Liechtensteinische Landesbank : LLB Sustainability Voting & Engagement

LLB Sustainability

Voting - Reporting for 2022

Agenda

Our motivation	3
Our voting & engagement approach	4
Our selection criteria	5
Our voting process for LLB funds	6
Our engagement process with LLB funds	7
Our engagement process with mandates	8
Entry into force	9
Voting Reporting 2022 at entity level	10

2	LLB Sustainability - Voting - Reporting for 2022, LLB Asset Management, April 2023

Our motivation

• We are committed to an economically efficient and at the same time sustainable financial system and support the regional and supra-regional industry associations.
• Our aim is to promote best practices in the field of "active ownership".
• The UN-backed Principles for Responsible Investment (PRI) provide us with best practices and inputs for incorporating ESG factors into our investment and ownership decisions.
• As a signatory to the PRI, LLB Asset Management AG feels a long-standing relationship with this organisation.
• With "Voting & Engagement", we pursue the goal of bringing about positive changes in corporate decisions that determine the long-termrisk-return characteristics of future investments.
• ESG issues are important determinants of value generation and risk reduction.

Our fiduciary responsibility in the form of the six principles of the PRI initiative.

1. We incorporate ESG issues into investment analysis and decision-making processes.
2. We are active shareholders and consider ESG issues in our investment policies and practices.
3. We encourage companies and entities in which we invest to make appropriate disclosure on ESG issues.
4. We drive acceptance and implementation of the Principles in the investment industry.
5. We work together to increase our effectiveness in implementing the Principles.
6. We report on our activities and progress in implementing the Principles.

3	LLB Sustainability - Voting - Reporting for 2022, LLB Asset Management, April 2023

Our Voting & Engagement Approach

Voting & Engagement Approach

Reconciliation & Engagement in LLB Asset Management

Influence with a clear goal

◆ Influencing through voting and engagement

The special exercise of voting rights and other opportunities to exert influence generally arise

• in norm-based engagement and in ESG incidents;
• in thematic

Voting & Engagement on issues such as human rights, ...;

• in influencing on material ESG risks.

Process steps

The individual process steps are as follows:

• Voting & Engagement Selection process
• Voting & Engagement Planning with Target setting
• Research and exchange

exchange with others Information providers, esp. ISS

Reporting

The various active ownership tools are reported transparently in the corresponding annual reports:

• Letter to the Management / Board
• Management visits
• Voting, Proxy Voting and shareholder proposals
• Cooperation with other investors

requires a clear objective in order to fully leverage

the effectiveness of the different tools.

◆ Engagement as well as voting allow us to

proactively work on relevant sustainability issues in

advance of a possible ultimate exclusion from our

portfolios.

◆ On the path to better sustainability among

companies worldwide, the exclusion of a holding

can only be the ultimate tool.

◆ We exchange views with other asset managers on

voting and engagement issues that are also on our

agenda.

4	LLB Sustainability - Voting - Reporting for 2022, LLB Asset Management, April 2023

Our selection criteria

				Voting & Proxy Voting
				- Inclusion of ISS SRI proxy voting information
				- As a rule, voting with ISS SRI recommendation,
				otherwise written documentation
Engagement&Voting	criteriaSelection			- Identification of controversial issues
		- Submission of a shareholder proposal
				ESG data and evaluation
				- ESG data basically represent the starting point for
				influencing (voting & engagement)
				- Orientation towards the MSCI ESG Reports and ISS
				SRI Recommendations
				- Many controversies and high ESG risks
				support a voting & engagement activity
				Extent of ownership
				- The extent of influence depends on the market
				capitalisation and the share of the market
				capitalisation of the company.
				- Engagement requires a larger participation quota
				than voting.

Engagement selection criteria

• In voting and engagement, we see a great added value for stakeholder value and at the same time shareholder rights.
• Our focus is therefore particularly on the governance issue, as this can lead to a reconciliation between the company's performance through management decisions on the one hand and shareholder interests on the other - especially with regard to sustainability.
• Against this background, transparency is of great importance, and transparency at both ends: Both in our voting and engagement decisions and in corporate governance.

5	LLB Sustainability - Voting - Reporting for 2022, LLB Asset Management, April 2023