Carbon report SEB Eastern Europe ex Russia Fund

Transcription

1 Carbon report SEB Eastern Europe ex Russia Fund Report created on: February 27, 2018 The carbon footprint provides a historic snapshot of the emissions from the companies that make up the fund s equity portfolio. The calculations are not comprehensive and do not include indirect emissions. The metric says nothing about how the portfolio contributes to a low-carbon society. For further information about the metric, see

2 Contents Executive Summary 3 Sector weighthing and relative carbon footprint 4 Relative Carbon Footprint Comparison 4 Sector Analysis & Stock selection 4 Attribution Analysis 5 Summary of 10 largest absolute contributors 6 Summary of 10 largest portfolio companies 6 Scope 3 overview 7 Company sector & breakdown 8-9 Carbon Barometer & Carbon Ranking 10 Carbon Report - SEB Eastern Europe ex Russia Fund 2

3 Carbon Report SEB Eastern Europe ex Russia Fund Report created on: Feb 27, 2018 Holdings Date: Dec 31, 2017 : MSCI EFM Europe and CIS (Net Return) Currency: EUR Industry Classification: GICS Company Breakdown Metrics: carbon intensity (tco2e / Mio. revenue) Value: 222'416' EUR Fund Management Company: SEB Investment Management AB Executive Summary Carbon emissions Scope 1-2 Total carbon emissions incl. Scope 3 Relative Carbon Footprint (kgco2e / EUR 1'000 invested) Carbon Intensity (kgco2e / EUR 1'000 revenue) Weighted Average Carbon Intensity (kgco2e / EUR 1'000 revenue) Disclosing Titles by Weight (market value) 119' ' % 96.1% 141' ' % 97.1% Total carbon emissions - measure the carbon footprint of a portfolio considering Scope 1-2 as well as Scope 3 emissions. *) - SEB Eastern Europe ex Russia Fund is associated with greenhouse gas emissions of 119'457.6 tons per year. Relative carbon footprint - is a normalized measure of the portfolio's contribution. - It enables comparisons with a benchmark between multiple portfolios, over time and regardless of portfolio size. Carbon intensity - allows investors to measure how much carbon emissions per EUR of revenue are generated. - It therefore measures the carbon efficiency of a portfolio per unit of output. This report analyses the portfolio of securities in terms of the carbon emissions and other carbon related characteristics of the underlying portfolio companies, and compares this data to the performance of a relevant respectively chosen market benchmark. The portfolio s intensity is 36.4% lower than the benchmark The Sectors Energy, Utilities and Materials (per GICS classification) in the portfolio make up 28.7% of the weight vs. 92.8% of the contribution to emissions Sector Weight 21.2% 3.8% 3.7% Contribution to 7.2% 17.0% 43.8% Energy Utilities Materials All other Sectors 0.0 Carbon Intensity Carbon 71.3% 32.1% 5 smallest contributors to the emissions of the fund are: emissions % of total Relative carbon footprint (kg CO2e / EUR 1'000 Invested) Globe Trade Centre % 1.3 Haci Omer Sabanci % 0.5 Warsaw Stock Exchange % 3.4 mbank % 3.5 Bank Handlowy W Warszawie % largest contributors to the emissions of the fund are: emissions % of total Relative carbon footprint (kg CO2e / EUR 1'000 Invested) Energa 19' % 4'941.0 CEZ 17' % 3'508.3 MOL Hungarian Oil and Gas Nyrt 17' % 1'496.7 SNP Petrom 15' % 1'857.3 Akcansa Cimento 10' % 13'480.4 *) Scope 1 emissions are directly generated by company's operations, whereas indirect Scope 2 emissions are related to the company's energy consumption. Scope 3 emissions include other indirect emissions including e.g. business travel, use of company's products sold, investments, and goods and services purchased. Carbon Report - SEB Eastern Europe ex Russia Fund 3

4 Sector weighting and relative carbon footprint Weight Rel. Carbon Footprint tco2e / Mio EUR invested vs. Energy 21.20% 16.85% 1' % Utilities 3.84% 5.41% 4' ' % Materials 3.67% 2.89% 2' ' % Industrials 1.19% 2.22% 1' % Others 5.57% 3.90% % Financials 49.12% 47.53% % Telecommunication Services 3.60% 3.52% % Consumer Discretionary 2.10% 7.05% % Consumer Staples 1.53% 1.74% % Health Care 2.98% 4.45% % Information Technology 1.30% 1.52% '677.06% Relative Carbon Footprint Comparison Energy Utilities Materials Industrials Others Financials Telecommunication Services Consumer Discretionary Consumer Staples Health Care Information Technology Sector Analysis & Stock Selection The graph below shows how the carbon allocation in the portfolio differs from the average of each sector. Sectors have been defined using the GICS classification at the Supersector/Industry Group level. 40% 30% 20% 10% 0% Commodity Chemicals Construction & Engineering Construction Materials Diversified Banks Electric Utilities Environmental & Facilities Services Food Retail Hotels, Resorts & Cruise Lines Integrated Oil & Gas Multi-Sector Holdings Oil & Gas Exploration & Production Oil & Gas Refining & Marketing Oil & Gas Storage & Transportation Others Specialty Chemicals GICS Sub-Industry, Average GICS Sub-Industry 4

