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The international business of Federated Hermes (formerly Hermes Investment Management)

PRI reporting framework 2020

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ガバナンスおよび人事

SG 07. RI roles and responsibilities

07.1. 組織が採用している内部または外部の役割、ならびにそれぞれの責任投資に対する監督責任および実施責任の有無について明示してください。

組織における役職

下記の内部の役割より選択;

          Head of Responsibility
        

その他の役職(具体的に記入してください) (1)

          Investment Office
        

その他の役職(具体的に記入してください)(2)

          Stewardship Team
        

07.2. RIの監督/説明責任または実施責任を担う役職について、このような責任をどのように果たすのか記載してください。

While the responsibility for implementing our approach resides with all of our personnel, we have a number of structures and teams to ensure that across the firm we discharge our stewardship responsibilities effectively.

Board members

We have a well-established governance structure that is led by the Board. Among the multitude of responsibilities residing with the Board is the formulation of our strategy, namely to help individuals invest and retire better, to help clients achieve better risk-adjusted returns, and to contribute to positive outcomes in the wider world.

Chief Executive

Our Chief Executive has passionately led the development and implementation of our mission and responsibility goals. We believe it is our responsibility to lead discussion and debate about the fiduciary responsibilities of fund managers to our clients, their stakeholders and, ultimately, society at large, a role that our Chief Executive actively leads and contributes to. In particular, our Chief Executive is the founder of the 300 Club, an independent forum that challenges the orthodoxy of the investment industry and puts forward approaches to align the industry more closely to the goals of beneficiaries. He is also a member of the Banking Standards Board, the FCA-PRA Climate Financial Risk Forum, the International Integrated Reporting Council and the Global Steering Committee of UNEP FI.

Responsibility Office

Our dedicated Responsibility Office, led by the Head of Responsibility, reports to our CEO and coordinates and supports the integration of our responsibility approach and activities across our funds and stewardship services. This includes quarterly meetings with each of the investment teams to review their ESG and engagement integration activities, as well as asset- and issuer-specific discussions related to ESG and engagement. The Responsibility Office is also responsible for leading our advocacy and corporate citizenship work and ensuring that all of our business areas are acting in the interests of clients and their beneficiaries.

Portfolio managers and investment analysts

Each of our investment teams has formulated their own responsibility plans that explain how, in the context of their particular strategy and investment universe, they incorporate ESG factors and engagement within their investment process. Each team is responsible for undertaking their own fundamental ESG research and is accountable through the performance appraisal system for their part in delivering our mission.

Responsible investment staff

Our stewardship team EOS boasts one of the largest stewardship resources of any fund manager in the world. The team is composed of individuals with a diverse mix of backgrounds, skills and perspectives and has been at the forefront of the development and evolution of responsible investment practices globally.

Investor relations

Our Corporate Communications team is responsible for the communication of responsible investment internally, as well as externally. The also ensure alignment between our internal policies and external statements.

Investment Office

Our Investment Office is the guardian of the investment outcomes we deliver to clients, acting independently to ensure that our strategies are performing in the best interests of clients. It embodies our commitment to being a responsible and transparent asset manager. The Head of the Investment Office is effectively our CIO

Customer Outcomes Group ("COG")

The COG meets on a monthly basis and exists to support the Federated Hermes product governance, by providing a forum through which products (including funds and segregated mandates) are reviewed and assessed through a client-centric lens. Good product governance is aligned with our focus on responsible investment management, and we aim to put the customer at the heart of product design and management. The COG will utilise a customer centric view in reviewing investment products and when considering our obligations to investors both directly and indirectly via distributors.

The group reviews every strategy at least on an annual basis; this includes reviewing how well the fund integrates ESG and its engagement progress.

Responsibility Working Group

We have established a Responsibility Working Group, which meets on a quarterly basis and is constituted of senior representatives from across the business and is chaired by our Head of Responsibility. This group is charged with reviewing and making recommendations to our ExCo with respect to our policy and approach to all matters related to the delivery of holistic returns to the beneficiaries of our owners and clients and to share best practice across the organisation.

