Baloise Holding AG

**Governance**
The active ownership council, consisting of four representatives from Portfolio Management and the active ownership lead from the responsible investment core team, is responsible for selecting and coordinating the collaborative engagements and selecting the focus issues, as well as for annual reporting. [...] **Public policy engagement**
An important part of the active ownership strategy is also political engagement on the industry level. Baloise Asset ­Management is a member of both the UN-supported PRI and the Swiss Sustainable Finance (SSF) network. In addition, ­representatives of Asset Management participate in working groups and are members of the sustainability commission of the Swiss Insurance Association (SIA) and the Asset ­Management Association Switzerland (AMAS), both of which have the goal, among other things, of advancing and promoting responsible investment on the Swiss market. We are also part of expert groups that have been formed on this issue by the State Secretariat for International Finance (SIF) and the Swiss Financial ­Market Supervisory Authority (FINMA).

### 4 Governance

The basic organisation, procedures, duties and responsibilities are governed by the Responsible Investment Policy. In addition, the key units and functions, as well as their tasks in the area of Active Ownership, are presented below.

These include:

— Baloise Executive Committee

- Investment Insurance Committee

- Active Ownership Council

- Engagement Manager

- Portfolio Management

- Responsible Investment (RI) Team

- Compliance

- Risk Management

Other functions within the organisation, such as Group Public Affairs & Sustainability and Investment Strategy, are also involved and informed about the Active Ownership activities.

#### 4.1 Governance of third-party client assets and investment funds

The Baloise Executive Committee issues the policy on third-party client assets and investment funds. The Baloise Executive Committee management which has expertise in the area of sustainability is informed on a regular basis for the decisions taken by the Active Ownership Council, with respect to direct corporate dialogues concerning third-party client assets funds and investment funds, in particular regarding the initiation and termination of direct engagements.

#### 4.2 Governance of insurance assets

The Head of Asset Management defines the policy on insurance assets, with the Insurance Investment Committee (IIC) providing advice. This Committee is composed of representatives of the Corporate Division Asset Management and the capital managers of the foreign insurance companies. The Head of Corporate Division Asset Management issues the policy. The applicability of this policy defined by the decision-makers of the Baloise Group insurance companies.

The IIC has expertise in the area of sustainability and, following consultation with the Active Ownership Council with respect to direct corporate dialogues concerning insurance funds, in particular with regard to the initiation and termination of direct engagements.

#### 4.3 Functions in Corporate Division Asset Management

**Active Ownership Council (AOC)**

The AOC is composed of representatives from:

- Engagement Manager (Chair)

- Portfolio Management (PM)

- RI Team

- Compliance

- Risk Management

The AOC is responsible for verifying compliance with the predefined criteria in the process and making decisions in conjunction with direct corporate dialogues, in particular for initiating and terminating them, which are submitted to the Baloise Executive Committee and the IIC.

**Engagement Manager**

The Engagement Manager is part of the Responsible Investment Team and plays the central role in the execution of the active ownership strategy. The Engagement Manager is responsible for:

- Detailed examination of companies that could be considered for direct engagement, including assessment of possible risks from a sustainability and reputational perspective

- The decision on how to conduct the corporate dialogue

- Conducting the corporate dialogue, usually together with a PM sponsor

- Final evaluation of the engagement in order to draw a conclusion at the end of the engagement period

- Regular internal reporting to the AOC, RI Team, Executive Committee and IIC, as well as information sharing with other relevant functions (including Group Sustainability and Regulatory Affairs)

- Preparation of Active Ownership Reports

- Screening, selection and implementation of collaborative engagements

- Participation in initiatives, associations and working groups.

**Portfolio Management (PM)**

Portfolio Management is responsible for implementing the requirements of this policy within the investment process for equities and bonds. The tasks include:

- Depending on the contractual arrangement of roles and responsibilities, development of a decision making basis for immediate disposals or initiation of the selection process for direct engagements based on predefined criteria and in coordination with the relevant PM Equities and Fixed Income

- Preliminary assessment of companies that could be considered for direct engagement, including assessment of possible risks from an investment perspective

- If applicable, providing support to the Engagement Manager in having the corporate dialogue conducted by a relevant PM.

**Responsible Investments (RI) Team**

As dedicated resources that deal intensively with sustainability issues, the RI Team contributes additional sustainability expertise to the active ownership activities. In particular, it advises and supports the selection and implementation of direct and collaborative engagements as well as public policy engagements.

**Compliance**

Compliance evaluates and verifies the integration of the sustainability criteria into the process for direct corporate dialogues and their compliance with these criteria within the scope of investment activities.

