Dialogue & Engagement Report
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MANDARINE GESTION Dialogue & Engagement Report 1 2021 Updated March 2021 PREAMBLE Dialogue with the companies in which Mandarine Gestion invests on behalf of UCIs is a key component of our fiduciary responsibility. Increasingly, we are encouraging companies to establish extra-financial targets to protect them against any potential impact on their financial valuations. The objective of our engagement policy is to enter into constructive dialogue with companies in order to urge them to protect themselves against the non-financial risks that may arise during the course of their activities or to encourage them to seize opportunities. Ultimately, the purpose of shareholder engagement is to take a stand on ESG issues and require targeted companies to improve their practices over time, via a structured approach and long-term monitoring. IMPLEMENTATION Mandarine Gestion’s engagement consists of several strategies: ‐ Continuous engagement: identify the ESG issues of companies in the portfolio via constructive dialogue with management teams; urge companies to make public declarations on their sustainable development strategy, backed up with relevant ESG indicators; support companies in a process of continuous improvement. ‐ Targeted engagement: ask companies affected by controversy or current events how they manage these situations and which corrective measures they implement; companies with low ESG ratings that could be sold as part of our investment processes are also included in the targeted engagements; participating in collaborative engagement initiatives (FIR Dialogue and Engagement Committee) is also part of our targeted engagement activities. ‐ Engagement by vote: exercise our shareholder rights (proposing and/or voting on resolutions, exchanges prior to general meetings regarding the ESG issues identified, buying, selling or holding positions on a case-by-case basis). A separate voting report is produced annually alongside this Dialogue and Engagement Report. FUNDS AFFECTED All open-end UCIs in the Mandarine Gestion range are affected. 2 OVERVIEW OF OUR SHAREHOLDER ENGAGEMENT IN 2020 CONTINUOUS ENGAGEMENT: We spoke with portfolio companies during 90 meetings dedicated to ESG topics. The themes discussed during these discussions are summarised in the table below: 3 Topics discussed Date Company Environment Social Governance Stakeholders Consumption of water and chemicals in laundry. Mix of Succession planning. Integration of CSR 09/01/2020 Elis the vehicle fleet. Heating efficiency of machinery. Single- Fixed-term contract turnover rate. criteria in the remuneration of top Impact of strikes in France. use plastic. management. Hoffman Green Carbon footprint divided by 5. Durability of product 09/01/2020 Cement Customer. Patent. European regulations materials Technologies 09/01/2020 ALD Vehicle fleet mix. Eco-driving, carpooling Cyber risk for platforms. Growing digitisation Partnerships with Italian utilities Retention of employees. Warehouse AFEP MEDEF code. Eco-driving automation. Accident rate. Health & safety of Independence of the Board and Audit 09/01/2020 ID Logistics Impact of strikes Euro 6 vehicle fleet employees. Committee. Difficult working conditions Failure to respect minority shareholders Employer attractiveness. Overhaul of the Estate of Isabelle Kocher. Integration of 10/01/2020 Engie Coal phase-out. ETS. Science Based Targets Initiative Partnership with universities resource pool. CSR in the bonus. Inclusion of CSR criteria in the remuneration Relationship with Sherpa and other 10/01/2020 Teleperformance Energy consumption of sites Mapping of the duty of care. Training. of directors NGOs Competitiveness in renewable energy. Impact of fires in Gender parity. Issues relating to the supply of 10/01/2020 Neoen Compliance with the AFEP MEDEF Code Audited, quality suppliers Australia battery metal. Total's impact on society. Total is said to be Some cities and communities Signed up to the Paris agreement, but not in compliance Application of the vigilance plan Proposal to 24/01/2020 Total responsible for more than 1% of global criticise Total for not complying with it. No objective yet on scope 3 work on a climate resolution for the 20 AGM emissions with its climate commitments Respect for sites. Reduction of water consumption. Use Consultation and inclusion of of renewable energies. Waste management A score not Employee follow-up and support following the Presentation of the new CEO Mr Caillère 04/02/2020 Pierre & Vacances stakeholders during a new project awarded by CDP. No AGM development, no vegetable announced plan. and his vision for the group Customer satisfaction garden... Electricity consumption, local, quality food Building Investors are happy. Future Working conditions for employees and 07/02/2020 Korian construction and recycling. These discussions are Divergent European regulations satisfaction surveys with improving quality for customers. ongoing but nothing is definitive or focused. customers and suppliers. There is strong demand among Targets in terms of carbon neutrality, reduction of water 62% of the workforce is based in France within stakeholders for more consumption, use of recycled materials Signature of the Employee shareholding: 22 new shares 27/02/2020 Hermès the group, i.e. 8,846 employees Hermès has transparency on the objectives and fashion pact last August Latest CDP score B and 72/100 every 4 years. 