I. Sustainability risks
Sustainability risks are environmental, social or governance events or conditions, the occurrence of which could have an actual or potential material negative impact on the value of the Fund's assets as well as on the business activities of the AIFM. Sustainability risks can also affect all other known types of risks and be a factor in determining the materiality of these types of risk.
In our risk management system, we consider sustainability risks to be sub-factors, i.e. - aspects of other risk categories, especially with regard to market and counterparty default risk, as well as reputational and legal risks with respect to operational risk. These include, for example:
- environmental risks that may have an adverse and decreasing effect on the value of real estate held as an asset for a fund or as loan collateral (earthquake risks, floods, radiation risks, electrosmog or radon concentrations, or other emissions pollution, use of fossil fuels);
- risks to the aforementioned properties at the social level in terms of ensuring primary care (schools, childcare, mobility);
- ethical or other environmental aspects.
Whether and to what extent sustainability risks influence our investment decisions depends to a large extent on the investment strategy of the individual (sub) fund. As part of the investment process and depending on the product specific investment objectives and restrictions, the following measures may particularly be taken to reduce or avoid sustainability risks:
- Careful use of resources at company and project level
- Creation of energy efficient and optimised buildings
- Compliance with climate objectives and commitment to climate neutrality in real estate projects
- Integration of a holistic corporate governance approach by linking the existing quality, compliance and risk management systems
The Investment Adviser, appointed to advise our investment solutions, has also made a voluntary commitment to comply with and implement the United Nations backed Principles for Responsible Investment (‘PRI’).
Information on whether and to what extent the investment funds we manage and the underlying investments comply with binding ecological and/or social characteristics, pursue sustainable investments and take into account EU criteria for ecologically sustainable economic activities can be found in the most recent Issuing Document of each fund.
II. Remuneration policy
At the present time, we do not take into account separately the consideration or reduction of sustainability risks at the corporate level or at the level of individual funds within the framework of the remuneration system. These aspects may have an indirect impact on remuneration policies and practises only as part of the overall risk strategy or as part of individual target agreements.
III. Adverse sustainability impacts
Our company does not currently take into account any adverse impact of investment decisions on sustainability factors. In this context, sustainability factors are environmental, social and labour concerns, respect for human rights and the fight against corruption and bribery. The legal requirements for measuring, weighting and mitigating adverse sustainability impacts are new and very detailed. In addition, the market currently does not have sufficient relevant data to be used for determination and weighting.
No consideration of adverse impacts of investment decisions on sustainability factors.
This statement describes our company's decision pursuant to the requirements of Article 4 (1) of Regulation (EU) 2019/2088 of the European Parliament and of the Council on sustainability-related disclosure requirements in the financial services sector (hereinafter "SFDR") regarding the consideration of the Principal Adverse Impacts (hereinafter "PAI") of investment decisions on sustainability factors, which, according to Article 2 (24) SFDR, include environmental, social and labor concerns, respect for human rights, and the fight against corruption and bribery.
Currently, our company has less than 500 employees and is therefore not required to consider PAIs at the company level under the SFDR.
The Company does not currently consider the Principal Adverse Impacts of
investment decisions on sustainability factors at the company level.
In relation to our decision-making process, we have considered, among others, the following aspects:
- the classification of managed investment funds under the SFDR and the content of the pre-contractual disclosure made for the managed investment funds,
- the ongoing regulatory developments and clarifications from the European Supervisory Authorities as well as the European Commission in 2022 and the updates expected in 2023 regarding PAIs,
- additional time and resources requirement for us to ensure that reliable PAI information and/or robust estimates are available and reportable for all investments across all managed investment funds.
Consideration of key adverse impacts for selected investment funds.
Since January 2023, our company has been managing investment funds for which the PAIs of investment decisions are taken into account on sustainability factors in accordance with Article 7 SFDR as a mandatory part of the investment strategy.
In this context, the pre-contractual information of the respective investment funds disclose which PAIs are taken into account and how. The results of the consideration of the PAIs of investment decisions on sustainability factors will be reported in the annual reports of the respective investment funds in accordance with the requirements of Article 11 in conjunction with Article 7 SFDR.
Periodic review of this statement
We actively monitor regulatory developments related to the consideration of PAIs at both the company level and managed investment fund levels. This statement is reviewed at least annually.