Sustainable Investments
Through their investment policies, large institutional investors and credit institutions increasingly have the ability to positively influence the development of corporate social and environmental responsibility.
Aware of its role, Intesa Sanpaolo considers the integration of ESG factors into its investment process of fundamental importance, in the belief that these elements, as well as promoting economically and socially sustainable development, can contribute positively to the financial results of customer portfolios, while at the same time reducing their risks.
We are continuously striving to create new solutions that meet the needs of our clients to enhance the long-term growth of their investments, while respecting ESG sustainability criteria.
The European Union has adopted a series of measures to direct capital flows towards sustainability-conscious investments so as to integrate ESG aspects into risk management and to promote transparency and longterm vision in economic and financial activity, such as the Regulation (EU) 2019/2088 (Sustainable Finance Disclosure Regulation) which governs disclosure in the field of sustainable finance, Regulation (EU) 2020/852 (so-called Taxonomy Regulation) on the establishment of a framework for the classification of activities considered sustainable, the Delegated Regulation (EU) 2021/1253 relating to the integration of customers’ sustainability preferences by investment firms, Delegated Directive (EU) 2021/1269 referring to the integration of sustainability factors into the product governance obligations and Delegated Regulation (EU) 2022/1288 concerning the content and presentation of investment sustainability information. This represents a further stimulus to reinforce the commitment of the Group to act as a responsible player in global change, also through the increasingly well-structured offer of sustainable investments and the availability of insurance solutions for the protection of customers, in line with European plans and regulations.
In 2023, the Group Companies continued with the activities specified in the SFDR legislation (Regulation EU 2019/2088) in the area of sustainable finance, in terms of policies, roles, responsibilities, processes and reporting.
The Intesa Sanpaolo Group intends in the 2022-2025 Business Plan to become leader in Wealth Management, Protection & Advisory, with a strong commitment to ESG; in particular, it has stated among its objectives an expansion of its ESG range of products in asset management, the further development of Eurizon’s proprietary ESG scoring with the extension of its use to new asset classes and the development by Fideuram of advisory services with an ESG focus, in the insurance sector, the Intesa Sanpaolo Group is committed to the development of a dedicated non-life ESG offer and the enrichment of the ESG/climate offer within the Life range of the Intesa Sanpaolo Vita Insurance Group.
In such a complex context, the Intesa Sanpaolo Group also confirmed its leadership in sustainability-conscious investments in 2023. The Group has reached a total of over 400 funds that promote environmental and/or social characteristics (among others) or that have sustainable investment objectives, classified pursuant to Articles 8 and 9 of the SFDR, amounting to assets of over 182 billion euro (310 funds with assets amounting to over 136 billion in 2022).
To bear witness to its awareness of its own active role in combating climate change, in November 2021 Intesa Sanpaolo announced to have joined, through Eurizon Capital SGR, Fideuram Asset Management SGR and Fideuram Asset Management (Ireland), to the Net Zero Asset Managers Initiative (NZAMI).
After joining the Net-Zero initiatives at the end of 2021, in 2022 Eurizon Capital SGR, Fideuram Asset Management SGR and Fideuram Asset Management Ireland DAC determined their respective targets, approved by the individual Boards of Directors, following the publication - in the 2022-2025 Business Plan - of the 2030 targets for the reduction in financed emissions relating to the main emission-intensive sectors, resulting from their membership of the Net-Zero Banking Alliance. The year 2023 was an important year as regards membership of NZAMI, with the preparation of internal monitoring activities and external reporting of progress in the pursuit of the objectives (using the UNPRI platform) and with the start of engagement activities on the Net-Zero theme with respect to the investee issuers.
The offer portfolio therefore includes funds that apply selection criteria consistent with the United Nations Principles for Sustainable Investment, with the aim of activating sustainability dynamics in companies and in customer choices.
Intesa Sanpaolo Group is aware that it has a significant impact on this front as well. In particular, in providing advice, the Bank plays an important role in informing clients about financial products with sustainable investment characteristics or objectives.
This context includes information on the adverse impacts on sustainability factors and on the management of sustainability risk in the provision of investment advisory or insurance distribution services.
Sustainability, management of large portfolios, support for the real economy, digitalisation and internationalisation are the pillars on which the future growth strategies of our Division will be based.
