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imug Beratungsgesellschaft für sozial-ökologische Innovationen mbH

Service Providers Framework 2020

You are in Strategy and Governance » Policy on ESG beliefs

Policy on ESG beliefs

SG 01. Responsible investment policy

01.1. Describe how your organisation’s philosophy incorporates environmental, social and governance factors, and the link to your business offerings.

The assessment and promotion of social and environmental responsibility are at the core of imug rating business model. imug Bearatungsgesellschaft has built its own social responsibility approach with the firm belief that it constitutes a performance factor, a risk management driver and a lever for stakeholder dialogue and sustainable value creation.

Social pillar:

Our teams are at the core of our professional excellence. Our employees are the backbone of the agency, the true foundation of our expertise and guarantee the quality of all products and services offered to our clients. The development, reinforcement and promotion of our competencies are amongst our priorities and form an important part of the commitments taken by the agency towards its employees.

The teams work closely towards our clients’ and partners’ needs. We do have a commitment to "Sustainable Excellence" which constitutes the foundation of our daily work and combines the two pillars of imug Beratungsgesellschaft - Service Excellence and  We continuously reinforce our know-how through experience and feedback, and pay close attention to the transparency, readability and accessibility of our analyses.

Our commitments towards our employees are:

Ensuring in-depth and regular social dialogue in terms of information, consultation and negotiation.
Guaranteeing equal treatment to all employees in terms of the recruitment process, skills and career development, remuneration, and work-life balance.
Promoting equal opportunities between men and women in the workplace, and developing cultural diversity.
Ensuring that skills development as well as individual and collective performance, are key factors contributing to career development.

Innovation, trust & dialogue are the foundation of our client relationships.

imug rating communicates to its clients, the companies it rates and stakeholders about the methodology through which Vigeo Eiris builds its opinion.
imug rating provides clients with research and services adapted to every responsible and ethical investment approach.
Maintaining close contact with our clients enhances our understanding of market expectations. Several customisable extranet portals for clients ensures fast access, not only to the products and publications but also to real time information published by the agency.
Project managers in charge of innovation ensure the diversification of our services to meet the needs of new market segments and to anticipate future needs.
Teams are dedicated to answering to client requests within 24 hours (maximum).

 

Governance:

The nature of imug's shareholding structure ensures the independence of the agency. Shareholders are mainly imug's managing directors.

Independence, transparency, quality and integrity - those requirements are formalised in a code of conduct available on our website, which is translated into professional practices. After the Arista quality standard has been discontinued, we are aiming for ISO 9001 certification in 2019.

A code of conduct is signed by all employees. imug applies strict guidelines on work ethics and integrity to reinforce its independence. Our research is independent from any financial or economic interest. We follow rules of impartiality in formulating our research opinion in order to prevent potential conflicts of interest or influence strategies.

 

Environment:

imug measures its carbon footprint and compensates the whole carbon footprint. (https://www.imug.de/fileadmin/user_upload/Downloads/imug_csr/Urkunde_CO2-Ausgleich_2016_10_12.pdf)
Reduction of energy consumption through:

Most employees come to the office by public transport or bicycle.
A teleconferencing system for calls and working meetings across sites.
The opportunity to use telework to avoid long and recurrent commuting.

Sorting system for office waste and recycling of expired objects and documents.
Use of recycled paper and commitment to limit the use of paper outputs for imug Rating.

 

01.2. Indicate whether you have policies that formalise the incorporation of your ESG beliefs in your business offerings.

01.3. Indicate the components/types of your internal policy and provide the URL and/or an attachment of the document/s if they are publicly available.

Policy components/types

Public availability

01.4. Indicate how these are put into practice internally across the organisation.

01.5. Additional information [OPTIONAL]

https://www.imug.de/imug-nachhaltigkeit/

https://www.imug.de/imug-rating/?L=0

 


SG 02. Norms used to develop policies

02.1. Indicate what frameworks and guidelines you have used to develop your organisation’s policies. Tick all that apply.

