Sustainability and Corporate Governance Report 202
0 1
IN-DEPTH REPORT – HANDELSBANKEN FONDER Glossary T
he 2030 Agenda and the sustainable development goals The UN resolution “The 2030 Agenda – Transforming our world” was adopted by the UN General Assembly in 2015. The agenda consists of 17 SDGs and its 169 targets, and aims to achieve long-term sustainable economic, social and environmental development to eradicate extreme poverty, reduce inequalities and injustices in the world, and fight climate change. ESG Environmental, social and corporate governance issues. EU Action Plan To achieve the Paris Agreement goals and sustainable development, the EU has developed an action plan on financing sustainable growth. The action plan contains a series of measures aimed at re-allocating capital to sustainable investments, better integrating sustainability factors in risk management, and promoting transparency and long-termism. The EU has produced several new and updated regulations, all of which place requirements on how financial players approach and consider sustainability. Global Compact The UN initiative in which affiliated companies undertake to conduct their activities responsibly in line with the Global Compact’s ten principles on human rights, labour law, the environment and anti-corruption. International norms and conventions International norms and conventions refer to international agreements on issues such as the environment, human rights, working conditions, corruption and controversial weapons. Examples include the ILO Core Conventions, the UN Principles on Business and Human Rights and the UN Convention against Corruption. Carbon footprint An estimate of the total greenhouse gas emissions caused by an organisation, event or product. Carbon footprints are measured according to the greenhouse gas protocol (GHG), which defines three scopes, which are a way to classify a company’s carbon dioxide and other greenhouse gas emissions. Scope 1 covers direct emissions from owned or controlled sources. Scope 2 covers indirect emissions from the generation of purchased electricity, heat or steam. Scope 3 covers all other indirect emissions not covered by Scope 2 that occur in the value chain. These include production emissions by subcontractors, transport using vehicles not directly owned by the company, outsourced operations, waste management and energy consumption. The measurement takes into account direct emissions (Scope 1) as well as indirect emissions from purchases (Scope 2). Principles for Responsible Investment (PRI) PRI is the UN’s initiative for responsible investing that aims to raise awareness and an understanding of the importance of sustainable development in the investment sector. We are committed to following PRI’s six principles by doing the following: 1. Considering environmental, social and governance (ESG) aspects in our investment analyses and investment decisions. 2. Being active owners and incorporating ESG aspects into our guidelines and our work. 3. Promoting greater openness around the ESG issues of the companies we invest in. 4. Actively promoting compliance with these principles in the financial industry. 5. Working together to follow the principles as effectively as possible. 6. Reporting what we do and the progress of our efforts to comply with the principles. Companies in transition Companies that are working to shift their business in a more sustainable direction. One example is energy companies that shift from energy production based on fossil fuels to renewables. Read more about our requirements for companies in transition on page 26. The Paris Agreement At the Paris climate summit in December 2015, the world’s countries agreed on a new climate agreement that is binding on all countries to apply from 2020. Governments agreed to keep the rise in the global average temperature well below 2 degrees Celsius above preindustrial levels, and preferably to limit it to 1.5 degrees. Paris Aligned Benchmark One of the action points in the EU Action Plan is sustainable benchmarks, and the EU has therefore launched a completely new framework and common standard for a 69