AllianzGI Sustainability Risk Management Policy Statement Page 4 Sustainability Risks are appropriately identified, measured, monitored and mitigated in accordance with regulatory requirements. Allianz Global Investors applies various Sustainability Risks management techniques and instruments. These are customized by type of investment strategy and asset class. 1.3 Managing conflicts of interest Allianz Global Investors has a duty to act in Clients’ long - term best interests. Potential conflicts of interest with Allianz Global Investors or between Clients, or between Clients and Counterparties, shall be the subject of specific attention a nd handling, as specified under relevant policies related to the prevention or mitigation of such conflicts of interests. Allianz Global Investors has policies and procedures in place in order to identify and to prevent or fairly manage conflicts of intere st. Various examples of potential conflicts of interests and how Allianz Global Investors manages them are included in Allianz Global Investors’ Europe Client Information on conflict of interests (provided to Clients upon request) as well as the Stewardship Statement . Employee training is designed and implemented to prevent perceived or actual conflicts of interests from constituting or giving rise to a mat erial risk of damage to the interests of our clients. 2. Sustainability Risk management Allianz Global Investors considers Sustainability Risks as follows: - For publicly listed asset classes , Sustainability Risks are assessed using external sustainability research data and/or internal research and analysis. Both external and internal research aims at identifying potential financial risks of an investment in securities of an issuer related to sustainability. Issuers can be corporate issuers, sovereign issuers or sub - sovereign agency issuers. Allianz Global Investors considers the Sustainability Risks in the investment process through pre - trad e warning s to portfolio managers who are in the pro cess of investing in securities for which the issuer has been assessed to possess a potential Sustainability Risk. This ensures that portfolio managers are being made aware of potential Sustainability Risks ahead of making the investme nt decision. Furthermore , Allianz Global Investors is performing a regular portfolio screening of Sustainability Risks and providing transparency to portfolio managers on the Sustainability Risk profile of the ir r espective portfolios . The Sustainability Risks assessment does not cover cash and deposits, derivatives and non - rated investments. Additionally, through active stewardship, such as targeted corporate engagement and proxy voting, Allianz Global Investors investment professionals ai m to mitigate and improve Sustainability Risks of listed corporates. To ensure proper stewardship of invested corporates Allianz Global Investors has implemented Global Corporate Governance and Proxy Voting Guidelines for public market equity investments. - For private market asset classes , Sustainability Risks are considered throughout both the investment process and ongoing asset management activities. In many cases, they are also specifically screened along Sustainability Risks guidelines or using minimum exclusions lists. These Sustaina bility Risk guidelines or filters are based on international best - practice standards and comprise aspects such as climate change, biodiversity, governance, and impacts on the workforce and local communities. When a Sustainability Risk is detected during th e origination process, the investment team can utilize a number of methods to mitigate and manage these identified Sustainability Risks, whether through commercial terms or documenting specific conditions, or indeed by rejecting the transaction if the Sust ainability Risk s are deemed to be insufficiently mitigated. Investments are actively monitored through the asset management process, responding to materializing Sustainability Risks quickly and decisively through engagement with the management or sponsors of the companies in which Allianz Global Investors invests on behalf of our clients. Allianz Global Investors also considers Principal Adverse Impact of prospective and active investments. - For listed equities and corporate fixed income assets , Alli anz Global Investors has implemented pre - trade warnings for investment in securities for which the issuer is doing significant harm across one of the mandatory