Review portfolio based on MSCI ESG and Maplecroft rating scores
The ESG integration efforts of external managers are assessed on an ongoing basis. This assessment is done across the following four dimensions:
1) Governance and Policies (e.g. Responsible Investment Policy, ESG Voting Policy, ESG oversight, etc.)
2) Integration in Investment Process, Resources and Source of ESG Information (e.g. ESG knowhow, information on ESG factors used in investment process, ESG training, ESG data sources, etc.)
3) Engagement and Proxy Voting (e.g. engagement with investees, voting activities, etc.)
4) Reporting (e.g. report on ESG considerations, report on ESG integration efforts, etc.)
Each of the four above ESG assessment dimensions is evaluated against our expectations for the specific mandate. The overall ESG assessment is documented in the initial due diligence report. The due diligence report is then the basis for the manager appointment for any particular mandate.
For active listed equities and corporate credit, investment performance is measured against ESG benchmarks.
For buy-and-hold investment strategies, we prohibit the purchase of (i) issuers rated below ESG BB, and (iii) firms whose revenues stemming from coal-related or oil sand are above a certain threshold. We monitor the manager's purchases against these restrictions; any purchase would be considered an active breach.
For infrastructure loans, the ESG impact and ESG risks are assessed at the screening stage of any new potential loan by external managers.
For Real Estate, the certification of the individual properties for green building certification programs as e.g. LEED and tracking the ESG performance of mature portfolios through GRESB as well as the approach of the manager to ESG is monitored.