En­vi­ron­men­tal, So­cial & Governance

In ac­cordance with Ar­tic­le 3 of Re­gu­la­ti­on (EU) 2019/2088 of the Eu­ro­pean Par­lia­ment and of the Coun­cil of 27 No­vem­ber 2019 on sustainability-related dis­clo­sures in the fi­nan­cial ser­vices sec­tor (“SFDR”), fi­nan­cial mar­ket par­ti­ci­pan­ts and fi­nan­cial ad­vi­sers are re­qui­red, as of 10 March 2021, among other ob­li­ga­ti­ons, to pu­blish on their web­sites information about their po­li­ci­es on the in­te­gra­ti­on of sus­taina­bi­li­ty risks in their invest­ment de­cis­i­on-ma­king pro­ces­ses.

UniCredit Invest Alternatives Ap­proach to Sus­taina­bi­li­ty
UniCredit Invest Alternatives places gre­at im­portance on sus­tainable busi­ness prac­ti­ces and the so­cial re­spon­si­bi­li­ty as­so­cia­ted with them. The­r­e­fo­re, UniCredit Invest Alternatives has set its­elf the goal of ac­tively sup­port­ing the trans­for­ma­ti­on of the economy towards cli­ma­te neu­tra­li­ty. On the one hand, UniCredit Invest Alternatives is op­ti­mi­zing the en­er­gy ef­fi­ci­en­cy of its real estate port­folio and will con­ti­nue to in­ten­si­fy the­se ef­forts. On the other hand, UniCredit Invest Alternatives po­si­ti­ons its­elf as a pro­vi­der of sus­tainable invest­ment pro­ducts in or­der to ex­pand the ran­ge of sus­tainable invest­ment op­por­tu­ni­ties available in the mar­ket and ther­eby ac­tively di­rect fi­nan­cial flows into sus­tainable invest­ment pro­ducts.

Fur­ther­mo­re, UniCredit Invest Alternatives is con­ti­nuous­ly enhan­cing its high so­cial and governance stan­dards. As a si­gna­to­ry to the United Na­ti­ons Prin­ci­ples for Re­spon­si­ble Invest­ment (UN PRI), UniCredit Invest Alternatives aims to in­crease trans­pa­ren­cy re­gar­ding the company’s sus­taina­bi­li­ty stra­tegy and, th­rough the im­ple­men­ta­ti­on of this stra­tegy, con­tri­bu­te to a more sus­tainable fi­nan­cial sys­tem. This com­mit­ment is re­flec­ted in new pro­duct de­ve­lo­p­ment, invest­ment ac­ti­vi­ties, and as­set ma­nage­ment ali­ke. Wi­thin UniCredit Invest Alternatives, the prin­ci­ples of va­lue-ba­sed and sus­tainable cor­po­ra­te governance ap­p­ly. To fos­ter this cul­tu­re, em­ployees are en­cou­ra­ged to share re­spon­si­bi­li­ty th­rough trai­ning cour­ses and in­for­ma­tio­nal events.

As­set Class Real Estate Di­rect Invest­ments
Sus­taina­bi­li­ty risks are ta­ken into ac­count in all invest­ment de­cis­i­ons, and ESG cri­te­ria are as­ses­sed as part of the ac­qui­si­ti­on due di­li­gence pro­cess. The re­gio­nal invest­ment fo­cus is on real estate assets lo­ca­ted in Ger­ma­ny. As a re­sult, UniCredit Invest Alternatives ge­ne­ral­ly con­siders di­rect phy­si­cal cli­ma­te risks af­fec­ting in­di­vi­du­al pro­per­ties to be si­gni­fi­cant­ly re­du­ced; nevert­hel­ess, such risks are ta­ken into ac­count, in­clu­ding in the sel­ec­tion of lo­ca­ti­ons (e.g. avo­i­ding flood-pro­ne are­as). So­cial con­side­ra­ti­ons are ta­ken into ac­count along­side cor­po­ra­te governance aspects in the invest­ment sel­ec­tion pro­cess in or­der to mi­ti­ga­te re­pu­ta­tio­nal risks and any po­ten­ti­al busi­ness risks ari­sing the­r­e­f­rom. This ap­proach is em­bedded in the po­li­ci­es of UniCredit Invest Alternatives. Tran­si­ti­on (en­vi­ron­men­tal) risks are mi­ti­ga­ted by in­cor­po­ra­ting fac­tors such as buil­ding qua­li­ty, buil­ding age and lo­ca­ti­on into invest­ment de­cis­i­ons. En­er­gy ef­fi­ci­en­cy re­pres­ents a key ac­qui­si­ti­on cri­ter­ion for UniCredit Invest Alternatives.

