Our Sector Policies

Ostrum Asset Management has rolled out a series of strict exclusion and sector policies to exclude all sectors and issuers that do not comply with certain fundamental responsibility standards from our investment universe. Somme policies apply to all our funds (controversial weapons, Worst Offenders), while others cover all our open-ended funds (Tobacco, Coal, Palm oil, Oil and Gas*). We also offer tailored exclusion policies for our clients to support them in meeting their own individual goals.

* Excluding benchmark management, and excluding structured products existing on 01/01/23, regardless of the types of exclusion (excluding regulations), and in accordance with the objectives and constraints related to the contractual documentation of our clients.

Controversial Weapons and Worst Offenders exclusions are purchased on all our funds, and on existing stocks unless clients request otherwise for our mandates.

Ostrum’s Oil and Gas policy plans adjustments to enable a gradual convergence of structured management and quantitative management, integrated into the scope on 01/01/23, with the aim of fully withdrawing from unconventional and/or controversial oil and gas exploration and production businesses by 2030 according to the pre-existing policy of Ostrum AM.

Coal: an ambitious sector policy

In 2021, Ostrum AM stepped up its sector-based policy aimed at withdrawing from the coal sector. It now excludes companies that:

• develop new coal capacity
• have not by 2021 defined a coal exit plan in accordance with the Paris Agreement
• exceed the following thresholds:
• 10% of energy generation revenue
• streams derived from coal or from coal production
• 10 m tons of thermal coal
• 5 GW of installed coal capacity
• a coal share of power generation of 10%

Controversial Weapons

Ostrum Asset Management excludes from all its portfolios companies involved in the use, development, production, sale, distribution, stockpiling or transport of the following weapons categories:

• Anti-personnel mines;
• Cluster bombs;
• Chemical weapons;
• Biological weapons;
• Nuclear weapons (outside the framework set by the Treaty on Non-Proliferation);
• Depleted uranium weapons.

These pledges comply with the Ottawa Treaty, the Oslo Convention, the Chemicals Weapon Convention, the Biological Weapons Convention, the Treaty on the Non-proliferation of Nuclear Weapons.

This policy (excluding regulatory exclusions) applies to the purchase for all our funds (including mandates), and also to existing stocks for open and dedicated funds, with the exception of index management, structured products existing on 01/01/23, and excluding specific constraints related to the contractual documentation of our clients. Regulatory exclusions (BASM MAP) apply to all our purchase funds and to existing inventory.

Oil and gas

As of 2022, we no longer conduct any fresh investments in companies that derive more than 10% of production in unconventional and/or controversial oil and gas exploration and production operations : categories have been defined as techniques that rely on fracking procedures (shale oil and gas, tight gas and liquids) or that use ultra-deep offshore drilling, drilling in the Arctic, and extraction from tar sands, coalbed methane and extra-heavy oil. Ostrum AM iinteds full withdrawing from these activities in 2030.

This policy will apply to all open-ended funds, dedicated funds and mandates (unless clients request otherwise).

Ostrum Asset Management’s move to fully withdraw from unconventional and/or controversial oil and gas exploration and production operations by 2030 will be a priority focus for our engagement – via dialogue and our voting policy – with the companies we invest in across our equity and bond portfolios. We will also undertake active dialogue with all sector issuers to discuss how their strategies fit with the recommendations from the International Energy Agency with a view to meeting the Paris Agreement.

Following the absorption of Seeyond by Ostrum AM and the transfer to the latter of the institutional insurance management and structured management activities of NIM Solutions (01/01/2023), the funds historically managed by Seeyond and NIM Solutions will gradually converge towards Ostrum AM’s pre-existing policy, with the same final aim of fully withdrawing from unconventional and/or controversial oil and gas exploration and production businesses by 2030.

Palm oil

The production of palm oil, which is widely used in various products, is on the rise to meet growing demand, leading to the deforestation of tropical forests and negatively impacting the environment, biodiversity, and the rights of local communities.

Aware of these issues, and as part of its biodiversity initiative aimed at protecting nature and reversing the trend of ecosystem degradation, Ostrum AM excludes from its investment universe companies that generate at least 5% of their revenues from the production and/or distribution of palm oil.

This policy applies to direct investments made across all open funds for which Ostrum Asset Management is the parent management company or delegated financial manager, unless otherwise instructed by the relevant parent management company and with the exception of index management funds.
In the context of dedicated or mandate-managed funds, Ostrum Asset Management applies this policy to direct investments made, subject to the agreement of its clients in order to consider it in portfolio management.
In the case of delegated management assigned by Ostrum Asset Management to a management company, the applicability of the policy is subject to discussions between the parties, taking into account the location of the delegate's domicile.

Tobacco

Since 2018, Ostrum AM has been committed to halting support for the tobacco sector, which has particularly negative social and environmental effects and runs contrary to the United Nations Sustainable Development Goals.

Worst Offenders

Ostrum AM excludes from the investment scope all companies – both listed and unlisted – that are proven to contravene a range of fundamental responsibility standards (United Nations Global Compact, OECD Guidelines), particularly as regards human rights, labor rights, environmental protection and business ethics.

This policy applies to the purchase for all our funds (including mandates), and also to existing stocks for open funds and dedicated funds, with the exception of benchmark management, structured products existing on 01/01/23, and excluding specific constraints related to the contractual documentation of our clients.