Sustainability Report 2021 02.2 Sustainability in proprietary investments 01 Introduction Exploring the difference between sustainable investments Investing in a net-zero economy By investing in the Allianz Impact Investment Fund, We have a growing global portfolio of climate which is managed by AllianzGI, we further promote 02 Measuring and and EU Taxonomy regulations. solutions including investing in renewable the generation of measurable environmental and managing sustainability Sustainable investments definition by the As Allianz is pre-dominantly a debt investor energy, energy innovations and fostering the / or social impacts in Europe through investments Sustainability in our business activities Sustainable Finance Disclosure Regulation (SFDR) with a globally diversified portfolio, large parts transition to a net-zero economy. Examples in private debt and equity opportunities across a 02.1 Sustainability in insurance is principle based; qualifying investments shall of our assets fall outside the application of the include investments in the AllianzGI Renewable range of sectors such as for example energy supply 02.2 Sustainability in have an environmental or social objective, do no EU Taxonomy. For example, sovereign debt is Energy Fund and financing measures that reduce and energy efficiency as well as health and care. proprietary investments significant harm to any of those objectives and not in scope of the EU Taxonomy. Also direct energy consumption, resource use and GHG 02.3 Sustainability in asset management have good governance practices. Based on these debt financing of renewable projects is emissions. We are committed to increasing our Sustainability in our organization principles and with respect to the detailed and outside the scope of EU Taxonomy reporting. exposure in renewables by 5.85 percent per year 02.4 Human resources still evolving framework set by the EU Taxonomy, Additionally, regulation foresees reporting in line with the International Renewable Energy 02.5 Customer satisfaction which is amending the SFDR, we developed based only on self-reported data of companies Agency projections. 02.6 Environmental management our own conservatively calibrated approach rather than estimations so our reporting will covering our main asset classes and all regions phase in over time as in-scope companies Investing in emerging economies 03 Strengthening globally. Through this approach, we identify will report for the first time in their full-year For the achievement of a global net-zero our foundation around 15 percent of our portfolio as sustainable 2022 disclosure. economy, it is pivotal to close the large financing 04 Climate-related investments, in line with the EU regulation. As EU Taxonomy alignment criteria are difficult gap prevailing in emerging economies. financial disclosure The EU Taxonomy is a tool to help investors to assess and takes time for companies and We actively pursue investment opportunities in understand whether an economic activity is investors to analyze, EU regulation foresees that these markets alongside development finance 05 Our universal principles environmentally sustainable and to navigate the investors will report this year only on Taxonomy institutions, donors and other impact investors. transition to a low-carbon economy. It follows eligibility and not alignment. This means that Utilizing blended finance structures allows us roughly the same structure as sustainable a business activity is eligible whenever it is to access new markets and tap into growth investment regulation (e.g., objective, do no covered by the Taxonomy. Only the second opportunities, such as for example our funding to significant harm and social safeguarding) step – assessment of alignment – will reflect innovative SMEs and start-ups in Africa through but it is very detailed and not principle based. how climate-friendly a business activity is. Allianz Global Investor’s AfricaGrow fund of funds. The Taxonomy defines qualifying criteria on For example, electricity generation is a business Another example includes our investment into a single business activity level. Only climate activity covered in the Taxonomy and all power responsAbility’s Global Climate Partnership Fund, adaptation and mitigation objectives are plants are eligible, but only assessment of which fosters energy efficiency and renewable currently in-scope objectives, with more alignment distinguishes between coal power energy investments for SMEs and private environmental and social objectives to come plants and renewables – and this assessment households in emerging countries and thus in the next years. will not take place until 2022. contributes to the reduction of GHG emissions. Through GAWA Capital’s Huruma Fund we also The data reporting universe for the EU The Taxonomy eligible assets for the actual support improving the access to financing for Taxonomy is regulated by the Non-Financial reporting period therefore only contain assets small or excluded farmers in rural areas of Latin Reporting Directive (NFRD), covering only where we are in a control position – namely America, the Caribbean, sub-Saharan Africa and investments into European companies with part of our Real Estate portfolio and equity Asia, thereby helping to improve the quality of life activities which are in scope of the EU Taxonomy investments into renewables – as well as our of farmers in the target regions. and assets where we are in a control position, exposure to mortgages. meaning in simplified terms that we are an Taxonomy-eligible investments in 2021 equity investor and fully consolidate the assets totaled € 76.9 billion. on our balance sheet. 29