41 factories in France out of 52 results concerning environmental for Sustainalytics issues Call ahead of the 2020 AGM Structure of variable remuneration (ESG criteria integrated but more quantitative 14/02/2020 Edenred criteria needed). Renewal of a director for the fourth time (not easy to find such a competent profile) New Managing Director Laurent Carme, Main objective, lower costs but not at any price formerly of Alstom in the wind power The logistics chain is controlled. Water + Electricity = Hydrogen and not at the cost of human capital; every segment. Still need subsidies. Integration of 11/03/2020 McPhy Energy Alkaline electrolysis = production of hydrogen from water contributor is important Investment in human Develop mainly in European markets (Italy, employees. Need other actors to and electricity through an electrochemical reaction. capital Qualified and motivated sellers in the Germany, France) For the moment, strong realise the transition. value chain. technological advantage Sensitive political and social context due to the Carbon neutrality objective unchanged in 23/03/2020 RVE Share of renewables in the energy mix. Corona Virus. Factories shut. line with the European Green Deal. 4 Topics discussed Date Company Environment Social Governance Stakeholders Impact of stoppages of activities on Programme for new renewable capacities installed and Impact of Covid 19. Health & safety of the value chain, in particular the 14/05/2020 Iberdrola under construction. European Green Deal employees supply of spare parts to run factories (turbines, etc.) Gender equality: CDP score A (on climate and water) The Group’s Executive Committee has been The gender equality index was 84/100 for the Air Liquide is the world leader in gases, technologies and enhanced, with four new members. year 2013. This result is the result of a 04/06/2020 Air Liquide services for industry and health. Younger, more international and more constant remuneration policy. A confidential The objective is to reduce carbon intensity by 30% by female, with a rich variety of profiles and whistleblower system is available to all 2025 based on 2015 emissions. skills. employees. SDGs (7,8,9 & 12), relative importance of different criteria, 04/06/2020 Alfen Carbon emissions reduction targets Integration of CSR policy discussion with key stakeholders, transparency Enhancing the contribution of SDGs (7,13,9,8,14) Our Two-tier board, which means management Possibility of making the link goal is to prevent oil (products), pollutants and dangerous and supervision are separate. There is close between SDGs (7,13,9,8,14) to Health and safety policies are robust: no 04/06/2020 Boskalis cargoes from salvaged ships from entering marine collaboration between the Supervisory which the group has contributed injuries, no accidents. ecosystems. Examples: - Chemical tanker with 25,000 Board and its committees, the Management and the amounts allocated by tonnes of methanol in the Gulf of Oman Board and stakeholders. project. Enel’s position in the new world of energy = leading network operator: by number of end users, the world's largest player in renewable energies: by installed 50% of women involved in the recruitment 10,021 of people involved in digital skills 04/06/2020 Enel capacity. Includes 3.7 GW managed capacity process training Largest retail customer base in the world including customers in the free and regulated electricity and gas markets Renewable energy strategy: commitment to 7.5 GW Integration of criteria and indicators installed capacity in 2025; emission reduction targets concerning sustainability issues in the Commitment to shareholders with (absolute emissions, methane intensity, gas burning); 04/06/2020 Repsol Staff safety programmes and training remuneration of directors, objectives of the dividend maintained; safety carbon capture and storage: an important element of the gender diversity and independence on the within operations. carbon neutrality ambition; implementation of circular board of directors economy projects CDP Reporting in 2013: final score B (management The projects in 2019 led to the creation