Du­ring the as­set ma­nage­ment pha­se, the op­ti­mi­sa­ti­on of elec­tri­ci­ty, na­tu­ral gas and dis­trict hea­ting sup­p­ly con­tracts is a key com­po­nent of re­du­cing the car­bon foot­print. To this end, the en­er­gy sup­p­ly con­tracts wi­thin the UniCredit Invest Alternatives port­folio are con­ver­ted to green elec­tri­ci­ty and re­ne­wa­ble gas whe­re­ver pos­si­ble. In ad­di­ti­on, UniCredit Invest Alternatives places a strong em­pha­sis on en­er­gy ma­nage­ment and the achie­ve­ment of the ob­jec­ti­ves of the Pa­ris Agree­ment wi­thin its ESG and invest­ment stra­tegy. To fur­ther streng­then this ap­proach, me­a­su­res for the sys­te­ma­tic coll­ec­tion and quan­ti­fi­ca­ti­on of CO₂ emis­si­ons are be­ing im­ple­men­ted and con­ti­nuous­ly enhan­ced. This en­ables po­si­ti­ve con­tri­bu­ti­ons to de­car­bo­ni­sa­ti­on, as well as risks ari­sing from chan­ging en­vi­ron­men­tal stan­dards, to be me­a­su­red, ma­na­ged and made trans­pa­rent to in­ves­tors. In this con­text, UniCredit Invest Alternatives is in­tro­du­cing a di­gi­tal me­ter­ing in­fra­struc­tu­re in or­der to im­pro­ve the mo­ni­to­ring of en­er­gy con­sump­ti­on across its pro­per­ties. Fur­ther­mo­re, UniCredit Invest Alternatives has im­ple­men­ted a was­te mo­ni­to­ring sys­tem for the ma­jo­ri­ty of its exis­ting port­folio and plans to ex­pand its co­vera­ge fur­ther. Op­ti­mi­sing re­cy­cling op­por­tu­ni­ties is also a key and im­portant aspect of the ma­nage­ment of the exis­ting port­folio.

FoF – laun­ched be­fo­re 2026
(In­sti­tu­tio­nal and Re­tail Cli­ents) Ac­ting as AIFM and Invest­ment Ad­vi­sor
Wi­thin the frame­work of ca­pi­tal com­mit­ment and invest­ment de­cis­i­ons made in its ca­pa­ci­ty as AIFM, as well as in its role as invest­ment ad­vi­sor whe­re UniCredit Invest Lux acts as AIFM, UniCredit Invest Alternatives re­views, in re­la­ti­on to com­mit­ments to in­sti­tu­tio­nal tar­get funds, the tar­get fund manager’s over­all ESG frame­work and the tar­get fund’s invest­ment ap­proach with re­gard to sus­taina­bi­li­ty-re­la­ted aspects and risks. As tar­get funds are ge­ne­ral­ly struc­tu­red as blind pools, the abili­ty to in­cor­po­ra­te sus­taina­bi­li­ty risks into the sel­ec­tion of tar­get fund invest­ments is li­mi­t­ed to as­ses­sing the ro­bust­ness and con­sis­ten­cy of the over­all frame­work pro­vi­ded by the tar­get fund manager. In this con­text, UniCredit Invest Alternatives also do­cu­ments the information con­tai­ned in the pre-con­trac­tu­al dis­clo­sures, in­clu­ding information on the pro­mo­ti­on of en­vi­ron­men­tal or so­cial cha­rac­te­ristics and on sus­tainable invest­ments. In par­ti­cu­lar, fol­lo­wing a ca­pi­tal com­mit­ment to a tar­get fund, UniCredit Invest Alternatives has no abili­ty to in­fluence the tar­get fund manager’s sel­ec­tion of in­di­vi­du­al port­folio com­pa­nies, even whe­re such invest­ments do not ful­ly meet UniCredit Invest Alternatives’ ex­pec­ta­ti­ons re­gar­ding sus­taina­bi­li­ty risks.

