A Committed Player

By signing the Principles for Responsible Investment (PRI), Amundi Group has reasserted its commitment to responsible finance.

The PRI are six principles in the form of 32 actions developed under the aegis of the United Nations Environment Programme - Finance Initiative (UNEP-FI) and the Global Compact, currently supported by over 500 major institutional investors and asset management companies. Aware of the growing importance of environmental, social and governance (ESG) issues, the signatories make a commitment to take these criteria into account in all of their investment analysis and decision-making processes, to encourage ESG practices among issuers and the investment industry, and to collaborate in implementing these principles.

Amundi supports this initiative, which corresponds to its view of investors as playing a central and financially responsible role, obliged to take all material factors into account in their investment management, including ESG criteria.

Each year, Mercer is asked by PRI to carry out a general survey based on a questionnaire sent to the signatories in order to assess progress made. Each signatory then receives an individual score relative to all signatories and its peers.

Amundi firmly believes that overall analysis of a company, encompassing economic, social and environmental aspects, allows for better assessment of the risks and opportunities that may affect its long-term valuation. Amundi's extra-financial research and analysis are centralised at IDEAM, its dedicated responsible investment subsidiary.

As part of its policy of shareholder dialogue, Amundi supports a number of collective shareholder initiatives, such as the Carbon Disclosure Project (CDP), the Extractive Industries Transparency Initiative (EITI), the Forest Footprint Disclosure Project, the Institutional Investors' Group on Climate Change (IIGCC) and the UN Global Compact Investors' Initiative.

These international initiatives bring together institutional investors and asset management professionals with the aim of encouraging companies to improve their practices and communications with regard to social responsibility and sustainable development, and encouraging public authorities to adopt incentive measures. The concerned areas are climate change, deforestation, and transparency in contractual relationships between companies and extractive industries (oil, gas and mining) and the countries in which they operate.

Amundi is a member of the Forum pour l’Investissement Responsible (FIR), Eurosif, the Observatoire sur la Responsabilité Sociétale des Entreprises (ORSE), and also AFG, the Institut Français des Administrateurs (IFA), and the Société Française des Analystes Financiers (SFAF). Amundi plays an active role in a number of working parties organised by these organisations to develop responsible investment, sustainable development and corporate governance.

Taking an active stance towards voting at general shareholders' meetings, Amundi has devised its own voting policy and, since 2003, widened its scope to include meetings of foreign companies and integrated social and environmental criteria into its policy.

It has adopted a proactive role, holding pre-AGM discussions with companies, and informing them of motions against which it is planning to vote. This warning system - already applied to 120 major listed French companies - was extended to international companies in 2009. In particularly complicated cases, voting committee meetings are convened attended by asset managers and analysts and chaired by the head of asset management.

Amundi has launched a Scientific Committee on Responsible Finance Issues. The Committee has around 15 permanent members comprising people renowned for their areas of expertise, such as business owners, economists, financiers, philosophers, scientists, sociologists and key personnel from the Crédit Agricole Group.

The Committee's role is:

• to review, from the angle of its members’ various disciplines, the major issues relating to sustainable development;
• to draw up practical recommendations for businesses and analyse whether they are correctly translated in terms of responsible investment;
• to assist in disseminating the results of its work in documents distributed to employees of the Crédit Agricole Group, Amundi and its customers, as well as various marketplace institutions;
• to foster greater public awareness.

The diversity and quality of the Committee members' areas of expertise, as well as their professional experience and positions of responsibility, constitute a huge advantage for the success of their work.

Amundi supports the creation and financing of the first "Sustainable Finance and Responsible Investment" academic chair, sponsored by the Association Française de Gestion (AFG) and set up by the Ecole Polytechnique and the Institut d’Economie Industrielle (IDEI) in Toulouse.

Its main aims are:

• to help show objectively that developing sustainable finance and responsible investment is not only necessary but above all possible;
• to develop research methodologies to ensure better identification of extra-financial criteria and their integration into analysis;
• to build up a scientific team with an international reputation in SRI.

The chair's research will concern two main areas: "financial markets, investment strategies and sustainable growth"; "corporate governance and sustainable finance".

Amundi is a financial backer of the FIR Finance and Sustainability European Research Award and a member of its Steering Committee. This award is intended to support and promote European research into the financial markets' responses to sustainable development issues. It rewards academic research by students and researchers in the field.

IDEAM makes public the composition of the responsible investment funds managed by Amundi Group and calculates their ESG footprint.
The ESG footprint is worked out by IDEAM's Responsible Research team and based on its reference system covering environmental, social and governance criteria in the management of responsible investment funds. The results are provided in the form of scores and charts, for both the portfolio and its benchmark index. The extra-financial quality of the portfolio and its associated benchmark index is assessed on the basis of the calculation of an average ESG score and a review of the ratings of each of the criteria used (scale of 5 levels from +2 to -2). The higher the score relative to the index for one of the E, S or G criteria or for all ESG criteria, the more responsible the portfolio.
This information is available online on the ideam.fr website, as well as information about the fund management process.