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Providence Capital N.V.

PRI reporting framework 2020

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

Outputs and outcomes

SAM 08. Percentage of externally managed assets managed by PRI signatories (Private)


SAM 09. Examples of ESG issues in selection, appointment and monitoring processes

09.1. Provide examples of how ESG issues have been addressed in the manager selection, appointment and/or monitoring process for your organisation during the reporting year.

Topic or issue
          Monitoring ESG issues with external managers
        
Conducted by
Asset class
Scope and process

We conduct a written annual review with all our external managers.
More than half of the questions relate to responsible investment issues.

Amongst others, the following is addressed:
- Responsible investment policy
- Details exclusion/screening
- Details best-in-class selection
- Details engagement
- Details proxy voting
- Thematic selection
- Integration of ESG-(risk)factors in valuation process
- Specific policy on carbon footprint
- Participation in industry initiatives / collaborate actions
- Transparancy
- Resources and capacity developments of ESG (research) team
- ESG-elements in personal development and rewards ​
- ESG-score, carbon footprint and SDG score (vs benchmark)

 

Outcomes

We have a full understanding of all ESG related activities of our underlying managers.
Also the managers understand these are very important issues for us.

Topic or issue
          Appointment new manager
        
Conducted by
Asset class
Scope and process

In the reporting year we have appointed a new institutional manager, only accessible for professional investors, for a charitable foundation client of ours. We have selected them to make a step-up in the responsible investments for this charitable foundation.

Outcomes

The ESG outcome of the portfolio has much increased. Instead of only negative screening best-in-class is incorporated. In addition the engagement and voting are further institutionalised. There was a substantial reduction of exposure to lesser responsible companies. As a result the E, S and G scores improved tremendously. Also the carbon footprint of the portfolio was reduced substantially.

Topic or issue
          Specific thematic issue
        
Conducted by
Asset class
Scope and process

Our client did not want to have exposure to countries that do not acknowledge the State of Israel. All underlying holdings of all external managers were screened by Sustainalytics on the issue raised.

Outcomes

Some external managers were sold and new funds were selected for this particular client.

Topic or issue
          The full exclusion of all weapons for one of the leading Dutch charitable foundation
        
Conducted by
Asset class
Scope and process

Fully understand the methodoligy of both indexproviders and fund managers for the exclusion of weapons based on direct and indirect involvement.
For all weapons this is relatively complicated due to the issues of the indirect involvement in development, production and sales.
The ESG policy of this specific charitable foundation does not allowed to invest in any type of weapons due to their global social activities incuding conflict areas.

Outcomes

High certainty on the exclusion of direct involvement.
Not having a small indirect exposure can not be 100% guaranteed.

09.2. Additional information.


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