All asset classes have been analyzed accordingly to the TCFD recommendations, grouped as follows: Equity Portfolio and Corporate Bonds Portfolio together and, Sovereign Bonds Portfolio.<\/p>\n
The data analysis reports climate<\/strong> performance achieved at the year-end 2020<\/strong>.<\/p>\n The related carbon metrics used in the Equity and Corporate Bonds analysis are the following ones (please refer to Appendix for more details):<\/p>\n The Data Analysis goes beyond the sole carbon footprint assessment by providing various metrics[3]<\/sup><\/a> used to assess climate-related risks and opportunities in forward-looking perspectives. In the scope of this extract, for the Equity and Corporate Bonds Portfolio, results will be reported on Scenario analysis, Transitional climate risk and Carbon Risk Rating. For the Sovereign Portfolio results are referring to carbon footprint assessment.<\/p>\n <\/a><\/p>\n The Relative Carbon Footprint is crucial because it is based on the ownership principle, which is the key logic to the GHG protocol: one EUR million invested in the Equity and Corporate bonds Portfolio of Etica Impatto Clima Fund is associated with 107.54 tCO2e<\/strong> and this is based on the investor\u2019s \u201cownership\u201d of the underlying companies.<\/p>\n The Portfolio Scope 1 & 2 emission exposure and Relative Carbon Footprint (tCO2<\/sub>e \/ EUR million Invested) are higher than the benchmark, mostly driven by higher exposure to the carbon-intense sector such as Materials.<\/p>\n Sectoral Contribution to the Equity and Corporate Bond Portfolio of the Etica Impatto Clima Fund\u2019s Scope 1 & 2 Emission Exposure<\/strong><\/p>\n The Equity and Corporate bonds Portfolio\u2019s WACI is 164.58 tCO2<\/sub>e per one EUR million of revenue, lower than the benchmark. <\/strong><\/p>\n In terms of sector contribution, the generally carbon-intensive Materials sector is the largest contributor to the Portfolio\u2019s WACI. The same pattern can be observed with regards to the Industrials sector. On the other hand, the fact that the Portfolio has a more limited asset allocation to the Energy sector compared to the benchmark contributes positively to the WACI of the Portfolio versus the benchmark.<\/p>\n The Portfolio is aligned with a Sustainable Development Scenario (SDS)[4]<\/a> until 2040 and is associated with a potential temperature increase of 1.7\u00b0C by 2050. The analysis shows a better performance than the benchmark which is not aligned with the SDS and exceeds the SDS -budget in 2024.<\/strong><\/p>\n The Portfolio is within its carbon budget until 2040 is mainly the result of the outperformance in most sub-sectors and specifically, in carbon-intense sub-sectors such as Cement Manufacturers, where the portfolio remains within its carbon budget until 2030 but not with until 2050. On the other hand, the Diversified Chemicals is already overshooting its carbon budget by 2030. However, other sub-sectors such as Insurance and Food Retailers & Wholesalers are in line with the carbon budget throughout the entire period.<\/p>\n The portfolio includes very high percentage of companies with approved Science-based Targets for emissions reduction.<\/p>\n Equity and Corporate bonds Portfolio of Etica Impatto Clima Fund GHG Emission Pathway vs Climate Scenarios<\/strong> The Portfolio exposure to renewable power generation (37%) is much larger than the benchmark (16%). <\/strong><\/p>\n In terms of Carbon Risk Rating \u2013 CRR, the weighted average CRR of the Equity and Corporate Bonds Portfolio of the Etica Impatto Clima Fund is 57, outperforming the benchmark (53). This shows that issuers invested in the Portfolio are better prepared for a transition to a low carbon economy, compared to benchmark constituents.<\/p>\n A total carbon footprint of 4,48 tCO\u2082e is attributed to the Sovereign Portfolio of Etica. That corresponds to a relative footprint of 30,5 tCO\u2082e\/Mil EUR invested, 5% below the benchmark.<\/p>\n This ranking is reflected in the Relative Carbon Footprint based on investor\u2019s \u201cownership\u201d of the underlying countries\u2019 debts.<\/p>\n The WACI metric highlights the Portfolio\u2019s exposure to carbon intensive countries. The WACI of the Portfolio amounts to 35.8 tCO2e per one EUR million of GDP, slightly more than the benchmark.<\/p>\n Emission intensity of the main constituents in the Sovereign bonds Portfolio of Etica Impatto Clima Fund<\/strong><\/p>\n <\/strong><\/p>\n [1]<\/a> Launched after the 2015 Paris Agreement by the Financial Stability Board (FSB), the Task Force on Climate-related Financial Disclosure (TCFD – https:\/\/www.fsb-tcfd.org\/) considers climate transparency as a crucial factor for the stability of financial markets. The objective of the TCFD is therefore to improve climate transparency in financial markets through recommendations on disclosure. These recommendations provide a \u201cconsistent framework that improves the ease of both producing and using climate-related financial disclosures\u201d. The TCFD aims to create a unique standard for both corporate and investment disclosure, understanding that local regulatory frameworks may require different compliance levels.<\/sup><\/p>\n [2]<\/a> https:\/\/www.issgovernance.com\/esg\/<\/a><\/sup><\/p>\n\n
Equity and Corporate bonds portfolio of Etica Impatto Clima Fund<\/h2>\n
1. Relative Carbon Footprint<\/h3>\n
![\"tcfd_etica](\"https:\/\/www.eticasgr.com\/app\/uploads\/2021\/09\/tcfd_etica_impatto_clima.png\")
<\/p>\n2.Weighted Average Carbon Intensity – WACI<\/h3>\n
![\"tcfd](\"https:\/\/www.eticasgr.com\/app\/uploads\/2021\/09\/tcfd_etica_impatto_clima_1.png\")
<\/p>\nSUSTAINABLE DEVELOPMENT SCENARIO (SDS) ANALYSIS<\/h3>\n
![\"tcfd](\"https:\/\/www.eticasgr.com\/app\/uploads\/2021\/09\/tcfd_etica_impatto_clima_2.png\")
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\nSectoral Contributors to the WACI of the Equity and Corporate Bond Portfolio of the Etica Impatto Clima Fund.<\/strong><\/p>\nTRANSITIONAL CLIMATE RISK & CARBON RISK RATING<\/h3>\n
Sovereign Bonds portfolio of Etica Impatto Clima Fund<\/h2>\n
CARBON FOOTPRINT ANALYSIS<\/h2>\n
1. Relative Carbon Footprint<\/h3>\n
2. Weighted Average Carbon Intensity – WACI<\/h3>\n
![\"tcfd](\"https:\/\/www.eticasgr.com\/app\/uploads\/2021\/09\/tcfd_etica_impatto_clima_3.png\")
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