This report shows public data only. Is this your organisation? If so, login here to view your full report.

AEGON Asset Management

PRI reporting framework 2020

Export Public Responses
Pdf-img

You are in Strategy and Governance » Investment policy

Investment policy

SG 01. RI policy and coverage

New selection options have been added to this indicator. Please review your prefilled responses carefully.

01.1. Indicate if you have an investment policy that covers your responsible investment approach.

01.2. Indicate the components/types and coverage of your policy.

Select all that apply

Policy components/types

Coverage by AUM

01.3. Indicate if the investment policy covers any of the following

01.4. Describe your organisation’s investment principles and overall investment strategy, interpretation of fiduciary (or equivalent) duties,and how they consider ESG factors and real economy impact.

Aegon Asset Management (AAM) is a significant investor in a large number of industries and companies, and takes its responsibility as a capital provider seriously. AAM aims to contribute broadly to wellbeing and sustainable development through our 3 pillars: ESG Integration, Active Ownership, and Responsible Investment Solutions. We encourage the development of products that have a specific positive societal or environmental impact as a way to leverage our expertise in this field and to meet client demand. This RI policy and its included RI framework forms the core of Aegon’s responsible investment beliefs and is applicable to operations in all countries where we are active.

Responsible investment (RI) is a key element of Aegon’s responsible business strategy. Through the investment decisions that we make, we meet the commitments to our customers while contributing to economic growth and sustainable capital markets. Being a responsible company means that we integrate responsible investment into our core business.

 

 

 

 

 

 

01.5. Provide a brief description of the key elements, any variations or exceptions to your investment policy that covers your responsible investment approach. [Optional]

4.1. ESG integration
The ESG performance of companies can impact their ability to create long-term value for investors and we therefore consider ESG integration an important instrument to improve the risk-return profile of the investments we make. At Aegon, we integrate ESG factors in the bottom-up fundamental research process for all active investment strategies. The focus is on ESG factors that are material from a financial or risk point of view. It is up to portfolio managers, analysts and others involved in the investment research and decision-making process to determine what weight these factors should be given. Access to sustainability information is critical. All our analysts and portfolio managers have access to ESG data and are provided with ESG training where required.
4.2. Engagement and voting
To promote the long-term success of companies, Aegon acknowledges the importance of investor stewardship. It is in the best interest of our clients that we monitor the companies in which we invest, that we vote on the stocks that we hold, and that we engage with companies on issues like strategy, risk and corporate governance. We believe that actively engaging with companies to improve sustainability performance and corporate behavior is more effective than excluding companies from our investment universe.
All proprietary investments managed internally by AAM are screened using a combination of proprietary and third-party ESG research tools to ensure compliance with our RI Policy. If the screening process highlights that an investee company is not entirely in compliance with our RI Policy, we will look to use our influence as a long-term investor to encourage that company to change its behavior and bring it into alignment. This may involve regular dialogue with company management to inform them of where they are failing to meet our expectations as outlined in the RI topics further below. We may also engage with companies where our ESG-integrated research process has highlighted that there are material financial risks for a company arising from sustainability issues or on the basis of Aegon’s strategic priorities (e.g. clean energy and
sustainable real estate). In addition to engagement, as providers of equity capital we seek to use our voting rights to enhance long-term value creation and promote sustainable business practices in a manner that is consistent with our RI Policy.
4.3. Exclusion
When companies are involved in certain controversial activities, we may refrain from investment in those companies with our proprietary assets. For example, we exclude companies from our investment universe when they are involved in controversial weapons (see 5.7 Weapons & arms trade below). We also consider excluding companies when our efforts to change company behavior do not make sufficient progress.
Aegon is responsible for setting the exclusion list (see Appendix: Exclusion List), which is compiled using available external research and subsequently reviewed and approved by the Management Board annually. Although Aegon aims to exclude all companies involved in certain activities outlined in the RI topics below, we may not be able to exclude companies involved in such activities not identified by external research in the annual exclusion list review process. Individual Aegon units may add companies, countries or sectors to the list in order to meet local requirements or preferences.
4.4. Reporting
Aegon believes that it is important to not only have an RI Policy in place, but also to report on the activities covered by that policy. We want to be transparent with relevant stakeholders and wider society when it comes to our responsible investing activities through our reports. The Aegon Integrated Annual Report provides in-depth information on the financial and nonfinancial performance of Aegon. AAM provides further detail on its RI activities through additional corporate and client reporting. Through these communications Aegon aims to explain its commitment to careful analysis and thoughtful decision-making.

