Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Governance
• Social

Environmental Achievements

• Carbon neutral since January 1, 2009
• Ranked among the most climate-friendly financial institutions according to CDP

Social Achievements

• Best Swiss Asset Management Company (Swiss Sustainable Finance Awards 2020)
• A+ rating for PRI module “Strategy and Governance”, and above-market-median ratings in all other modules (2020)

Governance Achievements

• ISS-ESG awarded ‘Prime’ status to Vontobel
• Above-average sustainability ratings from MSCI, Sustainalytics, and ISS ESG in environmental and social dimensions

Climate Goals & Targets

Environmental Challenges

• Implementation, regulatory, and reporting challenges of sustainable investing

Mitigation Strategies

• Commitment to sustainable business built on solid foundations (responsible entrepreneurship since 1924)
• Continuous improvement in ESG integration across operations and investment decisions
• Transparent communication with clients

Supply Chain Management

Responsible Procurement

• Guidelines for sustainable procurement (addressing employment conditions, child labor, environmental protection, and corruption prevention)

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI

Third-party Assurance: GRI Service Team (Materiality Disclosures Service), ISS ESG (Impact Report)

Awards & Recognition

• Best Swiss Asset Management Company (Swiss Sustainable Finance Awards 2020)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Responsible Business Practices
• Client Advisory on ESG
• ESG Investment Solutions
• Transparency

Environmental Achievements

• Climate neutral since 2009
• CHF 35.4 billion in “Prime” sustainable strategies (25% of AuM)

Social Achievements

• Launched various initiatives to promote diversity and inclusion
• Engaged with companies on human rights and labor standards

Governance Achievements

• Implemented a group-wide policy prohibiting investments in companies manufacturing cluster bombs and landmines
• Established ESG governance structure with Corporate Sustainability Committee and ESG Investment Forum
• Signatory of the UK Stewardship Code

Climate Goals & Targets

Environmental Challenges

• Inconsistency in ESG ratings from different providers
• Data quality challenges, particularly in emerging markets (e.g., China)
• Balancing client demand for ESG products with rigorous governance and operational processes

Mitigation Strategies

• Conducting own ESG research and leveraging multiple data sources
• Using specialized data providers for specific regions (e.g., SynTao Green Finance for China)
• Defining clear minimum criteria for ESG product categories
• Strengthening product governance through the ESG Investment Forum
• Documenting ESG processes and controls to mitigate greenwashing risk

Supply Chain Management

Responsible Procurement

• Guidelines for sustainable procurement addressing employment conditions, child labor, environmental protection, and corruption prevention

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, UN PRI

Third-party Assurance: GRI Materiality Disclosures Service (partial), ISS ESG (Impact Report)

Environmental Metrics

ESG Focus Areas

• Clean energy
• Clean water
• Sustainable cities
• Innovative industry & technology
• Sustainable food & agriculture
• Equal opportunities
• Good health & well-being
• Responsible consumption

Environmental Achievements

• Reduced carbon emissions by achieving 27,700 tons of potential avoided CO2 (PAE) from holdings’ activities in 2022. This corresponds to 373 tons of potential avoided CO2 (PAE) per one million euros invested.
• 84 percent of all revenues are considered to have a direct or indirect positive impact.
• Portfolio’s average Sustainalytics ESG risk level decreased from 26 to 19. The carbon emissions by the companies in the Vontobel Fund II – GIE are 33 percent below those of the constituents of the reference index MSCI ACWI.

Social Achievements

• Increased access to affordable healthcare services to 147 million people worldwide.
• Provided financial services to underserved categories (e.g., microcredit, digital banking) resulting in 28 million jobs created and 36 million underbanked people served.
• Women empowerment initiatives serving 45 million women.

Governance Achievements

• Active engagement with portfolio holdings on material ESG issues, particularly environmental issues.
• High percentage of holdings committed to SBTi targets (68%).
• Alignment with Article 9 SFDR, the most demanding category with the highest disclosure requirements.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to geopolitical events and the pandemic.
• Global hunger exacerbated by war, supply chain issues, and extreme weather.
• Data availability challenges for some PAIs and inconsistencies in company reporting on sustainability efforts.

Mitigation Strategies

• Companies are mulling over their sourcing strategies to reduce dependencies, either by expanding to alternative suppliers or by “near-shoring” or “re-shoring”.
• Fine-tuning of impact strategy assessment to improve data quality and reduce discrepancies.
• Proactive engagement with companies to enhance data uniformity and improve reporting on PAEs and carbon reduction targets.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Integrating environmental requirements into corporate credit issuance process (Bank Rakyat).

