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


PRI reporting framework 2020

Export Public Responses

You are in Direct - Listed Equity Incorporation » Outputs and outcomes

Outputs and outcomes

LEI 12. How ESG incorporation has influenced portfolio composition

12.1. Indicate how your ESG incorporation strategies have influenced the composition of your portfolio(s) or investment universe.

Describe any reduction in your starting investment universe or other effects.

We exclude from on our investment universe:

- first, issuers based on negative and norms-based exclusion policies

- then issuers which have not been awarded a ESG score, either by our internal team or by a external research provider.

Specify the percentage reduction (+/- 5%)

90 %

Select which of these effects followed your ESG integration.

12.2. Additional information.[Optional]

After the ESG screening process, we conduct an ESG integration process in the form of a detailed ESG analysis of an issuer, on the 3 key pillars E, S and G, that enables the analyst to assess the global ESG policy of the issuer and to allocate a proprietary ESG score (from 1 to 5, 5 being the highest score). This score is highly important for the weighting of the portfolio (overweight/underweight at sector and stock level) since :

- the average ESG score of the portfolio (position-weighted) must be higher at all times than the average ESG score of the universe of the fund (weighted by the market capitalisation in euros of each issuer) after excluding the 20% worst-rated issuers from the universe.

- controversies arising from an issuer result in a penalty affecting the maximum weighting of an issuer in our investment funds. In extreme cases, the issuer can even be added to the exclusion list of Trecento AM.

LEI 13. Examples of ESG issues that affected your investment view / performance

13.1. Provide examples of ESG factors that affected your investment view and/or performance during the reporting year.

ESG factor and explanation

Factor Social : Regarding out Trecento Robotique fund, the management team of the fund had to decide whether we should include all types of robots or should exclude some segments on ESG or PRI criteria. For example, the issue of killing robots had to be addressed.

ESG incorporation strategy applied Screening|Thematic|Integration

Impact on investment decision or performance

The management team decided that it should exclude manufacturers and operators of robots that could harm humans, even if it only represents a small part of their activities.

ESG factor and explanation

A typical example of an issuer that is excluded for environmental and social negative reasons is a manufacturer of nuclear weapons. Nuclear weapons are violating fundamental humanitarian principles and are considered as an inhumane weapon.

Moreover, the potential global impacts of nuclear blasts on the environment would be desastrous as even a small-scale war would quickly devastate the world's climate and ecosystems, causing damage that would last for more than a decade.

ESG incorporation strategy applied Screening

Impact on investment decision or performance

We have excluded nuclear weapon manufacturers from our investment universe, even if it only represents a small part of their activities.

ESG factor and explanation

Factor Governance : We exclude issuers that have been convicted of corruption, either during the screening process, or after investment if controversies arise.

ESG incorporation strategy applied Screening|Integration

Impact on investment decision or performance

We have for example excluded this French company which was bribing officials to gain capital goods contracts in some countries, usually emerging markets.

13.2. Additional information.[Optional]