Sustainability and Corporate Governance Report 202
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HANDELSBANKEN FONDER – IN-DEPTH REPORT benchmark
aligned with the global climate goals of the Paris Agreement – the EU Paris Aligned Benchmark, or PAB. This is a benchmark index whose companies are selected and weighted so that the benchmark portfolio’s greenhouse gas emissions are aligned with the long-term global climate goals. Sustainable Finance Disclosure Regulation (SFDR) An EU Regulation, no. 2019/2088, which aims to strengthen consumer protection through enhanced sustainability information disclosure. The new regulatory framework places increased demands on fund companies regarding transparent disclosure of sustainability work and thus will improve consumers’ ability to compare financial products and make informed investment decisions. Read more on page 67. Taxonomy The EU taxonomy is a tool for classifying which economic activities are environmentally sustainable. Its purpose is to ensure that companies, the financial sector and decision-makers receive common guidelines on classifying these activities. For starters, the taxonomy focuses on climate change and the environment. This means that investments that contribute to other sustainability aspects, such as social factors, are not currently captured in this framework. Task Force on Climate-related Financial Disclosures (TCFD) An international working group commissioned by the G20 countries to develop recommendations to address the lack of information on companies’ efforts to manage climate change and its consequences. Our definitions Sustainability analysis: Sustainability is an integral part of our ongoing investment analysis and decisions in active management. Positive screening: Sustainability is crucial for the selection of companies in which the fund invests. Direct dialogue: Dialogues that our managers drive through direct contact with the companies or fund managers. Pooled engagement: Company dialogues that we, together with other investors, support and which are usually coordinated by external parties. Voting: Handelsbanken Fonder’s voting as an owner at annual general meetings. Serving on nomination committees: Handelsbanken Fonder’s representation on a company’s nomination committee. Negative screening – companies that violate international norms and conventions: The exclusion of companies that have verified violations of international norms and conventions. Negative screening – controversial sectors: For controversial industries that we exclude, see page 55 for further details. Assets under management: Assets we manage, adjusted for internal holdings. Paris-aligned investment portfolios: Portfolios that invest in line with requirements for meeting the climate goals of the Paris Agreement adopted in 2015. 70