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Česká spořitelna – penzijní společnost, a.s.

PRI reporting framework 2020

You are in Direct - Fixed Income » ESG incorporation in actively managed fixed income » (C) Implementation: Integration

(C) Implementation: Integration

FI 10. Integration overview

10.1. Describe your approach to integrating ESG into traditional financial analysis.

ESG research and valuation are one step ahead of traditional financial analysis that we take internally in cooperation wirth ERSTE Asset management. We valuate each issuer with its environmental, social and governance score combining external research and internal analysis. Having these inputs each issuer receives an EAM ESG score and furthermore lead to an inclusion or exclusion in our ESG investment universe. Based on this data traditional financial analysis that combines bottom-up and top-down research is conducted. The combination of minimum standards, positive and negative criteria, exclusion criteria, best-in-class approach (selection of the best companies in each sector), active engagement and voting process (dialogue with companies, exercise of voting rights) plus the rigourous review of finanicial performance objectifies the management approach.

10.2. Describe how your ESG integration approach is adapted to each of the different types of fixed income you invest in.

SSA

Approach is similar for all types of fixed income. For sovereign, supra-national and agency issuers the ESG valuation is also an upstreamed step in the investment process with emphasis on exclusion criteria like death penalty, human rights, corruption or nucler weapons.

Corporate (financial)

Approach is similar for all types of fixed income.

Corporate (non-financial)

Approach is similar for all types of fixed income.

10.3. Additional information [OPTIONAL]


FI 11. Integration - ESG information in investment processes

11.1. Indicate how ESG information is typically used as part of your investment process.

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
ESG analysis is integrated into fundamental analysis
ESG analysis is used to adjust the internal credit assessments of issuers.
ESG analysis is used to adjust forecasted financials and future cash flow estimates.
ESG analysis impacts the ranking of an issuer relative to a chosen peer group.
An issuer`s ESG bond spreads and its relative value versus its sector peers are analysed to find out if all risks are priced in.
The impact of ESG analysis on bonds of an issuer with different durations/maturities are analysed.
Sensitivity analysis and scenario analysis are applied to valuation models to compare the difference between base-case and ESG-integrated security valuation.
ESG analysis is integrated into portfolio weighting decisions.
Companies, sectors, countries and currency and monitored for changes in ESG exposure and for breaches of risk limits.
The ESG profile of portfolios is examined for securities with high ESG risks and assessed relative to the ESG profile of a benchmark.
Other, specify in Additional Information

11.2. Additional information [OPTIONAL]


FI 12. Integration - E,S and G issues reviewed

12.1. Indicate the extent to which ESG issues are reviewed in your integration process.

Environment
Social
Governance
SSA

Environmental

Social

Governance

Corporate (financial)

Environmental

Social

Governance

Corporate (non-financial)

Environmental

Social

Governance

12.2. Please provide more detail on how you review E, S and/or G factors in your integration process.

SSA

ESG factors and ratings are an essential part of the screening before an investment decision and lasting during the whole live of investment. It is valid for all fixed income asset classes.

Corporate (financial)

ESG factors and ratings are an essential part of the screening before an investment decision and lasting during the whole live of investment.It is valid for all fixed income asset classes.

Corporate (non-financial)

ESG factors and ratings are an essential part of the screening before an investment decision and lasting during the whole live of investment. It is valid for all fixed income asset classes.

12.3. Additional information.[OPTIONAL]


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