicate if you request your investees to comply with an environmental exclusion list.

23.5. Additional information. [Optional]

Our MIIs apply exclusions in some cases, which tend to vary on a case-by-case basis based on the impact each investment is trying to achieve.

In principle, our MIIs are also subject to our Group-wide exclusions (controversial weapons, essential food commodities, securities subject to sanction by the UN, EU, US and/or the Swiss government as well as relevant local sanctions. In practice, given the nature of microfinance, these exclusions tend to be implicit in their business model. However, for Fair Agriculture, we do check they don’t speculate on essential food commodities, or offer outrageous loan rates.

This information is reflective of our microfinance activities.


IFD 24. Anti-corruption and whistle-blowing policies

Possible action:

Promote implementation of anti-corruption practices.

24.1. Indicate if you have anti-corruption policies.

24.2. Indicate if you have internal whistle-blowing policies.

24.3. Indicate if you review whether your investees have anti-corruption policies as part of your due diligence process.

24.4. Indicate if you review whether your investees have internal whistle-blowing policies as part of your due diligence process.

24.5. Additional information.

This information is reflective of our microfinance activities.


Top