Sustainability Disclosures

Disclosures pursuant to the Sustainable Finance Disclosures Regulation (EU) 2019/2088 ("SFDR")

Published on 19/12/2022

The SFDR requires financial market participants to disclose the manner in which sustainability risks are integrated in the investment decision‐making process, whether and how principal adverse impacts of investment decisions on sustainability factors are considered and how remuneration policies are consistent with the integration of sustainability risks in investment decisions.

"Sustainability risk" means an environmental, social or governance (ESG) event or condition that, if it occurs, could cause an actual or a potential material negative impact on the value of an investment.

"Sustainability factors" means environmental, social and employee matters, respect for human rights, anti‐corruption and anti‐bribery matters.

In addition, SFDR categorises financial products as follows:

• "Article 6" products may or may not integrate sustainability risks into their investment decisions but do not specifically promote environmental or social characteristics or have sustainable investment as their objective.
• "Article 8" products promote environmental or social characteristics, or a combination of those characteristics, provided that the companies in which the investments are made follow good governance practices.
• "Article 9" products have sustainable investment as their objective.

Integration of sustainability risks in the investment decision‐making process

All the products we offer are categorised as "Article 6" products. The investments underlying our financial products do not take into account the EU criteria for environmentally sustainable economic activities.

We integrate sustainability risks in our investment decision‐making process, both at firm level and at product level. Integration of sustainability risks is the practice of incorporating ESG information into investment decisions and analysis to help enhance risk-adjusted returns. This means that ESG-related factors that are material to the risk and return of the investment are considered alongside traditional financial factors when making an investment decision.

More specifically, during the due diligence process of potential investments, we consider and assess ESG indicators and headline ratings from third-party providers to help us evaluate each candidate’s relative and absolute performance on the various sustainability topics and to identify potential ESG-related risks or opportunities. The presence of an unfavourable ESG indicator or the discovery of a sustainability risk during the due diligence are not necessarily reasons to exclude a specific investment from our investment universe. In this regard, sustainability risks are treated in our process like other risks (e.g. credit, market, liquidity, etc.), allowing us to evaluate the risk-return profile of a given investment more comprehensively.

More details on our approach towards the integration of sustainability risks can be found in our ESG Integration Statement.

No consideration of adverse impacts of investment decisions on sustainability factors

We do not consider any adverse impacts of our investment decisions on sustainability factors, both at firm level and at product level.

We do not offer any financial products that promote environmental or social characteristics ("Article 8" products) or financial products that have sustainable investment as their objective ("Article 9" products), therefore the consideration of adverse impacts of investment decisions on sustainability factors becomes less relevant.

Each of our financial products invests, primarily, in a number of mutual funds and ETFs (i.e. fund-of-funds structures) and therefore, the assessment of principal adverse impacts resulting from a large number of indirect investments involves disproportionate effort, taking due account of the company’s size, the nature and scale of its activities and the types of financial products it offers.

We will continue to keep this decision under review and, if needed, will update our policies and practices accordingly in the future.

Integration of sustainability risks in remuneration policy

Our remuneration policy involves a broad range of factors which are considered to determine the appropriate level of remuneration for our personnel, including the management of sustainability risks so as to discourage actions and activities that could, potentially, have negative social, environmental or governance implications.