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 bond portfolio. It is not making any new investments in companies which derive more than 10% of revenue from the mining, extraction and sale of coal for power stations to external parties.
In its Responsible Investment Manual, Swiss Life defines a coal limit for its infrastructure equity investments in the context of the infrastructure funds: Swiss Life does not invest in companies or projects with a coal valuation contribution exceeding 10%. This means that the present value of cash flows 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 limits for coal comprise the areas in which Swiss Life can in principle make corresponding investments.
A thermal coal phase-out strategy for the PAM corporate bond portfolio has been formalised in order to contribute to the transition towards a more sustainable and low-carbon economy and mitigate the risk of stranded assets. In the course of 2020, Swiss Life’s investment in companies that derive 10% or more of their revenues from the mining, extraction or sale of thermal coal to external parties was reduced to 0%. As at the end of 2022, this position remains unchanged at 0%. In connection with Article 29 of the French regulation Loi Énergie-Climat, Swiss Life Asset Managers France has implemented a division-specific coal exit strategy. 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, these limit values may be exceeded in future.
At the end of 2022, infrastructure equity investments within the framework of all infrastructure funds in companies or projects with a valuation contribution of 10% or more from the extraction, sale and trading of coal or the generation of electricity and heat from coal amounted to 0%. The exposure at the end of 2022 with respect to the same threshold was also 0% for investments within the PAM infrastructure equity portfolio.