Integration of ESG risks into the investment decision process means assessing ESG factors along with the conventional risk factors, such as liquidity, credit and interest rate risks. The second pillar of the ESG Investments Framework prescribes such assessment.
All investments made by the Treasury & Asset Management unit are assessed based on external data, namely Sustainalytics ESG score/rating. Depending on the Treasury Strategy, the goal is to manage the weighted ESG score at the portfolio level towards the targeted level. For example, if the current level is set to be below 20, which is the equivalent of being exposed to “low” ESG risk, the portfolio manager selects securities in line with this target.