01.6. Additional information [Optional].

          
        

SG 01 CC. Climate risk

01.6 CC. Indicate whether your organisation has identified transition and physical climate-related risks and opportunities and factored this into the investment strategies and products, within the organisation’s investment time horizon.

Describe the identified transition and physical climate-related risks and opportunities and how they have been factored into the investment strategies/products.

1. transition risk into our exclusion policy; we’ve considered the continued relevance of fossil fuels in future transition scenarios and identified thermal coal and oil sands for exclusion so as to reduce our exposure to potentially stranded assets
2. transition opportunities into products: our sustainability themed funds, e.g. GSEF and SFI, seek to benefit from decarbonisation trends though identifying positive market players and green investments

01.7 CC. Indicate whether the organisation has assessed the likelihood and impact of these climate risks?

Describe the associated timescales linked to these risks and opportunities.

Analysis of risks was done to 2100. Analysis of opportunities is done on a shorter term basis (max 2025-2030).

01.8 CC. Indicate whether the organisation publicly supports the TCFD?

01.9 CC. Indicate whether there is an organisation-wide strategy in place to identify and manage material climate-related risks and opportunities.

Describe

Aegon has a Climate Change Working Group (CCWG) which is the primary body responsible for assessing and monitoring climate-related issues within the company (which includes Aegon Asset Management). The CCWG is a working group of the board-level Responsible Business and Investment Committee (RBIC) and is tasked with evaluating new climate developments affecting investment, insurance and our other business activities, and recommending further action when necessary.

The CCWG meets at least quarterly. It is chaired by Aegon Asset Management’s Responsible Investment team, and comprises representatives from different functional areas across the company including investment portfolio risk management, operational and underwriting risk management, investment analysis, investor relations and reporting, corporate strategy and sustainability, public affairs and responsible investment.

Climate-related issues assessed as relevant or material by the CCWG are presented to the Responsible Business and Investment Committee through regular reporting as well as to Aegon’s Chief Risk Officer and Aegon’s Management Board through the quarterly risk management dashboard. The Management Board may then decide on management actions as appropriate.

For investment risk: portfolio managers and analysts incorporate ESG data in investment decisions. This includes climate change-related issues. In addition, we organize occasional sessions on climate-specific topics to raise awareness among portfolio managers and other stuff. For example, In July 2019, Aegon’s Climate Change Working Group hosted a workshop to provide background on climate change and insight on how a changing climate can be reflected in investments, as well as to discuss our progress and objectives approach as a company. The event took place at the Aegon head office in Den Haag and was made available via webcast to staff located in other offices around the world. External speakers presented on climate scenario analysis (Ortec Finance), climate risks and opportunities in fixed income (Moody’s), and company-level transition risk (Sustainalytics).

1.10 CC. Indicate the documents and/or communications the organisation uses to publish TCFD disclosures.

specify

          Responsible Investment Report, Aegon NV Annual Integrated Report
        

SG 02. Publicly available RI policy or guidance documents

 

02.1. Indicate which of your investment policy documents (if any) are publicly available. Provide a URL and an attachment of the document.

URL/Attachment

URL/Attachment

02.2. Indicate if any of your investment policy components are publicly available. Provide URL and an attachment of the document.

02.3. Additional information [Optional].


SG 03. Conflicts of interest

03.1. Indicate if your organisation has a policy on managing potential conflicts of interest in the investment process.

03.2. Describe your policy on managing potential conflicts of interest in the investment process.

There may be a conflict of interest if we invest in a company that has a business relationship with us, or if we hold both bonds and shares in the same company. In these circumstances, we put the interests of our clients first. When conflicts arise, we will identify where our fiduciary responsibility lies and act accordingly.

The different legal entities that form the Aegon Asset Management business unit have their own conflict of interest policies.

https://www.aegonassetmanagement.com/globalassets/asset-management/netherlands/about-us/policies/conflicst-of-interest-policy.pdf

 

03.3. Additional information. [Optional]


SG 04. Identifying incidents occurring within portfolios

04.1. Indicate if your organisation has a process for identifying and managing incidents that occur within investee entities.

04.2. Describe your process on managing incidents

With the help of our independent sustainability rating provider, we reguarly monitor the controversies our investee companies face and assess if they are compliant with Global Norms. This is an important element of our Responsible Investment Policy. When severe incidents and/or controversies have happened, our policy is to engage with the company. An engagement plan will be made and progress is monitored. When necessary a case will be escalated to our Responsible Business and Investment Committee (RBIC). We are also in dialogue with external stakeholders to identify incidents which merit attention.


Top