PFA

The financial institution assigns decision-making and oversight responsibility for its sustainability strategy to the highest governance body. The financial institution assigns responsibility for implementing its sustainability strategy to functions, teams or committees within the financial institution. The financial institution has a stewardship policy that supports environmental transitions and social best practices in line with its sustainability strategy. The assessed entity engages in partnerships to influence and support sectors, clients and investees to act on their nature-related impacts.

The financial institution has the opportunity to disclose a policy statement committing to respect fundamental human rights as declared by the ILO. It indicates the use of living wage benchmarks and assessments but could clarify the methodology for determining living wages in its operational regions. While it identifies material sustainability impacts across its value chain, further details on the process and criteria for prioritising these impacts are needed. It is recommended to link senior executive remuneration to specific sustainability targets. The position paper mentions plans to map portfolio exposure to sectors with significant biodiversity impact and deforestation, but a clearer connection between products, services, and prioritised impacts is necessary. Although it refers to nature protection and restoration, a strategy covering priority sectors is recommended. Monitoring of scope 3 categories and a breakdown of clients by income group should be disclosed. The risk assessment process includes some ILO rights but could encompass the full set. The institution engages in ownership dialogue regarding violations in listed investments and aims to improve corporate governance, yet it could address occupational health and safety rights. Additionally, it should identify social risks related to the net zero transition and provide examples of actions taken on salient human rights issues from recent assessments.

The financial institution has a publicly available policy statement committing to respect specific workers’ rights but could reference all ILO fundamental rights at work. It has the opportunity to disclose how it determines a living wage in its operational regions. While bribery and corruption are prohibited, formalising this commitment in a public policy document is advisable, along with including anti-bribery and anti-corruption clauses in contracts. A statement specifies that political contributions are not made, but it could clarify if exceptions exist and the criteria for them. Although a list of material topics is disclosed, there is no evidence of an impact materiality assessment, and it could identify and disclose its materiality analysis. Linking senior executive remuneration to sustainability targets is recommended. The engagement policy mentions addressing environmental and social risks with investee companies but could align more closely with the sustainability strategy.

The institution tracks financed GHG emissions of its bond portfolio but should disclose results and expand coverage. Establishing a transition plan for its operations, supply chain, and portfolio is recommended, along with disclosing client breakdowns by income group. The risk assessment process should include ILO fundamental rights risks, with a mitigation process for identified risks. Identifying social risks related to the net zero transition is also recommended, as is providing examples of actions taken on salient human rights issues from assessment processes in the last three years.

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.