EURIZON CAPITAL SGR
Eurizon Capital, offers investors a wide and diversified range of funds that integrate sustainability risks into their investment choices and at the end of 2023 it boasted assets of almost 149 billion euro in sustainability-conscious products that, in compliance with good governance practices, promote environmental or social characteristics, among others, or that have sustainable investment objectives, classified according to Articles 8 and 9 of Regulation (EU) 2019/2088 (SFDR), which represent about 73.3% of the assets managed in UCITS by the company.
With the signing in 2015 of the PRI (Principle for Responsible Investments) of the United Nations, Eurizon Capital has shown over the years particular attention to the policies implemented by the issuers in which it invests, in the belief that corporate governance policies and practices, which incorporate environmental aspects, and correct governance, are able to create value for all stakeholders in the long term.
Eurizon is also a signatory of the CDP and in 2014 has adhered to the Italian Stewardship Principles which define the procedures for exercising administrative and voting rights in listed companies.
During 2023, Eurizon updated its Sustainability Policy by refining the ESG / SRI strategies adopted by the products and providing specific negative and positive screening criteria and engagement strategies; the Eurizon Sustainability Policy provides, in particular, for:
- enhancement of the methods for verifying the adoption of good governance practices by investee companies, in particular with regard to sound management structures, staff relations, staff remuneration and compliance with tax obligations, in accordance with the provisions in the SFDR Regulation;
- the extension of the proprietary score known as the Eurizon ESG Score to include government issuers as well. In particular, this score weighs up the degree of sustainability of each country with respect to the E, S and G pillars and assesses the evolution of risk management policies and ESG opportunities over time by government issuers.
During the year, Eurizon also updated its Commitment Policy, which sets out the methods of dialogue with investee companies and the issues considered a priority by the asset management company as part of the Stewardship activities conducted by the Company. In particular, four macro-themes were identified for 2023: (i) mitigation and adaptation to climate change, (ii) mitigation of biodiversity loss and combating deforestation, (iii) respect for human rights and combating the production of unconventional weapons and (iv) the adoption of good governance practices.
In 2023, Eurizon followed its practice from previous years and voluntarily published its Sustainability Report for the year 2022 referred to the Asset Management Division. In line with what was done for the previous year and in compliance with the reporting standards adopted for the definition and prioritization of material issues, the Company involved various external and internal stakeholders, including numerous corporate bodies and structures, which contribute to the definition and implementation of the Sustainability Policy as evidence of the transverse nature of corporate commitments.
To strengthen supervision of the sustainability of investments, Eurizon employes three structures that report to the Board of Directors:
ESG Committee: defines the proposals to be submitted to the Board of Directors on sustainable and responsible issues; monitors the exposure of assets against identified ESG indicators; monitors the escalation process for issuers deemed as “critical”
Sustainability Committee: collaborates with the Board of Directors to ensure the compliance of management choices with ethical principles for Ethical products. The Committee is independent andautonomous in relation to the Company and is made up of individuals with recognized integrity and morality
Donations Committee: oversees the devolution and charity activities of the Company
Investment supervision Committee: tasked with advisory, drafting, and propositional activities related to the supervision of the Investment Process used in managing funds
Financial, credit and operational risk Committee: monitors the impacts of sustainability risks on financial products, and the mitigating actions adopted to face the adverse effects tied to investment decisions
Il Chief Executive Officer formulates, with the support of the SRI Committee, proposals for the Board of Directors relating to the methods for selecting and monitoring financial instruments. Identifies the main negative effects of investment decisions.
Governance sees the presence of these further structures.
The ESG & Strategic Activism structure, ensures the dissemination and implementation of the sustainability principles of the investments, promoting the integration of environmental, social and governance factors in the Investment Process
The Long Term Sustainable Strategies structure, Identifies the lists related to issuers deemed as non “socially responsible” and issuers with a high exposure to ESG risks (so called “critical issuers”). Oversees the identification and prioritization of the main negative effects of investment choices on sustainability factors.
Furthermore: the Compliance & AML structure, that monitors the compliance with the Sustainability Policy of the Company and the Risk Management structure, that monitors the sustainability risk of the products under management.
