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Mercy

PRI reporting framework 2020

You are in Indirect – Manager Selection, Appointment and Monitoring » Appointment

指名

SAM 04. Appointment processes (listed equity/fixed income)

04.1. あなたの組織では、ほとんどのケースで、また、商品の仕組みが許す限り、運用会社の選定および・もしくは約定の一環として以下の項目のいずれかを行っているかどうかを明示してください。

04.2. 運用会社の指名において通常盛り込んでいる、ベンチマーク、目標、インセンティブ/コントロールおよび報告要件の事例を資産クラス別に記載してください。

資産クラス

ベンチマーク

ESG目標

          We screen out anything that violates Mercy's 4 critical concerns of Human Dignity, Non-Violence, Stewarding Earth's resources, and Advancing Quality Healthcare.
        
          We request the manager to fill out an ESG DDQ where there are several questions regarding the manager's ESG integration. The team spends considerable amount of time with manager discussing their ESG integration approach.
        
          We ask the manager regarding their engagement efforts with the companies.
        
          We have used ISS since 1999 to vote proxies on our behalf following the guidelines of Mercy and several other Catholic systems, which has been shaped over time to the Interfaith Center on Corporate Responsibility policy. ISS votes at shareholder meeting for each company we own, per those guidelines.
        
          We discuss with the manager any of their responsible investment positions or opportunities and threats that could arise from certain ESG trends that could affect their positions. In addition, we discuss if / how the manager is engaging with the portfolio companies to implement change and responsible investment practices and improvements.
        
          Some of our managers highlight their engagements and specific portfolio company ESG improvements in their ESG annual reports (when applicable). We discuss this area during meetings as well.
        
          Mercy implements a negative screen based on its SRI Policy, which focuses on 4 key themes important to Mercy. Those 4 key themes are Human Dignity, Non-Violence, Stewarding the Earth's Resources, and Advancing Quality Healthcare & Healthcare Innovation. The negative screen serves to screen out any holdings/companies that generally violate the stated 4 themes, such as abortion providers, contraceptives, embryonic stem cell research, adult entertainment, controversial weapons, and tobacco.
        
          We inquire and discuss the manager's ESG policy (if applicable) and how the manager implements ESG criteria and considerations in the investment process.
        

インセンティブおよびコントロール

報告要件

ベンチマーク

          22.2% Emerging Markets Debt Policy Index, 27.8% iShares:iBoxx $HY Corp (HYG), 38.9% Investment Grade Policy Index, 11.1% iShares:US
Treasury Bond (GOVT) as of 7/1/2019.
        

ESG目標

          Negative Screening restrictions
        
          We request the manager to fill out an ESG DDQ where there are several questions regarding the manager's ESG integration. The team spends considerable amount of time with manager discussing their ESG integration approach.
        
          We ask the manager regarding their engagement efforts with the companies.
        
          Utilize ISS for proxy voting
        
          Mercy wants to ensure through our Fixed Income investments, we are not violating any of our four key critical concerns.  In addition, we discuss if / how the manager is engaging with the portfolio companies to implement change and responsible investment practices and improvements.
        
          Some of our managers highlight their engagements and specific portfolio company ESG improvements in their ESG annual reports (when applicable). We discuss this area during meetings as well.
        
          Mercy implements a negative screen based on its SRI Policy, which focuses on 4 key themes important to Mercy. Those 4 key themes are Human Dignity, Non-Violence, Stewarding the Earth's Resources, and Advancing Quality Healthcare & Healthcare Innovation. The negative screen serves to screen out any holdings/companies that generally violate the stated 4 themes, such as abortion providers, contraceptives, embryonic stem cell research, adult entertainment, controversial weapons, and tobacco.
        
          We inquire and discuss the manager's ESG policy (if applicable) and how the manager implements ESG criteria and considerations in the investment process.
        

インセンティブおよびコントロール

報告要件

ベンチマーク

          N/A (program is benchmarked to itself)
        

ESG目標

          Invested in multiple private equity firms that align with Mercy’s values, especially advancing quality healthcare. The Column Group is a science-driven venture capital firm focused on nurturing a select group of early stage drug discovery companies with unique scientific platforms that can change the world; Vistria is a lower-middle market buyout firm focused on the healthcare, education, and financial services sectors that focuses on delivering outsized investment returns and creating a positive impact on society.
        
          We request the manager to fill out an ESG DDQ where there are several questions regarding the manager's ESG integration. The team spends considerable amount of time with manager discussing their ESG integration approach.
        
          We ask the manager regarding their engagement efforts with the companies. Most of the PE firms we invest in, have control positions in their underlying companies and have a substantial amount of influence in their ESG practices.
        
          We discuss with the manager any of their responsible investment positions or opportunities and threats that could arise from certain ESG trends that could affect their positions. In addition, we discuss if / how the manager is engaging with the portfolio companies to implement change and responsible investment practices and improvements. We also highlight the importance of responsible investing for our organization.
        
          Discuss with the managers their engagements and specific portfolio company ESG improvements. Some managers have annual ESG annual reports.
        
          We inquire and discuss the manager's ESG policy (if applicable) and how the manager implements ESG criteria and considerations in the investment process.
        

インセンティブおよびコントロール

報告要件

ベンチマーク

          RE benchmarked to itself - program too young
        

ESG目標

          We have done research on some affordable housing strategies but have not invested in any of them yet to date.
        
          We request the manager to fill out an ESG DDQ where there are several questions regarding the manager's ESG integration. The team spends considerable amount of time with manager discussing their ESG integration approach.
        
          We ask the manager regarding their engagement efforts with the companies.
        
          We discuss with the manager any of their responsible investment positions or opportunities and threats that could arise from certain ESG trends that could affect their positions. In addition, we discuss if / how the manager is engaging with the portfolio companies to implement change and responsible investment practices and improvements. We also highlight the importance of responsible investing to our organization.
        
          Discuss with the managers their engagements and specific portfolio company ESG improvements.
        
          We inquire and discuss the manager's ESG policy (if applicable) and how the manager implements ESG criteria and considerations in the investment process.
        

インセンティブおよびコントロール

報告要件

04.3. 報告要件のいずれかが満たされない場合に、組織では、以下に記載するどの措置を講じることになるのかを示してください。

04.4. 組織が設定している外部運用会社の指名プロセスに関連する追加情報を記載してください。 [任意]

          Mercy's appointment processes of external managers require the due diligence team to conduct introductory and multiple following meetings, both on the phone and in person. After many meetings and team discussion, the due diligence team will draft and perfect an investment memo to present to the Chief Investment Officer asking for approval of adding the investment into Mercy's portfolio. As a standard part of this memo, SRI compliance and detail on the manager’s ESG practices is noted in every memo. Asides from the internal due diligence Mercy conducts, Mercy also utilizes our consultants in assisting with the operational due diligence to ensure all the accounting, operation, and team management are in line with best practices. When possible, Mercy evaluates ESG ratings provided by the consultant (such as Mercer). Mercy also has an external legal team to evaluate and examine the legal side of the investment terms and contract. Together the Mercy team is able to get a well-rounded review of the investment manager, and the Chief Investment Officer will finally make the ultimate decisions based on the information provided.
        

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