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Deutsche Börse AG

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 Deutsche Börse Group has sustainability principles. 

Organising capital markets characterised by transparency, safety and integrity is not only the public-service mission and core business of Deutsche Börse Group, but it is also its most important value contribution to society. We assume responsibility for the markets we organise, our employees, the environment and society.

Companies are responsible – not just for their business, but also for their social environment. Deutsche Börse Group takes this responsibility very seriously and puts it into practice in its company-wide sustainability management. We see this commitment as an ongoing obligation to our employees, customers and investors, society and the environment to ensure that our company remains competitive in the long term, taking all our relevant stakeholder groups into account.

In April 2018, Deutsche Börse Group’s initiative “Accelerating Sustainable Finance” and the Hesse Ministry of Economics’ “Green Finance Cluster” merged to form the “Green and Sustainable Finance Cluster Germany e. V.” (GSFCG).

The goal of this new Cluster is to enhance the expertise on sustainable finance in the market, put that expertise to efficient use, and identify (as well as take) specific action to make national and international financial markets structures fit for the future.

The Cluster has defined four fields of action: sustainable finance – status quo and innovation; data and digitalisation; metrics and standards; dialogue and knowledge development.

It coordinates the activities of the participating institutions within these fields of action and brings them together with policymakers, regulators, civil society and academia.

At a European level, the Cluster is a member of the technical expert group on sustainable finance and thus actively involved in the European Commission’s Action Plan on sustainable finance, whose implementation the Cluster supports.

 

 

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
          This CoC defines the principles and standards required of DBG’s suppliers of products and services re their responsibilities to people and the environment.
        

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

          Tracking and reporting of relevant KPIs in Deutsche Börse AG’s annual report
        

01.5. Additional information [OPTIONAL]


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.

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

03.3. Additional information. [OPTIONAL]

Eurex ESG derivatives offer a flexible solution for asset managers with strict mandates to achieve ESG compliance.

All STOXX indices are suitable as underlying for mandates, passive funds, ETFs, structured products and listed derivatives, with the ambition to increase liquidity and lower the cost of trading. These indices are developed in close cooperation with market participants such as asset owners.

EEX offers trading possibilities for renewable energies, e.g. on its power markets, and CO2-emission trading under the EU Emission Trading System.


SG 04. ESG/RI in business offerings (Not Applicable)


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.

          Research paper, events, webinars, articles & interviews published on the homepage and the intranet of Deutsche Börse Group, etc.
        

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.

The main components of Deutsche Börse Group´s training / educational services consists of websites, articles and customer events but also of webinars on sustainability / ESG related topics and specific events for a broad variety of stakeholders.  

Beyond the above mentioned classical offering related to training and education services, Deutsche Börse Group and other stakeholders initiated the "Green and Sustainable Finance Cluster Germany e.V."(GSFCG). The goal of this new Cluster is to enhance the expertise on sustainable finance in the market, put that expertise to efficient use, and identify (as well as take) specific action to make national and international financial markets structures fit for the future. 

The Cluster has defined four fields of action: sustainable finance - status quo and innovation; data and digitalisation; metrics and standards; dialogue and knowledge development.

It coordinates the activities of the participating institutions within these fields of action and brings them together with policymakers, regulators, civil society and academia. 

at a European level, the Cluster is a member of the technical expert group on sustainable finance and thus actively involved in the European Commission´s Action Plan on sustainable finance, whose implementation the Cluster supports. 

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

          The content is educational and engagement-oriented. The indices used as proof points & data points can be used for passive investment purposes (i.e. can be considered commercial indirectly). It should also be mentioned that the visibility arising of the above mentioned components can be considered to have indirect commercial effect.
        

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.

Beside different events hosted and co-hosted with the PRI, DBG is collaborating closely with the PRI through different Initiatives in means of content and development of sustainable finance.

For example, the PRI is member of the Accelerating Sustainable Finance Initiative, established by Deutsche Börse Group along with major stakeholders from the Frankfurt/Main financial centre and signed the associated Frankfurt Declaration. The Frankfurt Declaration demonstrates the signatories’ intention to define the framework conditions for sustainable finance and to put concrete initiatives in place in the Frankfurt financial centre. These are directed towards the identification of innovative business areas and the responsible handling of risks, among other things. The implementation of sustainable finance infrastructure must therefore be fully encouraged in order to support positive economic and social development, while protecting the natural capital, which is the foundation of all economic activity.