The ESG and SRI principles are applied to all actively managed funds, both benchmark or flexible ones (ESG criteria are not applied to passive/indexed products or investment solutions such as, for example, funds of funds and retail portfolio and unit-linked management). ESG specialised products are created as part of the active management funds.
The engagement process
In 2023, Eurizon conducted a total of 1,165 meetings with issuing companies; of these, 592 were considered engagement activities and involved 343 issuers. The engagements that covered ESG issues in the period numbered 228 and represented about 40% of the total engagements held in the period, confirming Eurizon’s strong commitment to sustainability issues and active ownership engagement.
In this context, it should be noted that as part of the Net Zero Asset Managers Initiative (NZAMI), in July 2022, the engagement activities began with the aim of contacting 155 companies by 2030, selected by taking into consideration various factors, including the current level of carbon emissions, the estimated level for the future, the jurisdiction and the progress made to date with reference to the set objectives of decarbonisation.
In 2023 Eurizon updated the Voting Procedure relating to the financial instruments pertaining to the assets under management of Eurizon Capital SGR S.p.A., defined in implementation of the Strategy for the exercise of intervention and voting rights regarding the financial instruments pertaining to the assets under management of Eurizon Capital SGR S.p.A., which was also updated.
Eurizon took part in 1,413 shareholders’ meetings of 100 selected companies listed on Borsa Italiana (7% of the total) and 1,313 companies listed on the international markets (93%), voting on 18,641 resolutions on the agenda.
In 2023, Eurizon published its Stewardship Report on engagement activities and the exercise of voting rights, reporting not only statistics on the activities carried out, but also in detail about the most significant issues that the asset management company had to address.
Under Regulation (EU) 2019/2088 (SFDR), at the end of 2023, the assets of the UCITS (Undertakings for Collective Investment in Transferable Securities) offered pursuant to Articles 8 and 9 amounted to approximately 149 billion euro, representing a total of about 73.3% of the assets managed in UCITS by Eurizon; in particular, the assets of the products pursuant to Article 8 amounted to approximately 145.6 billion euro and the assets of the products pursuant to Article 9 to approximately 3.4 billion euro.
The number of products managed according to these criteria was 306 (60 of which were launched in 2023) - considering the individual placement windows - referring to all the main asset classes (equity, balanced, flexible, bond, money-market and alternative).
Given the growing commitment towards the Net Zero targets subscribed and published by the SGR in 2022, the Company has launched the third edition of the Eurizon Step 50 Net-Zero Objective fund which, like the two previous ones launched in 2022, invests in global companies committed in achieving the Net-Zero goal by 2050.
In May 2023, the asset management company drafted the Green Bonds Impact Report regarding Eurizon Fund Absolute Green Bonds and Eurizon Fund Green Euro Credit for the analysis period (1 January 2022 – 31 December 2022), which details the results of the quantitative impact analysis and the contribution to the UN’s SDGs.
As regards the Eurizon Fund Absolute Green Bonds, it was calculated that for every million euro invested, the following results are achieved: 837 megawatt/hours of renewable energy produced, 1,478,928 litres of water saved or purified and a reduction of 749 tonnes of CO2. At the end of December 2023, the fund’s assets amounted to over 1.34 billion euro and during 2022 it invested in 457 Green and thematic bonds.
With reference to the Eurizon Fund Green Euro Credit, for every million euro invested, the following results are achieved: 1,056 megawatt/hours of renewable energy produced, 1,600,737 litres of water saved or purified and a reduction of 717 tonnes of CO2. At the end of 2023, the fund’s assets amounted to over 0.73 billion euro.
Also with reference to institutional mandates, the Company’s investment process takes into account the integration of ESG criteria in its investment choices in accordance with the provisions of Regulation (EU) 2019/2088. In particular, all mandates comply with exclusion criteria both with regard to SRI issues (with reference to issuers operating in “non-responsible” sectors) and ESG issues (“critical” issuers with low ESG scores). A specific ESG report is regularly produced on a large number of mandates (45 mandates with a value of 11.2 billion euro managed), indicating the positioning of the portfolio with respect to the reference benchmark. In addition, Eurizon manages a total of 31 mandates relating to 17 customers for approximately 7.5 billion euro (of which 8 are attributable to the scope of the subsidiary Eurizon Capital Real Assets SGR S.p.A.) on which specific investment restrictions are implemented and/or support is provided to customers within the engagement and corporate governance activities.
