Pictet Group 2021 reporting

The Pictet Group commits to the UN Principles for Responsible Banking, launched in September 2019 during the annual United Nations General Assembly.

The United Nations Principles for Responsible Banking are a framework that serves as an important and complementary next step to the United Nations Principles for Responsible Investing, signed by Pictet in 2007. This framework focuses on the types of products and solutions provided to clients and how they ultimately create value for them as well as for all other stakeholders. This is an essential step in the journey towards a more sustainable banking system.

Press release (5 November 2019)
Pictet commits to the Principles for Responsible Banking

Principles

“Sustainability is central to Pictet’s way of thinking. This goes hand in hand with embracing sustainability in our day-to-day investment decisions. It is in this spirit that we have taken the decision to pledge to the Principles for Responsible Banking.”

Renaud de Planta Senior Partner
Pictet Group

Principle 1

Business model alignment

We will align our business strategy to be consistent with and contribute to individuals’ needs and society’s goals, as expressed in the Sustainable Development Goals, the Paris Climate Agreement and relevant national and regional frameworks.

Principle dimension

Pictet UNPRB reporting 2021

Business model

The Pictet Group is a partnership of seven owner managers, with principles of succession and transmission of ownership that have remained unchanged since foundation in 1805. It offers only wealth management, asset management and related asset services. The Group does not engage in investment banking, nor does it extend commercial loans.

With CHF 609 billion in assets under management or custody at 31 December 2020, Pictet is today one of the leading Europe-based independent wealth and asset managers.

Headquartered in Geneva, Switzerland and founded there, Pictet today employs more than 4,900 people. It has 30 offices in: Amsterdam, Barcelona, Basel, Brussels, Dubai, Frankfurt, Geneva, Hong Kong, Lausanne, London, Luxembourg, Madrid, Milan, Monaco, Montreal, Munich, Nassau, New York, Osaka, Paris, Rome, Shanghai, Singapore, Stuttgart, Taipei, Tel Aviv, Tokyo, Turin, Verona and Zurich. 

Strategy alignment

With the scale of challenges humanity is now facing, we need change at a systemic level. For a more resilient, just and sustainable economy to emerge, each part of the system must understand their role and adapt accordingly. As an investment-led service company, our fiduciary duty has always been to manage the long term savings of our clients, and in doing so to protect and grow their capital. Focusing on this objective and shying away from short term profits is the only way to achieve the dual goal of performing for our clients, while deploying their capital in a way that accelerates the transition towards a more resilient and responsible economy.

In fact, we are convinced that investment leadership will increasingly be contingent on considering real-world impact of investment activities, requiring us to embrace new models based on solid science and innovative partnerships. Across public and private markets, investors must integrate environmental and social outcomes in their decisions, ownership practices and capital allocation. 

The Pictet Group has prospered for over two centuries by taking a responsible, long-term approach to business and to the management of our clients’ wealth - considering not only the interests of the present, but also of future generations. This is reflected in our purpose: to protect, grow and transmit wealth, in every sense, by building responsible partnerships with our clients, colleagues, communities and the companies in which we invest.

We have three ambitions before 2025: 

  • To significantly reduce the environmental impact of our activities and investments
  • To fully integrate ESG factors and active ownership into all investment processes
  • To be a leading provider of responsible products and solutions

To achieve these ambitions, we have identified 10 levers of action for conducting our own activities and for managing assets on behalf of our clients. In order to ensure coherence and maximize firm-wide impact, we have an empowered Group Stewardship and Sustainability Board which oversees and tracks Group and Business line alignment and progress against these ambitions and our Responsible Vision. Members of the Board include Business Line and Group key function representatives who have the responsibility to bring key topics, recommendations and decisions from the board into the appropriate respective bodies for execution.

Principle 2

Impact and target setting

We will continuously increase our positive impacts while reducing the negative impacts on, and managing the risks to, people and environment resulting from our activities, products and services. To this end, we will set and publish targets where we can have the most significant impacts.

Principle dimension

Pictet UNPRB reporting 2021

Impact analysis

Target setting

Plan target implementation & monitoring

Progress on implementing targets

Since Pictet’s commitment to the UNPRB in 2019, our Group ESG & Stewardship team is representing the Group in the UNEP FI working group for Private Banking and Asset Management signatories. The objective of this Working Group is to jointly develop a standard framework for Private Banking and Asset Management signatories to perform their Portfolio Impact Analysis (as per UNPRB commitment).

