Amundi will apply an environmental, social and governance policy to 100% of its money management and voting practices by the end of 2021 and is set to develop ESG advisory services for institutional clients.
The €1.4 trillion ($1.6 trillion) firm announced Monday it had adopted a three-year action plan to increase its commitment to responsible investment.
By 2021, ESG analysis will be integrated across all strategies run by the manager. Financial analysis using ESG criteria will be extended across active and passive strategies wherever technically possible.
All actively managed strategies will also be required to offer ESG performance above the ESG rating of their benchmark indexes or universes; while ESG assets under passive management will double in AUM to at least €70 billion over the period.
Those asset classes "currently poorly served by responsible investment," such as emerging markets, high yield, and small- and midcap equities, will fully incorporate the Amundi ESG analysis, the announcement said.
ESG performance will be systematically taken into account by the manager when it conducts shareholder dialogue with issuers and in its voting policies by the end of the three-year period. Amundi said it will strengthen its ESG advisory activities for institutional clients to support them in their development initiatives.
Before 2022, Amundi also wants to strengthen its initiatives related to the environment and with a strong social impact, aiming to double investments in such thematic strategies to €20 billion. Investment in the social and solidarity economy, which improves the quality of life of a region or community through local businesses and not-for-profit work, will increase to €500 million from €200 million.
Amundi already has €280 billion, or 19%, of its total assets invested in three areas. The firm has €270 billion invested under a policy of applying ESG criteria in addition to traditional financial analysis, with a dedicated team rating issuers with an ESG score. The policy helps to inform portfolio weights or exclusions.
In the second area, the firm has €10 billion invested in dedicated strategies with targeted investments, such as tackling climate change. A further €200 million strategy supports the social and solidarity economy.
"Since its creation, Amundi has chosen to make responsible investment one of the company's founding pillars," CEO Yves Perrier said in the announcement. "This was based on two convictions: the responsibility companies and investors have to society, and that this is guarantee of long-term financial performance. This three-year plan extends our commitment to responsible investment and anticipates the expectations of our clients."
The enhanced approach leverages work by the Medici Committee think tank, which is dedicated to responsible finance and aims to address major societal issues under the angle of finance.