FIDEURAM INTESA SANPAOLO PRIVATE BANKING
The Private Banking Division considers the integration of environmental, social and governance factors into its business model of fundamental importance, in the belief that these elements, as well as promoting economically and socially sustainable development, can contribute positively to the financial results of customer portfolios, while at the same time reducing the risks.
During 2023, some updates to the Sustainable and Responsible Investment Policies were made by Fideuram Asset Management SGR and Fideuram Asset Management (Ireland) DAC, both through the inclusion of further exclusion criteria in the selection of financial instruments (issuers involved in unconventional oil & gas extraction activities and in armaments as provided for in the “Rules governing transactions with subjects active in the armaments sector” of the Intesa Sanpaolo Group) and through the strengthening of the concept of good governance of investee companies in accordance with the SFDR Regulation, verifying the existence of a minimum set of requirements with reference to the management structure, relations with staff and its remuneration and compliance with tax obligations.
As regards engagement, in 2023 Fideuram Asset Management SGR and Fideuram Asset Management (Ireland) dac carried out 112 and 98 activities respectively, of which 78 and 82 on ESG issues (69.6% and 83.7%).
With a view to raising awareness and engaging customers on sustainability issues, in 2023 it held 16 events with around 14,000 participants, of which 4,000 customers.
Customer interest in sustainability-conscious investments is constantly growing: in this process evolutionary, the role of Private Bankers is fundamental, ready to listen and address the needs of customers by making them understand the logic of an ESG investment and its value points.
This context includes the establishment of the role of ESG Ambassador currently held by a group of 34 Private Bankers, selected for an initial pilot phase from among the approximately 6,000 belonging to the Fideuram and Intesa Sanpaolo Private Banking based on their attention to ESG issues. The ESG Ambassadors are called to promote, in their respective territories, the culture of sustainability with a dual purpose: to disseminate ESG issues and sustainable behaviors and to represent a point of listening to the needs of customers and Private Bankers.
Also in 2023, the new offer was strongly directed to solutions that reflected the criteria adopted by the Division in terms of ESG with an incidence of over 80% of the products pursuant to Articles 8 and 9 SFDR on the total of new products. The new aspects concerning the various product families (traditional and alternative funds, portfolio management, insurance investment products and placements of asset management products), included the following:
- Willerfunds Private Suite, 5 new sub-funds of the vehicle of Fideuram Asset Management Ireland dedicated to the Intesa Sanpaolo Private Banking (ISPB) Network, created with leading international asset managers, of which 4 that promote environmental and/or social characteristics (Article 8 SFDR) and 1 with sustainable investment objectives (Article 9 SFDR)
- FAI Progetto Italia II, created by Fideuram Asset Management SGR in collaboration with Eurizon Capital Real Asset SGR S.p.A. (ECRA), which allows investment in selected Italian companies and benefiting from the tax incentives provided for by the legislation on Alternative Individual Savings Plans, with a strategy that integrates sustainability criteria and risks in the investment policy and is classified pursuant to Article 8 SFDR.
Within the scope of Portfolio Management, the Fogli Fideuram range has been extended with new ESG lines, including the Foglio Net-Zero Transition (Article 8 SFDR), and the investment universe of Il Mio Foglio ESG (Article 8 SFDR) has also been enriched; the latter allows the customer to construct their own portfolio starting from a specific list of strategies that have strong ESG characteristics (all classified under Articles 8 or 9 SFDR) or to use predefined model portfolios (“guided pathways”) broken down by level of risk and built according to a “High Conviction” approach, linked to the tactical selection of specific ESG topics.
As at 31 December 2023, Fideuram Asset Management SGR and Fideuram Asset Management (Ireland) had a range of 240 products pursuant to Articles 8 and 9 of the SFDR, for a total of assets under management of 60.5 billion euro, divided as follows: 33.3 billion in investment funds, 21.2 billion in portfolio management and the remaining portion in insurance products. More specifically, the ESG offer in funds included 92 funds classified pursuant to Article 8 and 5 classified pursuant to Article 9 of the SFDR Regulation out of a total of 191 funds (33.3 billion euro equal to 71% of the total assets of the Funds).
Last updated 30 April 2024 at 09:25:02
