Summary Principal Adverse Impacts Statement BeFrank PPI

BeFrank PPI is a long-term institutional investor with a duty to act in the best interest of our accountholders, clients, shareholders and other stakeholders. To fulfil this duty, we acknowledge the importance of systematically incorporating Environmental, Social, and Governance (ESG) factors into our investment policies, decision-making and related processes. On the one hand, we strongly believe that this ensures better informed investment decisions and helps to optimise the risk-return profile of the investment portfolios. On the other hand, incorporation of ESG factors helps to reflect our organisation’s values in the investment process and to better align our business with the broader objectives and expectations of society.

Our assets are managed by asset managers chosen by us. We carefully select asset managers for managing these assets, to ensure that their investment philosophy and approach are aligned with our Responsible Investment policies.

As part of our approach to responsible investing, we aim to mitigate the negative impacts of our investment decisions on sustainability factors. These negative impacts are also called adverse impacts, whereby the most significant adverse impacts are referred to as principal adverse impacts. These principal adverse impacts can occur in different areas, such as environmental, social and employee matters, human rights, corruption and bribery matters.

We consider the adverse impact of our financial products investment decisions through specific guidelines. The degree and the way the principal adverse impacts are considered in the investment process depends on various factors, such as on the type of fund or strategy, asset class, asset manager, and availability of reliable data. As a consequence, the exact application can differ between product options, which will be documented when applicable in the financial product disclosures in line with the requirements and timelines of the European Union’s Sustainable Finance Disclosure Regulation (SFDR).

Where we have full discretion over the way our assets are managed, our asset managers are required to consider the principal adverse impacts in their investment due diligence and investment decision-making based on our specifications, and to report on this. Where we do not have full discretion, for example in pooled investment vehicles in which also other investors are investing in, we encourage our asset managers to have suitable methodologies, data and processes to consider the principal adverse impacts in their investment due diligence and investment decision-making. For pooled investment vehicles of external managers that promote environmental or social characteristics, or that have a sustainable investment objective, we expect asset managers to report to us on their activities to address principal adverse impacts and the achieved results. In line with the SFDR requirements, we will increasingly monitor asset managers that we work with and their performance in this area and will actively engage with them to further improve their practices and results.

In this statement we provide more information on our overall approach to identifying, prioritising and addressing principal adverse impacts of our investment decisions on various sustainability factors. This includes the expectations we have of our asset managers.