As soon as the Private Banking and Asset Management Portfolio Impact Analysis Tool is approved and released by UNEP FI, we plan on leveraging it to undertake our portfolio (positive & negative) impact analysis. The outcome of this analysis will then be used as the foundation to set targets for the most significant impacts identified and ultimately define actions to achieve these targets.

Principle 3

Clients and customers

We will work responsibly with our clients and customers to encourage sustainable practices and enable economic activities that create shared prosperity for current and future generations.

Principle dimension

Pictet UNPRB reporting 2021

Code of conduct

Our financial and legal independence underpins our stability and our freedom of spirit and action. It ensures objectivity in our client relationships and prevents conflicts of interest. It gives conviction and tenacity to our entrepreneurial drive and our long-term vision. Excellence leads us to aim for the highest standards of service so that we can, with our own perspective, add real value for our clients. It supports our desire to achieve consistent investment performance that meets the objectives of our clients. It inspires us to innovate, free from the dictates of fashion. It means being an employer of choice, able to attract, develop and retain employees of talent.

Responsibility is one of the 5 guiding principles at the Pictet Group. We believe responsibility goes hand-in-hand with a long-term, partnership approach. It means having a sense of responsibility and integrity not only towards the present generation but also to future generations — and to the real economy and the wider world. This is true sustainable thinking.

The Group’s Code of Ethics & Professional Conduct sets out the principles and standards which should characterize all the Pictet Group’s business activities and all our dealings with our stakeholders, clients, colleagues, regulators, business partners, suppliers, vendors and communities. We as a firm conduct our business with integrity, honesty, loyalty, due skill, care and diligence. We place the legitimate interests of our clients first at all times and treat clients fairly. All colleagues have access to the Code and are regularly trained on its implication when dealing with our clients and other stakeholders. 

Encourage sustainability of clients / their investments

Our Group Responsible vision articulates our ambitions with a focus on how we manage our client assets - where we can contribute most to the transition to a sustainable economic system and mitigating negative externalities. We want the solutions available to our clients to integrate ESG considerations by default. We have reached 70% of assets under management at the end of 2020 and are therefore on track to reach our ambition to have 100% ESG integration before our initial 2025 target. In addition, we want to continue to boost our product shelf in responsible products and solutions, already having a rich offering in environmental and social strategies. Our environmental funds alone raised CHF 6.3 bn in 2020.

In addition to what has already been achieved, we have identified 10 levers of action for conducting our own activities and for managing assets on behalf of our clients. One of those levers is client engagement, especially through the reporting and transparency we can provide on their portfolios. Making the “invisible visible” is key for the transition, which is why as far as possible where relevant data are available, we are strengthening reporting on the ESG characteristics of client portfolios and the impact of active ownership activities. Where data are missing, we encourage issuers to report according to international standards.

Finally, training is key to enable the transformation and to provide our clients with the best advice to redirect their capital where appropriate. In this respect we are rolling out an ambitious training program to all front colleagues to raise awareness on responsible products and solutions and ensure they are equipped to talk to their clients. Our investment and front teams throughout the organization have also designated ESG ambassadors to drive change and so we speak with one voice when it comes to sustainability and responsible investing.

“As a company that takes a long-term view, we believe we’re accountable for future generations and all causes that wouldn’t be supported if there were no responsible actors in our society.”

Renaud de Planta Senior Partner
Pictet Group

Principle 4

Stakeholders engagement

We will proactively and responsibly consult, engage and partner with relevant stakeholders to achieve society’s goals.

Principle dimension

Pictet UNPRB reporting 2021

Stakeholders engagement

As investors, besides our clients, our engagement with the companies in which we invest is an important lever of action. We have a programme of targeted engagement for issuers that fall short of our expectation on environmental, social or governance issues. Sometimes, collaboration is necessary to maximize impact, which is why we work through groups like the Climate Action 100+ or the Institutional Investor Group on Climate Change to implement our vision, and the Principles. 

In addition, as active member in various industry groups and workstreams such as Swiss Sustainable Finance or the Swiss Bankers Association we aim to engage and collaborate more broadly within our own industry. We collaborated in the drafting of several guidelines and educational pieces over the last year. 

Through its philanthropy, the Pictet Group Foundation supports impact driven solutions that build resilient communities and ecosystems with a special focus on Water and Nutrition. By partnering with entrepreneurial social and environmental changemakers, the Foundation seeks to have maximum impact at grassroots, community and policy level. These partnerships vary from global organizations such as the UNICEF to local NGOs such as Africa Water Solutions.

