Investing responsibly

In addition to economic criteria, the VHV Group also takes ecological, social and ethical factors into account in its investment decisions. Details can be found below under "ESG criteria in the investment process".

Excluded investment areas

Investment decisions of the VHV Group are critically reviewed on the basis of defined ESG criteria (exclusions, controversy screening and ESG ratings). Issuers are assessed with regard to ecology, social standards, human rights and corporate governance. Investments in controversial weapons are categorically excluded. In addition, companies that exceed certain turnover limits in coal-fired power generation or fracking/tar sands or that have been found to have controversial corporate behaviour are excluded from investing.

Controversial weapons

Coal-fired power generation

turnover > 30%

Fracking and tar sands

turnover > 5%

Selected investment areas

Ideal investments that meet our ESG investment criteria come from the six areas below, for example:

Wind energy

Investments in projects to generate electricity from wind energy.

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Solar energy

Investments in projects to generate electricity from solar energy.

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Public transport

Investments in infrastructure and financial instruments in the field of local public transport.

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Grid infrastructure (power)

Investments in electricity grids and related infrastructure for energy transmission and distribution.

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Green/social/sustainable bonds

Investments in bonds whose use of funds is allocated to ecological and/or social projects in accordance with the respective terms and conditions of issuance.

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Certified real estate

Investments in real estate for which building certifications are available according to recognized certification standards, such as DGNB, BREEAM or LEED.

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Engagement

We engage in dialogue with security issuers and/or data providers on an ad hoc basis. In doing so, we aim to increase sustainability transparency and encourage issuers to comply with environmental, social and governance standards and to improve their ESG quality.

In addition, we are involved in organizations and initiatives related to sustainability issues in the financial sector. As a signatory to the Principles of Responsible Investment (PRI) initiated by the United Nations, we are part of a global network of insurance companies, banks and other institutions that are committed to taking ESG criteria into account in their investment processes. Signing the PRI does not constitute a certification or award and is not proof of the sustainability of individual products, investments or investment portfolios.

ESG criteria in the investment process

Exclusionary criteria

Defined requirements and exclusion criteria apply to cooperation with business partners and suppliers. Depending on the area of application, these include aspects of compliance, business ethics, human rights and other requirements specified in the respective guidelines. Companies that violate our ethnic and environmental standards may be excluded from cooperation, depending on the violation. we exclude from cooperation.

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Exclusionary criteria

Companies

Controversial weapons (e. g. land mines and scatter bombs)
Severe violations of the UN Global Compact
Fracking and tar sands (5 percent turnover tolerance)
Coal-fired power generation (30 percent turnover tolerance)

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Positive criteria

In our investments, we evaluate companies based on environmental (E), social (S) and governance (G) criteria. The assessment is based on ESG scores, the Low Carbon Transition Score or the Corruption Perception Index, for example.

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Positive criteria

Detailed evaluation of the sustainability of an issuer in the dimensions E (Environmental), S (Social) and G (Governance)
Minimum thresholds for ESG scores
Consideration of the climate component through positive limitation using the “Low Carbon Transition Score” (which measures the transition risks of companies on their path to low carbon business practices)
Countries eligible for investment must have a Corruption Perception Index (CPI) score of >35. The CPI serves as a criterion for measuring efforts to prevent and combat corruption.
Countries in which investments are to be made must be classified as “Free” according to Freedom House. This is intended to exclude from investment those countries with serious violations of democratic rights and human rights.

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