01 Our vision of 02 Sustainable 03 Active 04 Strengthening sustainability 05 Appendices sustainability investing stewardship in our operations 03.1 Developing our engagement strategy Principle 2 7 9 Engagement across all listed asset We seek to communicate our stewardship general meetings and sustainability issues classes: The bedrock of our engagement approach externally to our clients that we identify as below market practice. activities comes from our heritage as and investee companies, for example, Engagements can also be triggered by an active equity manager. However, by publishing our convictions and controversies connected to sustainability in recent years we have increased our stewardship outcomes in thought or governance. 昀椀xed income engagement, facilitating leadership pieces or blog posts. This approach allows us to strike a good dedicated dialogues for our corporate Policy engagement complements balance between environmental, social credit strategies. our approach where we believe that and governance (ESG) risk reduction in In 2023, we worked intensively with our improved regulatory conditions and our portfolios and leading clients and 昀椀xed income engagement ambassador market standards could bene昀椀t our active companies on an inclusive and sustainable group, meeting regularly with portfolio stewardship work. The legal framework pathway to change. It also allows us to managers and credit analysts to for collaborative engagement in Germany set clear engagement objectives from the discuss and align on engagements is an example. outset. While our preference is to engage and coordinate engagement activity. See sections 03.5 and 03.6. investee companies con昀椀dentially, we are Our strategy includes enhancing the Risk-based engagement: Our risk- prepared to escalate to engage publicly engagement-speci昀椀c skills of our based approach remains the basis of our if we conclude that the con昀椀dential investment professionals through engagement strategy and focuses on the approach has gone as far as it can without dedicated training, which equips material sustainability or governance delivering progress and our objective them to work on more engagement issues that we identify. A larger share of would be best served by escalation. themselves. In 2023, this training reached these engagement meetings is dedicated See section 03.6. approximately 80% of our equity to preparing our voting decision at investment professionals. general meetings where our Global See section 03.2.1. Corporate Governance Guidelines guide Looking ahead our engagements. Targeting is closely In 2023, we worked on an enhanced related to the size of our exposure, strategy aimed at involving more portfolio whether per market or fund, or managers and analysts in engagement, considering the total value of investment. and integrating stewardship more broadly The focus of engagements is determined into investment strategy and positioning. by considerations such as signi昀椀cant votes We will roll out this strategy in 2024. against company management at past Allianz Global Investors Sustainability and Stewardship Report 2023 41