01 Our sustainability approach 02 Sustainable investing 03 Active stewardship 04 Corporate sustainability 05 Appendix 03.4 Engagement outcomes Principles 7 9 Increasing engagement in Asia We have stepped up engagement AllianzGI’s engagement activities Shaping sustainable pathways towards change activities dedicated to our investments in in Asia are guided by our top-down Asia, led by our local Stewardship Analyst thematic pillars and also by issues we and Investment teams. This was motivated identify as most critical to the market, Climate strategy engagement by rising expectations of clients regarding such as long-standing governance- sustainability aspects of funds in Asia, related topics, climate strategies, with a financial service increased relevance of these issues to our supply chain management and diversity. fund business, and evolving regulatory Biodiversity only started to draw holding company requirements for sustainable funds. companies’ attention in Asia very recently and we engaged on this emerging topic We believe that large financial holding usage, green certificates purchase with as well. companies in Asian markets could play good quality and other energy-saving an important role in driving different measures. On its financed activities, We leveraged the close partnership sectors’ decarbonisation pathways. we challenged how they would between the Stewardship team and However, many Asian companies expand their GHG emissions reduction local Investment team professionals to lack incentives to proactively develop interim plan from its current focus on proactively engage with our portfolio robust climate strategies due to a few sectors to include other carbon- companies. Our engagements focus on controlling shareholding structures intensive sectors. We also investigated Many Asian evaluating company performance on or lack of concrete guidelines from how the asset management arm of governance and sustainability, setting local regulators. the company practises sustainable companies lack expectations on KPI-based targets to investment in its portfolio. incentives to encourage sustainability outcomes, During the engagement with a and sharing global best practice within Japanese financial holdings company, The company shared detailed actions proactively develop the industry to guide on transition. we discussed climate strategies of and concrete figures. It committed We have observed a notable increase in its own operations and its financed to incorporating more sector specific robust climate responses to our engagement requests activities in the overall portfolio. decarbonisation interim goals in the and improved ESG disclosure in the Asian On Scope 1 and 2 emissions, coming year as it updated its climate strategies. market in 2022. we assessed the feasibility of the strategy. We will reassess progress company’s zero-carbon emissions going forward. plan, including renewable energy Allianz Global Investors Sustainability and Stewardship Report 2022 77