**Risk Management**

As an independent control function, Risk Management advises on the selection and termination of direct engagements and is also responsible for:

- Ensuring compliance with the specified Active Ownership Strategy at product level

- Ensuring identification and reporting of possible failures to comply with the Active Ownership Strategy to the relevant stakeholders.

**Public Policy Engagement** Representatives of the Responsible Investment Core Team have participated in various working groups that provide feedback on regulatory proposals from the State Secretariat for International Financial Matters (SIF) or other departments, for example. They were also part of the joint working group of the Asset Management Association Switzerland (AMAS) and Swiss Sustainable Finance (SSF) to develop the "Self-regulation on transparency and disclosure for sustainability-related collective investments", which is binding for all AMAS members.

**Does your organisation have governance processes or structures to ensure that your overall political engagement is aligned with your commitment to the principles of PRI, including any political engagement conducted by third parties on your behalf?**

- **(A) Yes**

Describe how you do this:

The general attitude is organised and formulated by the Group. Our Active Ownership Policy clarifies the points specifically to ESG/Responsible Investment/PRI. [...] **Did your organisation, or the external investment managers or service providers acting on your behalf, engage with policy makers as part of your responsible investment approach during the reporting year?**

☐ (A) Yes, we engaged with policy makers directly
☑ **(B) Yes, we engaged with policy makers through the leadership of or active participation in working groups or collaborative initiatives, including via the PRI**
☑ **(C) Yes, we were members of, supported, or were in another way affiliated with third party organisations, including trade associations and non-profit organisations, that engage with policy makers, excluding the PRI** [...] **During the reporting year, what methods did you, or the external investment managers or service providers acting on your behalf, use to engage with policy makers as part of your responsible investment approach?**

☐ (A) We participated in 'sign-on' letters
☑ **(B) We responded to policy consultations**
☑ **(C) We provided technical input via government- or regulator-backed working groups**

Describe:

As a member of Swiss organisations we respond regularly to policy consultations on ESG topics. Also, the Head of Responsible Investment is a member of working groups/panels with the Swiss regulators or the Financial Market Authority (FINMA).

This is one reason why the Board of Directors is adapting and reorganising its committee structure. Changes include transforming the Chairman's Committee into a Strategy and Governance Committee in order to address the strategic topics that will be relevant going forward. [...] From 2022, the Board of Directors' Strategy and Governance Committee will take on the function of a sustainability committee that oversees activities in the field of sustainable corporate governance. The outlined corporate governance process was applied four times in 2021. Consequently, the Board of Directors discussed sustainable corporate management four times as an agenda item – twice at meetings of the Board of Directors' Chairman's Committee and twice at meetings of the full Board of Directors. The subject featured in discussions concerning the 'Simply Safe: Season 2' strategic phase for the period from 2022 to 2025 and also constituted an agenda item in its own right where decisions needed to be taken regarding the ongoing integration of ESG aspects into Baloise's business processes.

At the heart of the organisation working on sustainability at Baloise is the Group-wide sustainability network that was created in 2019. Group-wide means that all national subsidiaries and Group functions, such as Compliance, Human Resources and Asset Management, are represented. This interdisciplinary structure means the network has the expertise it needs to perform its role. The network's tasks are strategic and consist of developing and steering the principle of how Baloise practises sustainability, and providing guidelines. The network is in regular dialogue with the Corporate Executive Committee. Sustainability representatives from the national subsidiaries in Switzerland, Germany, Belgium and Luxembourg are part of the Group-wide sustainability network. The Corporate Executive Committee provides feedback on proposals to the Group-wide network and facilitates implementation. The Corporate Executive Committee is also the link between the sustainability network and the Board of Directors. The Board of Directors is responsible for developing the sustainability approach at Baloise, integrating it into the overall strategy and overseeing it. This includes climate-related matters. Since 2022, the Board of Directors' Strategy and Governance Committee has been responsible for monitoring activities in the field of sustainable corporate governance. The Chairman of the Board of Directors chairs the Strategy and Governance Committee. The sustainability representatives of the national subsidiaries are the link to the local sustainability networks and the local Executive Committees, as well as the local Boards of Directors. The local networks focus on ensuring that sustainability is implemented in a manner appropriate to the local markets in every aspect. However, implementation is not the exclusive responsibility of the local networks. Together with the local departments, they coordinate which measures are implemented, as well as when and how they are implemented. Alignment between the networks is essential for Group-wide implementation and is ensured by the sustainability representatives of the national subsidiaries and at Group level. The specified corporate governance model was adopted by the Corporate Executive Committee and the Board of Directors at the end of 2019. Further governance structures are described in the relevant chapters, such as 'Responsible investment', 'Responsible underwriting' and 'Data governance & security'. Information on corporate governance can be found in the 2023 Annual Report, page 33 onwards. The Board of Directors dealt with the topic of sustainable corporate governance nine times in 2023. It featured three times in discussions of the Board of Directors' Strategy and Governance Committee: once in connection with the setting of our net zero targets, once in connection with the ongoing integration of ESG aspects into our business processes and once in the planning for 2024. It was discussed twice by the Board of Directors' Investment and Risk Committee, in connection with the setting of our net zero targets and in relation to an update on responsible investment activities, and once by the Audit Committee, in a discussion of reporting regulations. It was also discussed on three occasions at meetings of the full Board of Directors: once in connection with the setting of our net zero targets, once during a general update on the subject and once in the planning for 2024.

