Vision

At Vive, investing goes beyond financial aspects. Vive does not promote sustainable investments itself but incorporates sustainability criteria into its selection policy. Vive strives to select investment funds and managers that excel in sustainability within their category. Sustainability is approached from two sides.

1. Sustainability Risks (Outside-in): Vive analyzes sustainability risks that may affect investment performance, such as environmental issues, social risks and poor corporate governance. These are referred to briefly as ESG factors: Environment, Social and Governance. We integrate these risks into our investment process to make informed selection decisions that enhance the robustness of our portfolios.
2. Sustainability Impact (Inside-out): Vive considers the impact of its investments and strives to mitigate negative impacts. In addition, we pay attention to how our fund selection can contribute to a more sustainable world. We test this on the basis of the criteria in the Sustainable Finance Disclosure Regulation (SFDR). This is European legislation that thus provides an independent assessment framework.

By managing sustainability risks with ESG integration, we strengthen our risk-return ratio and support our long-term goals.

Application of SRI

Vive has not set specific sustainability targets but selects investment funds based on a selection policy, where sustainability characteristics are taken into account, with the goal of a balanced risk-return ratio. This policy is based on three core principles:

1. Exclusion Policy: Vive invests only in funds that actively exclude investments based on a structured exclusion policy.
2. Best-in-Class Selection: Vive only invests in funds that excel on sustainability within their asset class and mandate through ESG performance and promote ESG goals or make positive impact in line with SFDR criteria. To ensure this, Vive only selects funds with:
   1. Minimum MSCI ESG rating BBB
   2. Minimum SFDR Article 8 classification, with a preference for Article 9 funds
3. Voting Rights and Engagement: Vive only invests in funds that actively exercise their voting rights and have a clear engagement strategy to drive improvements in sustainability issues.

For government bonds, the SFDR criteria are not applied by default, as they are generally not as easily measurable as other asset classes. The SFDR ratings give us a transparent and objective framework to assess the sustainability profile of our investments.

Through this policy, we ensure that our investments not only meet financial requirements, but also contribute to sustainable and social value, appropriate to the ongoing development of sustainability standards and regulations.

Overview by sustainability criteria

1. Sustainability Risks & ESG Ratings.

Sustainability risks

A sustainability risk is an Environment, Social or Governance event or circumstance that could potentially negatively impact the value of an investment. Examples of such risks are:

Environmental risks: Climate change may reduce the value of investments in carbon-intensive sectors because the business model of these companies may not be sustainable over time.

Social risks: Poor working conditions or human rights violations can damage a company's reputation, negatively impacting its bottom line.

Governance risks: Lack of good governance, such as corruption or inadequate risk management, can lead to operational and financial problems.

ESG Ratings

ESG Ratings measure how well a company handles financially relevant sustainability risks and opportunities. These ratings are used to identify leaders and laggards within sectors based on:

1. Their exposure to ESG risks.
2. Their ability to effectively manage these risks compared to competitors.

ESG Ratings are categorized as:

1. ‍Leaders: AAA, AA‍.
2. Average: A, BBB, BB‍.
3. Laggards: B, CCC

These ratings are applicable to different asset classes, such as stocks, corporate bonds and government bonds.

What does Vive do in terms of sustainability risk and ESG ratings?

At Vive, we actively integrate ESG principles into our investment policies to mitigate sustainability risks and promote responsible investing. Our Best-in-Class approach focuses on selecting funds that outperform their peers on ESG criteria within their sector. We use ESG ratings as a key metric within our selection process. These ratings help us identify funds that fit within the standards of our policy. Vive only selects funds with at least ESG rating BBB, aiming for the highest scores within each segment. The funds Vive invests in score as follows based on MSCI ESG rating.

2. Mitigation of negative impact (PAI).

Principal Adverse Impact (PAI) criteria

One way to invest sustainably is to exclude investments with negative impacts on people and the environment. To identify the negative impacts of investments, the Principle Adverse Impact (PAI) indicators were created. This set of 64 measurable indicators evaluates the potential negative effects of an investment.

For investment products that indicate they take into account certain negative impacts, it is mandatory to report on at least 18 of these 64 PAI indicators. Of these 18, 14 are core indicators that must be mandatorily measured for all relevant investment products; in addition, 4 additional indicators may be included at your discretion. The 14 mandatory indicators are:

• Greenhouse gas emissions
• Carbon footprint
• Greenhouse gas intensity of investee companies
• Exposure to companies active in the fossil fuel sector
• Non-renewable energy consumption and generation.
• Intensity of energy consumption by sector with major climate impacts
• Negative impacts on biodiversity-sensitive areas
• Emissions to water
• Hazardous and radioactive waste ratio
• Violations of UNGC and OECD guidelines.
• Lack of procedures and compliance mechanisms for monitoring compliance with UNGC and OECD guidelines
• Unadjusted gender pay gap
• Gender diversity board of directors
• Controversial weapons

What is Vive doing in terms of negative impact and PAI?