          ISO Norms : ISO 26 000, ISO 9000, ISO 14000
        
          European Union relevant directives (On reporting for instance)
        

02.2. Additional information. [OPTIONAL]


SG 03. Policy offerings to clients

03.1. Indicate whether you offer standard, off the shelf, policies to clients as part of your product offerings, and/or whether you create tailored versions for individual clients.

Off the shelf
Tailored
Asset class-specific RI guidelines
Sector-specific RI guidelines
Screening/exclusions policy
Engagement policy
(Proxy) voting policy
RI guidelines set out within the Investment Policy Statement (IPS)
RI guidelines set out in a freestanding RI policy
Multi-year RI implementation project plan
Conflict of interest management policy
Stockbroker allocation policy
Securities lending policy
Other, please specify (1)
Other, please specify (2)
Other, please specify (3)
None of the above

please specify (1) - Off the shelf

          Sovereign Sustainability Rating
        

please specify (1) - Tailored

          Sovereign Sustainability Rating
        

please specify (2) - Off the shelf

          Green Bond Second Party Opinion
        

please specify (2) - Tailored

          Green Bond Second Party Opinion
        

03.2. Provide a brief description of the key elements, any variations, or exceptions applying to these policies.

Products and services are tailored to client interest. It is up to clients to define how they will integrate our services and which policies they may wish to build from them.

Our core ESG rating products are structured around and/or derived from our methodological framework, structured around 38 precise sustainability criteria based on international standards. These 38 ESG challenges are segmented into 41 sector sub-frameworks selecting and weighting the most relevant objectives. More than 330 principles for action enable us to question companies on their integration of social responsibility issues into managerial systems. We assess issuers on their overall ESG performance, and identify their strengths and weaknesses. Our screening activity enables investors to complement this managerial analysis with an assessment of issuers’ involvement in a number of activities:

products and services contributing to sustainable development

16 controversial activities.

This research on ESG or ethical drivers enables us to serve and answer any client’s RI policies

03.3. Additional information. [OPTIONAL]


SG 04. ESG/RI in business offerings

04.1. Briefly describe how you include ESG/RI factors as part of your business offerings.

Business area

Investment Consultancy

How you include ESG/RI factors

Advisory and consultancy services include ESG and RI factors.

Investor clients can benefit from imug rating's support in the development of structured products or a bespoke investment universe, combined with responsible investment strategies.

We can also offer assistance to define and implement investors’ ESG strategies. This includes assistance from formalisation to development, through to communication about a client’s investment policy.

Portfolio Audits are also provided to measure and manage the implementation of a client’s global or targeted ESG policy across their portfolio. Two formats of audit reports (at the fund level and at the portfolio level) are available. Vigeo Eiris provides clients with a mapping of ESG risks and a performance benchmark on their portfolios.

https://www.imug.de/imug-rating/

Research and Data Provision

How you include ESG/RI factors

imug rating offers decision-making tools designed for all types of investors, covering all ethical and responsible investment approaches.

Reliable, up-to-date, accessible and customisable research and data is needed to be able to identify risks related to ESG, to detect opportunities for future value creation and to be informed swiftly about controversies and litigations.

Sustainability rating provides research and services adapted to all types of investments, and aims to take ESG risk factors into account in the management of investment universes. imug rating gives access to analyst opinion on corporate management of sectoral issues through Vigeo Eiris offerings and own products.

Vigeo Eiris’ Controversy Database and Controversy Risk Assessement allow investors to stay informed about allegations and litigation affecting companies in their portfolio. These events can impact a company’s reputation and legal security. Vigeo Eiris informs clients of the severity an frequency of such events, and the company’s response.

04.2. Indicate the roles in your organisation, and indicate for each whether they have oversight and/or implementation responsibilities for ESG/RI within the organisation.

Roles present in your organisation
Oversight/accountability for ESG/RI
Implementation of ESG/RI
Board
Directors
Chief Executive Officer (CEO), Chief Financial Officer (CFO)
Chief Operating Officer (COO), Chief Information Officer (CIO)
Other chief-level staff
Other heads of department

Please specify

          Head of Research
        

Please specify

          Head of Research
        
Dedicated ESG/RI staff
Other role, specify (1)
Other role, specify (2)
Other role, specify (3)
None of the above

04.3. Indicate how you ensure ESG/RI expertise for the roles where there are RI oversight/accountability or implementation responsibilities.

