C _ Group Management Report In 2021, the following key areas of compliance risk were identified and Allianz takes a zero-tolerance approach to fraud and corruption. aligned with the Group’s top-risk assessment procedures, coordinated We are committed to complying fully with local and international by the Group’s Risk Management function: anticorruption and anti-bribery laws. Our aim is to go beyond complying with the minimum standards of the law, such as the Allianz − regulatory change monitoring, Anti-Corruption Program which sets high standards for a − customer protection, comprehensive and consistent group-wide approach in every − financial crime (money laundering and economic sanctions). jurisdiction. The program requires that employees and certain third parties with whom Allianz does business are prohibited from offering, As part of our global compliance program, we follow international accepting, paying or authorizing any bribe or any other form of standards and applicable laws related to corruption and bribery, corruption, be it with the private sector or with government officials. money laundering and terrorism financing, trade and financial Anti-corruption training is compulsory for all employees, with sanctions, capital markets, data privacy, customer protection, antitrust, online and classroom training delivered in multiple languages. and other relevant compliance risk areas. We thoroughly investigate As a matter of course, the development in the ongoing allegations of violations of laws as well as of breaches of Allianz- proceedings in connection with the Allianz GI U.S. LLC Structured Alpha specific rules. The obligations laid down in our various compliance funds would also be monitored by the compliance function and programs have been derived from the Allianz Group Code of Conduct considered as part of the regular reassessment of compliance risks. and detailed in various Allianz standards – specifically, the Economics Any findings will also be reflected in the continuous improvement of Sanctions, Anti-Money Laundering, Antitrust, Data Privacy, Capital our Compliance Management System and compliance processes. Markets Compliance and Anti-Corruption Standards. Targets and achievements: compliance/anti-corruption and bribery matters Topic Target 2021 Achievements 2021 Targets 2022 Compliance Complete the cycle of the − Roll-out of CARE program. − Complete the cycle of the integrated integrated compliance risk scoping − Completed the 2021 integrated compliance risk scoping and assessment and assessment activities as part of compliance risk scoping and assessment activities as part of the company’s IRCS the company’s IRCS process. activities as part of the company’s IRCS. process in 2022. Continue to enhance the − Continue to enhance the effectiveness of effectiveness of local compliance local compliance organizations by organizations by enriching our enriching our compliance reviews, to compliance reviews, to bolster bolster further the governance and further the governance and processes of underlying compliance processes of underlying organizations across our OEs. compliance organizations across our OEs. E.U. Taxonomy Regulation Economic activities that are not recognized by the E.U. Taxonomy Delegated Acts as substantially contributing to one of the E.U.’s climate The E.U. Taxonomy Regulation (2020/852) is a “green” classification and environmental objectives are not necessarily environmentally system that translates the E.U.’s climate and environmental objectives harmful or unsustainable. And not all activities that could generally into criteria for specific economic activities for investment purposes. make a substantial contribution to the environmental objectives are The regulation came into effect this year and Allianz is reporting already part of the E.U. Taxonomy Delegated Acts. Rather, the first against it for the first time. Delegated Act (namely, the Climate Delegated Act) under the E.U. taxonomy sets criteria for economic activities in the sectors that are most relevant for achieving climate neutrality and delivering on E.U. Taxonomy recognizes as “green”, or “environmentally sustainable”, climate change objectives. This includes sectors such as energy, economic activities that make a substantial contribution to at least one forestry, manufacturing, transport and buildings. of the E.U.’s climate and environmental objectives, while at the same At this stage, the regulation has only established “Technical time not significantly harming any of these objectives and meeting Screening Criteria” for (a) climate change mitigation and (b) climate minimum social safeguards. It is a transparency tool that will introduce change adaptation, which are laid out in the Climate Delegated Act. mandatory disclosure obligations on some undertakings (namely, the Criteria for the four remaining environmental objectives will follow in a ones in scope of the Non-Financial Reporting Directive (NFRD) and future Delegated Act, in line with the mandates outlined in the Corporate Sustainability Reporting Directive (CSRD) prospectively) Taxonomy Regulation. and financial market participants. The disclosure of the proportion of In addition, extensions of the Taxonomy Regulation with view to taxonomy-aligned activities will allow for the comparison of (a) economic activities that do not have a significant impact on companies and investment portfolios. In addition, it can guide market environmental sustainability and economic activities that significantly participants in their investment decisions. Nevertheless, the E.U. harm environmental sustainability, as well as (b) regarding other Taxonomy is not a mandatory list of economic activities for investors to sustainability objectives, such as social objectives, may follow at a later invest in. Nor does it set mandatory requirements on environmental stage. performance for companies or for financial products. Investors are free to choose what to invest in. Annual Report 2021 − Allianz Group 71