Sustainability Report 2021 02.2 Sustainability in proprietary investments 01 Introduction 02.2.2 Sustainable investments that such investments do not significantly harm any of review our assessment approach and data Sustainable investments Our strategy for sustainable investments those objectives and that good governance practices sources to develop a best-in-class sustainable Investments by asset class 02 Measuring and are respected. investments framework. € bn managing sustainability provides capital for financing the transition Under our revised definition, all investments Sustainable investments asset classes: Sustainability in our business activities to a low-carbon economy. We actively labeled as sustainable have to comply with all of 123.1 127.1 02.1 Sustainability in insurance pursue investment opportunities that the following three criteria: • Sustainable corporates and other (including 6.4 5.6 02.2 Sustainability in support solutions to environmental and 1. Positive contribution to an environmental and/ Green, Social and Sustainability Bonds) 7.0 6.9 proprietary investments societal challenges, aligned with the U.N. or social objective; • Sustainable sovereigns (including Green, 21.9 02.3 Sustainability in asset management Social and Sustainability Bonds) 25.5 Sustainability in our organization Sustainable Development Goals (SDGs), 2. Do no significant harm; and 02.4 Human resources and facilitate the timely transition to a 3. Follow good governance practices. • Renewables 02.5 Customer satisfaction net-zero world. With respect to the three criteria, we have • Green buildings 02.6 Environmental management developed an assessment approach to identify In 2021, we reviewed our definition of sustainable sustainable investments across a range of asset 03 Strengthening investments to follow the rules set by E.U. Sustainable classes. Our assessment is data-driven and based 84.1 92.7 our foundation Finance Disclosure Regulation (SFDR) Article 2(17). These define sustainable investments as on best available data from internationally 04 Climate-related investments in economic activities that contribute recognized data aggregators and our own financial disclosure to environmental and/or social objectives provided judgement, where applicable. We will periodically 05 Our universal principles Sustainable investments assessment approach: 2021 20202 Criteria Corporates Sovereigns Renewables Green buildings Sustainable sovereigns 1. Meet positive Percentage of revenues from identified Sovereigns that have net-zero Renewables are labelled as Buildings in compliance with Sustainable corporates and others environmental and/ positive environmental and/or social and/or climate neutral targets sustainable by default internal green label thresholds Renewables or social objective activities are labelled as sustainable are reviewed extensively are labeled as sustainable (target ambitions, ESG scores Green buildings etc.) and subsequently deemed as sustainable At the end of 2021, our sustainable investments 2. Do no Principle Adverse Impact Indicators (PAII) PAII screening, as set out by Internal sustainability due diligence PAII screening, as set out by EU totaled € 123.1 and were comprised of: significant harm screening, as set out by EU Sustainable EU SFDR, on a best effort process on a best effort, basis, SFDR, on a best effort basis • Sustainable investments contributing to Finance Disclosure Regulation (SFDR), basis, and exclusion of low using for example ESG sensitive environmental objectives € 109.9 bn on a best effort basis, and exclusion of ESG scoring sovereigns business guidelines, details of companies deriving any percentage of which can be found in Allianz ESG • Sustainable investments contributing to social revenues from non-sustainable business Integration Framework objectives € 12.0 bn 1 activities and/or with low ESG scoring • Sustainable investments contributing to 3. Good Assess for governance and labor Assess for human rights and Internal sustainability due Internal compliance screening environmental/social objectives € 1.1 bn governance practices rights controversies governance violations diligence process 1 Non-sustainable business activities include but are not limited to revenues generated from adult entertainment, alcohol, weapons, fossil fuels, tobacco, gambling etc. A zero tolerance approach is applied for companies generating revenues from these activities. Green bonds are exempted from fossil fuel activity screening due to climate friendly use of proceeds of these bonds. 2 Previous year numbers were not part of the audit engagement. 28