5 Attribution Analysis The two principal reasons why the carbon exposure of the portfolio may differ from the benchmark are due to sector allocation as well as stock selection decisions. Sector allocation decision will cause the carbon intensity of the portfolio to diverge from the benchmark where the sectors are either carbon intensive or low carbon. If the portfolio is overweight in carbon intensive sectors the portfolio is likely to be more carbon intensive than the benchmark. However, if the stocks within a carbon intensive sector are the most carbon efficient companies, it is possible that the portfolio may still have a lower carbon footprint than the benchmark. Sector Allocation Sector Selection Sector Allocation Contribution to Out/ Underperformance Sector Allocation Contribution to Out/ Underperformance (%) Stock Selection Contribution to Out/ Underperformance Stock Selection Contribution to Out/ Underperformance (%) Energy 1' % 3' % Materials % % Industrials % % Consumer Discretionary % % Consumer Staples % % Health Care % % Financials % % Information Technology % % Telecommunication Services % % Utilities -1' % -2' % Others % % Total % % Explanation: The Underperformance of the portfolio is based on the effect of over/underweighting certain sectors and selecting more/less carbon intense stocks within each sector for each of the underlying holdings. A positive number indicates that the effect increased the greenhouse gas emission (in tons of CO2e) and a negative number indicated a decreasing effect. In this case, the sector weighting of SEB Eastern Europe ex Russia Fund harmed tco2e, while the stock selection harmed tco2e versus the benchmark. This explains a 3.2% underperformance through sector weighting and 8.3% carbon underperformance by stock picking. Interaction Effect: 1' % Carbon Underperformance Total 119' ' '999.3 Carbon Underperformance (%) 25.9 Attribution Analysis - Graph 60% 40% 20% 0% -20% -40% Energy Materials Industrials Consumer Discretionary Consumer Staples Health Care Financials Information Technology Telecommunication Services Utilities Others Sector Stock Total 5

6 Summary of 10 largest absolute contributors The tables below show the 10 largest greenhouse gas contributors and the 10 largest holdings respectively of the SEB Eastern Europe ex Russia Fund. Carbon Data section explains your, i.e. the amount of greenhouse gases that the portfolio finances from the company s overall emissions, relative to company ownership. You can further see what % of the overall portfolio GHG emissions each company accounts for and if the company s GHG emission number was disclosed by the company or approximated. In the Analysis section, the emissions are stated and the Average Sector allow a comparison of the greenhouse gas intensity of a company against its respective sector, i.e. the amount of GHG emissions that an investment of the same size would have financed, would it have been invested in the overall sector rather than the specific company. The effect on the portfolio can be found under Contribution: This is a measurement of how much a specific holding raises or reduces the carbon footprint of the portfolio. Company GICS Sub-Industry % of total Weight Carbon Data Analysis carbon intensity (tco2e / Mio. revenue) Av. Sector Contribution Energa Electric Utilities 1.7% % 1' ' ' ' CEZ Electric Utilities 2.1% 3.1% 15.1% 5' ' ' ' ' MOL Hungarian Oil and Gas Nyrt Integrated Oil & Gas 4.9% 3.5% 14.8% ' ' ' ' SNP Petrom Integrated Oil & Gas 3.7% 0.7% 13.8% 3' ' ' ' ' Akcansa Cimento Construction Materials 0.3% - 9.3% 17' ' ' ' Polskie Gornictwo Naftowe I Polski Koncern Naftowny Cimsa Cimento Sanayi ve Ticaret Integrated Oil & Gas 5.2% 2.5% 7.1% ' ' ' ' Oil & Gas Refining & Marketing 4.1% 7.4% 4.9% ' ' ' Construction Materials 0.2% - 3.7% 12' ' ' ' Bolu Cimento Construction Materials 0.4% - 2.8% 5' ' ' ' Elemental Holding Environmental & Facilities Services 0.5% - 2.6% 1' ' ' Summary of 10 largest portfolio companies Company GICS Sub-Industry % of total Weight Carbon Data Analysis carbon intensity (tco2e / Mio. revenue) Av. Sector Contribution Bank Pekao Diversified Banks 7.1% 4.8% 0.1% ' OTP Bank Diversified Banks 6.2% 8.0% 0.0% ' Polskie Gornictwo Naftowe I MOL Hungarian Oil and Gas Nyrt Integrated Oil & Gas 5.2% 2.5% 7.1% ' ' ' ' Integrated Oil & Gas 4.9% 3.5% 14.8% ' ' ' ' Turkiye Is Bankasi Diversified Banks 4.8% 0.6% 0.0% ' Powszechny Zaklad Ubezpiecze Turkiye Garanti Bankasi Polski Koncern Naftowny Multi-line Insurance 4.6% 5.9% 0.1% ' Diversified Banks 4.3% 1.3% 0.1% ' Oil & Gas Refining & Marketing 4.1% 7.4% 4.9% ' ' ' SNP Petrom Integrated Oil & Gas 3.7% 0.7% 13.8% 3' ' ' ' ' KRKA d.d Pharmaceuticals 3.0% 1.4% 0.2% '

