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European Bank for Reconstruction and Development (EBRD)

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.

EBRD’s environmental, social team has around 45 staff and is responsible for assessing and monitoring all investments against the requirements of the Bank's Environmental and Social Policy. The nature of the assessment depends on the risk and impacts associated with the proposed investment. This can range from questionnaire to site visits to detailed Environmental and Social Impact Assessments. Environmental and social requirements are included in financing agreements. The results of the environmental and social appraisals are summarised for the decision making body and are disclosed on EBRD's website. EBRD's Chief Compliance Officer coordinates the implementation of anti-bribery and corruption measures and governance-related aspects. It has 14 people working on project integrity issues.Significant ESG risks and management costs are integrated into financial analysis of investments. The EBRD carries out economic assessment with shadow carbon pricing of projects with high GHG emissions.

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

Corporate (non-financial)

EBRD’s environmental, social team has around 45 staff and is responsible for assessing and monitoring all investments against the requirements of the Bank's Environmental and Social Policy. The nature of the assessment depends on the risk and impacts associated with the proposed investment. This can range from questionnaire to site visits to detailed Environmental and Social Impact Assessments. Environmental and social requirements are included in financing agreements. The results of the environmental and social appraisals are summarised for the decision making body and are disclosed on EBRD's website. EBRD's Chief Compliance Officer coordinates the implementation of anti-bribery and corruption measures and governance-related aspects. It has 14 people working on project integrity issues. Significant ESG risks and management costs are integrated into financial analysis of investments. The EBRD carries out economic assessment with shadow carbon pricing of projects with high GHG emissions.

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
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
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.

Corporate (non-financial)

EBRD’s environmental, social team has around 45 staff and is responsible for assessing and monitoring all investments against the requirements of the Bank's Environmental and Social Policy. The nature of the assessment depends on the risk and impacts associated with the proposed investment. This can range from questionnaire to site visits to detailed Environmental and Social Impact Assessments. Environmental and social requirements are included in financing agreements. The results of the environmental and social appraisals are summarised for the decision making body and are disclosed on EBRD's website. EBRD's Chief Compliance Officer coordinates the implementation of anti-bribery and corruption measures and governance-related aspects. It has 14 people working on project integrity issues.

12.3. Additional information.[OPTIONAL]


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