Taking SI to the Next Level UN Sustainable Development Goals · Taking SI to the Next Level –UN...

Taking SI to the Next Level ndash UN Sustainable Development Goals

Institutional Money Kongress

Frankfurt 26th February 2019

David Hawa Director Client Portfolio Manager

For professional investors

UN Sustainable Development Goals

Aimed at tackling the issues of poverty inequality and climate change

Source United Nations httpwwwunorgsustainabledevelopmentnewscommunications-material

2Taking SI to the Next Level ndash UN Sustainable Development Goals

Background on the UN Sustainable Development Goals

ldquoRate of progress in many areas is far slower than needed to meet the targets by 2030rdquo

Source SDG Progress Reports 2017Estimated by UN Commission on Trade and Development (UNCTAD)


How to measure the SDG contribution

Assessment is not easy



3 important questions to ask


SDG rating methodology

Source Robeco RobecoSAMThese examples are for information purposes only and not intended to be an investment advice in any way


All companies are analyzed based on

gt Contribution to the SDGs positiveneutralnegative

gt Extent of the contribution highmediumlow

Assessment Impact SDG Score

Positive

High +3

Medium +2

Low +1

Neutral 0

Negative

Low -1

Medium -2

High -3

1What do companies produce


Sector

Banks

SDG

Starting pointPositiveLow +1

KPI 1

SME loans total loans

gt 25 Positive

Medium +2

KPI 2

EM loans total loans

lt25Positive

Medium +2

gt 25Positive

Medium +2

gt 50PositiveHigh +3

Extensive set of rules and KPIs - RobecoSAM guidebook

Taking SI to the Next Level ndash UN Sustainable Development Goals 7




Sector

Energy (EampP)

SDG

Starting pointNegative

Low -1

KPI 1

Natural Gas in production mix

gt 65 Positive Low

+1

45-65 Neutral

+0

30-45 Negative Low

-1

KPI 2

Fracking in production mix

gt 20-1 notch

gt 50-2 notches

gt 80-3 notches





Sector

Automotive

SDG


Medium -2

KPI 1

EVhybrids in production mix

gt5 Neutral

+0

gt10 Positive Low

+1


2 How do companies produce


SDG also govern how companies operate

Firmrsquos governance framework

Conduct track record

Environmental policies

hellip

Scrutinise companies

firms with serious or structural breaches

D o w n g r a d e

between firms with the highest SDG impact

D i f f e r e n t i a t e

Qualitative assessment

10




11




12




13

3 Are controversies known


Having the right products and procedures is not always sufficient

14




One off

Properly dealt with by management

hellip

Controversies

if assessment isnrsquot satisfactory

D o w n g r a d e

RobecoSAMSustainalyticsEngagement SpecialistsCredit SpecialistsQualitative assessment

15

3 Engagement with investee companies

Constructive dialogue with investee companies to discuss ESG related risks and opportunities


Source Robeco End of December 2017

Engagement Themes 206Engagement cases

177Companies engaged

87Cases closed successfully

4733Shareholder meetings voted in 2017

60Meetings with votes against management

Outcome of the SDG framework



We analyzed circa 600 companies

Source Robeco RobecoSAM Data September 2018


asymp 600c o m p a n i e s a s s e s s e d

16n e u t r a l c o n t r i b u t i o n s

24n e g a t i v e c o n t r i b u t i o n s

6 0 p o s i t i v e c o n t r i b u t i o n s

5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||

14 step 2 and 3 adjustments


Some sectors contribute to the SDGs and others are lagging

Source Robeco RobecoSAM This example is for information purposes only and not intended to be an investment advice in any way


Portfolio construction

Building a SDG Credit Portfolio





Research Universe

Application of SDG Research

SDG Eligible Universe




Portfolio Construction SDG Global Credit Portfolio SDG Eligible Universe

Robecorsquos Investment Process

ESG integration in fundamental issuer analysis

Key focus of fundamental issuer analysis is to identify downside risks

gt Assessment of the ESG Profile is a fixed part of issuer analysis

gt ESG information unveils risks that otherwise would remain beneath the surface

gt In over 30 of cases we adjust our fundamental view on the basis of ESG Profile