The Board of Directors has four committees, each of which is responsible for certain aspects of sustainability: [...] The Strategy and Governance Committee (SGC) – providing advice to the Board of Directors – monitors the development and implementation of the sustainability strategy in the field of sustainable corporate governance. The Organisational Regulations stipulate that the Chairman of the Board of Directors is a member of the SGC. [...] The Audit Committee (AC) monitors progress with sustainability reporting. It decides whether the non-financial report can be recommended for presentation to the Annual General Meeting and for approval. [...] The Investment and Risk Committee (IRC) is responsible for defining the principles of sustainable investment at a strategic level. It also monitors progress with sustainability in asset management and sustainability-related risks in Baloise's risk environment. [...] The Remuneration Committee (RC) submits proposals to the Board of Directors on the structure of remuneration and ensures that sustainability criteria are embedded in Baloise's remuneration system. [...] Representing the sustainability network, the Head of Sustainability & Regulatory Affairs regularly reports directly to the SGC on the development and refinement of the sustainability strategy and its implementation. [...] The Head of Sustainability & Regulatory Affairs reports to the Audit Committee on regulatory developments relating to sustainability and on mandatory reporting. [...] The Chief Risk Officer reports on the risks that could arise if sustainability rules are not properly implemented, which actions can mitigate sustainability risk and which controls are used to monitor risk. [...] The Corporate Executive Committee has overall responsibility for operational implementation and sets out the requirements of the sustainability strategy in more detail. It deals with requests from the sustainability network and signs off on them for approval by the Board of Directors.

Representatives of the Baloise Sustainability team and the Responsible Investment core team participated in the working groups listed below that provide feedback on regulatory proposals from the Swiss State Secretariat for International Finance (SIF) or other institutions.

These working groups include the following:

- Member of the Sustainability Commission of the Swiss Insurance Association (SIA),
- Sustainability Commission of Swiss Sustainable Finance (SSF) and Asset Management Association Switzerland (AMAS) (jointly),
- Expert Panel on Climate Risks of the Swiss Financial Market Authority (FINMA).

Representatives of the Baloise Responsible Investment core team were also part of the AMAS working group to develop version two of the "Self-regulation on transparency and disclosure for sustainability-related collective assets", which is binding for all AMAS members. In addition, the team was part of the development of the first "Self-regulation on the prevention of greenwashing in sustainability-related unit-linked life insurance" of the SIA.

**Indicator** **Type of indicator** **Dependent on** **Gateway to** **Disclosure** **Subsection** **PRI Principle**

Roles and
PGS 11.2 CORE N/A N/A PUBLIC 1 – 6
responsibilities

**Does your organisation have governance processes or structures to ensure that your overall political engagement is**
**aligned with your commitment to the principles of PRI, including any political engagement conducted by third parties on**
**your behalf?**

- **(A) Yes**

Describe how you do this:

The general attitude is organised and formulated by the Group. Our Active Ownership Policy clarifies the points specifically to
ESG/Responsible Investment/PRI.

#### 4.1 Governance of the Baloise Group

The Baloise Group has had a Group-wide sustainability network since 2019. In 2021, country-specific working groups were established with a focus on implementing sustainability measures in the respective national markets. The working groups comprise members of all operating segments that have an influence on, or are influenced by, the issue of sustainability. These working groups are equipped with the necessary professional expertise to develop and regularly update the content of the sustainability approach, such as the value-added model.

The Corporate Executive Committee decides on the implementation of the content. The Board of Directors is responsible for developing the sustainability approach, embedding it in the overall strategy and overseeing its application. Since 2022, the Board of Directors' strategy and governance committee has also functioned as the sustainability committee, monitoring developments in sustainable management.

This Responsible Investment Policy is defined by the Head of Corporate Division Asset Management. The Insurance Investment Committee (IIC) provides advice. This committee is composed of representatives of the Corporate Division Asset Management and the capital managers of the foreign insurance companies.

The Head of Corporate Division Asset Management issues the policy. The decision-makers of the Baloise Group insurance companies define the applicability of this policy. [...] #### 4.2 Governance at the level of Corporate Division Asset Management

Corporate Division Asset Management has suitable organisation and processes in place to ensure that the obligations and responsibilities arising from this policy and emerging contracts are adequately implemented.