7 Scope 3 Overview The following section provides a top-down approximation of the financed scope 3 emissions from each sector. The purpose of this analysis is to give an order of magnitude of the emissions in the portfolio on a sector level and should not be used as a basis for comparing two individual companies. All emissions are in tco2e metrics. The following graph shows the financed Scope 1+2 emissions in relation to the Scope 3 emissions of the portfolio. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Energy Materials Industrials Consumer Discretionary Consumer Staples Health Care Financials InformationTelecommunication Utilities Technology Services Scope 3 Scope 1&2 439'396 52'335 25'979 20'253 7'868 3'152 1' ' ' '791 38'294 The graph below compares the total emissions (including Scope 1, Scope 2 and Scope 3) between portfolio and benchmark Scope 3 Scope 1&2 529' ' ' '779 *) The methodology includes Scope 1, 2 and Scope 3 upstream and product use downstream. 7

8 Company Sector & Breakdown This table presents all holdings in the portfolio, sorted by sector, following the logic from the sections above. It shows how each company contributes to the overall portfolio footprint. It allows you to see which stocks are the greatest contributors to the portfolio s emission in absolute as well as relative terms. The -/+ signs on the far right indicate if a specific holding raises or reduces the carbon footprint of the portfolio. This helps with portfolio optimization and in managing the overall carbon portfolio footprint without comprising the chosen sector allocation. Weight Carbon Data Analysis Company % of total carbon intensity (tco2e / Mio. revenue) Av. Sector Contribution Integrated Oil & Gas 13.8% 6.7% 35.8% 1' ' ' ' ' MOL Hungarian Oil and Gas Nyrt 4.9% 3.5% 14.8% ' ' ' '520.1 Polskie Gornictwo Naftowe I 5.2% 2.5% 7.1% ' ' ' '793.2 SNP Petrom 3.7% 0.7% 13.8% 3' ' ' ' '718.0 Oil & Gas Exploration & Production 1.2% 0.8% 0.3% ' ' S.N.G.N ROMGAZ 1.2% 0.8% 0.3% ' '149.6 Oil & Gas Refining & Marketing 6.0% 9.4% 7.4% ' ' ' ' Grupa Lotos 0.9% 1.2% 1.8% ' ' ' Polski Koncern Naftowny 4.1% 7.4% 4.9% ' ' ' Tupras-Turkiye Petyrol Rafinerileri 1.0% 0.8% 0.7% ' Oil & Gas Storage & Transportation 0.2% 0.0% 0.3% 2' Transgaz SA Medias 0.2% - 0.3% 2' Commodity Chemicals 0.9% 0.3% 0.7% ' Ciech 0.9% - 0.7% ' Specialty Chemicals 1.8% 0.0% 0.4% ' ' Soda Sanayi 1.8% - 0.4% ' '790.4 Construction Materials 1.0% 0.0% 15.8% 11' ' ' ' Akcansa Cimento 0.3% - 9.3% 17' ' ' '263.5 Bolu Cimento 0.4% - 2.8% 5' ' ' '761.9 Cimsa Cimento Sanayi ve Ticaret 0.2% - 3.7% 12' ' ' '972.5 Construction & Engineering 0.7% 0.0% 0.1% Budimex 0.7% - 0.1% Environmental & Facilities Services 0.5% 0.0% 2.6% 1' ' ' Elemental Holding 0.5% - 2.6% 1' ' '336.5 Hotels, Resorts & Cruise Lines 0.5% 0.4% 0.2% Arena Hospitality Group 0.5% - 0.2% Cable & Satellite 1.1% 1.3% 0.0% ' Cyfrowy Polsat 1.1% 1.3% 0.0% '299.3 Publishing 0.1% 0.0% 0.0% Ekspress Grupp 0.1% - 0.0% Apparel Retail 0.5% 0.0% 0.0% Apranga 0.5% - 0.0% Food Retail 0.8% 0.8% 0.2% Eurocash 0.8% - 0.2% Packaged Foods & Meats 0.1% 0.2% 0.1% Pinar Entegre Et ve Un Sanayi 0.1% - 0.1% Tobacco 0.6% 0.4% 0.0% Adris preferred 0.6% 0.4% 0.0% Pharmaceuticals 3.0% 4.4% 0.2% ' KRKA d.d 3.0% 1.4% 0.2% '543.9 Diversified Banks 40.6% 40.8% 0.6% ' First Investment Bank 0.4% - 0.0% Komercni Banka 2.0% 2.6% 0.0% '498.6 Moneta Money Bank 1.6% 1.5% 0.0% '973.4 OTP Bank 6.2% 8.0% 0.0% '118.7 ALIOR BANK 1.8% 1.7% 0.0% '