Fundamental issuer analysis Sources of input for ESG Profile


Fundamentalview

Source Robeco

Portfoliorsquos contribution to the United Nations Sustainable Development Goals

24

Source RobecoSAM Global SDG Credits RobecoSAM Data end of December 2018


0 Robust Institutions25 Equality amp Opportunity

70 Sustainable Society17 Healthy Planet14 Basic Needs

Deep insight in the environmental footprint

Source RobecoSAM Data end of September 2018European average figures per yearAverage carbon dioxide emissions from new passenger cars per year average 20000 km and 130 g CO2-eqkm in t CO2-eq (source wwweeaeuropaeu) 26Average electricity consumption per household and year in MWh (source wwweceuropaeuEurostat) 39Average water consumption per person and year in m3 (sourcewwweeaeuropaeu) 475Average waste generation per household and year in t (source wwweceuropaeueurostat) 04


Portfolio RobecoSAM Global SDG Credits Benchmark Bloomberg Barclays Global Aggregate Corporates Index

Green bonds often have a positive SDG score

Green bonds

gt More and more issuers issue green bonds next to traditional bonds

gt Performance of these bonds tends to be good as dedicated funds are chasing these bonds

In the SDG framework both the issuer and the green bond are screened and scored separately

gt If the issuer has a negative SDG score the green bond could still have a positive score

gt Green bonds often contribute positively to SDG 13 (climate action)

Source RobecoSAM Global SDG Credits Data end of December 2018


Key takeaways


Key takeaways

Our commitment


Key takeaways

There are several sectors that are currently lagging



Key takeaways

There are more than enough names in the universe to build a global SDG Credit Fund for a positive impact



Wichtige Informationen


Gemaumlszlig sect63 Abs 6 WphG weisen wir darauf hin dass die Informationen eine Werbemitteilung darstellen und nicht allen gesetzlichen Anforderungen zur

Gewaumlhrleistung der Unvoreingenommenheit von Finanzanalysen genuumlgen Einem Verbot des Handels vor der Veroumlffentlichung von Finanzanalysen unterliegen sie

nicht Diese Informationen wurden von Robeco Institutional Asset Management BV (Robeco) zusammengestellt und dienen lediglich zur Information und sind nur

fuumlr diejenige Person bestimmt an die sie gerichtet ist Sie basieren auf den Angaben die dem Fondsverwalter zur Verfuumlgung stehen Zukunftsgerichtete Aussagen

sind Aussagen die nicht Tatsachen der Vergangenheit beschreiben Sie umfassen auch Aussagen uumlber unsere Annahmen und Erwartungen Solche Aussagen beruhen

auf Planungen Schaumltzungen und Prognosen die der Robeco-Gruppe bzw Ihren Mitarbeitern zur Verfuumlgung stehen Zukunftsgerichtete Aussagen gelten daher nur an

dem Tag an dem sie gemacht werden Wo erforderlich koumlnnen Angaben auf anwendbaren und brauchbaren Schaumltzungen jeweils nach Auffassung des

Fondsverwalters basieren Auf den Inhalt dieses Dokuments wird keinerlei Garantie gegeben Der Inhalt basiert auf Informationsquellen die als zuverlaumlssig erachtet

werden Es wird jedoch weder eine Garantie noch eine Erklaumlrung in Bezug auf die Richtigkeit und Vollstaumlndigkeit dieser Information abgegeben weder ausdruumlcklich

noch stillschweigend Keine Robeco-Investmentgesellschaften noch ihre Vorstandsmitglieder oder Mitarbeiter haften fuumlr Informationen bzw fuumlr die in diesem

Dokument geaumluszligerten Empfehlungen die ohne Vorwarnung geaumlndert werden koumlnnen Wir uumlbernehmen keine Verpflichtung solche Aussagen angesichts neuer

Informationen oder zukuumlnftiger Ereignisse anzupassen noch haftet die Robeco-Gruppe fuumlr die Richtigkeit der abgedruckten Informationen Zukunftsgerichtete

Aussagen beinhalten naturgemaumlszlig Risiken und Unsicherheitsfaktoren Eine Vielzahl wichtiger Faktoren kann dazu beitragen dass die tatsaumlchlichen Ergebnisse

erheblich von zukunftsgerichteten Aussagen abweichen Der Wert der Anlagen kann schwanken Ergebnisse der Vergangenheit sind keine Garantie fuumlr die Zukunft

Saumlmtliche Angaben werden durch Robeco Rotterdam Niederlande geliefert Der Verkaufsprospekt das Verwaltungsreglement bzw die Satzung der jeweils neueste

Jahresbericht und sofern veroumlffentlicht auch der neueste Halbjahresbericht sind in englischer Sprache und die wesentlichen Anlegerinformationen in deutscher

Sprache erhaumlltlich im Internet unter wwwrobecode sowie kostenlos per E-Mail oder postalisch bei Robeco Deutschland Taunusanlage 17 60325 Frankfurt am Main