FoF – ELTIF (Re­tail Cli­ents) Ac­ting as AIFM and Invest­ment Ad­vi­sor (Ar­tic­le 6 and Ar­tic­le 8 SFDR)
FoF – RAIF (In­sti­tu­tio­nal Cli­ents) Ac­ting as AIFM and Invest­ment Ad­vi­sor (Ar­tic­le 6 and Ar­tic­le 8 SFDR)
As part of ca­pi­tal com­mit­ment and invest­ment de­cis­i­ons in its ca­pa­ci­ty as AIFM, as well as in the cour­se of its invest­ment ad­vi­so­ry ac­ti­vi­ties, UniCredit Invest Alternatives con­siders sus­taina­bi­li­ty risks as an in­te­gral com­po­nent of the invest­ment pro­cess. When ma­king ca­pi­tal com­mit­ments to in­sti­tu­tio­nal tar­get funds, UniCredit Invest Alternatives ana­ly­ses, in par­ti­cu­lar, the tar­get fund manager’s over­all ESG frame­work and the tar­get fund’s invest­ment ap­proach with re­gard to the iden­ti­fi­ca­ti­on, as­sess­ment and ma­nage­ment of sus­taina­bi­li­ty risks. In this con­text, UniCredit Invest Alternatives also as­ses­ses whe­ther, and in what man­ner, en­vi­ron­men­tal or so­cial cha­rac­te­ristics are pro­mo­ted in ac­cordance with Ar­tic­le 8 of Re­gu­la­ti­on (EU) 2019/2088 (SFDR), or whe­ther sus­tainable invest­ments wi­thin the mea­ning of Ar­tic­le 9 SFDR are be­ing pur­sued. As invest­ments in tar­get funds are ty­pi­cal­ly struc­tu­red as blind pools, the con­side­ra­ti­on of sus­taina­bi­li­ty risks in the invest­ment de­cis­i­on-ma­king pro­cess is li­mi­t­ed to the information pro­vi­ded by the re­spec­ti­ve tar­get fund manager. In this re­gard, UniCredit Invest Alternatives re­li­es on the dis­clo­sures and pro­ces­ses of the tar­get fund manager and is unable to con­duct an in­de­pen­dent as­sess­ment of in­di­vi­du­al un­der­ly­ing invest­ments pri­or to their ac­qui­si­ti­on. Fol­lo­wing the ma­king of a ca­pi­tal com­mit­ment, UniCredit Invest Alternatives ge­ne­ral­ly has no in­fluence over the tar­get fund manager’s sel­ec­tion of in­di­vi­du­al invest­ments. Ac­cor­din­gly, sus­taina­bi­li­ty risks at the le­vel of the un­der­ly­ing port­folio com­pa­nies can only be con­side­red in­di­rect­ly th­rough the sel­ec­tion and as­sess­ment of the tar­get fund manager.

Un­der the SFDR, fi­nan­cial mar­ket par­ti­ci­pan­ts and fi­nan­cial ad­vi­sers are re­qui­red to pu­blish information on their web­sites re­gar­ding whe­ther, and if so, by which po­li­ci­es and stra­te­gies they take into ac­count the prin­ci­pal ad­ver­se im­pacts of invest­ment de­cis­i­ons on sus­taina­bi­li­ty fac­tors, ta­king into con­side­ra­ti­on their size, the na­tu­re and sca­le of their ac­ti­vi­ties, and the ty­pes of fi­nan­cial pro­ducts they make available.

For UniCredit Invest Alternatives, the ad­ver­se im­pacts of its invest­ment de­cis­i­ons or re­com­men­da­ti­ons pro­vi­ded in the cour­se of invest­ment ad­vi­so­ry ac­ti­vi­ties are of si­gni­fi­cant im­portance. For this re­ason, UniCredit Invest Alternatives has im­ple­men­ted ap­pro­pria­te me­a­su­res to enable the as­sess­ment of such ad­ver­se im­pacts.

Ho­we­ver, for the va­rious invest­ments held wi­thin the invest­ment funds ma­na­ged by UniCredit Invest Alternatives, the in­di­ca­tors re­qui­red to as­sess ad­ver­se im­pacts on sus­taina­bi­li­ty fac­tors are curr­ent­ly not yet available in a com­ple­te man­ner. In par­ti­cu­lar, wi­thin the area of tar­get fund so­lu­ti­ons, a com­pre­hen­si­ve and re­lia­ble data ba­sis is not yet available, as UniCredit Invest Alternatives de­pends on the pro­vi­si­on of re­le­vant data by tar­get fund ma­na­gers, who curr­ent­ly are unable to pro­vi­de the re­qui­red data, or can­not pro­vi­de it to the ext­ent ne­ces­sa­ry.

Fur­ther­mo­re, due to the si­gni­fi­cant­ly dif­fe­rent na­tu­re of the ac­ti­vi­ties wi­thin the “tar­get fund so­lu­ti­ons” and “di­rect real estate invest­ments” busi­ness are­as, the available data can only be com­pared to a li­mi­t­ed ext­ent and can­not be meaningful­ly ag­gre­ga­ted at com­pa­ny le­vel from a me­tho­do­lo­gi­cal per­spec­ti­ve. In ad­di­ti­on, le­gal un­cer­tain­ties con­ti­nue to exist re­gar­ding the spe­ci­fic re­qui­re­ments for the coll­ec­tion and dis­clo­sure of the re­le­vant in­di­ca­tors.