9 Weight Carbon Data Analysis Company % of total carbon intensity (tco2e / Mio. revenue) Av. Sector Contribution Bank Handlowy W Warszawie 0.4% 0.6% 0.0% Bank Millenium 1.7% 1.3% 0.0% '078.2 mbank 0.4% 1.6% 0.0% Bank Zachodni WBK 1.0% 3.2% 0.0% '185.0 Bank Pekao 7.1% 4.8% 0.1% '392.1 Powszechna Kasa Oszczednosci 2.7% 9.7% 0.0% '380.9 BRD-Groupe Societe Generale 2.1% 0.6% 0.0% '574.8 Banca Transilvania 1.0% 1.3% 0.0% '217.0 Turkiye Garanti Bankasi 4.3% 1.3% 0.1% '560.1 Turkiye Is Bankasi 4.8% 0.6% 0.0% '233.1 Yapi ve Kredi Bankasi 0.7% 0.2% 0.0% Turkiye Halk Bankasi 2.1% 0.3% 0.1% '547.7 Turkiye Vakiflar Banksai 0.6% 0.3% 0.0% Multi-Sector Holdings 1.0% 0.5% 0.0% ' Haci Omer Sabanci 1.0% 0.5% 0.0% '315.2 Consumer Finance 2.0% 0.0% 0.1% ' International Personal Finance 1.1% - 0.1% '266.1 Kruk 0.8% - 0.0% '041.4 Multi-line Insurance 5.0% 6.2% 0.1% ' Powszechny Zaklad Ubezpiecze 4.6% 5.9% 0.1% '892.9 ZAVAROVALNICA TRIGLAV 0.4% 0.3% 0.0% Reinsurance 0.5% 0.0% 0.0% Pozavarovalnica Sava 0.5% - 0.0% Internet Software & Services 0.7% 0.0% 0.0% Wirtualna Polska Holding 0.7% - 0.0% Systems Software 0.6% 0.0% 0.0% Asseco Poland 0.6% - 0.0% Integrated Telecommunication Services 3.6% 2.7% 0.6% ' O2 Czech Republic 0.7% 0.7% 0.0% Hrvatski Telekom (Hrvatske) HRK 0.7% 0.9% 0.0% Magyar Telekom 2.2% - 0.5% '258.6 Electric Utilities 3.8% 5.4% 32.1% 2' ' ' ' ' CEZ 2.1% 3.1% 15.1% 5' ' ' ' '986.2 Energa 1.7% % 1' ' ' '692.1 Others 5.6% 3.9% 2.3% ' ' ' Echo Investment 0.4% - 0.1% Warsaw Stock Exchange 0.5% - 0.0% Globe Trade Centre 0.1% - 0.0% KGHM Polska Miedz (PL) 1.3% 3.6% 1.8% ' ' LC 0.6% - 0.0% Emlak Konut Gayrimenkul Yatirim Ortakligi 2.6% 0.3% 0.4% '896.6 Total portfolio 96.1% 97.1% 100.0% ' ' Note that the weighting for the benchmark will not always total 100% as the stocks shown are only for those held by the portfolio. 9

10 Carbon Ranking This is a standardized ranking of the fund based on the productís weighted average carbon intensity using two peergroups. One consisting of all other funds in the database (global percentile) and one where the fund is ranked taking the specific Lipper Global Classification into account (peer percentile). The ranking is based on percentiles and ranges from 0 (worst) to 100 (best). Global Percentile 9 (n=4380) Peer Percentile 11 (Lipper Global Equity Emerging Mkts Global, n=219) The carbon footprint provides a historic snapshot of the emissions from the companies that make up the fund's equity portfolio. The calculations are not comprehensive and do not include indirect emissions. The metric says nothing about how the portfolio contributes a low-carbon society. For further information about the metric, see 10