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Amra Balic World Circular Economy Forum 2017 Helsinki Finland

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Promoting sustainability – an investor perspective

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Amra Balic World Circular Economy Forum 2017 Helsinki Finland

  1. 1. Promoting sustainability – an investor perspective Amra Balic, Managing Director June 2017 FOR PROFESSIONAL CLIENTS / QUALIFIED INVESTORS ONLY 20170523-164232-453645
  2. 2. BlackRock at a glance * As of 31 March 2017 • Established in 1988 • NYSE: BLK • $5.42 trillion assets under management • More than 12,000 employees • More than 1,800 investment professionals • Offices in over 30 countries • 25 primary investment centers globally • Clients in over 100 countries • Over 800 iShares® ETFs Globally • Through BlackRock Solutions, the Firm provides risk management and enterprise investment services for over 200 clients • Financial Markets Advisory business managed or advised on over $8 trillion in asset and derivative portfolios • Transition Management team partners with clients to save costs and reduce risks when changing investment exposures BlackRock facts * $5.42 trillion managed across asset classes Create a better financial future for our clients by building the most respected investment and risk manager in the world BlackRock Mission Statement Assets as of 31 March 2017 1 Includes commodity and currency mandates Active Equity 286 bn Passive Equity 2.6 tn Alternatives1 121 bn Active Fixed Income 765 bn Passive Fixed Income 865 bn Multi-Asset 412 bn Cash Management 389 bn Advisory 3 bn FOR PROFESSIONAL CLIENTS / QUALIFIED INVESTORS ONLY 2 20170523-164232-453645
  3. 3. Environmental, Social & Governance (ESG) has grown in significance 3 1995 1997 2000 2004 2006 2007-08 2010 2011 2012 2013 2014 2015 2004 Dutch Corporate Governance code 2005 UNEP Finance Initiative commissioned a report from Freshfields on the interpretation of law with respect to investors and ESG issues concluding integration was part of Fiduciary Duty 2007– 2008 Financial Crisis 2008 Bloomberg launches ESG Platform 2011 Bloomberg now has 5,217 companies reporting on ESG indicators since 2013 Emergence of fossil fuel divestment movement 1995 Dutch Green investment directive 2000 UN Global Compact established 2006 UN PRI guidelines issued – 68 founding signatories 2010 UK Stewardship Code 2012 $13.3t in SRI strategies 2014 • European Parliament approved disclosure of ESG information by certain large listed European companies • $21.4t in SRI strategies • Montreal carbon pledge 2015 • France pass law requiring French investors to report on the climate impacts of their investments • 1,372 UNPRI signatories • USA Clean Power Plan 2016 2016 • Member States finalise the EU Directive on non-financial disclosure • Ratification of the Paris agreement • Dutch corporate governance code update 2017 2017 • UK Consultation on Corporate Governance • Following the adoption of the revised Shareholder Rights Directive (SRD II), publication of engagement policies by asset owners and managers 1997 GRI founded FOR PROFESSIONAL CLIENTS / QUALIFIED INVESTORS ONLY 20170523-164232-453645
  4. 4. BlackRock Investment Stewardship in practice 4FOR PROFESSIONAL CLIENTS / QUALIFIED INVESTORS ONLY 20170523-164232-453645
  5. 5. Our Investment Stewardship helps BlackRock fulfil its fiduciary duty to investors to protect and enhance the economic value of their assets Investment Stewardship team capabilities The core components of the program are: with management or board members on corporate governance, social and environmental factors Engaging in market level dialogue to understand and contribute to the development of policies and practices that support long-term shareholder value creation Participating corporate governance, including environmental and social factors, impacting the long-term value of our clients’ investments Analyzing at company shareholder meetings in the best long-term economic interests of shareholders Voting FOR PROFESSIONAL CLIENTS / QUALIFIED INVESTORS ONLY 5 20170523-164232-453645
  6. 6. Investment Stewardship engagement priorities for 2017-2018* 6 *Reporting cycle from July 2017 to July 2018. Governance Corporate strategy for the long term Compensation that promotes long-termism Disclosure of climate risks Human capital management Board composition, effectiveness, diversity, and accountability remain a top priority. Board review of corporate strategy is key in light of shifting assumptions. Executive pay policies should link closely to long-term strategy and goals. Consistent disclosure of standards would enhance understanding of the impact of climate change on individual companies, sectors and investment strategies. In a talent constrained environment, human capital management is a competitive advantage. FOR PROFESSIONAL CLIENTS / QUALIFIED INVESTORS ONLY 20170523-164232-453645
  7. 7. 7FOR PROFESSIONAL CLIENTS AND QUALIFIED INVESTORS ONLY Unless otherwise stated all data is as at 31 March 2017, Source; BlackRock. This material is for distribution to Professional Clients (as defined by the FCA or MiFID Rules) and Qualified Investors only and should not be relied upon by any other persons. Issued by BlackRock Investment Management (UK) Limited, authorised and regulated by the Financial Conduct Authority. Registered office: 12 Throgmorton Avenue, London, EC2N 2DL. Tel: 020 7743 3000. Registered in England No. 2020394. For your protection telephone calls are usually recorded. BlackRock is a trading name of BlackRock Investment Management (UK) Limited. Past performance is not a guide to current or future performance. The value of investments and the income from them can fall as well as rise and is not guaranteed. You may not get back the amount originally invested. Changes in the rates of exchange between currencies may cause the value of investments to diminish or increase. Fluctuation may be particularly marked in the case of a higher volatility fund and the value of an investment may fall suddenly and substantially. Levels and basis of taxation may change from time to time. Any research in this document has been procured and may have been acted on by BlackRock for its own purpose. The results of such research are being made available only incidentally. The views expressed do not constitute investment or any other advice and are subject to change. They do not necessarily reflect the views of any company in the BlackRock Group or any part thereof and no assurances are made as to their accuracy. This document is for information purposes only and does not constitute an offer or invitation to anyone to invest in any BlackRock funds and has not been prepared in connection with any such offer. © 2017 BlackRock, Inc. All Rights reserved. BLACKROCK, BLACKROCK SOLUTIONS, iSHARES, BUILD ON BLACKROCK, SO WHAT DO I DO WITH MY MONEY and the stylized i logo are registered and unregistered trademarks of BlackRock, Inc. or its subsidiaries in the United States and elsewhere. All other trademarks are those of their respective owners. Disclaimer 20170523-164232-453645

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