Climate-related portfolio ambitions of the Swiss Life Group
Thresholds for coal
Swiss Life has adopted a thermal coal phase-out strategy for its PAM corporate bond portfolio by refraining from new investments in companies that derive more than 10% of revenues from mining, extracting and selling thermal coal to external parties.
Swiss Life has set a coal threshold for infrastructure equity investments within the Global Infrastructure Opportunities III (GIO III) fund: Swiss Life refrains from investing in companies or projects with a coal valuation contribution exceeding 10%, meaning the present value of cash flows generated from extracting, selling and trading coal or generating electricity and heat from coal must be below 10% of the company’s or project’s valuation.
The thresholds for coal comprise the areas in which Swiss Life can make corresponding investments.
A thermal coal phase-out strategy for Swiss Life’s PAM corporate bond portfolio has been formalised in order to contribute to the transition towards a more sustainable and low-carbon economy and avoid the risk of stranded assets. In the course of 2020, Swiss Life’s exposure to companies that derive 10% or more of their revenues from mining, extracting or selling thermal coal to external parties was reduced to 0%. As at the end of 2021, this position remains unchanged at 0%. Swiss Life also does not hold any items in its PAM equity portfolio that exceed this threshold. As Swiss Life pursues a partially passive investment strategy for equities, some exemptions may be necessary in future.
For the infrastructure equity investments within the GIO III fund, Swiss Life has set a coal threshold covering both thermal and coking coal. As at the end of 2021, the exposure of infrastructure equity investments within the scope of Swiss Life’s infrastructure funds1 to companies or projects with a valuation contribution of 10% or more from extracting, selling and trading coal or generating electricity and heat from coal was 0%. The exposure at the end of 2021 with respect to the same threshold was also 0% for investments within Swiss Life’s PAM infrastructure equity portfolio.
1 These comprise the GIO Growth, GIO I, GIO II, GIO III and GIO III Co-Invest funds.