The central units as well as their duties in the field of responsible investment for Corporate Division Asset Management are outlined briefly below:

**Responsible Investment (RI) Core Team**

Corporate Division Asset Management has the necessary infrastructure and dedicated resources, which are independent of the operational functions and address sustainability issues. The core tasks of the RI Core Team include:

- Further development of RI strategies;

- Consultation for the entire organisation on all sustainability issues; and

- Monitoring of sustainability developments at corporate level and in terms of investments.

The RI Core Team also performs the following tasks:

- Initiation and management of cross-cutting ESG initiatives

- Development and coordination of ESG integration projects in organisation and business

- Coordination and exchange with the sustainability network and sustainability boards of the Baloise Group

- Ambassadorial function regarding RI

- Suggestions for the selection of new ESG data providers

- Development of training concepts and training of the organisation within the framework of the concepts adopted by the competent bodies

Regular exchange meetings take place between the RI Core Team and the control functions Risk Management and Compliance as well as the Head of Asset Strategy & Investment Controlling.

**Responsible Investment (RI) Guild**

The Responsible Investment Guild is interdisciplinary and consists of the RI Core Team and representatives from Portfolio Management, Product Management, the Legal Department or Investment Controlling and Reporting as well as individual representatives from other units of the Baloise Group.

This Guild has the necessary expertise and performs the following functions:

- Development and regular update of concepts related to the responsible investment approach

- Exchange and networking

- Collaboration on sustainability-related projects and initiatives

**Portfolio Management**

Portfolio Management is responsible for the implementation of the requirements of this policy in the investment process and, in particular, for the integration of sustainability-related criteria in the investment process and their compliance. The responsible portfolio managers have and maintain the necessary expertise in the area of sustainability.

**Compliance**

Compliance reviews the integration of the sustainability-related criteria in the investment process and their compliance within the scope of investment activities with a focus on the regulatory and contractual aspects.

**Risk Management**

Risk Management is responsible for defining, implementing, and monitoring control frameworks, in particular with regard to:

- identifying, monitoring and internal reporting of sustainability risks in the investment process;

- ensuring compliance with the specified responsible investment strategy at product level;

- transparent validation of external data suppliers of ESG data;

- traceability of the implemented ESG risk rating methodology of the external data provider; and

- ensuring that breaches of the responsible investment strategy are identified and reported to the appropriate bodies.

Other functions such as finance, investor relations, communications and legal can also play an important role.

Corporate Division Asset Management provides appropriate internal and/or external resources for the familiarisation and training of all stakeholders involved in order to provide them with standard and in-depth knowledge of the necessary ESG topics.

**Governance**
The active ownership council, consisting of four representatives from Portfolio Management and the active ownership lead from the responsible investment core team, is responsible for selecting and coordinating the collaborative engagements and selecting the focus issues, as well as for annual reporting. [...] **Public policy engagement**
An important part of the active ownership strategy is also political engagement on the industry level. Baloise Asset Management is a member of both the UN-supported PRI and the Swiss Sustainable Finance (SSF) network. In addition, representatives of Asset Management participate in working groups and are members of the sustainability commission of the Swiss Insurance Association (SIA) and the Asset Management Association Switzerland (AMAS), both of which have the goal, among other things, of advancing and promoting responsible investment on the Swiss market. We are also part of expert groups that have been formed on this issue by the State Secretariat for International Finance (SIF) and the Swiss Financial Market Supervisory Authority (FINMA).