Because the problems we face require new partnerships across sectors of the economy and society, we have been very active in the Building Bridges initiative, which aims to drive more capital towards the SDGs through dialogue between the financial center and the rich international organization ecosystem in Geneva. 

In 2019 the conference and week galvanized close to 1000 participants around the topic of finance for the SDGs and we will continue to support this important mission in 2021.

Principle 5

Governance and Culture

We will implement our UNPRB commitments through effective governance and a culture of responsible banking.

Principle dimension

Pictet UNPRB reporting 2021

Structure, policies & procedures

The Group Stewardship & Sustainability Board (GSSB) is the governing body for Group ESG & Stewardship. It oversees and tracks Group and Business line alignment and progress against our 2025 ambitions and the 10 levers of action outlined in our Responsible Vision which was approved by our Partners in 2020. This includes tracking progress and implementation against our main commitments such as the UNPRB, UNPRI and TCFD. 

Members of the Board include Business Line and Group key function representatives who have the responsibility to bring key topics, recommendations and decisions from the board into the appropriate Business Line and Group bodies (EXCO, EXBOs and IMCOs) for execution. 

The Head of Group ESG & Stewardship coordinates the Board, and ensures information is brought in a timely manner, and decisions are effectively executed at the business line level. The Group ESG & Stewardship team also has oversight of GSSB sub-committees - including the Group ESG Data Committee, the ESG & Stewardship Operational Committee and the Environmental Policy Committee. The team also provides support services, either in the form of subject matter expertise or project management to the business lines when particular ESG risks and opportunities need to be addressed transversally.

The GSSB meets 4 times per annum and reports to the board of partners through the Group Head of ESG & Stewardship, at minimum on a quarterly basis, and ad hoc if need be.

Responsible culture amongst employees

Our ambition of becoming a leading responsible investment firm is one of Pictet’s seven 2025 strategic priorities and was first presented by our Partners in early 2020 at the bi-annual all-staff company presentation (“Semestrielle”). This ambition has been re-iterated at each subsequent Semestrielle session, underlining its importance and providing visibility of progress towards it.

Furthermore, over the last 6 years we have had an annual Sustainability Week which aims to foster a Group-wide conversation on Sustainability and responsible investing. Several of our Partners and C-suite representatives are involved alongside internal and external experts around key sustainability themes for Pictet and our stakeholders. In 2020, 609 colleagues participated at least to one conference or workshop aiming to raise awareness and educate around our ambitions and 10 levers of action. The 2020 Sustainability Week also pro-actively invites colleagues to contribute to our transformation through idea generation and/or active involvement in ongoing initiatives. 

In order to align incentives, our remuneration policy integrates sustainability risks by way of the policies and procedures which Pictet employees are bound to respect. Compliance with internal (Policies & Procedures) P&Ps form a part of an employee’s annual review, which may include ESG limitations and taking into account sustainability risks based on the type of products or services selected by clients served by that employee. In addition, Pictet employees are held to the Group’s general engagement on sustainability and responsible investing, as relevant to their function.

Governance for UNPRB implementation

We have been on the sustainability journey for many years and adhering to the Principles for Responsible Banking is part of our commitment to transparency, and to advocating sustainability within our industry. The Group has embedded the Principles within the existing governance structure to ensure they are implemented effectively.

Our Group ESG & Stewardship team is leading the implementation of the UNPRB within the Group, coordinating the efforts with our experts across the Business Lines. This team is representing the Group in the UNEP FI working group for Private Banking and Asset Management signatories and will lead our portfolio impact analysis as soon as the Portfolio Impact Analysis Tool is approved and released by UNEP FI.

Principle 6

Transparency and accountability

We will periodically review our individual and collective implementation of these Principles and be transparent about and accountable for our positive and negative impacts and our contribution to society’s goals.

Principle dimension

Pictet UNPRB reporting 2021

Progress on implementing UNPRB

Over the last 12 months we have made significant progress on implementing the six Principles for Responsible Banking. We have published a clear vision, ambition and our levers of action.

Our governance has been strengthened through the Group Stewardship and Sustainability Board which has helped us drive implementation within the relevant business lines.

Our Group strategy aligns with what the Principles and other relevant international/regional good practices articulate. We have created and are animating a group of ambassadors within the organization which help us drive change, especially through client interactions.

Beyond our own organization, our work in industry association work-groups such as Swiss Sustainable Finance, the Climate Action 100+ or the IIGCC also aims to foster the transition to a more sustainable and resilient financial system.