In 2021, DNCA Finance calculated and published the climate trajectory of its investments for the first time. This year, DNCA is back with an updated version of its analysis, incorporating an assessment of its footprint on other key factors related to biodiversity: water and soil use.

Since the 1992 Rio de Janeiro Earth Summit and the signing of the Convention on Biological Diversity (CBD) by 168 parties, biodiversity conservation has been recognised in international law as a major concern. Biodiversity conservation programmes have been implemented since then, mobilising the financial sector, and more particularly asset managers, to promote a more virtuous allocation of funds. The objective is to identify the projects and companies to be financed as a priority in order to adapt and transition the economy.

In this context, DNCA Finance has analysed more than 1,000 stocks covering nearly €23 billion, i.e. more than 75% of the management company's assets at the end of 2021. All environmental pressure indicators were calculated from company data provided by the Carbon Disclosure Project (CDP).

The aggregate temperature of DNCA Finance's investments is, according to the methodology, between +1.7°c and +2.3°c, which is an improvement on last year. This result is explained by the increase in the number of companies with a temperature score (+153%), as well as by the increase in the number of companies whose targets are validated by the Science Based Target Initiative (SBTi, +105%).

DNCA Finance's water and soil use footprints are lower than those of MSCI Europe. To give an order of magnitude, DNCA Finance's portfolios generate a withdrawal of 13,373 ML of water per year for 1 billion euros invested, while the city of Paris withdraws 14,100ML of water each month. In terms of land use, the management company has a footprint of 67 hectares per billion euros invested. For comparison, the Bois de Vincennes covers an area of nearly 1,000 hectares. These results are affected by the fact that data for many issuers is not yet available (the scope analysed for water use represents 28% of DNCA's assets and 1.5% for land).

More than just a tool to monitor the biodiversity footprint of DNCA's portfolios, this publication allows the management company to track the progress of its environmental objectives and to identify companies with the lowest scores in order to encourage them to commit to the climate.

To download full report, please follow the link. 

Written on September 26th 2022. 

This article has been provided for information purposes only to professional clients. It must not be used for retail investors. The provision of this material or reference to specific sectors or markets in his article does not constitute investment advice or a recommendation or an offer to buy or sell any security. Investors should consider the investment objectives, risks, and expenses of any investment carefully before investing. Views expressed in this article as of the date indicated are subject to change and there can be no assurance that developments will transpire as may be forecasted in this article.
DNCA FINANCE - Affiliate of Natixis Investment Managers. DNCA has been approved as a portfolio management company by the French Financial Market Authority (Autorité des Marchés Financiers) under number GP00-030 since 18 August 2000. 19, place Vendôme - 75001 Paris.