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PRI reporting framework 2020

You are in Strategy and Governance » ESG issues in asset allocation

ESG issues in asset allocation

SG 13. ESG issues in strategic asset allocation

13.1. Indicate whether the organisation carries out scenario analysis and/or modelling, and if it does, provide a description of the scenario analysis (by asset class, sector, strategic asset allocation, etc.).

Describe It is integrated in all the areas of activities at Cordiant.

13.2. Indicate if your organisation considers ESG issues in strategic asset allocation and/or allocation of assets between sectors or geographic markets.

We do the following

13.3. Additional information. [OPTIONAL]

SG 13 CC.

SG 14. Long term investment risks and opportunity (Private)

SG 14 CC.

14.6 CC. Provide further details on the key metric(s) used to assess climate-related risks and opportunities.

Metric Type
Metric Unit
Metric Methodology
Exposure to carbon-related assets

14.8 CC. Indicate whether climate-related risks are integrated into overall risk management and explain the risk management processes used for identifying, assessing and managing climate-related risks.

Please describe

Non-Renewable Energy Policy: 

Although the projects in the present industry are expected to bring economic and social benefits, the sector intrinsically involves different potentially complex and significant and diverse ESG risks and impacts, depending on the type of energy production-which are applicable to both the construction and operational phases (i.e. upstream, midstream, and downstream operations). Those inherent risks and impacts are likely to have material implications for long-term shareholder value, if transition to low carbon economy is not taken into account into the decision making process.

In this context, we integrate our existing corporate values, principles and policy commitment with reference to (i) quality of products; (ii) safety and reliability of operations; (iii) care for the environment and communities; (iv) engaging stakeholders; (v) respect for others and their rights; and (vi) innovative solutions.

Cordiant’s Engagement Strategy & The development of company-wide proactive compliance strategy

 Cordiant is committed to participating in dialogue with borrowers on the effects of their activities—the impacts, benefits, risks and trade-offs, as well as corporate responsibility or environmental, social and governance (ESG). The team employs a stepwise process to addressing ESG matters inherent in this industry. This is a central element of due diligence, investment structuring and on-going ownership and monitoring.

Policy: Benefits of Renewable Energy Investments

Investing in low carbon energy transition assets is in itself a value added investment. For investors, it is a preferable alternative to fossil-fuel based energy production systems which are now categorised as “stranded assets”. As well, it reduces the impacts on the environment and on biodiversity, compared to traditional sources of energy.

Alignment with Best Practices & Sustainable Development Goals

As part of its Fiduciary Responsibility and Responsible Investment Approach, Cordiant ensures that its business strategy is consistent with, and contributes to, the development goals, as expressed in the SDGs and Paris Agreement[4] on climate change. Investing in the clean and renewable energy sector thus allows Cordiant to be aligned with the sustainable development goals[5] (SDGs), including;

  • SDG 7: Affordable and clean energy
  • SDG 9: Industry, Innovation & Infrastructure
  • SDG 11: Sustainable Cities and Communities
  • SDG 12: Responsible Consumption and Production
  • SDG 13: Climate Action

The scaling-up of national climate action plans, also known as Nationally-Determined Contributions (NDCs), and which represents a key opportunity to address a wide range of issues, by addressing investment gaps in the clean energy sector. Accordingly, by applying its ESG risk management system and Responsible Investment Process to the clean energy sector, Cordiant is systematically maximizing positive impacts while minimizing negative impacts.

Scope & Applicability of the Clean Energy Policy and Due Diligence Process

Although renewable sources are more environmentally friendly compared to non-renewables, the exact type and intensity of environmental risks and impacts varies depending on the specific technology used, the geographic location, and a number of other factors. By understanding the current and potential environmental issues associated with each renewable energy source, we can takes steps to effectively avoid or minimize these impacts as they become a larger portion of our electric supply.

14.9 CC. Indicate whether your organisation, and/or external investment manager or service providers acting on your behalf, undertake active ownership activities to encourage TCFD adoption.

SG 15. Allocation of assets to environmental and social themed areas (Private)