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Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (FMO)

PRI reporting framework 2020

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Asset class implementation not reported in other modules

SG 16. ESG issues for internally managed assets not reported in framework

Describe how you address ESG issues for internally managed assets for which a specific PRI asset class module has yet to be developed or for which you are not required to report because your assets are below the minimum threshold.

Asset Class

Describe what processes are in place and the outputs or outcomes achieved

Forestry

In accordance with SDG 13 related to Climate Action, one of FMO’s strategic objectives is to move to zero emissions by 2050. About 20% of annual global GHG emissions are related to deforestation and forest degradation and form a severe threat to long-term sustainable development. Investment in the Forestry sector therefor offers a good opportunity to contribute to FMO’s strategic objective as it is regarded green and has a strong carbon sequestration capacity meaning negative emission potential.

FMO requires all their forestry clients to be FSC/PEFC certified, which specifically safeguards responsible forest management and includes for example :

1. Preservation of waterways with bufferzones,
2. Respect of land ownership and landuse by local population and specifically indigenous peoples,
3. Respecting workers rights,
4. and maintenance of High Conversation Value (HCV) areas.

The forestry program will also bring considerable positive impacts regarding decent work and economic growth (SDG 8) and reducing inequalities (SDG10). This means strengthening local economies by stimulating local markets and investment in basic infrastructure i.e. roads

See link for more information: https://www.fmo.nl/news-detail/9fcf9ba8-9ed6-477f-b9cc-284730fb9b95/fmo-launches-global-forestry-program-to-mitigate-climate-change-with-west-african-and-se-asian-investments

Farmland

We do not specifically address farmland in our ESG processes.

Inclusive finance

To further develop decent work concept.

Steps to be taken are below:

1. Literature review: what is decent work?​
2. Describe DFI approach to decent work​
3. Develop pragmatic measurement/performance tool​
4. Map decent work profile of employment supported by FMO​
5. Identify decent work risks based on country/sector/employees​
6. Apply tool to sample of (higher risk) FMO investments​
7.Draw recommendations for due diligence/investment selection​
8. Identify risks but also opportunities to ‘do good’ and include ‘all’

Please see our decent work article and report:

https://www.fmo.nl/news-detail/accb9331-68cb-4d40-a462-175486133e29/decent-work-examining-the-quality-of-the-jobs-we-create

https://www.fmo.nl/l/library/download/urn:uuid:c17dc77e-217d-4837-b393-05fbc698a484/report+decent+work+and+development+finance+%28march+2019%29.pdf?format=save_to_disk&ext=.pdf

FMO considers gender equality as both a human right and as a means to reach sustainable people centered growth. We are further developing our gender strategy, specifically for inclusive finance.

16.2. Additional information [Optional].


SG 17. ESG issues for externally managed assets not reported in framework (Not Applicable)


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