TCFD REPORT 2021 TACKLING CLIMATE CHANGE 44 CLIMATE-RELATED RISK MANAGEMENT ASSET MANAGEMENT ACTIVITIES Natixis Investment Managers has identified climate risks as a key challenge and seeks to ensure better understanding to support sectors and companies working towards the transition and impact investing. A working group was arranged, including the representatives of the federation and affiliates. It meets on a monthly basis and promotes shared best practices. Most affiliates integrate ESG criteria into their investment and engagement processes (see Section 2. Strategy). This practice is supported by a number of actions: rolling out training programs, defining methodologies, climate data improvement and measuring portfolio carbon footprint. Examples of such practices include: • Ossiam uses a quantitative model based on machine learning (ESG Machine Learning). The goal is to find links in thedata, such as recurring impacts, and use this information to identify risks. • DNCA has developed a proprietary Above & Beyond Analysis (ABA) model. The tool is designed to identify companies facing risks and opportunities in terms of sustainable development and ESR. • Ostrum Asset Management implemented in 2019 a new materiality assessment tool available to all investment personnel on an internal platform. This assessment is systematically supported by a qualitative analysis of each ESG dimension, which is outlined in a dedicated reports written by analysts, on an issuer by issuer basis. In 2020, training on climate issues and carbon accounting was offered to asset managers. • Loomis Sayles which, in 2020, focused on climate concerns by publishing guidelines on climate change as well as introducing training initiatives and working with climate data. In 2019, AEW co-developed an audit framework allowing to assess projected climate risks impact on a building and propose impact reduction measures. Over 2019-2020, we have conducted a pilot study on climate risk financial impact on a sample of ten buildings with varied characteristics located across Europe. A climate expert, building design engineers, and a technical expertise firm were involved in this study. From 2021 onwards, acting on our proposal, our main investors have approved the integration of climate risk in portfolio management processes across the following key steps: acquisition, construction, renovation, and existing building management. Thierry Laquitaine Director and Head of SRI, AEW smart sustainable solutions