ACRA has assigned ESG-4, category ESG-B to Open-end mutual investment fund of market financial instruments "Sberbank - Global Internet" of Sber Asset Management JSC (hereinafter, the Fund), which corresponds to a very high score in the field of the environment, social responsibility and governance. According to the ESG assessment methodology, this assessment also means that significant attention is paid to environmental, social responsibility and governance issues.
The assessment is driven by the structure of the Fund, which invests in the shares of companies whose business is directly related to the internet: websites, online stores, development of online technology, including the provision of internet access, and production of smartphones and smartphone software.
The Fund’s manager, Sber Asset Management JSC, is a subsidiary of Sberbank (ACRA rating AAA(RU), outlook Stable) and is included in the non-financial reporting of Sberbank Group (hereinafter, the Group). The Group, including all the companies that are part of it, applies a systemic approach to integrating ESG factors and sustainability aspects into all areas of operations and is characterized by high quality corporate governance.
Sber Asset Management JSC’s sustainability priorities are based on the Environmental, Social, Governance and Sustainability Policy of Sberbank.
KEY ASSESSMENT FACTORS
The environmental and social responsibility assessment is based on an analysis of the companies in the Fund’s portfolio (see Key Assumptions).
Companies that make up the core part of the portfolio belong to high tech sectors that have a low direct environmental impact. The majority of the portfolio is made up of companies in the digital services sector, online retail, and the production of computer components. For them, significant factors of environmental impact are energy consumption, direct and indirect emissions of greenhouse gases and, if there are consumer services in the structure, waste management. Therefore, the assessment of the environmental impact in terms of quantitative indicators is average.
The assessment of the analyzed companies’ actions to minimize environmental risks and their ability to counter them, based on public sources of information, is high. All of the companies have developed key top-level documents for managing the main industry-specific environmental risks, implemented ESG management systems, and developed responsible supply chains. These companies have a high level of information disclosure. Many are participants in various voluntary climate initiatives and publish corresponding reports in accordance with international standards. The Agency separately notes the high level of work with the main climate risks at the analyzed companies and the presence of public targets in the field of reducing greenhouse gas emissions. At the same time, the inability to analyze internal documents on environmental risk management limits the risk assessment for Part E (Environment).
The assessment of Part S (Social) is based on the high level of management of social risks and high socially responsible business standards of the analyzed companies. Most of the analyzed companies are responsible employers, contribute to the development of local communities, and have developed sustainable development and social responsibility practices. The Agency notes a fairly high level of elaboration of policies and procedures in the field of human rights and combating discrimination among the analyzed companies, as well as the presence of publicly announced goals and declarations in this area. The assessment is also positively influenced by the participation of these companies in various international initiatives in the field of responsible supply chains. The assessment of this part is limited by the inability to analyze internal documents on social risk management.
Part G (Governance) is assessed with regard to Sber Asset Management JSC. The assessment stems from the high corporate governance standards of the parent company (Sberbank), high level of integration of ESG principles in management practices, and strong reputation of the parent company’s brand.
The assessment of the Governance part is constrained by the absence of independent directors in the board of directors (BoD) of Sber Asset Management JSC and the indicator of average duration of membership in the BoD (BoD stability indicator).
KEY ASSUMPTIONS
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When assessing the Environment and Social parts, the Agency used public sources of data on the companies in the portfolio (annual reports, non-financial reports, materials published on the companies’ official websites, publications in the press, etc.);
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The Agency used data provided by Sber Asset Management JSC to assess the Governance part, including a questionnaire sent by the Agency;
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Alphabet Inc., the parent company of Google LLC, as well as several other companies that were subsidiaries of Google LLC before its reorganization, was analyzed based on the non-financial statements of Google LLC;
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The Agency analyzed and assessed nine companies that accounted for 52.17% of the Fund’s portfolio as of September 30, 2021:
o Microsoft Corporation;
o Apple Inc.;
o Facebook Inc.;
o Alphabet Inc.;
o Amazon.com, Inc.;
o Broadcom Inc.;
o General Motors Company;
o T-Mobile US, Inc.;
o Baidu, Inc.
assessment components
Final ESG assessment: ESG-4.
Final ESG category: ESG-В.
ESG assessment determination: very high assessment in the field of the environment, social responsibility and governance. Significant attention is paid to the environment, social responsibility and governance matters.
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E assessment: ESG-4.
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S assessment: ESG-4.
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G assessment: ESG-3.
ADDITIONAL INFORMATION
The ESG assessment has been assigned in accordance with ACRA’s ESG Assessment Methodology.
An ESG assessment has been assigned to Open-end mutual investment fund of market financial instruments "Sberbank - Global Internet" of Sber Asset Management JSC for the first time. The assessment is expected to be revised within one year following the publication date of this press release.
The ESG assessment was assigned based on data provided by Sber Asset Management JSC, information from publicly available sources, and ACRA’s databases.
The ESG assessment is solicited, and Sber Asset Management JSC participated its assignment.
In assigning the assessment, ACRA used only information, the quality and reliability of which was, in ACRA’s opinion, appropriate and sufficient to apply the methodology.
No conflicts of interest were discovered in the course of assessment.
The assigned assessment is not a credit rating.
