Intesa Sanpaolo is aware of the positive influence that major institutional investors and banks are able to exert in the activation of sustainability dynamics among the companies they invest in or liaise with.
In September 2015 Eurizon Capital, the asset management company of the Intesa Sanpaolo Group, embraced the Principles for Responsible Investment (PRI), geared to achieving a sustainable global financial system, born from the partnership between the UNEP-FI and the UN Global Compact, after having contributed in developing them by intervening in working tables since their inception in 2005 in UNEP FI, thus confirming its commitment to continue a responsible management activity. In November 2015 was one of the first companies to subscribe to the Italian Stewardship Principles.
Eurizon Capital has an investment process in place which contemplates to remove all companies directly involved in cluster bombs and landmines from active managed portfolios. This complete exclusion applies to all flexible funds without a benchmark. The other funds cannot invest in those stocks exceeding the percentage weight in their benchmark. The investment process provides for the monthly composition of a list of stocks with the lowest sustainability / CSR rating which is at disposal of all the analysts and asset managers in addition to the traditional economic financial analysis. This ESG rating of stock is highlighted in the evaluation tables produced by the analysts on each stock.
Eurizon has established a group of 8 sustainability professionals responding to different divisions among Corporate Affairs and Investments, with the mission to take care of and to supervise all activities relating to Sustainable and Responsible Investments and to provide support to the Marketing and Commercial Development Division on the integration of ESG factors into the core processes of the Company.
The ethical funds system made available to our customers is articulated in an offer within a framework of shares and securities funds managed by Eurizon Capital: Eurizon Ethical International Equity; Eurizon Ethical Diversified; Eurizon Ethical Bonds. In 2016 a new fund, Eurizon Flexible Equity, was launched, which also incorporates environmental, social and governance elements in the selection process of the companies in which it invests.
As of the end of 2016 the assets managed by the ethical funds amounted to 902 million euro (1.3% of the total assets of Italian registered funds.
Investments in ethical funds are selected on the basis of positive criteria (inclusive principle) and negative (exclusive principle). Positive criteria are applied in order to detect the presence of ethical characteristics in the companies and entities that are under analysis; negative selection criteria instead detect the areas of activity which are considered in contrast to the ethical principles declared by the funds. At the same time the "best in class" principle is used, which allows positive and negative selection criteria to be used together, with the aim of singling out companies which, within certain risky markets (e.g. oil sector) stand out in any case thanks to merits earned on social and environmental topics. In 2016 the ethical system was provided with new benchmarks provided by MSCI, one of the most important companies worldwide for the ESG (Environmental, Social, Governance) research. An additional research service focused on environmental, social and governance (ESG) topics was also implemented by MSCI ESG.
The application of the ESG criteria resulted in the variation of the investment universe, with inclusions and exclusions of various issuers in the investment portfolios. Among the main reasons for stock inclusion we generally consider: greenhouse gas reduction programs, biodiversity, clean tech, suppliers involvement and protection of minorities in the workforce. Exclusions are mainly triggered by the involvement in arms, antitrust violations, accounting frauds and discrimination in granting credit.
In order to guarantee that the management choices respond to the above-mentioned ethical principles, Eurizon has set up a Sustainability Committee, which is independent and autonomous with respect to SGR, composed ofprofessional persons of heterogeneous extraction, with significant experience in various sectors of social responsibility concerning the management of products (bioethics, alternative energy, corporate governance, law, medicine, environment, equal opportunity). Only one member of the Committee represents SGR.
The "Regolamento Unico di gestione" furthermore envisages "the commitment of SGR to finance humanitarian projects and initiatives through the devolving of a part of the management commission paid to the Ethical System Funds, equal to 0.01% of the overall daily average net worth of the Ethical bonds and International Shares funds in each financial year". The devolving is destined in part to recognized associations and in part to humanitarian initiatives selected by the Board of Directors, on the basis of proposals from the Sustainability Committee. Participants in the Ethical bonds fund furthermore have the possibility to devolve to charitable bodies or associations a part of the profits made by the same fund, which is in fact the distribution of profits.
Eurizon Capital collaborates with international entities for the development of sustainability guidelines for the finance sector.
FONDITALIA ETHICAL INVESTMENT
Fonditalia Ethical Investment is the socially responsible investment solution of the Fideuram Group which integrates income objectives with financial sustainability and social value aspects.
The sub-fund invests in the bonds of those States that stand out for the special focus on social and environmental issues, in bonds issued by Supranational Bodies in favour of developing economies and in funds specialised in microfinance, in fair trade funds and in equity funds and shares with a positive impact on a social and/or environmental level.
An Ethics Committee composed of managerial and other professionals with proven experience in social, economic, environmental and financial sustainability, including qualified academic professionals, is tasked with verifying consistency between the actual fund portfolio composition and the ethical principles characterising the same, thereby formulating, where applicable, its own opinions on the ethics of the investments.
A further element characterising the ethics behind the sub-fund is given by its commitment to supporting scientific research, through the placement of share units and through the donation in favour of the AISM and its Foundation (FISM), the amount of which is proportional to the fund fees.
As the end of 2016, the asset managed amounted to 40 million euro.
The Fondo pensione Gruppo Intesa Sanpaolo is the first in Italy to adopt an active shareholder strategy, interacting directly with a number of large companies included in the portfolio and recommending improvement measures on topics of particular interest to customers regarding social, environmental and governance issues.
The Fund adhered to the Principles for Responsible Investment promoted by the United Nations (UNPRI) and to the CDP (Carbon Disclosure Project), an international non-profit organization that promotes the reduction of greenhouse gas emissions and the improvement of water management.
As the end of 2016, the equity and corporate portfolio of the Pension Fund was made up of about 1,300 companies.
The engagement initiatives undertaken were 6 and involved different companies in the IT and finance sectors (representing approximately 2% of the number of companies and 6% of the portfolio value). The Fund decided also to exercise voting rights in relation to the same companies, through providers specialized in proxy voting.