Translations

LA FRANÇAISE ( GROUP CREDIT MUTUEL NORD EUROPE) defines its Strategically Aware Investing (SAI)

1. Organizational Governance

Relations with stakeholders

Sector Finance / Bank / Insurance

Year 2018

Country France

Transmitter

Context

Created in 1975, La Française, subsidiary of Credit Mutuel Nord Europe (CMNE) is in 2013, with 480 employees, an intermediate player in management of financial assets with a capital of 47 billion euros placed in 4 types of investments (securities, real estate, solutions of investment and incubation) in France and internationally. In the continuity of its 2009 commitment in the investment socially responsible (ISR), La Française teamed up with its partner ICMP (Inflection Point Capital Management) to set in 2013 a strategically Aware Investing (SAI). The ISR approach (Investment socially responsible), was set up in 2009 by La Française. This approach combines the criteria of financial performance with those of governance and societal /environmental commitments in the choice of portfolios of assets. It was recognized in 2012 by the Novethic agency. In 2013, the SAI approach incorporated the ISR criteria by "expanding" them into strategic positioning criteria capable of identifying tomorrow's leading companies.

Objectives

Respect the traditional criteria of financial profitability.
Associate the ISR criteria (economic, societal/environmental and governance) to the criteria of innovation and adaptation of the companies in undertaking the challenges of the future.
Identify and develop enterprises in promising areas (economy of functionality, access to the functionality more than the property, energy transition...).

APPROACH

The SAI approach has been built on 3 foundations:

Core Financial and quantitative research : thanks to an analysis based of traditional criteria (such as cost-effectiveness, risks…), the group can provide firstly a focus list in which the manager can build his portfolio.
"5 factors" Research : it measures the responsiveness of firms towards global issues. This analysis is based on:

- The 3 risk criteria ESG (Environmental, Social and of Governance) of the ISR. This practice is based on the respect of internationally recognized standards and conventions such as the 10 principles of the United Nations Global Compact. Thus any company that would be recognized in violation of these principles would be immediately excluded from the investment universe and would not be subject to further analysis.

- The capacity to innovate

- The ability to adapt

Research on global trends : with this strategic, sectorial and thematic analysis, it is possible for the group to determine the best firms’ management in the global issues’ context (such as demographic growth, natural resources disputes, increasing urbanization).

The SAI approach has been applied to all asset classes, which naturally includes real estate. As a result, the LFP IMMO SR investment fund won first place in France within the Tertiary sector by the GRESB (Global Real Estate Sustainability Benchmark). The GRESB ranking is based on corporate commitment, sustainable management policy and the environmental data produced on buildings held in the portfolio.

Best Practice spotted by the World Forum for a Responsible Economy in 2014 and updated in 2016.

CONTRIBUTION TO COMPANY PERFORMANCE

53 billion euros in assets under management as of 31st December 2015 (vs. €48 billion at the end of 2013);
Invested SAI funds amounted to €1.4 billion on 31st December 2015 (€830 million in equity, €520 million in real estate, and €50 million in bonds);
LFP IMMO SR, rated Green Star 2015 (first in France in the Office sector - GRESB - 2015), whose label offers recognition at the international level.

Benefits

Signatory to the Principles for Responsible Investment (2010)
Signatory to the Charter for energy efficiency in public and private tertiary buildings (2013)
Signatory to the Carbon Disclosure Project (2013)
Signatory to Japan's Stewardship Code (2015)
Signatory to the Principles for Responsible Investment Statement on ESG in Credit Ratings (2015)