In April 2018, Deutsche Börse Group’s initiative “Accelerating Sustainable Finance” and the Hesse Ministry of Economics’ “Green Finance Cluster” merged to form the “Green and Sustainable Finance Cluster Germany e. V.” (GSFCG). The goal of this new Cluster is to enhance the expertise on sustainable finance in the market, put that expertise to efficient use, and identify (as well as take) specific action to make national and international financial markets structures fit for the future.

The Cluster has defined four fields of action: sustainable finance – status quo and innovation; data and digitalisation; metrics and standards; dialogue and knowledge development. It coordinates the activities of the participating institutions within these fields of action and brings them together with policymakers, regulators, civil society and academia. At a European level, the Cluster is a member of the technical expert group on sustainable finance and thus actively involved in the European Commission’s Action Plan on sustainable finance, whose implementation the Cluster supports.

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

Yes, events, education, research, content, promotion etc.


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]

Deutsche Börse Group's objectives and strategies include discharging its corporate responsibility holistically. Therefore, the Group Sustainability unit manages and oversees all sustainability related initiatives and topics and is in charge of the above mentioned activities.


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.

Seismic shifts in climate, demographics, technology (macro-level megatrends ) are transforming politics, economics and consumer behavior. Thematic investing attempts to capitalize on these broad, disruptive and often hard-to-predict developments changing our society.

STOXX makes these megatrends investable, honing in on a range of cross-industry concepts with long-term economic impact.

The topic of "Changing Demographics" is addressed ie

STOXX® Millenials Index

https://www.stoxx.com/index-details?symbol=STXMLNGR

STOXX® Silver Economy

https://www.stoxx.com/index-details?symbol=STXSLVGR

Eurex makes these megatrends investible via derivatives using ESG indices of leading index providers

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

STOXX built a full family of Climate change and low-carbon related indices which are already licensed to institutional investors, who use them (the indices) as an underlying for the promotion of ESG/RI investment.

Eurex Exchange has listed two futures on STOXX climate indices (EURO STOXX 50 Low Carbon Index and STOXX Europe Climate Impact Index) in February 2019

EEX Group provides special trading products for renewable energies, such as so-called wind power futures and long-term hedging products for renewable energy projects. Also, EEX Group provides primary and secondary markets for CO2-emission certificates under the EU Emission Trading System. Climate change and climate action are the core drivers of energy and related markets and thus shape EEX Group´s product portfolio decisions.

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

Samples:

STOXX® Global Industry 4.0

https://www.stoxx.com/index-details?symbol=STXIN4GR

 

STOXX® Global AI

https://www.stoxx.com/index-details?symbol=STXAIV

 

STOXX® Global Electric Vehicles & Driving Technology

https://www.stoxx.com/index-details?symbol=STXELVGR

 

iSTOXX® Developed Markets B.R.AI.N.

https://www.stoxx.com/index-details?symbol=IXBRANGR


SG 10. Interaction with asset owners (Not Applicable)


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.

Deutsche Börse Group continuously interacts with a large number of different stakeholder groups, whose significance for the company we evaluated in an internal survey of the Group’s divisions. Depending on their points of view, i. e. whether they consider Deutsche Börse as a capital market organiser or whether they regard it as a listed company, stakeholders and their interests can vary.

A fixed component of Deutsche Börse Group’s sustainability strategy is a process-oriented materiality analysis. The objective is primarily to incorporate the expectations and requirements of our relevant internal and external stakeholder groups on an ongoing basis. Only by doing so we can identify the opportunities and risks of our core business activities early on, analyse them and translate them into specific fields of action for the company. The following link provides more information on Deutsche Börse Group’s stakeholder groups, the dialogue formats we use and an insight into a materiality matrix with the areas in which we need to take action.

https://www.deutsche-boerse.com/dbg-en/sustainability/materiality-analysis

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.

We can customize mandates and indices to meet investor goals.

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.

Our Global Sales teams have continuously open dialogues with clients about how our services can suit their needs.

E.g. EEX Group constantly seeks client feedback on its product range as combating climate change is the main driver within energy markets.


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.

