Fubon Financial : Leading the Industry! Fubon Life Releases the English Version of its Stewardship Report

Enhance the International Transparency of Responsible Investment & Promote the Green Transformation of the Industry

As one of the major institutional investors in Taiwan, Fubon Life's investment assets reached NT$4.6 trillion by the end of 2022. In order to fulfil the value of sustainable finance and demonstrate ESG strategies and thinking in its financial operation, Fubon Life has not only released the Chinese version of its 2022 Stewardship Report but has also taken the lead in the industry by releasing the first English version of the Stewardship Report among the major life insurance companies in Taiwan. The company has fulfilled its duty as a corporate citizen and contributed to the international visibility of stewardship for Taiwanese enterprises.

Fubon Life stated that in order to fulfill its asset management responsibilities in institutional investment and enhance its long-term value to itself, funding providers, and society, Fubon Life has signed the "Stewardship Principles for Institutional Investors" in 2018 and began preparing the Chinese version of the Stewardship Report in 2020. This year, Fubon Life actively released the English version of the Stewardship Report which also allowed foreign institutional investors to better understand Fubon Life's efforts and actions in ESG related issues regarding stewardship and responsible investment. In the future, Fubon Life will continue to echo the international attention on stewardship, deepen communication, engagement, and disclosure quality of stewardship to work together with investee companies towards the goal of sustainable development.

ESG Accounts for 49% of Total Investment Assets & Aim to Become a Key International Promoter of Sustainable Transformation

In order to implement the stewardship policy, Fubon Life has established a "Sustainable Development Committee" under the Board of Directors and a responsible finance working team under the six ESG implementation teams to formulate internal investment management policies and rules in accordance with Fubon Financial Holdings' "Sustainable Finance Policy," the "Principles for Responsible Investment," and the "Sustainable Development Goals". Before and after investments are made, Fubon Life identifies and evaluates the risks and opportunities of the sustainability of its investment targets through various ESG checklists and indicators, and continues to invest in new pharmaceuticals, the green energy industry and ESG-related themes so as to guide the flow of capital towards the enhancement of human health and well-being, the acquisition of sustainable clean energy and the promotion of inclusive and sustainable economic growth. By the end of 2022, Fubon Life's ESG-themed investment amount was approximately NT$2.26 trillion which accounted for 49% of total investment assets.

In order to implement the principles of responsible investment, Fubon Life strictly implements a three-step evaluation mechanism in its self-operated investment positions: First, before investment: review the negative list to ensure that no new investments are made in targets that violate major ESG issues. Second, during the investment analysis: in addition to the financial situation, ESG risk indicators are also included in the evaluation which will be published in the investment analysis report. Third, after the completion of the investment: annual ESG checklists are continuously reviewed and tracked in order to confirm whether the investment targets have fulfilled their social responsibilities.

If it is found after tracking that the investee company has violated key ESG issues, Fubon Life will proactively initiate the engagement process and discuss improvement plans with the investee company. If no improvement is made in the future, or if the investee company has been fined or the sentence is determined, then the investee company will be put on the negative list and the company will gradually divest itself of its shareholdings. In 2022, Fubon Life issued a total of 956 visit reports on the engagement activities and implemented responsible investment with concrete actions.

Lighting up Sustainability with Investment & Promoting the Green Transformation of the Industry

As a leader in green finance, Fubon Life is concerned about climate change and global warming and responds to the Paris Agreement's 1.5 °C goal. In addition to actively responding to domestic and international net-zero emission initiatives with Fubon Financial Holdings, Fubon Life also participated in Fubon Financial Holdings' Science Based Targets (SBT) program and promoted carbon inventory and target setting of scope 3 investment and financing positions from 2021.

Considering that every penny of investment may bring carbon emissions to the earth, Fubon Life makes good use of every penny of investment to encourage and guide investment targets and enterprises to implement net-zero carbon reduction, set carbon reduction targets, and improve ESG governance resilience and sustainable transformation in order to face the global sustainable wave and climate change challenges, enhance the international competitiveness of the capital market, and further exert the influence of its capital. By the end of 2022, 31.5% of the investee companies have promised or completed to set their own SBT targets, an increase of 7.8% as compared with the end of 2021. Fubon Life will also work with its investment targets to control the reduction of greenhouse gases in a more efficient way, demonstrate its commitment to climate change and the protection of natural resources, and make a contribution to the sustainability of the Taiwan market and the future of the earth.