Since having been founded in 2009, thinking and acting responsibly, as well as sustainably, have been central components of our corporate culture and the basis for our cooperation within the team, with our customers and our partners. Even within our own business activities, we regularly try to improve our environmental footprint whenever possible, e.g. by avoiding air travel if possible and instead using environmentally friendly means of transportation. We are convinced that particularly investors and fund managers have a responsibility to actively consider, not only risk factors and return expectations, but also which impact is enabled by an investment decision and whether the decision can be reconciled with the responsibility for our environment. This recognition is based on the insight that sustainable returns can only be achieved if environmental and social aspects are appropriately incorporated into the decision-making process and, in particular, if risks are carefully evaluated.
Accordingly, we view ourselves as responsible investors and since having signed the Principles for Responsible Investing of the United Nations-backed UNPRI in 2017, we have committed ourselves to incorporating environmental, social and governance (ESG) factors into our investment processes and portfolio construction when making investment decisions. We are committed to transparent reporting on ESG impacts and strive to engage in close dialogue with the issuers of the financial instruments that we acquire, so we can continuously improve the ESG performance.
We do not view sustainability and socially responsible investing as an abstract goal, but instead as a long-term commitment and process of continuous development. We believe that through ESG integration, we can reduce fundamental risks in our portfolios and business, thus creating value for our clients and team.
Inclusion of sustainability risks in the investment process
ESG analysis and scoring: We systematically and regularly review and assess ESG risks and factors for both our portfolio positions and acquisition decisions. For assesement purposes, we use ESG standards and key performance indicators (KPIs), as well as the MSCI ESG sustainability rating from MSCI ESG Research and also include independent analyses.
Best-in-class approach: Given equivalent investment alternatives, we select the issuers that offer the highest standards from an environmental, social and corporate governance perspective when compared to other sectors. We do not purchase financial instruments from issuers if there are reasonable doubts as to whether they are willing to respect human rights, assume social responsibility for the environment, society and fellow human beings, or act responsibly with regards to climate, nature and resources.
Minimum MSCI ESG rating: For each of our portfolios, we have defined a minimum ESG criteria, exclusion grounds and target values based on MSCI ESG data for specifically defined parameters. These are taken into account as part of the investment process and consistently applied throughout the investment decision.
The company's remuneration policy: The remuneration of nordIX employees, including the management board, generally consists of fixed and, in individual cases, variable components, as well as additional benefits. Variable components of remuneration are determined on the basis of qualitative or also quantitative performance targets. The remuneration policy at nordIX ensures that no incentive or remuneration package encourages excessive sustainability risks.