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products and services
• Investment in clean energy technologies

Reporting Standards

Frameworks Used: UN SDGs, PCAF, WBCSD, SFDR Article 9, GIIN

Certifications: Null

Third-party Assurance: ISS ESG

UN Sustainable Development Goals

• Not disclosed

The fund invests in companies contributing to at least one of the six impact pillars, each contributing to one or two key SDGs.

Sustainable Products & Innovation

• Renewable energy technologies
• Energy-efficient products
• Sustainable packaging solutions

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate Change
• Biodiversity
• Governance
• Human Rights
• Social Impact

Environmental Achievements

• Achieved significant reduction in energy consumption in 2023, primarily driven by decreased fuel consumption from non-renewable sources.
• Implemented an internal carbon pricing mechanism for business travel to incentivize more sustainable travel choices.

Social Achievements

• Continued creating a great workplace where everyone can thrive, advancing equality, diversity, and inclusion.
• Offers a range of attractive employment conditions and benefits beyond statutory requirements, including maternity and paternity leave, childcare access, and flexible working arrangements.

Governance Achievements

• Further sharpened terms of reference and roles/responsibilities of committees to increase efficiency.
• Integrated application of four ESG Investment Principles into performance assessments of senior Investments leadership.

Climate Goals & Targets

Environmental Challenges

• Increased scrutiny on companies to demonstrate ESG commitments.
• Challenges in obtaining sufficient carbon data in upstream and downstream value chains for Scope 3 emissions.
• Challenges in engaging with mainland Chinese companies on ESG issues.
• Difficulty in cost-efficient solutions for Scope 3 emissions.

Mitigation Strategies

• Investing in ESG data platform to centralize data, improve quality, and increase efficiency.
• Participating in working groups to develop Swiss Climate Scores.
• Conducting fact-finding engagements to gather information on ESG aspects.
• Partnering with engagement pool providers to amplify influence and leverage specialized resources.

Supply Chain Management

Responsible Procurement

• Guidelines for sustainable procurement addressing employment conditions, child labor, forced labor, environmental protection, and corruption prevention.

Climate-Related Risks & Opportunities

Physical Risks

• Physical risks of climate change (e.g., extreme weather, flooding)

Transition Risks

• Transition risks from adjustment of policies and actions towards a more environmentally sustainable economy.

Reporting Standards

Frameworks Used: GRI Standards, SFDR, TCFD, UN Global Compact, UN PRI

Third-party Assurance: Ernst & Young Ltd (EY) (limited assurance on selected KPIs)

UN Sustainable Development Goals

• Various UN SDGs (e.g., Goal 6, Goal 7, Goal 13)

Vontobel's sustainability commitments and initiatives contribute to various UN SDGs.

Awards & Recognition

• 4-star rating in 2023 for the PRI module “Investment and Stewardship Policy”

Environmental Metrics

ESG Focus Areas

• Climate Change
• Water Management
• Resource Efficiency
• Circular Economy
• Clean Energy

Environmental Achievements

• Potential avoided emissions (PAE) of 1,200 tons of CO2 per EUR 1 million invested, reflecting a carbon footprint to PAE ratio of 14.
• Renewable energy generated: 160.2 GWh
• Water recycled or saved: 125.9 mn m3
• Waste collected/recycled: 116,100 t
• Materials captured for circular economy: 56,500 t

Social Achievements

• Engagement with portfolio companies to improve ESG disclosures and impact reporting.
• Investigation into the use of company products in Russian weapons, resulting in confirmation of compliance with human rights standards and cessation of operations in Russia.

Governance Achievements

• Updated Group-wide ESG investing and advisory policy.
• Updated statement on principal adverse impacts of investment decisions on sustainability factors.
• 8% increase in Vontobel Fund – GEC holdings with SBTi activities compared to last year.

Climate Goals & Targets

Environmental Challenges

• Geopolitical and economic shifts impacting investment environment.
• Challenges in measuring impact versus outcomes due to evolving ESG frameworks.
• Uncertainty regarding the impact of political changes on net-zero efforts.
• Water scarcity and water stress in many parts of the world.
• High interest rates and project delays impacting renewable energy manufacturers.

Mitigation Strategies

• Focus on solution providers supporting low-carbon infrastructure.
• Proactive engagement with portfolio companies to enhance data uniformity.
• Utilizing Carbon4 Finance data for more comprehensive climate analysis.
• Increased exposure to Clean Water and Resource Efficient Industry pillars.
• Active ownership and engagement with portfolio companies to improve sustainability practices.

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Droughts
• Floods

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Investments in clean energy and transition technologies.

Reporting Standards

Frameworks Used: SFDR Article 9, EU Taxonomy, TCFD

Certifications: Towards Sustainability

Third-party Assurance: ISS ESG

UN Sustainable Development Goals

• SDG 6
• SDG 7
• SDG 9
• SDG 11
• SDG 12
• SDG 13

Companies invested in contribute to these goals through their products and services.