Ac­cor­din­gly, at the pre­sent time, UniCredit Invest Alternatives is not yet in a po­si­ti­on to com­pre­hen­si­ve­ly con­sider the ad­ver­se im­pacts of its invest­ment de­cis­i­ons or invest­ment ad­vi­so­ry re­com­men­da­ti­ons on sus­taina­bi­li­ty fac­tors wi­thin the mea­ning of Ar­tic­le 4 SFDR.

Nevert­hel­ess, UniCredit Invest Alternatives re­views this ap­proach on a re­gu­lar ba­sis in light of data avai­la­bi­li­ty and fur­ther re­gu­la­to­ry de­ve­lo­p­ments.

UniCredit Invest Alternatives’ re­mu­ne­ra­ti­on po­li­cy has been im­ple­men­ted in ac­cordance with Di­rec­ti­ve 2011/61/EU on Alternative Invest­ment Fund Ma­na­gers of 8 June 2011. It ap­pli­es to em­ployees who are mem­bers of se­ni­or ma­nage­ment, iden­ti­fied risk ta­kers, em­ployees per­forming con­trol func­tions, and all other em­ployees who­se to­tal re­mu­ne­ra­ti­on places them wi­thin the same re­mu­ne­ra­ti­on bra­cket.
Re­mu­ne­ra­ti­on con­sists of a fi­xed sala­ry and a va­ria­ble re­mu­ne­ra­ti­on com­po­nent. The­se two com­pon­ents are ba­lan­ced in a man­ner that po­si­tively sup­ports em­ployee mo­ti­va­ti­on and re­ten­ti­on. UniCredit Invest Alternatives en­su­res that a pru­dent ba­lan­ce is main­tai­ned bet­ween the company’s sound fi­nan­cial po­si­ti­on (ta­king into ac­count its busi­ness stra­tegy and risk to­le­rance) and the gran­ting, pay­ment and re­ceipt of va­ria­ble re­mu­ne­ra­ti­on. The re­mu­ne­ra­ti­on po­li­cy of UniCredit Invest Alternatives is de­si­gned to sup­port long-term in­te­rests and sus­tainable va­lue crea­ti­on. UniCredit Invest Alternatives has es­tab­lished a re­mu­ne­ra­ti­on struc­tu­re that is ba­sed on risk-ad­jus­ted and risk-re­la­ted per­for­mance and does not en­cou­ra­ge ex­ces­si­ve risk-ta­king, in­clu­ding with re­gard to the as­sump­ti­on of sus­taina­bi­li­ty risks. The tar­get-set­ting frame­work in­cludes ap­pro­xi­m­ate­ly 50% sus­taina­bi­li­ty-re­la­ted and long-term ob­jec­ti­ves, while en­vi­ron­men­tal mat­ters as well as di­ver­si­ty and in­clu­si­on con­side­ra­ti­ons are also ta­ken into ac­count. In ad­di­ti­on, in­cen­ti­ves for ma­na­ging di­rec­tors and em­ployees to as­su­me dis­pro­por­tio­na­te­ly high le­vels of risk are mi­ti­ga­ted th­rough governance me­a­su­res re­qui­ring tran­sac­tions to be ap­pro­ved by the ma­na­ging di­rec­tors in ad­van­ce. Tran­sac­tions in­vol­ving risks (in­clu­ding, whe­re re­le­vant, sus­taina­bi­li­ty risks) must be sub­mit­ted to the com­pe­tent go­ver­ning body, such as the company’s Su­per­vi­so­ry Board, for ap­pr­oval. Fur­ther­mo­re, the key re­mu­ne­ra­ti­on pro­ces­ses sup­port the ali­gnment bet­ween re­mu­ne­ra­ti­on po­li­cy and sus­taina­bi­li­ty ob­jec­ti­ves. The­se in­clude, for ex­am­p­le, the Group In­cen­ti­ve Sys­tem, which go­verns the de­ter­mi­na­ti­on of va­ria­ble re­mu­ne­ra­ti­on and bo­nu­ses for se­ni­or ma­nage­ment. The Long-Term In­cen­ti­ve Plan also in­cor­po­ra­tes a sus­taina­bi­li­ty com­po­nent and is de­si­gned to ali­gn the in­te­rests of se­ni­or ma­nage­ment with the long-term va­lue crea­ti­on ob­jec­ti­ves of in­ves­tors.