Saumlmtliche Urheberrechte Patente intellektuelle und sonstige Eigentumsrechte die auf den Inhalt dieser Information Anwendung finden wurden von Robeco

erworben und gehoumlren Robeco Es werden weder Rechte in Lizenzen abgegeben noch zuerkannt noch in irgendeiner Weise auf andere Programme uumlbertragen die

Zugang zu diesen Informationen haben Robeco Institutional Asset Management BV ist bei der niederlaumlndischen Finanzaufsichtsbehoumlrde in Amsterdam registriert

Robeco Deutschland (Handelsregister Nr 55163) ist die Zweigniederlassung der Robeco Institutional Asset Management BV Stand aller Angaben soweit nicht

anders angegeben Februar 2019

UN Sustainable Development Goals

Aimed at tackling the issues of poverty inequality and climate change

Source United Nations httpwwwunorgsustainabledevelopmentnewscommunications-material



















Positive

High +3

Medium +2

Low +1

Neutral 0

Negative

Low -1

Medium -2

High -3



Sector

Banks

SDG


KPI 1


gt 25 Positive

Medium +2

KPI 2


lt25Positive

Medium +2

gt 25Positive

Medium +2







Sector

Energy (EampP)

SDG


Low -1

KPI 1


gt 65 Positive Low

+1

45-65 Neutral

+0

30-45 Negative Low

-1

KPI 2


gt 20-1 notch

gt 50-2 notches

gt 80-3 notches





Sector

Automotive

SDG


Medium -2

KPI 1


gt5 Neutral

+0

gt10 Positive Low

+1








hellip



D o w n g r a d e




10




11




12




13




14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways













































Positive

High +3

Medium +2

Low +1

Neutral 0

Negative

Low -1

Medium -2

High -3



Sector

Banks

SDG


KPI 1


gt 25 Positive

Medium +2

KPI 2


lt25Positive

Medium +2

gt 25Positive

Medium +2







Sector

Energy (EampP)

SDG


Low -1

KPI 1


gt 65 Positive Low

+1

45-65 Neutral

+0

30-45 Negative Low

-1

KPI 2


gt 20-1 notch

gt 50-2 notches

gt 80-3 notches





Sector

Automotive

SDG


Medium -2

KPI 1


gt5 Neutral

+0

gt10 Positive Low

+1








hellip



D o w n g r a d e




10




11




12




13




14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways






























Sector

Banks

SDG


KPI 1


gt 25 Positive

Medium +2

KPI 2


lt25Positive

Medium +2

gt 25Positive

Medium +2







Sector

Energy (EampP)

SDG


Low -1

KPI 1


gt 65 Positive Low

+1

45-65 Neutral

+0

30-45 Negative Low

-1

KPI 2


gt 20-1 notch

gt 50-2 notches

gt 80-3 notches





Sector

Automotive

SDG


Medium -2

KPI 1


gt5 Neutral

+0

gt10 Positive Low

+1








hellip



D o w n g r a d e




10




11




12




13




14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways































Sector

Energy (EampP)

SDG


Low -1

KPI 1


gt 65 Positive Low

+1

45-65 Neutral

+0

30-45 Negative Low

-1

KPI 2


gt 20-1 notch

gt 50-2 notches

gt 80-3 notches





Sector

Automotive

SDG


Medium -2

KPI 1


gt5 Neutral

+0

gt10 Positive Low

+1








hellip



D o w n g r a d e




10




11




12




13




14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways































Sector

Automotive

SDG


Medium -2

KPI 1


gt5 Neutral

+0

gt10 Positive Low

+1








hellip



D o w n g r a d e




10




11




12




13




14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways


































hellip



D o w n g r a d e




10




11




12




13




14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways































11




12




13




14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways































12




13




14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways































13




14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways































14




One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways































One off


hellip

Controversies


D o w n g r a d e


15




















5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways















































5 9 1 0 | |

| high|

hi g h

7 2 1 3 2 | |

||












Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways






































Research Universe















Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways








































Fundamentalview

Source Robeco


24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways





























24










Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways

































Green bonds








Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways




























Key takeaways


Key takeaways

Our commitment


Key takeaways




Key takeaways




























Key takeaways

Our commitment


Key takeaways




Key takeaways




























Key takeaways




Key takeaways




























Key takeaways




























Taking SI to the Next Level UN Sustainable Development Goals · Taking SI to the Next Level –UN...

Documents

Transcript of Taking SI to the Next Level UN Sustainable Development Goals · Taking SI to the Next Level –UN...