02.2 Sustainability in proprietary investments 01 Introduction and strategy 02 Measuring and managing sustainability 03 Climate change related disclosure 04 Str engthening our foundation 05 Our universal principles managers can represent our interests. We have implemented the NZAOA guidelines Elevating Climate Diligence on Proxy Voting Approaches across our public equity asset managers selection, appointment and monitoring cycle. 02.2.1.5 Exclusion of certain sectors, companies and sovereigns Our exclusion approach covers multiple aspects with exclusion lists updated annually based on data from external service providers and in-house research. The following exclusion themes apply to Allianz portfolios globally: 1) Controversial weapons Weapons that fall under the scope of the follo wing international conventions are excluded: Ottawa Convention (anti- personnel landmines); Convention on Cluster Munitions (cluster ammunition/ bombs); Biolo gical and Toxin Weapons Conv ention (biological weapons); and Chemical Weapons Convention (chemical weapons). Table ESG-8 Divestment from coal-based business models Proprietary Investments € mn As of December 31 2022 2021 2020 Cumulative divestment since November 2015 Cumulative divestment since 2015 – Fixed Income € mn 5,995.0 5,983.0 5,983.0 Cumulativ e divestment since 2015 – Equities € mn 350.7 347.5 347.5 Additional divestments Additional divestment – Fixed Income € mn 12.0 0.0 40.3 Additional divestment – Equities € mn 3.2 0.0 7.0 2) Coal-based business models Allianz started to restrict financing coal-b ased business models in 2015. Equity stakes have been divested, existing fixed income investments put in run-off and no new investments have been allowed since 2015. In 2021, Allianz released an update of its guideline on coal-based business models which defined even more ambitious thresholds from 1st of January 2023 and a clear pathway to further reduce thresholds in the future to fully phase out coal by 2040 at the latest. Our new stricter thresholds will be implemented via restrictions as of end of 2022 for 2023. 3) Oil and gas business models In April 2022, Allianz released its new Statement on oil and gas business models. As of 1st of January 2025 w e will have the expectation of a commitment of portfolio companies to net-zero GHG by 2050, in alignment with science-based 1.5°C pathways. This commitment will cover all three GHG emissions scopes for the companies with the largest hydrocarbon production (i.e., above 60 million barrels of oil equivalent production in 2020), which are estimated to represent approximately 85 percent of the hydrocarbon production of the oil and gas industry. In addition, in our existing oil sands approach the revenue threshold for companies active in oil sands will be reduced from 20 percent to 10 percent. Please also see section 03.2 for more on our oil and gas statement. This approach is rooted in 1.5°C climate scenarios which see a need for a massiv e transformation of the energy sector, in which oil and gas demand and production need to decline drastically in the coming three decades. While oil and gas are still used and needed in this period, no new oil and gas exploration is needed anymore and energy needs to come largely from non-fossil sources by 2050 to allow net-zero emissions to be achie v ed by 2050. Allianz wants to support its clients and investee companies in this unprecedented transition. 4) Human rights concerns Human rights are a fundamental value of our business activities. On the investment side, w e restrict investments in sovereign bonds from countries associated with severe human rights concerns and significant issues managing those. In addition to ESG ratings from external data providers, w e review the Human Rights situation in a country with the Allianz Human Rights Risk Score, developed in 2022. Based on the United Nations Universal Declaration of Human Rights (e.g. right to liberty, equality, education, prohibition of torture, etc.), our experts assess countries’ human rights risk exposure, using NGO information as well as in-house research. For more information on our Allianz Group Human Rights approach, see section 05.5. 5) Engagement outcomes If the dialogue as part of our bilateral or coop erative corporate engagement program does not lead to the improvement of the issues raised by us, we restrict the issuer. Allianz Group Sustainability Report 2022 44