Der Inhalt dieser Richtlinie wird mindestens einmal jährlich durch den Engagement Manager überprüft. Im Rahmen dieser Überprüfung wird beurteilt, ob die Richtlinie aktuell ist und mit den anwendbaren nationalen und internationalen Vorschriften, Prinzipien und Standards sowie mit internen Richtlinien und Praktiken übereinstimmt. Bei Bedarf ergreift der Engagement Manager umgehend Massnahmen zur Anpassung und Aktualisierung. [...] Die grundsätzliche Organisation, Abläufe, Pflichten und Verantwortlichkeiten werden in den Richtlinien für verantwortungsbewusstes Investieren geregelt. In Ergänzung dazu werden die zentralen Einheiten und Funktionen sowie deren Aufgaben im Bereich Active Ownership im Folgenden kurz vorgestellt. Diese umfassen: - Geschäftsleitung der Baloise - Investment Insurance Committee - Active Ownership Council - Engagement Manager - Portfolio Management - Responsible Investment (RI) Team - Compliance - Risk Management [...] Andere Funktionen innerhalb der Organisation wie Group Public Affairs & Sustainability und Investment Strategy werden ebenfalls einbezogen und über die Active Ownership Aktivitäten informiert. [...] Die Geschäftsleitung der Baloise, die über Fachwissen im Bereich Nachhaltigkeit verfügt, wird regelmässig über die Entscheidungen des Active Ownership Council informiert, insbesondere über die Aufnahme und Beendigung direkter Engagements im Rahmen von Unternehmensdialogen in Bezug auf Drittkundenvermögen und Investmentfonds. [...] In Bezug auf Versicherungsgelder wird die vorliegende Richtlinie vom Leiter Konzernbereich Asset Management definiert. Hierbei wird er vom Insurance Investment Committee (IIC) beraten. Dieses Committee setzt sich aus Vertretern des Konzernbereichs Asset Management und den Kapitalverantwortlichen der ausländischen Versicherungsgesellschaften zusammen. Erlassen wird die Richtlinie vom Leiter des Konzernbereichs Asset Management. Die Anwendbarkeit dieser Richtlinie wird von den Entscheidungsträgern der Versicherungsgesellschaften der Baloise Gruppe erklärt. Das IIC verfügt über Fachkenntnisse im Bereich Nachhaltigkeit und trifft nach Beratung mit dem Active Ownership Council in Bezug auf direkte Unternehmensdialogen betreffend Versicherungsfonds, insbesondere bezüglich Initiierung und Beendigung von direkten Engagements. [...] Das AOC ist zuständig für die Überprüfung der Einhaltung der vordefinierten Kriterien im Prozess und Entscheidungsfindung im Zusammenhang mit direkten Unternehmensdialogen, insbesondere zu deren Initiierung und Beendigung, aus, die der Geschäftsleitung der Baloise und dem IIC vorgelegt werden. [...] Der Engagement Manager ist Teil des Responsible Investment Teams und ist die zentrale Rolle in der Ausführung der Active Ownership Strategie. Er ist verantwortlich für: - die detaillierte Prüfung möglicher Unternehmen, die für ein direktes Engagement in Frage kommen, inkl. Einschätzung möglicher Risiken aus Nachhaltigkeits- und Reputationssicht; - den Entscheid über die Art und Weise des Unternehmensdialogs; - die Durchführung des Unternehmensdialogs, i.d.R. zusammen mit einem PM Sponsor; - die abschliessende Evaluation des Engagements zur Ausarbeitung einer Konklusion am Ende des Engagement Zeitraums; - die regelmässige interne Berichterstattung an das AOC, RI Team, GL und IIC sowie den Informationsaustausch mit anderen relevanten Funktionen (inkl. Group Sustainability and Regulatory Affairs); - die Erstellung von Active Ownership Reports; - Screening, Auswahl und Durchführung kollaborativer Engagements; - die Mitarbeit in Initiativen, Verbänden und Arbeitsgruppen. [...] Compliance überprüft die Integration der nachhaltigkeitsbezogenen Kriterien in den Prozess für direkte Unternehmensdialoge und deren Einhaltung im Rahmen der Anlagetätigkeit. [...] Als unabhängige Kontrollfunktion berät Risk Management bei der Auswahl und Beendigung von direkten Engagements und ist ferner verantwortlich für: - die Sicherstellung der Einhaltung der vorgegebenen Active Ownership Strategie auf Produkteebene - die Sicherstellung der Identifikation und des Reportings der möglichen Verfehlungen der Einhaltung der Active Ownership Strategie an die entsprechenden Anspruchsgruppen.

Undertaking collaborative dialogue with companies and public policy engagement through our memberships of various industry associations (such as PRI, SSV, AMAS, SSF) [...] Public policy engagement: We also work with public authorities on ESG topics in certain policies. This takes place through our active involvement in various associations of which we are members: PRI (Principles for Responsible Investment), an initiative supported by the United Nations that focuses on responsible investment practices; SIA (Swiss Insurance Association), the association of Swiss insurers; AMAS (Asset Management Association Switzerland), an association representing the interests of the asset management sector in Switzerland; SSF (Swiss Sustainable Finance), an organisation devoted to the promotion of sustainability in the Swiss financial sector. These memberships provide support on specific or broader ESG topics such as reducing CO2 emissions, decarbonising the economy and protecting biodiversity. The focus areas also help to guide us in the selection of possible collaborative corporate discussions as part of our active ownership strategy.

