Mandatum Oyj

MAMin salkunhoitajat tekevät äänestyspäätökset ESG-tiimin avustuksella. Päätökset hyväksyy sijoitusjohtaja, mikäli se on äänestyspäätöksen luonteen vuoksi tarpeen. [...] Vaikuttamisen edistymistä ja tuloksia seurataan sisäisesti ja yhdessä palveluntarjoajan kanssa niin kauan kuin vaikuttaminen on käynnissä. [...] Omistajaohjauksen osalta MAM noudattaa Mandatum-konsernin ja MAMin eturistiriitapolitiikoissa määriteltyjä eturistiriitojen tunnistamista, ehkäisemistä ja hallitsemista koskevia periaatteita. Kaikkien työntekijöiden odotetaan tunnistavan toimintaansa mahdollisesti liittyvät eturistiriidat ja ilmoittavan organisaatiossa mahdollisesti epäilemistään epäkohdista. Tunnistetut eturistiriidat on arvioitava, ja niiden hallitsemiseksi on toteutettava asianmukaiset ehkäisytoimet, tai mikäli niitä ei voida ehkäistä, asianmukaiset torjuntatoimet.

### 2. Organisation and responsibilities

This policy is approved by the boards of MAM and Mandatum Life annually. The management groups of MAM and Mandatum Life are responsible for its execution in each Mandatum Group company.

Mandatum has a dedicated ESG team whose primary responsibility is to support other investment functions on matters related to responsible investment. The team also monitors adherence to the Responsible Investment Policy and assists portfolio management when required. In addition, Mandatum has appointed a Senior ESG Manager, who has overall responsibility for coordinating responsible investment across Mandatum.

All investment professionals are required to account for sustainability factors when selecting and monitoring investment objects. Portfolio managers and analysts are in the best position to understand the sustainability aspects of investee companies and business partners they are monitoring and to engage in a dialogue with management to influence matters. As part of their investment market monitoring, portfolio managers and analysts also look at how sustainability issues are incorporated in investor information and investment product offerings.

The responsible investment responsibilities and division of tasks in Mandatum are described in Table 2.

|Unit/body|Responsibilities and tasks|
|---|---|
|MAM's and Mandatum Life's Boards|Approve the Responsible Investment Policy and outline the procedures and policies regarding responsible investment.|
|MAM's and Mandatum Life's Management Groups|Oversee the practical implementation of responsible investment and responsible for compliance with the Responsible Investment Policy.|
|Portfolio Management Unit|Each portfolio manager and analyst includes a sustainability analysis in their investment analysis and monitors their investment objects also from a sustainability perspective. If any discrepancies are observed, the portfolio manager/analyst consults with the ESG committee to ensure a consistent operating method. The responsible portfolio manager for each investment basket, fund or responsibility area ensures compliance with the Responsible Investment Policy within their area of responsibility.|
|ESG Committee|Expert body responsible for co-ordinating responsible investment, developing tools and cascading operating methods throughout the organisation. Prepares the responsible investment approach and supports the portfolio managers in issues related to responsible investment. Reports on the implementation of responsible investment to MAM's and Mandatum Life's Management Groups. Headed by the Senior ESG Manager, with overall responsibility on developing Mandatum's ESG approach.|

Table 2. Responsible investment responsibilities and division of tasks.

Mandatum's Responsible Investment Policy is reviewed, updated and approved annually. The latest policy was approved by Mandatum's and MAM's Board of Directors in December 2022. Mandatum aims to recognize and mitigate the adverse impacts of its investment operations to the environment, climate, society, employees, respect for human rights, and anti- corruption and anti-bribery (hereinafter sustainability factors). Therefore, Mandatum has incorporated sustainability into its investment operations, and the company's investment decisions take into account not only financial aspects, but also sustainability factors, as well as the related risks (hereinafter sustainability risks). Mandatum's and MAM's personnel are bound by its Responsible Investment Policy. The policy is intended as a guide for portfolio managers and for those participating in investment operations to take sustainability risks and factors into account in their day-to-day activities. The policy outlines the minimum level of measures taken to mitigate sustainability risks and adverse sustainability impacts. Stricter rules and engagement procedures can be applied to certain products or portfolios. Mandatum's asset manager MAM has a dedicated ESG team whose primary responsibility is to support investment functions on matters related to responsible investment. The team also monitors adherence to the Responsible Investment Policy and assists portfolio management when required. In addition, MAM has appointed a Senior ESG Manager, who has overall responsibility for coordinating responsible investment across Mandatum group. All investment professionals are required to account for sustainability factors when selecting and monitoring investment objects. Portfolio managers and analysts are in the best position to understand the sustainability aspects of investee companies and business partners they are monitoring and to engage in a dialogue with management to influence matters. As part of their investment market monitoring, portfolio managers and analysts also look at how sustainability issues are incorporated in investor information and investment product offerings. [...] Norm-based screening: The investments are monitored based on international norms and standards laid down in international conventions, such as the UN Global Compact, the OECD Guidelines for Multinational Enterprises, the ILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy, the Guiding Principles on Business and Human Rights: Implementing the United Nations 'Protect, Respect and Remedy' Framework, and the Paris Agreement on Climate Change. If abuses or breaches related to these standards and conventions are observed in an investee company, the incident is investigated, and measures are taken on a case-by-case basis. Depending on the severity, nature, and extent of the breach, portfolio management measures may consist of direct dialogue with the investee company's executive management, an engagement action or, as a last resort, divestment if the investee company does not respond to the engagement efforts and does not take measures to prevent the abuse or breach within a reasonable time frame. Spesifically regarding the Paris Agreement on Climate Change, Mandatum monitors companies that lobby against climate action and have not been able to reduce their emissions. Mandatum's portfolio did not include these types of companies in the reference period.

Mandatum has established a dedicated ESG team, whose primary responsibility is to assist investment functions in matters related to responsible investment. This team also monitors compliance with the Responsible Investment Policy and provides support to portfolio management as needed. Furthermore, Mandatum has appointed a Head of Responsible Investments, who holds overall responsibility for coordinating responsible investment initiatives across the organization. [...] Portfolio managers engage directly with company executives through meetings and visits, both proactively and reactively, and voting at AGMs is used as a tool for shareholder influence, with decisions guided by the ESG team and the CIO when necessary. Voting occurs either in person or by proxy, depending on location. Mandatum also collaborates with other investors through pooled engagement to address significant issues reactively, monitoring progress and escalating or reducing investments if engagement fails. As a UN PRI signatory, Mandatum reports annually on responsible investment practices, discloses the carbon footprint of investment products, and communicates sustainability efforts to clients within data and confidentiality limits.

Investments are monitored based on international norms and standards defined in international agreements. These agreements include the UN Global Compact initiative, the OECD Guidelines for Multinational Enterprises, the ILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy, the UN Guiding Principles on Business and Human Rights: Implementing the Protect, Respect and Remedy Framework, and the Paris Agreement. If a company in which investments are made is found to have violations related to these norms, an investigation is conducted, and actions are taken on a case-by-case basis. Depending on the severity, nature, and scope of the violation, portfolio management actions may include direct dialogue with company management, advocacy measures, or, as a last resort, divestment if the investment target does not respond to advocacy efforts and fails to take action to prevent abuses or violations within a reasonable timeframe. [...] Investments in companies with high or severe ESG risk ratings require an examination of sustainability risks and are reported to an internal committee at the next meeting. Furthermore, investments in companies with a severe ESG risk rating can only be executed with the approval of the investment manager.