No significant harm to the sustainable investment objective:
The investment must not violate the UN’s 10 principles (UN Global Compact) or be exposed to controversial weapons. To ensure that the fund limit or refrain from investments in activities deemed harmful to the environment and society, the fund applies exclusion criteria. These are continuously assessed and are related to the issuer’s revenue within the area.
Sustainable investment objective of the financial product:
The fund primarily invests the capital in green bonds but also in bonds and other interest-bearing financial instruments with various sustainability themes, such as social-, sustainable- and sustainability linked bonds.
The goal is to make a positive contribution to various environmental effects, including an increased share of renewable energy, reduced emissions, positive development of biodiversity, efficient use of resources and circular economy. The fund has a minimum requirement for sustainable investment with an environmental target of at least 85%.
The fund does not have a minimum requirement for sustainable investments with a social goal. Nevertheless, the fund will make investments in for example social bonds. By investing in social bonds, the fund will make a positive contribution to various social effects, such as combating inequalities and increased access to basic infrastructure and services.
The fund uses the exclusion method to reduce sustainability risks in the fund. A sustainability risk refers to environmental, social, or governance related events or conditions that, if realized, could have a negative impact on the investments value. By excluding various types of companies in the investment decision process, sustainability risks are reduced.
The fund promotes environmental and social characteristics through the following exclusion:
- Oil* (maximum 5% turnover)
- Coal* (maximum 5% of turnover)
- Oil sands* (maximum 5% turnover)
- Natural gas* (maximum 5% turnover)
- Controversial weapons (0%)
- Firearms and military equipment (5%)
- Nuclear weapons (0%)
- Alcohol (maximum 5% turnover)
- Tobacco (maximum 5% turnover)
- Pornography (maximum 5% turnover)
- Gambling (5%).
*The fund can make sustainable investments that exceed the threshold for fossil fuels due to investments in transition projects.
The fund excludes companies that systematically violate international norms and conventions such as the UN Global Compact and the OECD's guidelines for multinational enterprises.
Investment strategy:
The fund primarily invests the capital in green bonds but also in bonds and other interest-bearing financial instruments with various sustainability themes, such as social-, sustainable- and sustainability linked bonds.
Good governance practices include sound management structures, employee relations, compensation practices and compliance with tax regulations. Prior to each investment, a review is conducted to ensure that the investment adheres to good governance practices. This means that the investment should not systematically violate for example ILO conventions.
Proportions of investments:
At least 85% of the fund’s investment will be in sustainable investment. The fund aims to have 100% sustainable investment, but by temporarily investing in covered bonds during significant inflows in the fund, they can avoid purchasing expensive sustainable bonds at the moment or those that do not align with their management strategies.
Monitoring of environmental or social characteristics:
Different holdings in our investments are exposed to sustainability risks to varying degrees, which can also vary over time. Therefore, it is important to continuously monitor the holdings in case the portfolio manager needs to make a new assessment of sustainability risks in any of the portfolio companies.
Methodologies:
The company continuously monitors the holdings in the fund to ensure that the fund's sustainability criteria are met, and sustainability risks are reduced. A more detailed description of the methodologies is provided in the Due Diligence section.
Data sources and processing:
Captor primarily uses Sustainalytics and Bloomberg to obtain ESG data. Some data is obtained directly from portfolio companies. In addition, Captor analyzes the companies themselves.
Limitations to methodologies and data:
Over time, Captor controls data quality by collecting, comparing, and, in cases of uncertainty, contacting companies directly. Some of the data that Captor collects will be estimates, and these estimates are not always entirely accurate. However, we consider them a good guideline until better data becomes available.
Due Diligence:
Captor has procedures in place for due diligence to ensure that each fund's sustainability criteria are met, and sustainability risks are reduced. Captor sees the following methods as fundamental in this work: examination and exclusion, assessment, monitoring, documentation, as well as follow-up and evaluation.
Engagement policies:
In a situation where a portfolio company is at risk of violating international norms and conventions or if we have identified that a company has increased turnover linked to one of the excluded sectors, Captor may initiate a dialogue with representatives to highlight the issues and obtain important information. If a company systematically violates international conventions and norms, the fund will demonstrate its shareholder engagement by divesting from the holding.
Attainment of the sustainable investment objective:
The fund uses Bloomberg MSCI Euro Corp Green Bond hedged SEK as a benchmark index. However, the index is not used to assess how well the fund meets its sustainable investment objective.
.jpg)
-3.png)
.png)