The Engagement Manager reviews the content of this policy at least annually. This review assesses whether the policy is up to date and whether it complies with applicable national and international regulations, principles and standards as well as with internal policies and practices. If necessary, the Engagement Manager takes immediate action to adjust and update the policy. [...] The basic organisation, procedures, duties and responsibilities are governed by the Responsible Investment Policy. In addition, the key units and functions, as well as their tasks in the area of Active Ownership, are presented below. These include: — Baloise Executive Committee - Investment Insurance Committee - Active Ownership Council - Engagement Manager - Portfolio Management - Responsible Investment (RI) Team [...] The Baloise Executive Committee issues the policy on third-party client assets and investment funds. The Baloise Executive Committee management which has expertise in the area of sustainability is informed on a regular basis for the decisions taken by the Active Ownership Council, with respect to direct corporate dialogues concerning third-party client assets funds and investment funds, in particular regarding the initiation and termination of direct engagements. [...] The Head of Asset Management defines the policy on insurance assets, with the Insurance Investment Committee (IIC) providing advice. This Committee is composed of representatives of the Corporate Division Asset Management and the capital managers of the foreign insurance companies. The Head of Corporate Division Asset Management issues the policy. The applicability of this policy defined by the decision-makers of the Baloise Group insurance companies. The IIC has expertise in the area of sustainability and, following consultation with the Active Ownership Council with respect to direct corporate dialogues concerning insurance funds, in particular with regard to the initiation and termination of direct engagements. [...] The AOC is composed of representatives from: - Engagement Manager (Chair) - Portfolio Management (PM) - RI Team - Compliance - Risk Management The AOC is responsible for verifying compliance with the predefined criteria in the process and making decisions in conjunction with direct corporate dialogues, in particular for initiating and terminating them, which are submitted to the Baloise Executive Committee and the IIC. [...] The Engagement Manager is part of the Responsible Investment Team and plays the central role in the execution of the active ownership strategy. The Engagement Manager is responsible for: - Detailed examination of companies that could be considered for direct engagement, including assessment of possible risks from a sustainability and reputational perspective - The decision on how to conduct the corporate dialogue - Conducting the corporate dialogue, usually together with a PM sponsor - Final evaluation of the engagement in order to draw a conclusion at the end of the engagement period - Regular internal reporting to the AOC, RI Team, Executive Committee and IIC, as well as information sharing with other relevant functions (including Group Sustainability and Regulatory Affairs) - Preparation of Active Ownership Reports - Screening, selection and implementation of collaborative engagements - Participation in initiatives, associations and working groups. [...] Compliance evaluates and verifies the integration of the sustainability criteria into the process for direct corporate dialogues and their compliance with these criteria within the scope of investment activities. [...] Risk Management advises on the selection and termination of direct engagements and is also responsible for: - Ensuring compliance with the specified Active Ownership Strategy at product level - Ensuring identification and reporting of possible failures to comply with the Active Ownership Strategy to the relevant stakeholders.

**Public Policy Engagement** Representatives of the Responsible Investment Core Team have participated in various working groups that provide feedback on regulatory proposals from the State Secretariat for International Financial Matters (SIF) or other departments, for example. They were also part of the joint working group of the Asset Management Association Switzerland (AMAS) and Swiss Sustainable Finance (SSF) to develop the "Self-regulation on transparency and disclosure for sustainability-related collective investments", which is binding for all AMAS members.

At the heart of the organisation working on sustainability at Baloise is the Group-wide sustainability network that was created in 2019. Group-wide means that all national subsidiaries and Group functions, such as Compliance, Human Resources and Asset Management, are represented. This interdisciplinary structure means the network has the expertise it needs to perform its role. The network's tasks are strategic and consist of developing and steering the principle of how Baloise practises sustainability, and providing guidelines. The network is in regular dialogue with the Corporate Executive Committee. Sustainability representatives from the national subsidiaries in Switzerland, Germany, Belgium and Luxembourg are part of the Group-wide sustainability network. The Corporate Executive Committee provides feedback on proposals to the Group-wide network and facilitates implementation. The Corporate Executive Committee is also the link between the sustainability network and the Board of Directors. The Board of Directors is responsible for developing the sustainability approach at Baloise, integrating it into the overall strategy and overseeing it. This includes climate-related matters. Since 2022, the Board of Directors' Strategy and Governance Committee has been responsible for monitoring activities in the field of sustainable corporate governance. The Chairman of the Board of Directors chairs the Strategy and Governance Committee. The sustainability representatives of the national subsidiaries are the link to the local sustainability networks and the local Executive Committees, as well as the local Boards of Directors. The local networks focus on ensuring that sustainability is implemented in a manner appropriate to the local markets in every aspect. However, implementation is not the exclusive responsibility of the local networks. Together with the local departments, they coordinate which measures are implemented, as well as when and how they are implemented. Alignment between the networks is essential for Group-wide implementation and is ensured by the sustainability representatives of the national subsidiaries and at Group level. The specified corporate governance model was adopted by the Corporate Executive Committee and the Board of Directors at the end of 2019. Further governance structures are described in the relevant chapters, such as 'Responsible investment', 'Responsible underwriting' and 'Data governance & security'. Information on corporate governance can be found in the 2023 Annual Report, page 33 onwards. The Board of Directors dealt with the topic of sustainable corporate governance nine times in 2023. It featured three times in discussions of the Board of Directors' Strategy and Governance Committee: once in connection with the setting of our net zero targets, once in connection with the ongoing integration of ESG aspects into our business processes and once in the planning for 2024. It was discussed twice by the Board of Directors' Investment and Risk Committee, in connection with the setting of our net zero targets and in relation to an update on responsible investment activities, and once by the Audit Committee, in a discussion of reporting regulations. It was also discussed on three occasions at meetings of the full Board of Directors: once in connection with the setting of our net zero targets, once during a general update on the subject and once in the planning for 2024.

