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"Engaging with Food & Agri companies is key to feeding the nine billion sustainably" Robeco is a strong proponent of sustainability investing and has set up the Governance and Active Ownership team at RobecoSAM to engage with corporates on financially material sustainability issues. We define sustainability investing as a long-term, systematic approach that integrates environmental, social and governance considerations into traditional financial analysis, enabling us to fully understand a company’s ability to create value. Firms that embrace sustainability are in our view more likely to be successful over the long term than those that do not. The Food & Agri sector is exposed to a large number of social risks and at the same time provides ample opportunities to create impact for investors. To ensure sustainable production of food products to feed the nine billion in 2050 RobecoSAM engages with 18 companies from plantations, traders, manufacturers to retailers in our portfolios. Our global commodity ESG risk assessment revealed issues on human rights, labour standards, deforestation and water risk. In addition we identified opportunities for companies to create impact on living wage and smallholder capacity building. TBLI CONFERENCE™ EUROPE 2014 took place on 28 & 29 October 2014 in Amsterdam, hosted by the VU University Amsterdam. The program included a wide selection of topics high on the agenda for sustainable finance professionals. Among them were trends in impact investing, impact measurement, philanthropy and program-related investing, ESG integration, ESG in fixed income markets, green bonds, shareholder engagement, strategies on fossil fuel investing and managing ESG risks. Reflecting the year's theme for TBLI CONFERENCES, "Connecting the Dots", we had included several workshops held at previous events in Zurich, New York and Oslo so that we can build on their learnings and insights.
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TBLI – 28 October 2014
Peter van der Werf
Sustainable agriculture: Engaging for change
Sustainability Investing: Robeco’s integrated approach
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Governance and Active Ownership
Portfolio Managers
Sustainability Investing (SI) Research
Financially Material Themes
ESG Integration
• RobecoSAM Corporate Sustainability Assessment (CSA)
• SI Company Profiles
Engagement & Voting
• Our focus on identifying long-term sustainability factors forms the basis for the selection of financially material engagement themes
• Engagement activities are fully integrated with Portfolio Management and Sustainability Investing Research
Sustainability Investing: Current Robeco figures
SI in figures (31/12/2013)
Assets in sustainability theme funds EUR 3.1 billion
Assets for which ESG integration has been implemented
EUR 112.3 billion
Assets ‘under dialogue’ EUR 53.7 billion
Assets ‘under voting’ EUR 37.6 billion
Note: Robeco total AUM: EUR 205 billion
• These figures make Robeco one of the largest SI
asset managers globally
• Full transparency on ESG integration per fund on
our factsheets
• We offer engagement services for our funds and for
asset owners as an engagement overlay service
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Social issues in the Food & Agri supply chain
Engagement process:
• Research with commodity consultant AidEnvironment
• Three year engagement period
• Intensive dialogue with 18 companies
• Supply chain perspective
• Goal is investing in sustainable mainstream agricultural business
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Ten commodities:
• Palm oil
• Soy
• Cocoa
• Sugar
• Coffee
• Tea
• Cotton
• Hazelnut
• Malt Barley
• Dairy
Engagement with a supply chain perspective
Five objectives for engagement:
• Human Rights
• Labour Standards
• Sustainable Agricultural Practices
• Living Wage
• Smallholder Capacity Building
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18 companies in four tiers of the supply chain
• Plantations: Cosan, GAR, Olam International, Wilmar
• Traders: ABF, ADM, Bunge, Noble Group
• Food manufacturers: Coca-Cola, Heineken, Mondelez, Nestle, SABMiller, Unilever
• Retailers: Ahold, Carrefour, Metro, Tesco
Palm oil plantation: Olam International
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• 7,000 ha of palm oil plantation under development in Gabon
• Issues with High Conservation Value forest and RAMSAR wetlands in 112,000 ha concession from the government
• Dialogue with head of sustainability and manager Gabon
• Discussed how the company deals with the sustainable agricultural practices
• Received update on planning for RSPO certification
• Encouraged the company to increase smallholders inclusion in their operations
Commodity trading company: Associated British Foods
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• Active through division AB Agri in soy trading for animal feed
• Issues with human rights in several soy sourcing regions (Brazil, Paraguay) and labour standards in general
• Dialogue with head of sustainability AB Agri and corporate secretary ABF
• Discussed how the company deals with labour standards in the supply chain and sustainability of soy for animal feed
• Discussed the value of RTRS certification
• Encouraged the company to more prominently use the supplier code of conduct to improve labour standards at their suppliers
Food & Beverage company: Coca Cola
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• Sourcing of sugar from Brazil
• Coca Cola has committed to sustainably source major commodities such as sugar, coffee and tea
• Specific issues with water stewardship, both in operations and in the supply chain
• Dialogue with head of water management and head of global workplace rights
• Discussed how the company can work with its suppliers to decrease the water footprint of its raw materials
• Encouraged the company to take a leadership role in the food & beverage sector regarding water stewardship and protection of human rights in the supply chain
Retail company: Ahold
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• Retailers have a complex sourcing profile, we engage with Ahold on overall supply chain risk assessment and risk management
• Special focus on coffee, dairy and hazelnut
• Discuss labour standards, both in the supply chain and at Ahold subsidiary Giant Carlisle in the US
• Dialogue with head of sustainability
• Discuss how the company can work towards meeting its sustainable sourcing targets
• Encouraged the company to take a leadership role in the retail sector regarding supply chain management
Contribute to feeding the nine billion in 2050
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• Robeco aims to invest in sustainable mainstream agribusiness by:
• Preventing recurring issues with human rights violations
• Driving production with respect for employees
• Demanding sustainable agricultural production without deforestation and loss of biodiversity
• Encouraging development of a living wage approach throughout the supply chain
• Moving companies towards smallholder inclusion where feasible in the agricultural supply chain of commodities
Disclaimer
Important legal information:
“RobecoSAM” is a registered trade mark and trade name of Robeco Groep N.V. (The Netherlands) and hereinafter referred to as the “RobecoSAM-Brand”. The RobecoSAM-Brand is allowedly being used by Robeco Institutional Asset Management B.V. (The Netherlands) as well as by RobecoSAM AG (Switzerland). Both legal entities are responsible for their own activities or publications related to the RobecoSAM-Brand. For the sake of clarity we would like to state that the team members of RobecoSAM AG’s “Governance & Active Ownership” department are based in the Netherlands and employed directly by Robeco Institutional Asset Management B.V.
Important legal information: The details given on this page do not constitute an offer. They are given for information purposes only. No liability is assumed for the correctness and accuracy of the details given. Copyright © 2014 Robeco – all rights reserved. Robeco Institutional Asset Management B.V. (trade register number: 24123167) has a license of the Netherlands Authority for the Financial Markets (AFM) in Amsterdam. Robeco Institutional Asset Management B.V. (Robeco) • Coolsingel 120 • 3011 AG, Rotterdam • The Netherlands • www.robecosam.com • [email protected]
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