ADQ

ADQ performs fairly well in two key aspects, namely governance and stewardship. Not only does it assign decision-making and oversight responsibility for its sustainability strategy to its highest governance body, but it also assigns responsibility for implementing its sustainability strategy to various functions, teams or committees. In terms of stewardship, it has a stewardship policy that supports environmental transitions and social best practices in line with its sustainability strategy and covers client and other stakeholder engagement as well as advocacy and partnerships.

Additionally, ADQ provides at least one example of how its products, services and capital supports the climate adaptation and resilience of society.

There is scope for ADQ to improve its disclosures in various areas, such as its operational carbon footprint, financing of fossil fuels and high-emitting sectors, underrepresented groups and sectors, low and lower-middle income countries and its just transition risk mitigation processes. While ADQ mentions that it has conducted a full baseline measurement of its Scope 1 and 2 emissions, it has an opportunity to disclose its Scope 1-2 emissions. Additionally, ADQ could establish a transition plan covering its own operations, supply chain and portfolio and ensure that its scope 1-3 emissions reduce in line with its interim targets.

With regards to financing of fossil fuels, while ADQ states that it does not provide products, services or capital to some fossil fuel projects or some clients and investees undertaking such projects, it does not to refer to all fossil fuels. ADQ could also consider disclosing the breakdown of clients and/or beneficiaries by income group, as well as its processes for avoiding divestment from low-income and lower-middle countries as unintended consequences of its sustainability strategies and targets. It is also recommended that the financial institution discloses that it has a process for identifying the social risks associated with its provision of products, services and capital in relation to the net zero transition.

Another area where ADQ could improve in is in relation to the ILO fundamental rights at work. While it has a publicly available policy statement committing it to respect specific workers’ rights, it has an opportunity to reference all the ILO fundamental rights at work. Similarly, although it does expect its suppliers to respect specific workers’ rights, it could consider referencing all the ILO fundamental rights at work.

This scorecard refers to information in English which was publicly available by July 15 2024. AuM and Total assets are stated in USD for comparability and have been calculated based on reported local currency values multiplied by applicable IMF currency converter values.