Stewardship policy

In this policy, ‘we’ refers to Institutional Investment Group (2IG) and its companies, including Institutional Investment Partners (2IP).

1Our understanding of stewardship

Since our foundation, we have given sustainability factors significant weight in everything we do for investors and employees. As our market position has grown, so has our responsibility. We want to use our sphere of influence to make a meaningful contribution to the environment and society.

To this end, we have our own sustainability strategy. It makes sustainable conduct binding within our company and takes into account adverse impacts of investment decisions on sustainability factors.

Like the Principles for Responsible Investment (PRI), we understand stewardship as the use of our influence to increase overall long-term value. This means the economic, social and environmental values on which the returns and interests of our investors and beneficiaries depend.

2Objectives and responsibility

Our objective is the responsible and sustainable management of real assets, in the interests of our investors and in accordance with their requirements. We promote sustainable investments.

The Group’s asset management companies are responsible for the administration and management of the funds. They aim to create long-term value and to protect the interests of investors. To this end, they use their influence on asset managers and other service providers.

Our advisory unit also supports investors on strategic questions, for example on structure, investment strategy, manager selection and investment decisions, drawing on its own research.

We aim to set standards for how real assets are structured and managed for institutional investors. With our own technology, scalable processes and an eye on growing regulatory requirements, we are driving the digitalisation and professionalisation of the asset class, not least with regard to sustainability standards.

3Sustainability and ESG criteria

Our asset management companies integrate environmental, social and governance (ESG) criteria into the funds’ investment strategies in accordance with investors’ requirements. They support the corresponding investment decisions and take ESG criteria into account, in particular in risk management. They place particular emphasis on identifying and assessing the ESG risks and opportunities of real assets.

We support our investors’ sustainable investments and actively promote measures for greater energy efficiency, social responsibility and good corporate governance.

4Influence on partners and in investment committees

Our asset management companies and our advisory unit use their influence deliberately: on appointed asset managers and, indirectly, on other service providers. This takes place in day-to-day cooperation, in the funds’ investment committees and through reporting requirements.

We seek active dialogue with these companies in order to influence their business practices, strategies and ESG measures and to create long-term value. At the same time, we advise institutional investors on introducing, implementing and managing sustainable investment structures.

5Risk management and monitoring

Our asset management companies have established comprehensive risk management. It identifies, assesses and monitors potential risks of the funds under management. From this, we derive and implement measures to mitigate and control risks.

We regularly monitor the portfolios to ensure that they meet investors’ investment objectives and requirements. We pay particular attention to stranding risks, i.e. whether the assets will also be able to meet future sustainability requirements.

6Collaboration (collaborative stewardship)

We operate at key points in the value chain of institutional investments in real assets and work together with many stakeholders. From this position, we derive our ambition to make the market for real assets more sustainable.

We bring together the interests of institutional investors with suitable strategies of asset managers and coordinate cooperation with other service providers. Together, we improve processes for sustainable investments and the availability of data. This creates the transparency needed to identify, control and manage sustainability risks more effectively.

We develop our own technology along the entire value chain: from data capture at the property manager to the monitoring and management of large real asset portfolios of institutional investors.

The Group is a signatory to the United Nations-supported Principles for Responsible Investment (PRI). In exchange with other signatories, for example at conferences and webinars, we continue to develop the practical implementation of responsible investment.

In addition, we are members, directly or through subsidiaries, of the Bundesverband Alternative Investments (BAI), the BVI Bundesverband Investment und Asset Management and the Gesellschaft für Immobilienwirtschaftliche Forschung (gif). These memberships serve the exchange with other market participants. Through the gif, we support real estate research and help shape future standards.

7Transparency and communication

Transparency and open communication are of the utmost importance to us. We provide all required reports and notifications and go further: we influence the level of detail and the quality of the data supplied by property and asset managers, and check it as soon as it enters our systems.

As a result, our investors can trace numerous key figures down to property level. We are continuously expanding data availability and the number of sustainability indicators that can be calculated.

Our asset management companies are subject to the EU Sustainable Finance Disclosure Regulation and each publish a statement on the principal adverse impacts of their investment decisions on sustainability factors (Principal Adverse Impacts, PAI). Where circumstances permit, they make these impacts measurable by means of indicators. This covers impacts on climate and the environment as well as on social and employee matters, respect for human rights and the fight against corruption and bribery.

This policy serves as a guideline for all employees of the Group who work with real assets. It is intended to ensure that we manage capital responsibly and sustainably in the interests of our investors.

8Review and further development

We review this policy and its implementation regularly. We continuously improve it and adapt it to new developments, legal requirements and best practice.