Governance Committee

Accountable to and reporting to our CEO, the Governance Committee is a formal oversight committee responsible for overseeing the formulation and delivery of our engagement and voting policy for all our equity funds. Members are Head of Responsibility (chair), Head of Investment, Head of EOS, Head of Client Relationship Management and Strategic Risk and Compliance Director.

Corporate Citizenship Group

Consisting of the Head of Responsibility (chair), Corporate Citizenship Programme Manager, the COO, an EOS representative and the Head of HR, this group oversees and steers the firm’s corporate citizenship activities with local communities and on staff wellbeing and inclusion ensuring that all activities are closely aligned to and inform our responsible investment and ownership activities.

Other business processes

To ensure responsibility is embedded in all the firm’s business decisions, Responsibility Office colleagues are members of the firm’s key committees including the Portfolio Review Committee (investment), Business Development Forum (new products), Customer Outcomes Group (client delivery) and IT Steering Group.

07.3. 組織にいる専任の責任投資担当者の人数を記載してください。

74

07.4. 補足情報 [任意]

This number includes our ‘specialist’ responsibility and stewardship staff, including some of our investment professionals. It should be stressed however, that Federated Hermes sees responsibility as the role of everyone in the organisation including fund managers, business development and operations staff and relevant responsibility objectives are incorporated into individuals’ performance reviews. 


SG 07 CC. Climate-issues roles and responsibilities

07.5 CC. 気候関連問題について監視、説明責任および/または管理責任をもつ組織の役職を示してください。

取締役会メンバーまたは受託者

最高経営責任者(CEO)最高投資責任者(CIO)最高リスク責任者(CRO)投資委員会

他の最高級職員または部長(具体的に記入してください)

ポートフォリオマネージャー

投資アナリスト

専任の責任投資担当者

投資者関係(IR)

その他の役職(具体的に記入してください)(1)

          Investment Office
        

その他の役職(具体的に記入してください)(2)

          Stewardship Team
        

07.6 CC. 気候関連の問題の監督/説明責任または実施責任がある取締役会レベルの役職については、これらの責任の遂行方法を説明してください

As per our ESG oversight/accountability, while the responsibility for implementing our approach resides with all our personnel, we have a number of structures and teams to ensure that we effectively discharge our stewardship responsibilities, including around climate change risks and opportunities.

Board members

We have a well-established governance structure that is led by the Board. Among the responsibilities residing with the Board is the formulation of our strategy, namely to be the world's leading provider of long-term holistic returns for savers, thus creating value for all stakeholders in the financial system. The board and executive committee reviews our climate management approach on an annual basis and is informed on implementation progress through updates from the Head of Policy and Advocacy.

Chief Executive

Our Chief Executive has passionately led the development and implementation of our mission and responsibility goals. He has long been an advocate of change in the industry, having recently signed two agreements on behalf of the international business of Federated Hermes (‘Federated Hermes’) which focused on carbon pricing and carbon-risk disclosure following a two-day summit at the Vatican with the Pope.

Responsibility Office

Our Head of Policy & Advocacy chairs the Climate Change Working Group and is the climate change coordinator for Federated Hermes. She leads on implementation and delivery of our climate change strategy, reporting progress to the HFML Board and the Responsibility Working Group.

 

07.7 CC. 気候関連の問題を評価し管理する管理レベルの役職については、その構造とプロセスを詳しく説明してください。

Portfolio managers and investment analysts

Each of our investment teams across all asset classes have formulated their own climate change management approach in the context of their particular strategy and investment universe. Each team is responsible for undertaking their own fundamental ESG research, including assessing climate risks and opportunities, and is accountable through the performance appraisal system for their part in delivering our mission.

Stewardship Team

Our stewardship team, EOS, boasts one of the largest stewardship resources of its kind in the world, representing £662 billion in assets as at 31st December 2019. The engagement programme has identified climate as a specific engagement focus. EOS has taken an active role in the Climate Action 100+ initiative, and leads on engagement with 27 companies, including BP, Centrica, Rolls Royce and AngloAmerican.