Acting responsibly means having values that are shared by all employees throughout the Group. In 2017, Deutsche Börse AG’s Executive Board adopted an extended code of business conduct. This document, which is applicable throughout the Group, defines the foundations of key ethical and legal standards, including – but not limited to – the following topics:

Confidentiality and the handling of sensitive information
Conflicts of interest
Personal account dealing, as well as the prevention of insider dealing and market manipulation
Company resources and assets
Combat of bribery and corruption
Risk management
Whistle-blowers
Environmental awareness
Equal opportunities and protection against undesirable behaviour

The code of business conduct applies to members of the Executive Board, all other executives and all employees of Deutsche Börse Group. In addition to specifying concrete rules, the code of business conduct provides general guidance as to how employees can contribute to implementing the defined values in their everyday working life. The goal of the code of business conduct is to provide guidance on working together in the company on a day-to-day basis, to help resolve any conflicts and to resolve ethical and legal challenges. All newly hired employees receive the code of business conduct as part of their employment contract documentation. Staff who were already in the company prior to the introduction of the code of business conduct were familiarised with the guidelines in 2018 through an online training course, following which they had to confirm having received the document and having understood its content. The code of business conduct is an integral part of the relationship between employer and employees at Deutsche Börse Group. Breaches may lead to disciplinary action. The document is available on www.deutsche-boerse.com > Sustainability > Set an example > Employees > Guiding principles.

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.

Compliance has overall responsibility for identifying and managing Group-wide compliance risks. Compliance devises risk-oriented measures in order to contain and manage corresponding risks, communicating risks, incidents, and the effectiveness of the measures taken; it ensures continuous improvement of the compliance management system by way of regular adjustments to the relevant internal guidelines and processes. Key compliance topics are discussed by Deutsche Börse’s Group Compliance Committee, which comprises senior management representatives from the business divisions and the relevant Group-wide control functions.

Compliance has implemented Group-wide guidelines covering relevant local requirements. These rules are designed to ensure that the internal stakeholder groups acting on behalf of Deutsche Börse Group comply with the behavioural rules set out in such guidelines, with the objective of countering breaches of compliance throughout the Group in a preventive, investigative and sanctioning manner. Group-wide communications via the intranet are geared towards providing employees (including members of the Executive Board and Managing Directors) with the necessary guidance in their daily work, and making sure they commit to such guidance. In addition, all external staff and service providers must sign a form through which they undertake to comply with Deutsche Börse Group’s compliance regulations, including rules to combat corruption.

Regular compliance training is essential for a culture of compliance throughout Deutsche Börse Group: employees worldwide are being trained with respect to relevant compliance issues – covering, in particular, the areas of money laundering/terrorism financing, data protection, corruption, market manipulation and insider trading. Managers who are exposed to increased compliance risks on account of their activities receive additional training in line with their needs. Participation in training measures covering the compliance topics mentioned above is mandatory for employees, as well as for management.

Deutsche Börse Group has established a whistleblowing system, where employees can relay information about potential or actual breaches of regulatory rules or ethical standards, by phone or e-mail, whereby the anonymity of whistle blowers is a fundamental guarantee. Through its commitment to compliance awareness, Deutsche Börse Group cultivates an open approach to dealing with misconduct. For this reason, reports received are often passed on directly to the responsible line manager, or to Compliance. During 2018, five reports were submitted via the whistleblowing system, or directly via line managers or control functions (such as Compliance).

14.4. Additional information. [OPTIONAL]

Acting responsibly means having values that are shared by all employees throughout the Group. In 2017, Deutsche Börse AG’s Executive Board adopted an extended code of business conduct: this document, which is applicable throughout the Group, defines the foundations of key ethical and legal standards, including – but not limited to – the following topics:

􀂄 Confidentiality and handling of sensitive information

􀂄 Conflicts of interest

􀂄 Personal account dealing, as well as prevention of insider dealing and market manipulation

􀂄 Corporate funds and assets

􀂄 Anti-bribery and corruption

􀂄 Risk management

􀂄 Whistleblowing

􀂄 Ecological awareness

􀂄 Equal opportunities and protection from unsolicited behaviour

The code of business conduct applies to members of the Executive Board as well as to all other managers, and to all employees of Deutsche Börse Group. In addition to specifying concrete rules, the code provides general guidance as to how employees can contribute to implementing the defined values in their everyday working life. The goal of the code of business conduct is to provide guidance on working together in the company on a day-to-day basis, to help resolve any conflicts and to resolve ethical and legal challenges. All newly-hired employees will receive the code as part of their employment contract documentation. Staff who were already in the company prior to the introduction of the code will familiarise themselves with the guidelines within the scope of an online training course, following which they will need to confirm having attended the course and having understood its content. The code of business conduct will evolve into an integral part of the relationship between employer and employees at Deutsche Börse Group. Breaches of the code may lead to disciplinary action. The document is available on www.deutsche-boerse.com > Sustainability > Set an example > Employees > Guiding principles.


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