#### 4.1 Governance of the Baloise Group

The Baloise Group has had a Group-wide sustainability network since 2019. In 2021, country-specific working groups were established with a focus on implementing sustainability measures in the respective national markets. The working groups comprise members of all operating segments that have an influence on, or are influenced by, the issue of sustainability. These working groups are equipped with the necessary professional expertise to develop and regularly update the content of the sustainability approach, such as the value-added model.

The Corporate Executive Committee decides on the implementation of the content. The Board of Directors is responsible for developing the sustainability approach, embedding it in the overall strategy and overseeing its application. Since 2022, the Board of Directors' strategy and governance committee has also functioned as the sustainability committee, monitoring developments in sustainable management.

This Responsible Investment Policy is defined by the Head of Corporate Division Asset Management. The Insurance Investment Committee (IIC) provides advice. This committee is composed of representatives of the Corporate Division Asset Management and the capital managers of the foreign insurance companies.

The Head of Corporate Division Asset Management issues the policy. The decision-makers of the Baloise Group insurance companies define the applicability of this policy. [...] #### 4.2 Governance at the level of Corporate Division Asset Management

Corporate Division Asset Management has suitable organisation and processes in place to ensure that the obligations and responsibilities arising from this policy and emerging contracts are adequately implemented.

The central units as well as their duties in the field of responsible investment for Corporate Division Asset Management are outlined briefly below:

**Responsible Investment (RI) Core Team**

Corporate Division Asset Management has the necessary infrastructure and dedicated resources, which are independent of the operational functions and address sustainability issues. The core tasks of the RI Core Team include:

- Further development of RI strategies;

- Consultation for the entire organisation on all sustainability issues; and

- Monitoring of sustainability developments at corporate level and in terms of investments.

The RI Core Team also performs the following tasks:

- Initiation and management of cross-cutting ESG initiatives

- Development and coordination of ESG integration projects in organisation and business

- Coordination and exchange with the sustainability network and sustainability boards of the Baloise Group

- Ambassadorial function regarding RI

- Suggestions for the selection of new ESG data providers

- Development of training concepts and training of the organisation within the framework of the concepts adopted by the competent bodies

Regular exchange meetings take place between the RI Core Team and the control functions Risk Management and Compliance as well as the Head of Asset Strategy & Investment Controlling.

**Responsible Investment (RI) Guild**

The Responsible Investment Guild is interdisciplinary and consists of the RI Core Team and representatives from Portfolio Management, Product Management, the Legal Department or Investment Controlling and Reporting as well as individual representatives from other units of the Baloise Group.

This Guild has the necessary expertise and performs the following functions:

- Development and regular update of concepts related to the responsible investment approach

- Exchange and networking

- Collaboration on sustainability-related projects and initiatives

**Portfolio Management**

Portfolio Management is responsible for the implementation of the requirements of this policy in the investment process and, in particular, for the integration of sustainability-related criteria in the investment process and their compliance. The responsible portfolio managers have and maintain the necessary expertise in the area of sustainability.

**Compliance**

Compliance reviews the integration of the sustainability-related criteria in the investment process and their compliance within the scope of investment activities with a focus on the regulatory and contractual aspects.

**Risk Management**

Risk Management is responsible for defining, implementing, and monitoring control frameworks, in particular with regard to:

- identifying, monitoring and internal reporting of sustainability risks in the investment process;

- ensuring compliance with the specified responsible investment strategy at product level;

- transparent validation of external data suppliers of ESG data;

- traceability of the implemented ESG risk rating methodology of the external data provider; and

- ensuring that breaches of the responsible investment strategy are identified and reported to the appropriate bodies.

Other functions such as finance, investor relations, communications and legal can also play an important role.

Corporate Division Asset Management provides appropriate internal and/or external resources for the familiarisation and training of all stakeholders involved in order to provide them with standard and in-depth knowledge of the necessary ESG topics.