Climate Change Working Group

Our CCWG is made up of staff from across the business, including investment managers in public and private markets and representatives from the engagement, risk and sales and marketing departments. The group meets at least four times per year and is now focused on designing and implementing a strengthened climate strategy for 2020.


SG 08. RI in performance management, reward and/or personal development

08.1. 組織のパフォーマンス管理、報奨や個人の能力開発プロセスに責任投資の要素があるかどうかを記載してください。

取締役会メンバーまたはトラスティ―(受託者)

08.1b. 個人の能力開発または研修計画における責任投資

08.2. 報告年度に取締役が責任投資に関連したスキルや知識を開発し、維持するために行った活動について説明してください。

Stewardship and responsible investment matters are included as part of a board member's induction programme and are regularly the subject of the board's discussions. In addition, the board has a number of discussions outside of the formal board meeting agenda on key issues, generally facilitated by subject experts from across the business, and these include matters directly and/or indirectly connected to responsible investment.

最高経営責任(CEO)、最高投資責任者(CIO)、最高執行責任者(COO)、投資委員会

08.1a. 目標、評価、査定または報酬における責任投資

08.1b. 個人の能力開発または研修計画における責任投資

その他の最高幹部レベルのスタッフまたは部門長 具体的に記入してください

          Head of Responsibility
        

08.1a. 目標、評価、査定または報酬における責任投資

08.1b. 個人の能力開発または研修計画における責任投資

ポートフォリオマネージャー

08.1a. 目標、評価、査定または報酬における責任投資

08.1b. 個人の能力開発または研修計画における責任投資

投資アナリスト

08.1a. 目標、評価、査定または報酬における責任投資

08.1b. 個人の能力開発または研修計画における責任投資

専任の責任投資担当者

08.1a. 目標、評価、査定または報酬における責任投資

08.1b. 個人の能力開発または研修計画における責任投資

投資者関係(IR)

08.1a. 目標、評価、査定または報酬における責任投資

08.1b. 個人の能力開発または研修計画における責任投資

その他の役職(1)[SG 07から] 具体的に記入してください

          Investment Office
        

08.1a. 目標、評価、査定または報酬における責任投資

08.1b. 個人の能力開発または研修計画における責任投資

その他の役職(2)[SG 07から] 具体的に記入してください

          Stewardship Team
        

08.1a. 目標、評価、査定または報酬における責任投資

08.1b. 個人の能力開発または研修計画における責任投資

08.3. 組織の責任投資に関連したパフォーマンス管理、報奨や個人の能力開発プロセスについて詳細を説明してください。

Federated Hermes has defined a set of behaviours innate to its culture that contribute to the success of the business. Every employee has a responsibility to act in a way that upholds these core values through their day-to-day activities. As part of this, portfolio managers integrate ESG considerations, as appropriate, into their investment decision-making and valuation processes. This is considered as part of the performance management process and is a factor in their incentive plan: all of our staff, including the Chief Executive, are judged equally on their behaviours and on their technical performance in our performance management process. Our staff are also encouraged to incorporate the responsibility accountabilities developed for each business area into their personal objectives.

The introduction of the Federated Hermes Pledge towards the end of 2015 was intended as a clear signal of what we aspire to embody and is the foundation of our commitment to always put its clients and the beneficiaries first, and to act responsibly and transparently. Having been published in October 2015, as of 2020 99% of staff had voluntarily signed the pledge.

Our investment teams have access to in-house seminars on ESG risks and opportunities in the context of sectors, themes or country, which take place on a regular basis to provide an educational forum on the key risks or opportunities. They are also provided with training on proprietary and third party ESG and engagement integration tools (such as the Carbon Tool, Governance Tool, and Portfolio Snapshot). In addition, we have rolled out the PRI Fundamentals course to all front office staff and new joiners since 2015.


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