Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity, Equity and Inclusion (DEI)
• Governance
• Responsible Investing

Environmental Achievements

• Added climate impact assessment tools to better understand climate scenarios & risks to portfolios
• Classified 6 Loomis Sayles UCITS funds as Article 8 (“light green”) funds under Europe’s Sustainable Finance Disclosure Regulation (SFDR)
• Developed a set of shared climate principles
• Provided sophisticated climate resources to investment teams, including climate scenario analysis tools
• Set up a working committee to share knowledge on climate change
• Sustainable Euro Credit Fund awarded ISR label from French authority

Social Achievements

• Invested over $2 million in under-resourced communities
• Employees participated in 27 volunteer events
• Launched Fuss Family Mental Health Initiative, providing $600,000 over three years to support youth mental health
• Continued internship program for underrepresented students (over 20 interns annually, 17 became full-time employees)

Climate Goals & Targets

Environmental Challenges

• Lack of consensus about labeling, certification and terminology for green bonds
• Limited ability to directly influence issuers in fixed income strategies compared to equity
• Need to improve data accuracy and forward-looking capabilities of ESG risk metrics

Mitigation Strategies

• Focus on characteristics of each bond and its issuer, regardless of label
• Active engagement with issuers on material ESG matters, particularly during pre-issuance periods for fixed income
• Working through the Credit Roundtable to enhance bondholder rights and market improvements
• Using multiple ESG vendors and scenario analysis to evaluate climate risks
• Providing education and training to investment teams on climate scenario analysis

Supply Chain Management

Climate-Related Risks & Opportunities

Opportunities

• Growth of green bonds
• Opportunities in renewable energy and hydrogen

Reporting Standards

Frameworks Used: TCFD, SASB, PRI

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity, Equity, and Inclusion (DEI)
• Responsible Supply Chain
• Community Investment
• Governance

Environmental Achievements

• 99.7% of coffee sourced ethically (for one portfolio company)
• 77% of global operations powered by renewable energy (for one portfolio company)
• Significant investments in innovative products and solutions that drive better environmental outcomes (for one portfolio company)
• Reduced carbon emissions compared to what it would have otherwise been (for one portfolio company)

Social Achievements

• Launched Loomis Serves, a digital engagement platform for US employees, increasing employee participation in philanthropic activities.
• Established employee resource groups (ERGs) for women, multicultural employees, LGBTQ+ community, veterans, and environmental enthusiasts.
• Launched Emerging Leaders Program (ELP) to enhance ethnic diversity in management.
• Undergraduate Summer Internship Development (USID) program resulting in 26 full-time first-generation employees since 2015.
• Undergraduate Women’s Investment Network (UWIN) internship program resulting in 13 full-time employees at Loomis Sayles since 2015.

Governance Achievements

• Developed a Modern Slavery Statement and established a Vendor Oversight Taskforce to address modern slavery risks.
• Finalized a Supplier Code of Conduct outlining expectations for human rights, fair labor practices, environmental practices, and anti-corruption measures.
• Implemented enhancements to policies and procedures based on an ESG transversal audit by Natixis Investment Managers.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to geopolitical events and the war in Ukraine.
• ESG transition and related efforts impacting corporate health.
• Social unrest in Peru impacting investment decisions.
• Lack of consistent ESG data and disclosure for bank loans.
• Deforestation in the Amazon impacting Brazil's environmental policies and investment decisions.

Mitigation Strategies

• Developed a Bottleneck Barometer to track supply chain congestion.
• Developed a Credit Analyst Diffusion Index (CANDI) and Sovereign Analyst Diffusion Index (SANDI) to assess macroeconomic risks.
• Engaged with companies and governments to address ESG concerns.
• Developed a three-step engagement framework for corporate bond issuers with an escalation committee.
• Qualitative adjustments to ESG scores to account for deforestation in the Amazon.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD

Awards & Recognition

• Vault's best internships in financial services (USID program)

Environmental Metrics

ESG Focus Areas

• Sustainable Investing
• Stewardship Responsibilities
• ESG Integration
• Climate Change

Governance Achievements

• Established official Proxy Voting Policies and Procedures
• Developed a Conflicts of Interest Policy

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD