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Mirova

PRI reporting framework 2020

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Fixed income - Engagement

FI 14. Engagement overview and coverage (Private)


FI 15. Engagement method

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

15.1. Indicate how you typically engage with issuers as a fixed income investor, or as both a fixed income and listed equity investor. (Please do not include engagements where you are both a bondholder and shareholder but engage as a listed equity investor only.)

Select all that apply
Type of engagement
SSA
Corporate (financial)
Corporate (non-financial)
Individual/Internal staff engagements
Collaborative engagements
Service provider engagements

15.2. Indicate how your organisation prioritises engagements with issuers.

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
Size of holdings
Credit quality of the issuer
Duration of holdings
Quality of transparency on ESG
Specific markets and/or sectors
Specific ESG themes
Issuers in the lowest ranks of ESG benchmarks
Issuers in the highest ranks of ESG benchmarks
Specific issues considered priorities for the investor based on input from clients and beneficiaries
Other

15.3. Indicate when your organisation conducts engagements with issuers.

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
We engage pre-investment.
We engage post-investment.
We engage proactively in anticipation of specific ESG risks and/or opportunities.
We engage in reaction to ESG issues that have already affected the issuer.
We engage prior to ESG-related divestments.
Other, describe

15.4. Indicate what your organisation conducts engagements with issuers on.

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
We engage on ESG risks and opportunities affecting a specific bond issuer or its issuer.
We engage on ESG risks and opportunities affecting the entire industry or region that the issuer belongs to.
We engage on specific ESG themes across issuers and industries (e.g., human rights).
Other, describe

15.5. Indicate how your organisation ensures that information and insights collected through engagement can feed into the investment decision-making process.

Select all that apply
SSA
Corporate (financial)
Corporate (non-financial)
Ensuring regular cross-team meetings and presentations.
Sharing engagement data across platforms that is accessible to ESG and investment teams.
Encouraging ESG and investment teams to join engagement meetings and roadshows.
Delegating some engagement dialogue to portfolio managers/credit analysts.
Involving portfolio managers when defining an engagement programme and developing engagement decisions.
Establishing mechanisms to rebalance portfolio holdings based on levels of interaction and outcomes of engagements.
Considering active ownership as a mechanism to assess potential future investments.
Other, describe
We do not ensure that information and insights collected through engagement can feed into the investment decision-making process.

15.6. Additional information.[OPTIONAL]

As explained in detail the LEA section and in question FI.15 of this report, Mirova regularly engages in dialogue with issuers as part of its engagement strategy, through individual and collaborative initiatives. A specific engagement strategy notably targets green bond-issuers*.

Engagement themes are selected based on both sustainability matters (significant externalities or impacts, opportunities to efficiently address E and or S issues, etc.) and financial reasons (potential materiality of ESG factors, systemic risks to global portfolios). Mirova primarily issuers that represent Mirova’s key assets under management.

Such dialogue can be held either upstream before investing, as part of the ESG due diligence, or on an ex-post basis as part of the monitoring of ESG practices and updates of analysis. Issuers are mostly targeted individually, but sometimes, the RI Research team engages in dialogue with several issuers from a same industry when a specific sectorial ESG-related issue or risk is identified (collaborative engagement).

Engagement actions are generally carried out proactively in anticipation of specific ESG risks and/or opportunities identified, but the dialogue can sometimes occur in reaction to ESG issues that have already affected the issuer.

In terms of outcomes, a report of each engagement action is logged in “OCTAVE”**, a proprietary centralized database that notably tracks the history of the engagement’s goals for each company, the progress achieved, and the resulting impact on ESG analysis. This database is available to all Mirova’s teams, including PMs. With regards to "Establishing mechanisms to rebalance portfolio holdings based on levels of interaction and outcomes of engagements", portfolio managers take this information into account. 

Besides, in addition to the dialogue related to green and social bonds issuance, Mirova carries out some kind collaborative engagement towards SSA issuers, particularly governments: individual and /or collaborative dialogue is regularly held with public policy-makers to support higher standards towards sustainability, CSR and responsible investment. Mirova is a member of the Excom of the Green Bonds Principles. Mirova was also for instance particularly active in 2018/2019 within the EU Technical Expert Group (TEG) on sustainable finance to promote higher standards for sustainable financial products, including green bonds, in response to the need to finance the SDGs and the energy transition [SF1] [LC2] and prevent greenwashing. A detailed description of Mirova's approach to public policy engagement is provided in "Strategy & Governance" section, question SG.11.

We systematically engage prior to ESG-related divestment, for green bonds funds.  

*Both SSA (supranational organizations and government agencies) and corporate issuers

**Online Collaborative Tool for Analysis, Voting and Engagement

 


FI 16. Engagement policy disclosure

16.1. Indicate if your publicly available policy documents explicitly refer to fixed income engagement separately from engagements in relation to other asset classes.

16.2. Please attach or provide a URL to your fixed income engagement policy document. [Optional]

16.3. Additional information [OPTIONAL]

Mirova’s engagement approach explicitly covers fixed income asset class. Beyond the individual and collaborative engagement actions undertaken towards corporate issuers held in fixed income corporate portfolios, Mirova has set up a specific strategy focused on green bonds theme.

Mirova’s engagement approach to green bonds was born of two core beliefs:

Responsible Investment plays a crucial role in channelling savings and investments towards companies and projects that address Sustainable Investment Goals
Integration of extra-financial criteria into investment decisions is key to creating value over the long run.

Through its investment in sustainable bonds, Mirova therefore primarily strives to target issuers or projects that are able to seize the opportunities arising from the need for a transition of our economy towards a more sustainable society, while ensuring that potential environmental, social and governance (ESG) issues are taken into consideration. However, the sustainable bond market is still in its infancy, and practices are still heterogeneous, particularly in terms of transparency. This is why Mirova decided to initiate a constructive dialogue with sustainable bond issuers, or potential issuers, to inform them about its expectations and promote the development of a structured and reliable green bond market.

Mirova’s commitment towards the issuance of green bonds, as well as its approach, are publicly disclosed within its annual engagement report, available on its website in the section dedicated to voting and engagement (please refer to the URL provided above in FI.17.2).


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