04.4. Indicate whether your organisation has any ESG/RI linked incentives for its employees.

04.7. Additional information [OPTIONAL]


SG 05. Outsourcing of services (Private)


SG 06. Providing training/education

06.1. Indicate whether you provide training/educational services on ESG/RI. Tick all that apply.

06.2. Describe the main components of your training/educational services on ESG/RI and any variations depending on the group you provide training/education to.

Every client gets a training session on the beginning of new service period, before introduction of new products or on demand.

06.3. Describe whether these training/educational services include any commercial elements.

          Included in service package
        

06.4. Additional information. [OPTIONAL]


SG 07. Applying, advancing and promoting the PRI principles

07.1. Describe how your organisation applies, advances and promotes the PRI Principles.

Vigeo Eiris offers ESG engagement and voting services, which help clients to implement the PRI principles and meet their stewardship obligations.

imug | rating explains the PRI principles to clients, as well as how to apply and implement them, often in an incremental fashion.

Vigeo Eiris refers to the PRI principles when providing ESG training to imug rating's clients’ staff.

Where relevant and appropriate, we include reference to the PRI principles in pitches to prospects, or in public speaking engagements.

 

07.2. Highlight whether there are any ways that your organisation would like to engage further with the PRI. [OPTIONAL]


SG 08. Actions taken to promote responsible investment

08.1. Indicate which of the following actions your organisation has taken to promote responsible investments during the reporting year, independently of collaborative initiatives.

08.2. Additional information. [OPTIONAL]

We regularly write on ESG issues in our Sustainable Finance blog: https://www.imug.de/imug-rating/sustainable-finance-blog/

In addition we published a paper on ESG Ratings and Financial Institutions in Germany in 2019: https://www.imug.de/news/2019/deutsche-banken-im-nachhaltigkeits-stresstest/

We were speakers of various ESG, SDG and other Sustainable Finance Events, mainly with participants of the German Sustainable Finance Market.

With our imug | rating Newsletter we reach up to 1,500 professionals of sustainable finance, clients and other stakeholders and individuals: https://www.imug.de/news/2020/imug-rating-enews-februar-2020/


SG 09. Long term trends

09.1. Indicate which of the following long-term trends are addressed in your product outputs.

09.2. Explain how this long-term trend affects your product outputs.

Our bond sonar research on employee attraction and retention and employment security assesses corporate commitments towards enabling employees, in a transparent framework, to develop their careers and ensure their professional development. This is to ensure the future employability of employees, their adaptation to the changing work environment, their skills development, thereby facilitating labour mobility and anticipating job requirements.

Our Non-Discrimination analyses looks at companies’ strategies  to prevent discrimination against persons on the basis of their age or any familial responsibilities, as well as on the promotion of equality.

 

 

09.2. Explain how this long-term trend affects your product outputs.

We offer our clients own products and Vigeo Eiris services and products based on climate change trend:

indices focused on carbon (bespoke SRI indices set up with clients).

portfolio analysis of carbon footprints and physical impacts of climate change. This involves assessment of a company’s approach to prevent, mitigate and adapt to the physical impacts of climate change.

screening services focused on fossil fuel involvement (screening of companies’ fossil fuel reserves and assessment of the potential emissions embedded).

Sustainable Goods and Services research - positive screening that assesses a company’s involvement in products and services with a positive impact on the climate and contributing to climate-related UN SDGs. It provides an evaluation showing what percentage of a company’s activities are contributing to sustainable development (for each company in a specific portfolio)

Second Party Opinion for Green Bonds - climate change is integral part of the assessment and many of the projects are renewable energy projects

Impact Measurement for Impact Investments - climate change and renewable energy projects were part of some Impact Measurements in 2018

09.2. Explain how this long-term trend affects your product outputs.

We offer our clients own products and Vigeo Eiris services and products based on resource scarcity

