See FI 10.1 above. We use sector specific scorecards to identify the most material ESG issues, i.e. issues that are credit relevant.
Examples of material issues which we have a particular focus on in the financial sector-scorecard: climate-related risks, ESG integration, business ethics and compliance, product quality and governance, management incentives and risk & resilience. We believe that these metrics gives a general indication of how corporate financial issuers are positioned.
The scorecard is used by the PM’s both once a year when the credit assessment of each issuer is updated, but also when evaluating a new bond issuer. Sometimes when we lack ESG data, the scorecard is used as a basis for dialogue with the issuer.
The ESG team also makes a qualitative assessment of the company's ESG profile and makes a recommendation (positive / neutral / negative outlook). The ESG data from the external service provider, which is a more of a quantitative score, is thus complemented by our own qualitative assessment.
These metrics are subject to change and are regularly reviewed. But in general we our assessment of corporate (financial) is tilted more towards governance issues.