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Deutsche Bundesstiftung Umwelt

PRI reporting framework 2020

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ESG incorporation in actively managed fixed income

Implementation processes

FI 01. Incorporation strategies applied

Indicate (1) Which ESG incorporation strategy and/or combination of strategies you apply to your actively managed fixed income investments; and (2) The proportion (+/- 5%) of your total actively managed fixed income investments each strategy applies to.
Corporate (financial)
95 Screening alone
5 Thematic alone
0 Integration alone
0 Screening + integration strategies
0 Thematic + integration strategies
0 Screening + thematic strategies
0 All three strategies combined
0 No incorporation strategies applied
100%
Corporate (non-financial)
90 Screening alone
10 Thematic alone
0 Integration alone
0 Screening + integration strategies
0 Thematic + integration strategies
0 Screening + thematic strategies
0 All three strategies combined
0 No incorporation strategies applied
100%

01.2. Describe your reasons for choosing a particular ESG incorporation strategy and how combinations of strategies are used.

At least 80% of the corporates must be part of defined ESG-Indices. Moreover we want to achieve a rate of as near as possible to 100% of our bonds which are valued with regard to ESG-factors. Hence we have implemented sreening strategy.

Furthermore we have defined certain themes like microfinance, green bonds as sustainable. Here we have implemented thematic strategies.

01.3. Additional information [Optional].


FI 02. ESG issues and issuer research

02.1. Indicate which ESG factors you systematically research as part of your analysis on issuers.

Select all that apply
Corporate (financial)
Corporate (non-financial)
Environmental data
Social data
Governance data

02.2. Indicate what format your ESG information comes in and where you typically source it

Indicate who provides this information  

Indicate who provides this information  

Indicate who provides this information  

Indicate who provides this information  

Indicate who provides this information  

02.3. Provide a brief description of the ESG information used, highlighting any differences in sources of information across your ESG incorporation strategies.

As our information source we use databases like Bloomberg and specialized ESG research providers. Many times throughout a year we have the opportunity to check the information. We also discuss (e.g. on ESG onferences) wether the infos we obtained are reliable. This eables us to realize critical points, where the information may give a wrong picture.

02.4. Additional information. [Optional]


FI 03. Processes to ensure analysis is robust

03.1. Indicate how you ensure that your ESG research process is robust:

03.2. Describe how your ESG information or analysis is shared among your investment team.

03.3. Additional information. [Optional]


(A) Implementation: Screening

FI 04. Types of screening applied

04.1. Indicate the type of screening you conduct.

Select all that apply
Corporate (financial)
Corporate (non-financial)
Negative/exclusionary screening
Positive/best-in-class screening
Norms-based screening

04.2. Describe your approach to screening for internally managed active fixed income

In certain sectors as pornography, military equipment, tabac and coal-industry we use negative sreening. Others sectors (e.g. automobile) are problematic for ESG reasons, but for diversification we want to invest in them; here we use positive/ best-in-class-screeing.

Part of the data given by our providers, is a norms-based screening. If two investments would be equal on all factors, we can use this to identify a difference which could lead to an investment decision.

04.3. Additional information. [Optional]


FI 05. Examples of ESG factors in screening process

05.1. Provide examples of how ESG factors are included in your screening criteria.

Type of fixed income

ESG factors

Screening

Description of how ESG factors are used as the screening criteria

Investment in a social bond of DKB; The ISIN is DE000SCB0021; the total amount of the bond is used für social business.

Type of fixed income

ESG factors

Screening

Description of how ESG factors are used as the screening criteria

Investment in Deutsche Lichtmiete AG. ISIN: DE000A2TSCP0. Look at their homepage at which their business-case is declarde in detail: www.lichtmiete.de .GREAT story!

Type of fixed income

ESG factors

Screening

Description of how ESG factors are used as the screening criteria

EdF has emitted green bonds. As we aren't confident that these are real green bonds we decided to buy them not

05.2. Additional information.


FI 06. Screening - ensuring criteria are met

06.1. Indicate which systems your organisation has to ensure that fund screening criteria are not breached in fixed income investments.

Type of screening
Checks
Negative/exclusionary screening
Positive/best-in-class screening
Norms-based screening

06.2. Additional information. [Optional]


(B) Implementation: Thematic

FI 07. Thematic investing - overview (Private)


FI 08. Thematic investing - themed bond processes

08.1. Indicate whether you encourage transparency and disclosure relating to the issuance of themed bonds as per the Green Bonds Principles, Social Bond Principles, or Sustainability Bond Guidelines..

08.2. Describe the actions you take when issuers do not disburse bond proceeds as described in the offering documents.

Such a case dit not occur within the reporting period. If it would happen, we would ask for the reason. If there's no understandable reason, we would decide not to invest in the companies' bonds furthermore. This ban would last for 10 years, except the company can prove that they have made the required changes.

08.3. Additional information. [Optional]


FI 09. Thematic investing - assessing impact

09.1. Indicate how you assess the environmental or social impact of your thematic investments.

09.2. Additional information. [Optional]


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