The bank has a policy on integrating ESG risks into investment decisions and advice, approved by the bank’s Board of Directors on 20 October 2021, which covers the organisation’s ESG risk management criteria in its role as a financial market participant or financial adviser.
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A sustainability risk is understood as an environmental, social or governance event or condition that, if it were to occur, could have a material adverse impact on the value of an investment.
Investment decisions take into account sustainability risks and they are based on in-house and third-party analyses.
The integration of ESG risks shall also be generally included in the principles for action in the provision of financial investment advice and discretionary portfolio management, by means of the criteria and methodology deemed appropriate in accordance with the bank’s policy on integrating ESG risks into investment decisions and advice.
In accordance with Regulation (EU) 2019/2088 on sustainability‐related disclosures in the financial services sector and Commission Delegated Regulation (EU) 2022/1288 supplementing the former, financial market participants and financial advisers must disclose whether they consider the principal adverse impacts (PAIs) to measure the adverse impact investment decisions and financial advice may have on sustainability factors.
PAIs are to be understood as impacts from investment advice and decisions that have negative effects on sustainability factors (ESG), i.e., environmental and social matters, as well as matters relating to corporate governance.
Pursuant to Articles 4.1.b) and 4.5.b) of Regulation (EU) 2019/2088, the Entity, in its role as financial market participant or financial adviser, declares that it does not conduct an analysis of the adverse impact of investment decisions and advice on sustainability factors.
The reasons for this decision are as follows:
- At present, the Entity does not have sufficiently robust processes in place to analyse the available information to enable it to rigorously quantify the foreseeable and real impact of investment decisions and advice on sustainability factors.
- Given the level of the Entity in terms of size, scale of activities and characteristics, in accordance with the applicable regulations and exceptions provided for in Article 4 of Regulation (EU) 2019/2088, we are entitled to not consider PAIs.
The Entity’s decision to not consider PAIs across the Entity does not prevent the monitoring of PAIs in the management of certain financial products, as part of the application of the ESG integration processes in investment decisions and advice.
The current non-consideration of PAIs at the Entity level does not prevent the Entity from changing its decision regarding the consideration of PAIs on sustainability factors should the regulation on this matter establish new requirements and the degree of evolution of the data and information necessary for disclosing PAIs on the market lead to greater maturity in the availability of such data and of the associated calculation methods.
In accordance with Article 5 of Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector, the Bank has included information in its Remuneration Policy, pending final approval by the Board of Directors, on the consistency of the Policy with the integration of sustainability risks.
As such, the Bank shall include among the basic principles governing its Remuneration Policy that it will “ensure that it does not remunerate or evaluate the performance of its personnel in a way that conflicts with its obligation to act in the best interest of its clients, taking into account environmental, social and governance (ESG) risks, and the transparency obligations of Regulation (EU) 2019/2088”.
The bank believes that the integration of ESG criteria in the evaluation and analysis of products may have a favourable effect on the long-term performance of companies and contribute to the greater economic, social and environmentally sustainable progress of society.
Information on the consideration of ESG aspects in the products marketed by the bank is contained in the prospectus for each product, where applicable. For more information about the integration of ESG aspects in the products, please read the product prospectus.
Below are the products currently available to the entity that promote environmental and social characteristics, in accordance with the provisions of Article 8 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: