ESG
matters
Environmental, Social and Governance
thought piece
Issue 13
FinTech: Buzzing
about Blockchain
04
The Dao: Do nothing, and nothing is left
undone
12
Methane emissions: The next frontier
for the Oil & Gas industry
18
Dialogue between shareholders and
the German supervisory board
20
How does ESG affect the credit rating of
corporate bonds?
by Robbie Miles
by Marie-Sybille Connan
by Henrike Kulmann
by Dr. Steffen Hörter
Understand. Act.
The Global ESG Team
LONDON
Eugenia Jackson, Head of ESG Research
Marissa Blankenship, ESG Analyst
Robbie Miles, ESG Analyst
PARIS
Eugenia Jackson
Head of ESG Research
Marie-Sybille Connan, ESG Analyst
Mathilde Moulin, ESG Analyst
FRANKFURT
Henrike Kulmann, ESG Analyst
Dear reader
Rainer Sauer, Proxy Voting Specialist
CONTACT DETAILS
Welcome to the 13th edition of ESG matters. The lead article by Marissa Blankenship
investigates the development and merits of Blockchain and the regulatory hurdles that this
technology will have to overcome before widespread application within the financial
industry is possible. Robbie Miles explores the world of the DAO: a business model that breaks
all conventions about how a company works, combining the two recent major technology
innovations of Blockchain and Crowdfunding.
For any further information please contact:
Further to our special edition on Climate Change in November of last year, Marie-Sybille
Connan in her latest article, raises awareness about Methane emissions and argues that any
strategy on climate change should tackle both Carbon Dioxide and Methane emissions in
order to limit global warming.
Editorial
Henrike Kulmann discusses a recent initiative in Germany which aims to increase dialogue
between shareholders and supervisory boards members of listed companies. While
meetings with the non-executive board members are becoming business as usual in the
United Kingdom, such exchanges are currently the exception rather than the rule in
Germany.
Finally, this edition closes with an extract from the latest whitepaper by Dr. Steffen Hörter
(Global Head of ESG) and his team, the aim of this paper is to find evidence of the material
effect of ESG dimensions in the performance of listed corporate bonds. For this edition we
have taken a short extract from the paper which looks at how ESG affects the credit ratings of
listed companies’ bonds.
We hope you enjoy reading this edition of ESG matters.
As always we are happy to discuss any comments or address any questions that you may
have about our magazine.
Eugenia Jackson
Head of ESG Research
2
Eugenia Jackson
Head of ESG Research
 [email protected]
 +44 20 3246 7134
 www.esgmatters.co.uk
Emma-Louise Allen, Allianz Global Investors
Design and Art Direction
Susan Lane, Allianz Global Investors
Imagery
Getty Images, iStockphoto
Allianz Global Investors GmbH,
UK Branch
199 Bishopsgate
London EC2M 3TY
 www. allianzglobalinvestors.co.uk
+44 20 7859 9000
© 2016 Allianz Global Investors
All rights reserved
ESG Matters | Issue 13
EXECUTIVE
PAY
04 08
12
Contents
18
20
04
The DAO: Do nothing, and nothing is left undone
08
FinTech: Buzzing about Blockchain
12
Methane emissions: The next frontier for the
Oil & Gas industry
18
Communication is key: dialogue between
shareholders and German supervisory board
20
How does ESG affect the credit rating of
corporate bonds?
3
The DAO/
Section 1
The DAO: Do nothing,
and nothing is left
undone
A leaderless collective, automated by a set of laws enshrined
in its algorithms. ROBBIE MILES examinesthe world of the
DAO and how it is inspiring a radically new type of
governance structure.
4
ESG Matters | Issue 13
The DAO, or ‘Decentralised Autonomous
Organisation’, is a business model that breaks all
conventions about how a company works. It
combines the ideology of decentralised
organisational power with two major tech
innovations; blockchain (for more information
please refer to our lead article ‘Blockchain: more
than just Bitcoin’ by Marissa Blankenship) and
crowdfunding. In doing so, it opens the door to a
potentially radical new era of commerce, law and
politics and with them a host of new risks. The
DAO is the largest ever crowdsourcing project,
yet employs no-one. It works by allocating a
digital currency called ‘Etheruem’ (invented by a
coder named Vitalik Buterin when he was a mere
teenager) to projects worthy of investment, a bit
like an automated venture capital fund.
Insinuated by its name, parallels can be drawn
between the DAO and an ancient philosophy
known as Taoism. The Tao (pronounced the
same) refers to the spontaneous way the
universe works according to the spiritual
philosophy of Taoists. While the ways of the Tao
technically cannot be described with words, they
are alluded to in metaphors. For example, a 
Robbie Miles
ESG Analyst
London
5
THE DAO/
SECTION 1
“ The DAO’s white
paper outlines two
fundamental problems
with corporate
governance: (1) people
do not always follow
the rules and (2)
people do not always
agree what the rules
actually require.
”
Vitalik Buterin on day one of Devcon two in Shanghai.
cherry tree, without any assertion of will, grows deep roots and its
branches grow tall. As if by doing nothing, the tree silently forms
cherries. Without claim or praise; it fulfils its purpose. This is ‘nonaction’. The cherry tree is governed by the universal laws of nature.
Similarly, the DAO is automated by its own laws; its immutable
algorithms. Nothing needs to be done by the organisation, yet
nothing in the DAO’s cyber universe is left undone.
When it launched, the leaderless collective raised a record-breaking
USD150m via crowdfunding from 20,000 individuals who believed
in the investment potential that the DAO was offering. To invest, one
buys ‘Ether’ a cryptocurrency (currently trading for around USD11.76
each, as at 10/10/16) and then exchanges these for voting shares
called ‘DAO tokens’. The investor can use these tokens to vote on
projects on The DAO’s platform that they believe to be worthy of
investment. When sufficient votes are received, the projects, which
have their own unique smart contracts, fulfill their stated objectives.
These objectives may be to generate a return for the DAO, create
products and services the DAO can use or may simply support
charitable causes. Any returns are either reinvested or distributed to
token holders, depending on votes of the token holders.
Conceptually, using smart contracts enables the disintermediation
of lawyers because the contracts are undisputable and enforce
themselves. In reality though, this immutability can cause big
problems. If the code that creates such a contract contains a defect,
it can be manipulated for self-interest by a hacker with very few
remedial options available to the victim(s). The DAO’s designers
6
were criticized for launching too hastily, without carrying out
necessary security checks. The criticism was prophetic: in June 2016,
two months after launch, the DAO was hacked and USD60m of
Ethereum was stolen as vulnerability in the DAO’s code was
exploited. This was not the only theft of a digital currency. Bitfinex,
one of the largest exchanges for Bitcoin, was hacked in August 2016
with USD71 million being stolen, sending the price of a Bitcoin
plunging 20%. Stealing from a DAO isn’t even necessarily illegal as
some argue the DAO operates independently of legal systems. This
gives investors very little security if things go wrong. The token
holders in the DAO are given code name, as shown in the ownership
graph on the next page, giving them complete anonymity, making it
very hard for any national government to know who to prosecute.
This attack may well prove to be the death knell for The DAO, but the
concept is far from dead. It would not be the first time that a groundbreaking concept has failed in its first iteration. In 1997, seven years
before the launch of Facebook, a social networking site named
SixDegrees.com offered its users a platform to create profiles, invite
friends, view other’s profiles and organise groups. At its peak, the site
attracted 3.5 million members but pushy marketing e-mails began
to put off users. The site ultimately failed but the idea of social
networking went on to change the world.
If the design flaws can be ironed out, decentralised autonomous
organisations could have profound implications for society. Beyond
being a disruptive model of venture capital, the DAO offers an
example of a radically new form of corporate governance. The DAO’s
ESG Matters | Issue 13
0.69%
0.71%
0.87%
0.65%
0.48%
0.43%
The Dao Top 100 Token Holders
0.35%
0.35%
4.18%
0xbf4ed7b27f1d666546e30d74d50d173d20bca754
0x0a869d79a7052c7f1b55a8ebabbea3420f0d1e13
0xfc361105dd90f9ede566499d69e9130395f12ac8
1.62%
0x88bbf6f5ba896262d80dbbe3597d09c817fd1475
0x525784459b8926722b9137eddb5611ab346e8510
0xb1179589e19db9d41557bbec1cb24ccc2dec1c7f
0x5c4973d33fb982000fad5765b684d22b298b97aa
0x5816c2687777b6d7d2a2432d59a41fa059e3a406
0xdf21fa922215b1a56f5a6d6294e6e36c85a0acfb
0x17ef4acc1bf147e326749d10e677dcffd76f9e06
Token holders 11-100
87.02%
white paper outlines two fundamental problems with corporate
governance: (1) people do not always follow the rules and (2) people
do not always agree what the rules actually require. Their solution is
to automate and formalize governance rules by embedding them in
the code that automates the platform and also allow investors to
“maintain direct real-time control of contributed funds”. With
perfect financial transparency and no human decision makers to be
tempted by self-interest, the agency risk between a corporation’s
management and its shareholders would vanish. An entity that IPO’s
as a DAO could allow shareholders to participate in organisational
governance directly and regularly, rather than once a year by proxy
vote or AGM attendance, improving the stewardship a company
receives. It could create wealth creation opportunities for anyone
with an internet connection, even those at the bottom of the
pyramid. For example, a business with this DAO structure could IPO
to 100 million shareholders, each contributing just a few pennies.
The flexibility in the design of the decentralized structures will allow
people to build entirely new applications that couldn’t have been
built on top of conventional financial and legal infrastructure1. This
new model, where investors vote on which contracts to fulfil, could
lead to organisations that simply contract out tasks on behalf of a
highly active shareholder base – no employees are needed.
The DAO was ultimately conceived with a desire to find a way of
making more decentralised decisions. For example, one alternative
that emerged after Brexit was a website called referendum.nl, which
offers a glimpse of the benefits of direct democracy when combined
with ‘range voting’, where voters can express the strength of their
Source: Etherscan.io – The Ethereum Blockchain explorer
conviction. Further down the line, there could come a point when
artificial intelligence, such as IBM Watson, which is designed to find
the best possible answers by analysing vast quantities of data,
becomes a more attractive alternative to the votes of the
disillusioned public. There are certainly a lot of sustainability issues
created by the short-termism in policies that are inherent in a 4-year
political cycle. Tweaking these models and harnessing technology to
achieve long-term/bi-partisan/international agreement on
intergenerational issues such as climate change would be a great
way of addressing society’s toughest challenges.
What is clear is that developments in this area will be important to
monitor but there are teething problems to resolve before these
ideas are applied elsewhere and enjoy mass adoption. The coded
design of these new structures must undergo rigorous testing to
iron out the vulnerabilities that have plagued The DAO since its
inception. With headlines of robbery and lawlessness, it feels more
like the Wild West than a viable alternative to traditional governance
but the DAO’s rapid ascension into the forefront of the tech world’s
consciousness is a watershed moment for autonomous
organisations. Less than a year old, this innovative model already has
a rich story and imitators will follow. 
1
The Future of Business: Critical Insights into a Rapidly
Changing World from 60 Future Thinkers. Rohit Talwar, 2015.
7
FinTech/
section 2
FinTech:
Buzzing about
Blockchain
In the past two years, in terms of financial innovation, Blockchain
has surged past cyber security, peer-to-peer lending, mobile
payments, and cloud computing. MARISSA BLANKENSHIP
investigates this new technology, examining the potential risks
and rewards of its application within the financial industry.
Marissa Blankenship
ESG Analyst,
London
8
It is impossible to follow the financial sector without
being bombarded by information about distributed
ledger technology (DLT) or ‘Blockchain’, as it is more
widely known. Blockchain is the technology which
underpins Bitcoin and allows participants to share in a
single “golden record” without relying on central
authorities or intermediaries. It has sprung up from
almost nowhere as even as early as two years ago it was
largely an absent topic from sell side research, Bloomberg
Intelligence, and industry conferences. However, it is now
recognized as a potential disruptive force for systems,
process and infrastructure used to settle and record
financial transactions. To that point, financial and
technology companies are investing greater than
USD 1 billion in 2016 to bring this technology to the
market according to Magister Advisors, having already
spent over USD 900m in the past 36 months.1 
ESG Matters | Issue 9
9
FINTECH/
SECTION 2
Figure 1: Google Trends - Global Interest1 over 5 years in Blockchain and Distributed Ledger Technology
100
80
60
40
20
0
Sep 11
Sep 12
Sep 13
Blockchain: (Worldwide)
Sep 14
Sep 15
Distributed ledger technology: (Worldwide)
Source: Google Trends (www.google.com/trends). 1 A value of 100 is peak popularity for the 5-year term while a score of zero means the
term was less than 1% as popular as the peak.
In the past two years, in terms of financial innovation, blockchain has
surged past cyber security, peer-to-peer lending, mobile payments,
and cloud computing and is being touted as the best revolutionary
idea since the Internet. What is driving such attention is that the
transaction ledger database with cryptographic integrity is shared
by all parties in a distribution network and every transaction that
occurs in the network is recorded and stored by creating an
irrevocable and auditable transaction history.
The fact that every business has a ledger means that the potential
scale and application of DLT is far reaching and could easily evolve
into areas that are not yet in a pilot phase. In addition to diversified
financials (stock exchanges, banks, and asset managers), pilot
applications of DLT include e-commerce and manufacturing, supply
chain management, and healthcare. Intermediaries such as
custodians, clearing houses and financial messaging services can be
seen at most risk of disruption and are joining consortiums such as
R3 which consists of 42 banks and Hyperledger which consists of
banks, exchanges, post-trade, and other technology companies and
consultants to invest in research, design, and engineering of pilot
applications.
costly and the governance of aligning shareholder interests and
developing common protocols is a key challenge in addition to data
privacy, scalability and regulation.
As the application of blockchain becomes better understood, there
are trends emerging from an ESG perspective. Naturally, there will
be an impact on human capital although it is too early to determine
the magnitude. According to ‘Blockchain in Capital Markets: the
Prize and the Journey’,2 it is estimated that IT and capital markets
currently cost banks close to USD100 – 150 billion per year in addition
to another USD100 billion for post-trade and other market
inefficiencies. Santander estimates that about USD20 billion in costs
could be reduced per year with more efficient digital ledgers.
Further work needs to be done on quantifying both operational
costs and savings from blockchain. Human capital would be
impacted due to a reduction in operational overheads as well as
cost-sharing across institutions.
In addition to banks, venture capital is also active and growing
globally. According to Outlier Ventures, there are 967 blockchain
start-ups as of June 2016 with the United States and United Kingdom
leading the pack, although close to 20 percent of start-up origins
were not disclosed. While still dwarfed by the US and UK, financial
technology investment in Asia quadruped last year with venture
capital firms backing blockchain, peer-to-peer lending, online
lending, cloud computing, and cyber-security.
The nature of blockchain is such that it is designed to enable trust
and cooperation in new and innovative ways. This would be a
welcome benefit for financial companies who are still suffering from
mistrust post the global financial crisis. For banks, which are under
pressure to cut costs due to downward pressure of net interest
margin (NIM), blockchain can be used to streamline processes and
reduce inefficiencies in the capital market infrastructure. Specifically,
post trade settlement, custody, clearing, and international payments
are the most named applications. Furthermore, DLT allows for more
transparency for regulators on transaction history and can enhance
monitoring; know your client (KYC) and anti-money laundering
(AML) processes.
Realistically, wide-spread adoption of DLT is ten plus years away as
vested interests in legacy technology systems will make change
Stock exchanges are working on industry changing applications by
replacing Central Depositories (CSD) and positioning themselves as
10
ESG Matters | Issue 13
Figure 2: Percentage Blockchain Start Ups by Country as of June 2016
40%
“ For banks
30%
blockchain can be
20%
used to streamline
processes and reduce
10%
Zimbabwe
Vietnam
Sweden
Japan
Switzerland
Netherlands
France
Australia
Israel
Germany
Singapore
China
Canada
United Kingdom
inefficiencies in the
United States
0%
capital market
infrastructure.
”
Source Bloomberg, Outlier Ventures.
a “digital vault.” This sets them up to build applications which
process data for reporting and allow for performance monitoring.
Early projects involve the testing of providing real time access to
issuers to their share register and using smart contracts to facilitate
corporate actions.
Nasdaq Talinn (Estonia) is trialling using DLT to facilitate proxy voting
and the National Settlement Depository in Russia has also developed
an e-proxy voting system which allows for electronic interaction
between securities holders and issuers for the purpose of
exchanging information and documents. According to financial
messaging service company, SWIFT, the proxy voting function has
been characterised by non-standard, proprietary processes, with
frequent requirements for manual intervention. Proxy voting covers
about 85,000 companies each year is labour intensive for investors
as well as their intermediaries, is subject to significant errors and
carries a significant cost. The once manual process has moved
largely to online platforms but smart contracts would help catch the
large proportion of votes that go uncast each year. This was the case
in 2014, where according to Broadbridge, over 22 billion retail shares
went un-voted in 1,077 US company shareholder meetings from July
to December.3
In addition to stock exchanges and banks, there are several examples
which would be a positive from an ESG perspective including
providing trade finance facilities, real estate registration facilities,
databases on agricultural receivables and digital assets. Notably, it is
possible to use blockchain to help make supply chains more
transparent by using digital encryption to create an immutable
history of a products authenticity and ownership. This is being
explored in respect to conflict minerals and blood diamonds which
would enable compliance with disclosure requirements under the
Dodd-Frank Act in the US. In Honduras, blockchain technology is
being used to build a land title registry which will help to reduce land
title fraud which is a common issue in poorer countries.
The race to production has kicked off with most large financial
institutions already having 10-20 applications in prototype phase. Yet
the overarching hurdle to implementation is achieving the necessary
governance, regulation and compliance. This will be aided by having
regulators such as International Organisation of Securities
Committees (IOSCO) taking the lead to developing harmonised
global standards. Assuming these barriers can be scaled, what
remains to be considered from an ESG perspective is the trade-off
between improved transparency, reduced fraud and corruption and
better management of complex supply chains versus the implied risk
to human capital. The buzz about blockchain is indeed a constant
chatter and the opportunity to reduce ESG risks due through
applications which increase protection and promote the efficacy of
institutions across multiple sectors is needed globally. 
1http://uk.businessinsider.com/magister-advisors-report-onbitcoin-and-blockchain-ecosystems-2015-12/#-1
2https://www.euroclear.com/en/news-views/news/pressreleases/2016/2016-MR-02.html
3http://bravenewcoin.com/news/nasdaq-to-simplify-proxyvoting-process-for-shareholders-with-the-blockchain/
11
Methane
Emissions/
Section 3
Methane
Emissions: The
next frontier for the
Oil & Gas industry
In this article MARIE-SYBILLE CONNAN highlights the need
for a strategy on climate change which targets both
greenhouse gas emissions (GHGs), carbon dioxide and
methane. Methane emissions can be a game changer for
climate change in general and for the Oil & Gas industry in
particular.
Why methane emissions matter
Marie-Sybille Connan
ESG Analyst,
Paris
12
Ahead of COP21, the six largest European Oil & Gas
companies (including Shell, BP and Total) called for
a global carbon tax as a way of slowing global
warming and promoting natural gas as a transition
fuel to a low carbon economy. This was a welcome
initiative from the European Majors which was sadly
not mirrored by their US peers. However, as often,
the devil is in the detail. Any carbon tax should
recognize the two sides of carbon: there are two
major greenhouse gases, carbon dioxide (CO2) and
methane (CH4) and both are carbon gases.
Targeting both is critically important if we want to
ESG Matters | Issue 13
have a chance to limit global warming to
2°C (with an even greater ambition to reach
1.5°C) as agreed in the Paris Agreement.
Identifying an upper limit in greenhouse
gas emissions as soon as possible is the
immediate climate concern.
One can appreciate how difficult the
challenge is considering that the oil majors
are currently rebalancing their portfolios
towards natural gas and that the US
economic recovery post Lehman Brothers
is related to the shale gas boom.
Methane is the second most abundant
manmade greenhouse gas after carbon
dioxide: CO2 accounts for about half and
CH4 for one quarter1. It is emitted during the
production of coal, oil and natural gas. It
also comes from solid waste stored in
landfills, animal waste management
systems, wastewater treatment facilities
and other manmade and natural sources.
These emissions pose risks to people and
the environment. Methane emitted into the
atmosphere creates air pollution causing
thousands of premature births every year.
Methane that builds up in coal mines and oil
& natural gas facilities can cause explosions
that can endanger workers.
China, the US, Russia, India, Brazil, Indonesia, Nigeria, and Mexico are estimated to be
responsible for nearly half of all anthropogenic methane emissions. However the
major sources of methane emissions for
these countries vary greatly. For example, a
key source of methane emissions in China is
coal production, whereas Russia emits
most of its methane from natural gas and
oil systems. In the US, oil and gas systems
are the largest source methane emissions
(30%) according to the US Environmental
Protection Agency (EPA)2.
Global anthropogenic methane emissions
are projected to increase by 19% over the
period 2010 – 2030 to 10,220 million metric
tons of CO2 equivalent by 20303. The relative
contributions of the agriculture, coal
mining and landfill sectors are 
13
METHANE
EMISSIONS/
SECTION 3
Figure 1: Estimated and Projected Global Anthropogenic Methane Emissions by Source, 2020 and 2030
3000
Estimated 2020 Emissions
2500
Projected Added Emissions by 2030
2000
1500
1000
500
0
-500
Enteric
Fermentation
Oil &
Gas
Municipal
Solid
Waste
Coal
Mining
Wastewater
Rice
Cultivation
Other Ag
Sources
Stationary
& Mobile
Sources
Agriculture
(Manure
Mgmt)
Biomass
Source: Global Methane Initiative Global Methane Emissions and Mitigation Opportunities fact sheet.
“ The climate system reacts
quickly to changes in methane
emissions and therefore
reducing them now is crucial
for slowing climate change
over the next 30 to 40 years.
”
Figure 2: Global Anthropogenic Methane Emissions, 1990 - 2030
6000
5000
4000
3000
2000
1000
0
1990
2000
Agriculture (Manure Mgmt)
2010
Coal Mining
2020
Municipal Solid Waste
Source: Global Methane Initiative Global Methane Emissions and Mitigation Opportunities fact sheet.
14
2030
Oil & Gas
Wastewater
ESG Matters | Issue 13
projected to remain relatively constant
while methane emissions from wastewater
treatment systems are expected to increase
by nearly 19%. Oil and gas emissions are the
real issue as they are expected to increase
by 26% over the same period
Methane emissions in the
context of climate change
In order to address climate change, we
must reduce pollution to slow the rate of
climate change (notion of flows) while at
the same time limiting maximum warming
(notion of inventories).
But, all emissions are not equal. Like CO2,
methane is a gas that warms the Earth by
trapping heat. However, the way in which
each gas interacts with the planetary
climate is dramatically different. The
climate is slow to respond to changes in
carbon dioxide emissions and, as such,
immediate reductions in CO2 emissions will
take 30 to 40 years to slow warming but,
critically, all emissions produced will have a
warming effect on the climate that will last
for hundreds of years. On the other hand,
the climate system reacts quickly to
changes in methane emissions and
therefore reducing them now is crucial for
slowing climate change over the next 30 to
40 years. Furthermore, the methane
remains in the atmosphere for only 12
years: methane emissions don’t have any
lasting influence on the planetary climate
system, unlike carbon dioxide emissions.
Methane and carbon dioxide emissions
have very different lifetime and impact. CH4
is 84 times more powerful than CO2 over
the first two decades following its release
but its only 28 times more powerful over
100 years. By contrast, CO2 remains in the
atmosphere much longer. Over time, CO2
has then a greater warming potential4.
Hence, comparing them requires a metric
that depends on a timeframe. Scientists
measure the global warming of potential
gases over two time periods: 100 and 20
years. It is scientifically proven that the
Earth is predicted to warm by 1.5°C above
pre-industrial baseline within the next 15
years and by 2°C within the next 35 years
given current GHG emissions5. It is also
scientifically proven that a combination of
emissions reductions, such as curbing CO2
from coal-fired power plants and methane
from oil and gas activities, is the best way to
stabilize the climate in the long term while
reducing warming now. That’s why, the use
of a global warming potential of 84 for the
20-year time period from the IPCC Fifth
Assessment is the right approach to
compare the warming consequences of
methane and carbon dioxide emissions.
Hence, Robert W Howarth from the Cornell
University, Ithaca, NY, introduces the notion
of a GHG footprint for fossil fuels and he
shows that the GHG footprints of shale gas
first and then conventional natural gas are
higher than that of conventional oil and coal
when methane emissions are considered
over an appropriate timescale.6 As such,
natural gas (and shale gas in particular) may
lose its green credentials as the transition
fuel to a low carbon economy.
Regulatory, investor and
corporate initiatives to tackle
the critical issue of methane
emissions
There is an urgent need to act on methane
emissions. Take the massive natural gas
leak at a storage well near Los Angeles on
23rd October 2015 as an example, this
resulted in thousands of nearby families
having to flee their homes and be
temporarily relocated. After several
unsuccessful attempts to plug the leak,
SoCal Gas began building a relief well to
capture the leaking gas. In mid-February,
the leak was fixed, over three and a half
months later. The Environmental Defense
Fund (EDF) estimates that the amount of
methane leaked had the same 20-year
climate impact as burning nearly a billion
gallons of gasoline. This sole gas leak will
have an impact on California’s ability to
meet its GHG targets this year. Aside from
the environmental and reputational risk,
SoCal Gas estimates financial costs of
USD330m and 83 lawsuits have already
been filed against the firm7.
From an economic standpoint, methane is
valuable and lost methane is essentially
wasted fuel. Because methane is the major
component of natural gas, it can also be
captured before it is emitted into the
atmosphere and used to produce energy
for heating, electricity and cooking.
When it is captured from landfills and
agricultural sites, the collection systems
can reduce local water contamination. 
Leaked methane:
Estimated impact
97,100
metric tons of methane, a
powerful climate
pollutant, are estimated to
have leaked between 23
October and 11 February.
That‘s the same as:
8,156,400
metric tons of
carbon dioxide
released
Source:
Environmental
Defense Fund
15
METHANE
EMISSIONS/
SECTION 3
Benefits attributed to Methane Projects
Greenhouse gases
Economic growth
Energy security
Reduces emissions to
the atmosphere
Uses captured methane directly
or to generate electricity
Creates local, reliable
energy source
Source: Global Methane Initiative Accomplishments Infographic.
As such, all stakeholders have a vested
interest in managing actively methane
emissions. There are practical and cost
effective solutions to minimize methane
emissions, many of which can increase the
‘bottom line’ of the Oil & Gas industry.
new and modified oil and gas facilities
(August 2015). Indeed, circa 90% of
emissions in 2018 are expected to come
from existing facilities8. The outcome of the
US presidential polls may weigh on the
implementation of further regulations.
its leak detection and repair (LDAR)
program. Information provided is generally
vague, qualitative and non-actionable. The
EDF calls for corporate action to measure
and report methane emissions in order to
manage the impact on global warming.
Since 2004, countries around the world
have been working in partnership with the
Global Methane Initiative on projects to
reduce emissions worldwide and to use
methane emissions as a source energy
source. These projects are also helping to
reduce air pollution, protect people’s health
and improve local economies.
The Environmental Pension Fund (EDF) has
done great work in increasing awareness
across the Civil Society, corporate and the
investor sphere. In a recent study, they
show that global oil and gas methane
emissions represented USD 30bn in wasted
resources worldwide, which proves that
there is a financial benefit for Oil & Gas
companies to identify and manage
methane emissions9. They also found that
the disclosure on methane emissions is not
up to the challenge. 28% of the 65
companies (out of which 40 Oil Majors and
25 large midstream companies) surveyed
report methane emissions in investor
facing channels. No company provides
quantitative reduction targets. Only one
company provided detailed information on
In the wake of EDF, investors are increasingly
pushing for action on methane after having
targeted
companies
for
releasing
sustainability reports and disclosing their
carbon dioxide emissions. They want more
information on the extent of the issue and
how companies are tackling it. Hence, they
have filed 10 shareholder resolutions to
press US energy companies before their
annual meetings this year to detail plans for
limiting methane leakage from wells,
pipelines and other energy equipment10.
In particular in the US, where financial and
environmental stakes are high, the White
House announced in January 2015 an
ambitious national strategy to reduce oil
and gas methane emissions to 40-45%
below 2012 levels by 2025. However, in
order to meet this target, new regulations
are required that go beyond the EPA
proposed methane emissions standards for
16
Lastly, investors representing USD3.6trn
commended the joint US and Canadian
March 10th announcement that both
countries take steps to seriously address
methane emissions from the Oil & Gas
ESG Matters | Issue 13
Local environmental quality
Worker safety
Human health
Reduces air pollution and surface/
groundwater contamination
Minimizes explosive methane
levels or fires
Reduces respiratory impacts
associated with high ozone levels
sector11. As widely diversified, long-term
investors with holdings in the Oil & Gas
industry, they share a vested interest in the
industry’s long-term success and think that
natural gas can play a significant role in the
North American energy mix, has
demonstrated the potential to reduce
greenhouse
gas
emissions
while
supporting economic growth. However,
they are concerned that methane emissions
pose a risk to their investments. They urge
companies to minimize methane emissions
in a transparent manner and provide
investors and the public with better
methane reporting.
the transition to a low-carbon economy,
methane emissions must be actively and
transparently managed. Investor scrutiny
will only but increase. 
7http://www.latimes.com/business/
hiltzik/la-fi-socal-gas-ceo-20160328snap-htmlstory.html
Methane emissions: the next
frontier
Methane disclosure has become the new
challenge for investors in Oil & Gas
companies after the good progress
achieved on carbon disclosure and
stranded assets stress-testing. For the gas
industry to really be part of the solution in
1https://www.edf.org/methane-otherimportant-greenhouse-gas
2https://www3.epa.gov/climatechange/
Downloads/ghgemissions/US-GHGInventory-2016-Chapter-ExecutiveSummary.pdf
3
8, 9 https://www.edf.org/sites/default/
files/content/rising_risk_full_
report.pdf
10https://www.edf.org/sites/default/
files/content/rising_risk_full_
report.pdf
11https://www.ceres.org/files/investorsupport-of-the-joint-u.s.-andcanadian-announcement-onmethane-emissions
http://www.globalmethane.org/
documents/analysis_fs_en.pdf
4, 5 https://www.ipcc.ch/pdf/assessmentreport/ar5/syr/SYR_AR5_FINAL_
full.pdf
6http://www.eeb.cornell.edu/
howarth/publications/f_EECT-61539perspectives-on-air-emissions-ofmethane-and-climaticwarmin_100815_27470.pdf
17
German
Supervisory
Board /
section 4
Communication is key: dialogue between
shareholders and German supervisory board
HENRIKE KULMANN discusses a recent initiative in Germany to increase
dialogue between institutional shareholders and the supervisory boards
of listed companies. The working group of the initiative has developed a
set of guidelines to encourage such engagement with the aim of
increasing transparency and trust amongst both parties.
Henrike Kulmann
ESG Analyst,
Frankfurt
18
While meetings with the non-executive board
members are becoming business as usual in
markets such as the United Kingdom or France,
such exchange is currently rather the exception
than the rule in Germany. At the same time, the
planned amendments to the EU Shareholder
Rights Directive expect institutional investors to
become more active in monitoring listed
corporates. Regular communication with the
supervisory board, as the core oversight body in
Germany’s two-tier corporate governance
structure, would support investors to adequately
adapt to enhanced expectations. In order to
stipulate convergence for better shareholder access
to supervisory boards in Germany, a group of high
profile representatives of investors, academics and
corporates developed the “Guiding principles for
the dialogue between investors and German
supervisory boards” .1
ESG Matters | Issue 13
What is it all about?
The eight guiding principles are designed as a practical tool to frame
the topics of such dialogue and its participants, with the aim of
establishing high quality dialogue practices. Key focus areas include:
• Supervisory board composition and nomination
• Management appointment and removal
• Remuneration structure of management and supervisory
boards
• Strategy development and implementation
• Auditor appointment
Importantly, the guidelines clarify that communication should only
focus on topics within scope of the supervisory boards competencies
as outlined in the German company and capital markets laws.
Currently, the legal framework for supervisory board engagement is
not clearly defined which creates uncertainty amongst corporates
on how to handle investor requests for corporate governance
engagements with supervisory board members. As such exchange
is not excluded by German regulation and already practiced by some
Germany corporates, the guidelines help to provide more clarity to
all participants. They fit within the existing legal structures and the
German Corporate Governance Code, including the equal treatment
principle.
What are the benefits for investors and corporates to engage in a dialogue?
A fruitful exchange between supervisory boards and institutional
investors is beneficial for all participants. From a shareholder
perspective, dialogue contributes to investor confidence and better
investment decisions. It enables investors to evaluate supervisory
board composition and the supervisory board’s ability to oversee
and constructively challenge management action in the interest of
all shareholders. The first-hand information from supervisory board
members also helps to form a view how well management
Members of the
Working Group
Prof. Dr. Alexander Bassen
University of Hamburg
Dr. Jürgen Hambrecht
BASF, Daimler, Fuchs Petrolub
Dr. Hans-Christoph Hirt
Hermes Investment
Management
Prof. Dr. Dr. Dr. h.c. mult.
Klaus J. Hopt
Director (Emeritus) of the
Max Planck Institute for
Comparative and International
Private Law Hamburg
remuneration is aligned with long term shareholder interests.
Findings can be incorporated into voting decisions at annual general
meetings enabling investors to make well-informed choices as part
of their fiduciary duty towards clients.
From a company perspective, it gives the supervisory board the
chance to explain, for example, the rationale for proposed changes
to remuneration policies, how supervisory board collaborates or
how succession planning is organized. Therefore, meetings between
investors and supervisory boards could also increase investor
support at annual general meetings. Moreover, given the German
two-tier corporate governance system as well as the employee codetermination system, German supervisory boards get an
opportunity to foster an understanding of the country specific
corporate governance approach amongst foreign investors.
Corporates would also get the chance to better understand their
investors’ expectation on corporate governance and could enhance
their practices, making them more attractive investments to the
market.
What could be the way forward?
The initiative has started a discussion on the topic of investor –
supervisory board communication which will hopefully lead to
increased transparency and mutual trust amongst contributing
parties. As the Government Commission on the German Corporate
Governance Code is expected to incorporate a general
recommendation for supervisory board and investor
communication in the Code, chances are good that more German
corporates will start to engage in an active dialogue with institutional
shareholders. 
1http://www.esgmatters.co.uk/en/ThoughtLeadership/
ExternalArticles/Pages/default.aspx
Members of the Stakeholder
Advisory Group (selected)
Prof. Dr. Ulrich Lehner
E.ON, Henkel, Deutsche
Telekom, Porsche Automobil
Holding, ThyssenKrupp
Dr. Paul Achleitner
Deutsche Bank, Bayer, Daimler
Kay Bommer
Dr. Stephan Lowis
Deutscher Investor Relations
Verband
Ingo R. Mainert
Deutsches Aktieninstitut
RWE
Allianz Global Investors
Daniela Mattheus
EY
Prof. Christian Strenger
Deutsche Asset Management
Dr. Christine Bortenlänger
Dr. Dr. h.c. Manfred Gentz
Government Commission
on the German Corporate
Governance Code
Thomas Richter
German Investment Funds
Association BVI
Dr. Werner Brandt
RWE, Deutsche Lufthansa,
OSRAM Licht, ProSiebenSat. 1
Media
Dr. Joachim Faber
Deutsche Börse
19
Corporate
Bonds/
Section 5
20
ESG Matters | Issue 13
How does ESG affect
the credit rating of
corporate bonds?
Dr. Steffen Hörter
Global Head of ESG,
Munich
Similar to the ‘ESG in Equities’ and ‘ESG in Real Estate’ whitepapers produced
in 2015, DR. STEFFEN HÖRTER and his team have performed a meta-analysis
evaluating recent, selected, high-quality industry and academic research on
ESG in investment grade corporate bonds. The format of a meta-analysis
provides a diversified research view and aims to avoid research bias.
This article is an extract from our white paper called “ESG in
Investment Grade Corporate Bonds”. The paper aims to find
evidence of the materiality of ESG dimensions and ESG criteria
within financial performance and risk for listed, publically traded
corporate bonds. The paper analysed Investment Grade Bonds in
European and Global markets and evaluated recent, selected and
high quality industry and academic research.
ESG integration into credit risk analysis
Most recently, Moody’s and S&P, two authorities in the area of credit
risk analysis, have started to incorporate ESG factors into their
credit rating methodologies. By signing the UN PRI Statement on
“ESG in Credit Ratings”, Moody’s, S&P and four other rating agencies
affirmed their commitment towards a more systematic and 
21
CORPORATE
BONDS/
SECTION 5
transparent consideration of sustainability and governance factors
in credit analyses and ratings.
How does ESG affect the credit rating of corporate
bonds?
ESG analysis is focused on issuer, industry sector and country
specific key credit factors. Next to an explicit focus on selected highrisk ESG factors, ESG risk is indirectly scored through the analysis of
the business environment and financial strength of a corporate.
While ESG factors can be material to the credit rating, other criteria
such as financial strength are generally perceived to be of more
importance – not only because they may facilitate an issuer to adjust
to ESG risks over-time through enterprise risk-management, but
also because they already may be a good proxy on the corporate
management of ESG risks.
Corporate bond performance is generally determined by a
multitude of factors. These include a bond’s payment structure and
duration, market risks such as interest rates and liquidity fluctuations,
as well as credit risk. On a portfolio level, issuer selection and
diversification are relevant factors. We investigated the financial
materiality of ESG for corporate bonds and portfolios in some of
these factors by analysing several selected research studies and
methodologies. We investigated how and to what extent ESG ratings
can complement credit ratings.
22
ESG Matters | Issue 13
The link between ESG and corporate credit risk
For Investment Grade Corporate Bond portfolios it is important to
identify issuers with high credit quality. Credit risk may be measured
in various ways: credit ratings and rating migrations, bond price
volatility, credit default swap prices, credit spreads etc. Since many
bond portfolio managers use the credit opinions of rating agencies it
is important to understand if and how ESG is incorporated in their
credit assessment. In May 2016, the UN PRI launched an initiative to
develop practical solutions for more systemic and transparent
incorporation of ESG in credit ratings and analyses. A statement was
produced on ‘ESG in credit ratings and analyses’ which was signed
by over 100 investors and six of the leading credit rating agencies. In
our analysis we focus on the evidence of ESG integration by the ‘big
three’ agencies, namely S&P, Moody’s and Fitch ratings.
Standard & Poor’s approach to ESG
In its 2015 report “ESG Risks In Corporate Credit ratings — An
Overview” Standard & Poor’s (S&P) documents their ESG
methodology for credit assessment. ESG risks are seen as an
essential element in their credit analysis and are already incorporated
into their corporate credit criteria framework. While the main focus
of S&P’s ESG intake is to identify downside credit risk, any 
23
CORPORATE
BONDS/
SECTION 5
Figure 1: Rating actions related to environmental and climate risk: S&P
E&C Risk Impact on credit analysis and ratings
Outlook revised to negative
23
Downgrade
19
Upgrade
8
Outlook revised to stable from negative
3
Creditwatch negative placement
2
Outlook revised to positive
1
Contributed to general analysis
243
Source: Allianz Global Investors based on S&P Global (2015) “ESG Risks in Corporate Ratings - An Overview” and “How environmental and
climate risks factor into global corporate ratings”.
favourable environmental or social factors that may contribute to an
improved credit rating outlook are considered. Although governance
is only scored on a neutral or negative scale ESG risks are
incorporated throughout their credit rating research process.
Factors that are assessed in the analysis include climate change
policies, environmental pollution, resource depletion, employee-,
customer- and community relations, adherence to legal and
regulatory requirements etc.
As mentioned, ESG factors do not receive an explicit score but are
incorporated into the overall credit rating analysis to provide a
holistic view of an issuer’s profile. Governance is the most frequent
and material factor for rating changes.1 It is the only ESG dimension
that is explicitly and exhaustively examined. Observed changes in
Management & Governance can substantially influence the credit
rating. This is especially true for lower rated issuers. Yet, S&P argues
that environmental and social factors are implicitly covered by their
assessment of a company’s management of other credit factors.
In the S&P report “How Environmental and Climate Risks Factors
Into Global Corporate Ratings” the rating agency documents how
material environmental and climate factors (E&C) impact their
credit ratings. The analysis identifies 299 E&C cases in which these
factors either contributed to a rating revision or were a determining
factor in the rating analysis. 56 of these cases resulted in direct rating
actions with the majority of it being in the negative direction in the
energy sector (oil refining and marketing, regulated utilities, and
unregulated power and gas subsectors).
24
Moody’s approach to ESG risks in credit ratings
In the report “Moody’s Approach to Assessing ESG risks in Rating and
Research” the rating agency illustrates through which direct and
indirect paths ESG risks are incorporated into their credit risk
research and ratings. ESG considerations are captured in Moody’s
long-term credit risk analyses when the agency believes they will
materially affect the primary focus of their ratings systems – to
assess the probability of default of a debt issuer and expected credit
loss in the event of default. Consequently, Moody’s credit research
and ratings consider material ESG factors with potentially large
impact on credit default risk or size of loss in case of default.
ESG risks are differentiated along industries, sectors and single
issuers. In some of Moody’s credit rating methodologies ESG risks
are even explicitly scored, e.g. governance risk for sovereign bond
issuers and banks. For the ultimate credit risk assessment, Moody’s
puts ESG risks into the overall credit risk analysis picture. In doing so,
factors like high financial strength of an issuer may, however, off-set
ESG risk concerns.
Moreover, Moody’s rating outlooks are enriched by important ESG
risk trends identified by Moody’s credit research. A 2015 example is
the analysis of the potential impact of the ongoing Californian
drought on public Californian finance.
Recent reports include: Global anti-bribery and corruption
enforcement efforts, upcoming regulations on Europe’s electricity
markets, and the rising impact of carbon reduction policies.
ESG Matters | Issue 13
In summary, Moody’s does not see ESG as a main determinant of
credit outcomes but rather as one of the several elements they
consider through their holistic credit risk assessment for rated
entities. Moody’s argues that compared to ESG other credit factors
are deemed more relevant in analyses of creditworthiness. Further,
Moody’s estimates the direct impact of ESG risks to be felt only over
a longer time horizon. Hence, rated entities have more flexibility to
adjust for these risks in advance, which is why Moody’s argues that
they capture ESG risks in other, more immediate credit issues – such
as is the case in the prospective evaluation of capital requirements.
man-made disaster, etc.) and the consequences of regulation
designed to prevent or reduce those hazards.
Moody’s has developed a heat map (figure 3) that scores 86 sectors
in terms of materiality and timing of any likely environmental risks
with possible credit risk impact. The purpose of this map is to identify
sectors which are more prone to environmental hazards.
Environmental risks are broadly divided into two categories: effects
of environmental hazards (pollution, drought, severe natural and
Fitch ratings
The heat map represents a relative assessment of potential risks.
Each sector’s exposure is divided into five sub-categories: Air
pollution, soil and water pollution and land use restrictions, carbon
regulation, water shortages as well as natural and man-made
disasters. Carbon regulations and air pollution are the two
subcategories which are deemed to pose the biggest environmental
threats in the future.
The report “Evaluating Corporate Governance” by Fitch outlines
their approach. Within the ESG domains, Fitch focuses mostly on
corporate governance. As Fitch states: “poor governance practices,
including country-specific and issuer-specific corporate 
Figure 2 Moody’s heat map: assesses overal sector credit risk exposure to five subcategories of environmental risks
Overall Sector Environmental Risk Scoring
ICON KEY
Immediate,
Elevated Risk
Sectors scored “immediately/elevated” overall are already experiencing material
credit implications as a result of environmental risk. Therefore, rating changes
have either already been occurring for a substantial number of issuers or we
believe such rating changes are likely within the next three years.
Icon colour indicates weight of each
environmental exposure for the sector
VERY HIGH
HIGH
Emerging,
Elevated Risk
Sectors scored “emerging/elevated” overall have clear exposure to environmental
risks that, in aggregate, could be material to credit quality over the medium term
(three to five years), but are less likely in the next three years.
SOMEWHAT ELEVATED
CONSISTENTLY LOW
Emerging,
Moderate Risk
Sectors in this category have a clear exposure to environmental risks that could
be material to credit quality in the medium to long term (five or more years) for a
substantial number of issuers. However, in contrast to emerging/elevated sectors,
it is less than the identified risks will develop in a way that is material to ratings for
most issuers.
Air Pollution
Soil/Water Pollution & Land
Use Restrictions
Carbon Regulations
Low Risk
Sectors in this category have either no sector-wide exposure to meaningful
environmental risks or, if they do, the consequences are not likely to be material to
credit quality.
Water Shortages
Natural & Man-made
Disasters
Source: Moody’s (2015). Environmental Risks: Heat map shows wide variations in credit impact across sectors.
25
CORPORATE
BONDS/
SECTION 5
governance matters, can result in lower ratings than typical
quantitative and qualitative credit factors may otherwise imply”.
Corporate governance is identified through key analytics along two
dimensions: country- and issuer-specific factors. When evaluating
corporate governance on a country level, Fitch will focus on
systematic characteristics such as jurisdictional considerations, the
quality and quantity of financial information available in the market
and whether the regulatory and operational environment supports
or undermines the overall transparency. Issuer-specific governance
characteristics are for instance board effectiveness, management
effectiveness, transparency of financial information and relatedparty transactions. Governance characteristics are respectively
divided into three impact categories: ratings neutral, those that may
constrain ratings and ratings negative. Fitch states that good
governance will not, in isolation, positively affect a credit rating.
Results
When rating agencies perceive ESG risks to be material for changes
in ratings or rating outlooks, we have found that they are increasingly
considered as part of the credit rating process.
Rating agencies do not usually explicitly score companies or
sovereigns with regards to ESG risks or strengths as is done by ESG
research providers, to construct dedicated ESG issuer ratings.
Material ESG factors are considered part of the standard credit risk
assessment model. Credit risk materiality of ESG is subject to
industry sector, company and time horizon. Previously rating
agencies seem to have considered ‘governance/management
strength’ as part of their standard credit risk assessment framework.
Figure 3: Credit Rating Agencies (CRA) and ESG: Peer group comparison
Environmental factors
Social factors
Governance factors
Methodology
Key criteria
S&P
Mentioned in document
Evidence
Explicitly mentioned as credit criteria
Evidence
Extent of E in credit risk analysis
Considerable evidence
Mentioned in document
Evidence
Explicitly mentioned as credit criteria
Evidence
Extent of S in credit risk analysis
-
Mentioned in document
Considerable evidence
Explicitly mentioned as credit criteria
Considerable evidence
Extent of G in credit risk analysis
Considerable evidence
Level of consideration
Incorporates country and industry risk and
an assessment of the competitive position
Approach
• Risk based approach
• Opportunity-based approach for E&S
• Downside-scale for governance
Time horizon
Long-term
Integration
• E&S considered when deemed material
• G is a part of the “management”
assessment in the credit rating process
Which factor is most important?
Governance, E&S will receive more
prominence in the future
Additional information
Regular publications on environmental &
social event risks
Source: Allianz Global Investors based on selected publications of credit rating agencies.
26
ESG Matters | Issue 13
Corporate governance is perceived to be the strongest credit risk
contributor when considering ESG dimensions. Whereas,
environmental risks, such as climate change or industry regulations
are perceived to be more of a long term macro/industry risk. In
conclusion, it appears that rating agencies seem to assess
environmental issues indirectly through other factors, such as
solvency or liquidity.
Investors’ investment opinion. The research does not imply
investment advice or investment performance related forecasts.
1
See ”Standard & Poor’s (2012). Methodology: Management
and Governance credit factors for corporate entities and
insurers.
As ESG issues and ESG trends such as demographic change,
corporate transparency, carbon regulations etc. increasingly gain
public attention, it is likely that the number of ESG-related rating
incidents will rise. Materiality and corporate exposure towards these
risks will become more important than ever. 
Please note: the conclusions from the research studies analysed and
summarised in this report do not necessarily reflect Allianz Global
Moody’s
Fitch
Evidence
-
Evidence
-
Evidence
-
Evidence
-
Evidence
-
Evidence
-
Evidence
Evidence
Evidence
Evidence
Considerable evidence
Evidence
Individual industry and entity specific
ESG considerations
Assessment of jurisdictional environment
and entity specific factors
• Risk and downside based approach
• Industry/sector differences
• Risk and downside based approach
• No consideration of good governance
Long-term
n/a
• E&S considered when deemed material
• G is a fixed component of CR assessments
G: considered on individual basis
Governance, E will receive more
prominence in the future
Governance
• Dedicated environmental risks and developments topic
section page
• Social performance group (Moody’s SRI research platform)
n/a
27
ALLIANZGI AND
ESG/SECTION 6
Please find below biographies of the contributors to this edition of ESG Matters:
Eugenia Jackson
Head of ESG Research
Eugenia Unanyants-Jackson is a Director and Head of ESG Research at Allianz Global Investors, which she joined in 2016. Eugenia is
responsible for directing ESG research, guiding and overseeing AllianzGI’s stewardship activities, including corporate governance,
engagement and proxy voting, and supporting integration of ESG factors into AllianzGI’s investment process for different strategies.
Prior to joining AllianzGI, Eugenia was a Director, Governance and Sustainable Investment and Head of Corporate Governance at
BMO Global Asset Management (formerly F&C Investments), a Stewardship Services Manager at Governance for Owners LLP, a
Policy Analyst at Manifest Information Services, a Researcher at Pension Investments Research Consultants (PIRC). Eugenia co-chairs
ICGN’s Shareholder Rights Committee and represents AllianzGI on the Governance and Engagement Committee of the Investment
Association and other professional associations and networks. Eugenia has written on corporate governance matters, covering
issues related to shareholder rights, listing standards, board diversity, directors’ liabilities, cross-border voting issues, and director
remuneration. Eugenia has a M.P.A. from the Georgian Institute of Public Affairs in partnership with the National Academy of Public
Administration (USA). She holds the IMC designation.
Dr. Steffen Hörter
Global Head of ESG
Dr Steffen Hörter is Global Head of ESG. He advises institutional investorsin Europe on investment strategy, risk management and
sustainability. In recent years he has published various studies about incorporating sustainability into investment strategy. Prior to
joining Allianz Global Investors, Dr Hoerter worked as a Management Consultant for banks and risk management at an international
consultancy firm. Dr Hoerter studied Business Administration in Regensburg, Edinburgh and Ingolstadt/Eichstätt. He holds a
doctorate from the Catholic University of Eichstätt-Ingolstadt, where he worked as a lecturer at the Department of Finance and
Banking at WFI – Ingolstadt School of Management.
Robbie Miles, ACA
ESG Analyst
Robbie is an ESG analyst with Allianz Global Investors, which he joined in 2014. He has analytical responsibilities on the Environmental,
Social and Governance (ESG) Research team for the utilities and industrials sectors. He has three years of sustainable finance
experience. Robbie qualified as a chartered accountant with PwC and holds a BA in Environment and Business from the University of
Leeds.
Biographies
28
ESG Matters | Issue 13
Marissa Blankenship
ESG Analyst
Marissa Blankenship is a Senior ESG analyst with Allianz Global Investors, which she joined in 2011. As a member of the firm’s
Environmental, Social and Governance (ESG) team, she is responsible for conducting research on the financial and real estate sectors
and covering the cross-sectorial themes of business ethics, taxation, and ESG disclosure and reporting. She is also responsible for
corporate governance and proxy voting for the UK, Spain and Latin American markets. Prior work experience in the sustainability
field includes launching an impact investment fund of funds and serving as an advisor to a microfinance fund. Ms. Blankenship started
her investment career as an associate in the equity-strategies group at Hall Capital Management in San Francisco. She has a BS in
Economics from the University of California, Davis, an MSc in Latin American Economic Development from the University of London
and is currently completing a Master’s in Sustainability Leadership from the University of Cambridge. Marissa holds the IMC
designation.
Marie-Sybille Connan
ESG Analyst
Ms. Connan is an ESG analyst with Allianz Global Investors, which she joined in 2008. As a member of the firm’s Environmental, Social
and Governance (ESG) team, she is responsible for the energy, media and telecom sectors. Ms. Connan was previously a fund
manager and credit analyst with the firm. She has 16 years of investment-industry experience. Before joining the firm, Ms. Connan
was a senior credit analyst at Fortis Investments and Aviva Investors; before that, she worked at Natixis AM as a fund manager and
equity analyst, focusing on IT and software. Ms. Connan has a master’s in finance from the ESC Montpellier Business School. She is a
member of the French Society of Financial Analysts and a graduate of the Centre de Formation des Analystes Financiers.
Henrike Kulmann
ESG Analyst
Ms. Kulmann is an ESG analyst with Allianz Global Investors, which she joined in 2011. She is a member of the Environmental, Social
and Governance (ESG) research team and is responsible for ESG stock analysis, engagement and proxy voting. Ms. Kulmann has two
years of investment-industry experience and five years of overall experience in the ESG field. She previously worked at Deutsche Post
DHL in environmental-strategy management and corporate-responsibility evaluation. Ms. Kulmann has an M.A. in political science,
with a focus on business communication and economics, from Friedrich Schiller University of Jena, Germany.
29
Disclaimer
Investing involves risk. The value of an investment and the income from it will fluctuate and
investors may not get back the principal invested. Past performance is not indicative of future
performance. This is a marketing communication. It is for informational purposes only. This
document does not constitute investment advice or a recommendation to buy, sell or hold
any security and shall not be deemed an offer to sell or a solicitation of an offer to buy any
security.
The views and opinions expressed herein, which are subject to change without notice, are
those of the issuer or its affiliated companies at the time of publication. Certain data used are
derived from various sources believed to be reliable, but the accuracy or completeness of the
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