ESG ratings of more than 5,000 issuers. This includes an assessment of a company’s approach to waste management, recycling and life cycle analyses as well as innovative

Sustainable Goods and Services research - positive screening that assesses a company’s involvement in products and services with a positive impact on the resource scarcity issues and contributing to related UN SDGs. It provides an evaluation showing what percentage of a company’s activities are contributing to sustainable development (for each company in a specific portfolio)


SG 10. Interaction with asset owners

10.1. Indicate whether you interact with asset owner clients.

10.2. Indicate the typical frequency and type of interactions with your asset owner clients.

Type of interaction

Frequency

Frequency

Frequency

Frequency

10.3. Additional information. [OPTIONAL]

On request to present portfolio analysis results, advice, training or research presentations according to demand.


SG 11. Aligning approach with investor goals

11.1. Describe how you typically align your organisation’s philosophy and approach to ESG/RI with your investor clients’ goals.

Our corporate mission is to promote responsible growth through our products and services: empowering responsible investment and responsible management.

Being aligned to investor needs and fiduciary duty is part of our business model.  

imug | rating is committed to categorising risks related to ESG, to identifying opportunities for risk management, future value creation and to inform clients on a timely basis about controversies and litigations. All these require research and data that is reliable, up-to-date, accessible, and customisable. As a result, imug rating provides research and services adapted to many types of investment inlcuding impact investment measuring and developing and emerging country specialized ESG research as well as specialized research in financial institutions.

11.2. Additional information. [OPTIONAL]


SG 12. ESG recommendations not aligned with investor goals

12.1. Describe what steps you take, if any, when your ESG recommendations are not in line with your investor clients’ goals.

Whilst investors define how they will integrate our research, and which policies they may wish to build from it, imug | rating provides advice on these matters as clients request and require. We can also offer bespoke solutions for clients who may be interested in research, criteria or advice beyond the scope of our default offerings.

12.2. Additional information. [OPTIONAL]


SG 13. Seeking feedback from clients

13.1. Indicate whether you seek feedback from clients on your RI/ESG services and product offerings

13.2. Describe how you use this feedback in your RI/ESG services and product offerings.

Close contact with our clients informs our understanding of market expectations. A customisable extranet portal for clients ensures fast access, not only our the products, services and publications but also to real time information published by the agency.

We always seek feedback on our products and services and receive these in a contuining process in a very detailed way. We try to include these feedback in a timely manner and also give feedback to our data provider Vigeo Eiris in order to have these client's feedback recognized in all products and services.

Project managers in charge of innovation ensure the diversification of our services to meet the needs of new market segments and to anticipate future needs.

Teams are dedicated to answering to client requests within 24 hours (maximum).


SG 14. Managing conflicts of interest

14.1. Indicate whether your organisation has a policy for managing potential conflicts of interest.

14.2. Describe how you manage potential conflicts of interest.

imug rating has established a Code of Conduct, communicated to all employees.

Through its Code of Conduct, imug rating applies strict guidelines on work ethics and integrity. In order to prevent situations of conflict of interest, imug rating has defined the rule that an analyst/researcher or other employee may not participate in the determination of ratings or other output of assessments and evaluations if the employee:

1. directly owns securities or derivatives of the assessed entity or any related entity. Where such ownership has been declared, he / she must discuss this with his / her line manager and the Compliance Officer, who will decide what action to take. This decision will be recorded by the Compliance Officer.

2. has had an employment or other significant business relationship with the assessed entity within the previous 6 months.

3. has an immediate relation (i.e. spouse, partner, parent, child and sibling) who currently works or has worked within the previous 6 months for the assessed entity.

Any personal relationship with a company that creates the potential for any real or apparent conflict of interest shall be disclosed to the appropriate manager or the Head of Quality Management.

imug rating reports any real or potential conflicts of interest in a timely, clear, complete, concise and specific manner in its yearly Independence Report to its external ARISTA auditor.

14.3. Describe how you ensure that company employees do not derive any personal gain from the use of information collected during your work process.

The employees of imug rating must respect the applicable insider trading regulations

14.4. Additional information. [OPTIONAL]


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