a.s.r. SRI Policy
Any investments where a.s.r. has the power to exercise influence on the investment portfolio or guidelines are governed by the SRI Policy for Companies and the SRI Policy for Countries.
a.s.r. SRI Policy for Companies
Investment decisions include the company’s score on ESG criteria and an assessment of controversial activities. This is how a.s.r. avoids non-financial risk, especially reputational risk, and complies with legislation, i.e. the UN PRI, UN Global Compact and the Dutch Association of Insurer’s Sustainable Investing Code. a.s.r. SRI guidelines follow the standards as defined by Forum Ethibel and SRI research is performed by Vigeo Eiris. The SRI Policy for Companies is implemented as follows:
1. Selection of companies by their relative ESG score
We favour companies excelling on ESG policy and implementation; these are classified as pioneering, best-in-class and sustainable companies. This classification starts from a relative, sector-wise ranking for six domains of analysis:
- Human Resources
- Human Rights
- Community Involvement
- Business Behaviour
- Corporate Governance
Additionally, a.s.r. has defined specific guidelines for the relative ranking of companies involved in the following activities:
- Animal welfare violations
- Sex industry
- GMOs in food and feeds
- Hazardous chemicals
2. Controversial activities that can start an engagement process or lead to exclusion
As an institutional investor, a.s.r. can influence companies through engagement rather than by excluding them from its investment portfolio. When a.s.r. does not achieve adequate improvement in a constructive dialogue, it can exclude a company from its investment portfolio. The engagement and exclusion process looks at the following controversial activities:
- Human rights
- Labour Rights
- Nuclear Energy
a.s.r. SRI Policy for Countries
1. Exclusion of countries considered lacking basic political freedoms and civil rights. Indicator: ‘Freedom in the World’ published by Freedom House. Countries are classified as ‘Free’, ‘Partly Free’ and ‘Not Free’. Exclusion level: countries classified as ‘Not Free’ by Freedom House.
2. Exclusion of countries considered highly corrupt. Indicator: Corruption Perception Index published by Transparency International. The Corruption Perception Index (CPI) by Transparency International (TI) ranks countries from 100 (very little corruption) to 0 (very high level of corruption). Exclusion level: countries with a CPI of less than 30.
3. Exclusion of countries with poor environmental performance to achieve the climate agreement and the SDGs. Indicator: SDG Index, published by the Sustainable Development Solutions Network (SDSN) and the Bertelsmann Stiftung. The SDG Index ranks countries’ performance on results and policy on the 17 SDGs. For the environmental performance, the average score for SDG 7 (Affordable and Clean Energy), SDG 13 (Climate Action), SDG 14 (Life below Water) and SDG 15 (Life on Land) are calculated. Exclusion level: countries with an average score for SDGs 7,13,14 and 15 of less than 50. 4. Best in class approach to high performing countries to contribute to the Sustainable Development Goals Agenda Indicator: SDG Index, which presents where each country stands with regard to achieving the SDG 2030 Agenda throughout 99 indicators. Best in Class approach: The weighted average score of a.s.r. sovereign portfolio will be positioned within the first quartile of the SDG Index.
a.s.r. SRI Policy for External Providers
a.s.r. requests its External Providers to make the best possible effort to become signatories of the UN PRI and the UN Global Compact. Furthermore, a.s.r. engages its External Providers to comply as much as possible with a.s.r. SRI policy. ESG criteria are always taken into account in the selection process of External providers. There are certain providers (e.g. smaller boutiques or private equity houses) that do not have the internal capabilities to comply with the provisions of both sets of UN principles. With them, a.s.r. discusses their internal SRI practices and codes of conduct to make its own assessment. Exclusion of controversial weapons according to the Sustainable Investing Code of the Dutch Insurance Association is always a minimum requirement