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ESG roundup: First Austrian pension fund signs Montreal Carbon Pledge

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The €6.5bn VBV pension fund has become the first Pensionskasse in Austria to sign the Montreal Carbon Pledge agreement.

With this, it commits to measure and publish its carbon footprint on an annual basis. In 2015 the VBV Vorsorgekasse, part of the same financial group, had become the first Austrian financial service provider overall to sign the agreement. The signature is part of the VBV Pensionskasse’s move to reduce carbon exposure in its portfolio.

In February, the pension fund had announced to switch part of its passive equity investments to track a low carbon index.

ERAFP European equity mandates…

The €26bn French pension scheme for civil servants, ERAFP, has awarded seven European equity mandates worth some €4.6bn, completing a search process that was launched in early summer last year.

It has also awarded nine stand-by mandates. The mandates are to be managed in accordance with ERAFP’s socially responsible investment (SRI) policy. 

The mandates are split across five lots, four of which are for fundamental non-benchmarked management of listed equities. For these, ERAFP said it expected “management processes based on fundamental research and in which stock picking relies on in-depth analysis of the companies, in particular through ongoing dialogue with these companies’ management”.

These mandates, and the selected active and stand-by managers are:

  • Euro-zone mid- and large-cap: Allianz Global Investors, Edmond de Rothschild Asset Management, and Mirova (Standby: Sycomore Asset Management, Ofi Asset Management)
  • Euro-zone mid- and large-cap with risk overlay: AXA Investment Managers (Standby: CPR Asset Management, Mandarine Gestion)
  • European small-cap: BFT Investment Managers, Montanaro Asset Management (Standby: Kempen Capital Management, Financière de l’Echiquier)
  • European mid- and large-cap: Candriam (Standby: NN Investment Partners, Comgest)

ERAFP also awarded a mandate for SRI low carbon index-based management of euro-zone mid and large cap equities. This was awarded to Amundi, which had already worked with the pension fund on decarbonising part of its portfolio.

… and voting activity

Separately, ERAFP has disclosed how it voted at French and foreign company general meetings last year, based on a sample covering just less than 50% of its equity portfolio in terms of market capitalisation.

It voted for just over 60% of board-submitted resolutions at 40 French meetings. A much higher opposition rate was registered for votes on executive pay (83%). This was for reasons such as excessiveness (more than 100 times the minimum wage), and lack of ESG criteria. It supported 70% of resolutions submitted by shareholders. 

ERAFP supported far fewer resolutions at general meetings of foreign companies, voting for 43%. It did not support any of the pay votes at the 20 companies in the sample.

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