Vive only selects funds with structured exclusion policies. In addition, Vive does not use specific exclusions to mitigate certain negative impacts.

What are the underlying funds doing in terms of negative impact and PAI?

The underlying funds, in which Vive invests, report on the specific negative impacts (PAI indicators) they mitigate through their exclusion policies. Below is a summary of the negative impacts the funds limit in each of Vive's asset classes.

3. Positive social and environmental contribution (SFDR).

Sustainable Finance Disclosure Regulation (SFDR) classifications.

The Sustainable Finance Disclosure Regulation (SFDR) provides a European framework for classifying investments based on their sustainability ambitions and performance. Only investments that meet the SFDR requirements may be labeled as sustainable. These regulations require financial institutions to report transparently on how sustainability is integrated into their investment choices and allow investors to be better informed about the sustainability of investment products. SFDR divides products into three categories based on the extent to which sustainability plays a role:

• Article 6: Investment products that do not actively integrate sustainability and typically do not provide specific information about addressing sustainability risks within the investment strategy. These products are often referred to as "gray investments."
• Article 8: Investment products that consider the impact of investments on ESG criteria, without requiring sustainability to be the primary focus. These funds can pursue sustainable investment goals, but this is not mandatory. Article 8 funds are known as "light green investments."
• Article 9: Investment products with an explicit focus on sustainable objectives, aiming for measurable positive impact on ESG. Article 9 funds focus on deep sustainability and are referred to as "dark green investments."

This rating system helps investors discern the sustainability performance of investment products and provides a standardized basis for responsible investment choices.

What does Vive do in terms of positive social and environmental contribution & SFDR

Vive selects, whenever possible, only funds that meet at least SFDR Article 8 criteria, with a strong preference for Article 9 funds. However, these classifications do not apply to investments in government bonds. Vive's selection criteria do not set a minimum percentage in SFDR compliant sustainable investments but apply only to the fund's SFDR classification. Below is an overview of Vive's funds and SFDR classifications.

What are the underlying funds doing in terms of positive social and environmental contribution & SFDR

Funds with an SFDR Article 8 classification are not required to have a minimum target of SRI in accordance with SFDR. Vive does not set a minimum requirement for this either. However, some of the funds in which Vive invests do have a minimum target for these SRI investments.

Below is a summary of the objectives of the funds in which Vive invests, as well as the reported percentages of sustainable investments achieved in accordance with SFDR.

What is a sustainable investment in accordance with SFDR?

Fund managers have internal policies and methodologies to measure whether an investment is sustainable in accordance with SFDR. There is no uniform set of tools to classify investment as sustainable in accordance with SFDR. SFDR legislation prescribes that an investment may be called sustainable under three conditions:

1. The investment must make a positive contribution to an environmental or social objective.
2. The investment must comply with the "Do No Significant Harm" principle, which means that the investment does not contribute to activities that could cause significant harm, such as controversial weapons.
3. The investee company must meet standards of good governance practices with clear rules to prevent social problems.

If a fund manager determines that an investment adheres to all 3 of these conditions, then it is a sustainable investment in accordance with SFDR.

4. Ecologically sustainable investments (EU Taxonomy).

EU Taxonomy

An investment is only classified as environmentally sustainable by the EU Taxonomy if the underlying activity contributes significantly and measurably to at least one of the six established environmental objectives. In addition, data must also show that the company does not significantly harm other environmental objectives (the "Do No Significant Harm" principle). The company must also meet social benchmarks, such as protecting labor rights and respecting human rights.

The six ecological objectives of the EU Taxonomy are:

1. Climate change mitigation: Reducing the company's impact on global warming by, for example, reducing greenhouse gas emissions.
2. Climate change adaptation: Measures to manage the impact of climate change on the organization by, for example, building levees to protect against flooding.
3. Sustainable use and protection of water and marine resources: promoting efficient water use and protecting water quality.
4. Transition to a circular economy: promoting recycling, reuse and reducing waste generation.
5. Pollution prevention and control: preventing and reducing air, water and soil pollution.
6. Protection and restoration of biodiversity and ecosystems: Conservation and restoration of natural habitats and prevention of biodiversity loss

What does Vive do on environmentally sustainable investments & the EU Taxonomy

None of Vive's sustainable selection criteria address sustainable investments according to the EU Taxonomy.

What does Vive do on environmentally sustainable investments & the EU Taxonomy

None of the underlying funds Vive invests in has an environmentally sustainable investment target in accordance with the EU Taxonomy.

Only the Fund Corporate Loans Euro retrospectively reports environmentally sustainable investments of 1.06% (31/12/2023) in accordance with the EU Taxonomy.

Continuous improvement and adaptation

Sustainability is a topic in constant evolution. At Vive, we recognize that the standards, legislation and insights surrounding SRI continue to evolve. We therefore continue to continuously hone our sustainability policy and adapt it to the latest developments. This enables us to continuously align our strategy with industry best practices.

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