#### 4.1 Governance of the Baloise Group

The Baloise Group has had a Group-wide sustainability network since 2019. In 2021, country-specific working groups were established with a focus on implementing sustainability measures in the respective national markets. The working groups comprise members of all operating segments that have an influence on, or are influenced by, the issue of sustainability. These working groups are equipped with the necessary professional expertise to develop and regularly update the content of the sustainability approach, such as the value-added model.

The Corporate Executive Committee decides on the implementation of the content. The Board of Directors is responsible for developing the sustainability approach, embedding it in the overall strategy and overseeing its application. Since 2022, the Board of Directors' strategy and governance committee has also functioned as the sustainability committee, monitoring developments in sustainable management.

This Responsible Investment Policy is defined by the Head of Corporate Division Asset Management. The Insurance Investment Committee (IIC) provides advice. This committee is composed of representatives of the Corporate Division Asset Management and the capital managers of the foreign insurance companies.

The Head of Corporate Division Asset Management issues the policy. The decision-makers of the Baloise Group insurance companies define the applicability of this policy. [...] #### 4.2 Governance at the level of Corporate Division Asset Management

Corporate Division Asset Management has suitable organisation and processes in place to ensure that the obligations and responsibilities arising from this policy and emerging contracts are adequately implemented.

The central units as well as their duties in the field of responsible investment for Corporate Division Asset Management are outlined briefly below:

**Responsible Investment (RI) Core Team**

Corporate Division Asset Management has the necessary infrastructure and dedicated resources, which are independent of the operational functions and address sustainability issues. The core tasks of the RI Core Team include:

- Further development of RI strategies;

- Consultation for the entire organisation on all sustainability issues; and

- Monitoring of sustainability developments at corporate level and in terms of investments.

The RI Core Team also performs the following tasks:

- Initiation and management of cross-cutting ESG initiatives

- Development and coordination of ESG integration projects in organisation and business

- Coordination and exchange with the sustainability network and sustainability boards of the Baloise Group

- Ambassadorial function regarding RI

- Suggestions for the selection of new ESG data providers

- Development of training concepts and training of the organisation within the framework of the concepts adopted by the competent bodies

Regular exchange meetings take place between the RI Core Team and the control functions Risk Management and Compliance as well as the Head of Asset Strategy & Investment Controlling.

**Responsible Investment (RI) Guild**

The Responsible Investment Guild is interdisciplinary and consists of the RI Core Team and representatives from Portfolio Management, Product Management, the Legal Department or Investment Controlling and Reporting as well as individual representatives from other units of the Baloise Group.

This Guild has the necessary expertise and performs the following functions:

- Development and regular update of concepts related to the responsible investment approach

- Exchange and networking

- Collaboration on sustainability-related projects and initiatives

**Portfolio Management**

Portfolio Management is responsible for the implementation of the requirements of this policy in the investment process and, in particular, for the integration of sustainability-related criteria in the investment process and their compliance. The responsible portfolio managers have and maintain the necessary expertise in the area of sustainability.

**Compliance**

Compliance reviews the integration of the sustainability-related criteria in the investment process and their compliance within the scope of investment activities with a focus on the regulatory and contractual aspects.

**Risk Management**

Risk Management is responsible for defining, implementing, and monitoring control frameworks, in particular with regard to:

- identifying, monitoring and internal reporting of sustainability risks in the investment process;

- ensuring compliance with the specified responsible investment strategy at product level;

- transparent validation of external data suppliers of ESG data;

- traceability of the implemented ESG risk rating methodology of the external data provider; and

- ensuring that breaches of the responsible investment strategy are identified and reported to the appropriate bodies.

Other functions such as finance, investor relations, communications and legal can also play an important role.

Corporate Division Asset Management provides appropriate internal and/or external resources for the familiarisation and training of all stakeholders involved in order to provide them with standard and in-depth knowledge of the necessary ESG topics.

Representatives of the Baloise Sustainability team and the Responsible Investment core team participated in the working groups listed below that provide feedback on regulatory proposals from the Swiss State Secretariat for International Finance (SIF) or other institutions.

These working groups include the following:

- Member of the Sustainability Commission of the Swiss Insurance Association (SIA),
- Sustainability Commission of Swiss Sustainable Finance (SSF) and Asset Management Association Switzerland (AMAS) (jointly),
- Expert Panel on Climate Risks of the Swiss Financial Market Authority (FINMA).

Representatives of the Baloise Responsible Investment core team were also part of the AMAS working group to develop version two of the "Self-regulation on transparency and disclosure for sustainability-related collective assets", which is binding for all AMAS members. In addition, the team was part of the development of the first "Self-regulation on the prevention of greenwashing in sustainability-related unit-linked life insurance" of the SIA.

Does your organization have a public commitment or position statement to conduct your engagement activities in line with the goals of the Paris Agreement?[…]No, but we plan to have one in the next two years