Sustainable Finance Strategy

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Sustainable Finance Strategy

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SDGs

Sustainable Finance Strategy

SKFH is committed to promoting sustainable development, uses its core competencies and professionalism to fulfill the “Sustainable finance” spirit and contribute to the sustainable development of society. We actively supporting to the United Nations Sustainable Development Goals(SDGs) and the Taiwanese government's target of 2050 net-zero emissions. We encourage our subsidiaries and outsourced investment institutions to integrate environment, social, corporate governance (ESG) and climate change considerations into financial activities such as investments, lending, life insurance, and asset management. SKFH and its subsidiaries voluntarily adhere to internationally advocated principles, including the Principles for Responsible Investment(PRI), Principles for Responsible Banking(PRB), Equator Principles(EPs), and Principles for Sustainable Insurance(PSI), and cooperate with customers, suppliers partners and other stakeholders to promote sustainable financial products and services.

In the future, we will continue to follow sustainable development trends, gradually increase the proportion of responsible investment, and effectively keep pace with global sustainability and positive opportunities.


 


Sustainable Finance Policy

SKFH has formulated the "SKFH Sustainable Finance Policy" adhering to the United Nations PRI, PRB, PSI, and EPs. The policy regulates SKFH and its subsidiaries’ to incorporate ESG factors into their financing activities such as investment, lending, and life insurance. Before making decisions, ESG risks and opportunities due diligence must be conducted and evaluated prudently. Those included in the exclusion lists should avoid dealing with each other.

In addition, in order to safeguard shareholders, employees and customers’ long-term value, reduce sustainability-related risks, and seize opportunities. SKFH upholds the function of pooling market funds for investment as a financial institution and fulfills the spirit of stewardship for institutional investors to formulate engagement policies and voting policies as the stewardship behavior standards for each subsidiary. Subsidiaries need to take engagement actions based on the engagement issues that SKFH is
concerned about, and continue to pay attention to the operation status and sustainable performance of counterparties, actively attend annual general meeting, exercise voting rights, and properly dialogue and interact with the management of the counterparty. If the counterparty does not make improvements, no new transactions are allowed. If the deterioration of counterparties continue, capital reduction or  divestment actions should be taken.

 
SKFH Sustainable Finance Policy
 

The sustainable finance policy covers 100%
of the total managed assets of all applicable responsible investment and responsible lending.

 

The Principles Sustainable Insurance (PSI)

 
  • Principle 1
  • Principle 2
  • Principle 3
  • Principle 4
  • We will embed in our decision-making environmental, social and governance issues relevant to our insurance business
 
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Issues Key Plans and Results
Company strategy
  • SKL has established a "Corporate Sustainability Committee" to develop annual ESG strategy targets. The Committee tracks ESG progress and achievements every quarter and reports regularly to the Board of Directors after review by senior executives of the Committee.
  • Integrating ESG indicators into key performance indicators (KPIs) for senior executives and general employees.
  • Utilizing platforms such as shareholder meetings, earnings calls, press conferences, and company website to disclose management of ESG issues and communicate with stakeholders.
  • Incorporating "sustainable development" into mandatory training for all employees; organizing sustainability, DEI related seminars, workshops, and online courses.
  • Including human rights issues in human resources policies; Achieving 100% completion of human rights training and gender equality checks; Safeguarding the rights of indigenous peoples and persons with disabilities in the workplace
Risk Management
  • Establish risk management procedures to identify related risks such as product design and pricing risks, insurance underwriting risks, reinsurance risks, catastrophe risks, compensation claim risks, and preparatory fund risks including the potential impact of ESG issues.
  • The Task Force on Climate-related Financial Disclosures (TCFD) framework was adopted, which includes governance, strategy, risk management, indicators and targets. We have studied climate-related issues, proposed response measures and implementation plans, and quantitatively evaluated the impact of such risks on the Company through greenhouse gas inventory and scenario analysis. The management of climate-related risks and opportunities are included in sustainability reports.
  • A "Information Security Committee" was established to ensure the completeness of information security and personal data protection controls through continuous international certifications such as ISO 27001 information security standards and BS 10012 personal data management system.
Products and services
  • We continue to offer insurance products that meet the career planning needs of Taiwanese people by responding to changes in societal structure, policyholder demands, advances in underwriting technology, and improvements in product development.
  • Develop financial inclusion products such as microinsurance and small-amount whole life insurance, helping the disadvantaged groups and the elderly to obtain basic protection.
  • Develop ESG-oriented products to help policyholders mitigate the risks of air pollution and food safety issues；develop pillover insurance and provide premium cuts incentives to help the public improve their health management concepts and behaviors, creating a triple-win situation of improving public health, reducing claim payouts, and decreasing the utilization of medical resources.
  • Conducting seminars and educational programs on risks, insurance, and ESG issues for children, youth, and the elderly; Inviting expert speakers to share knowledge on insurance, financial planning, and healthcare.
Sales and marketing
  • The sales and promotion of all products comply with legal regulations on the disclosure of the quality of products. We also set forth a "Management Regulations for Product Sales and Promotional Materials," which requires all sales channels and personnel to ensure that product sales and promotional materials are veracious, accurate, clear, easy to understand, and complete.
  • Adhere to the fair treatment principle, we held anti-fraud and digital-friendly talks for elderly policyholders, helping elderly policyholders on the three Don'ts for frauds as well as convenient digital payment channels；Proposing preventive measures against financial exploitation issues among the elderly；developed a CIS system and a sign language video-call translation platform for vulnerable groups, creating a financial friendly environment
  • By integrating online and offline resources, we work with our agents and policyholders to create low-carbon insurance services through the abundant activities of our official LINE service center and on-site promotion and training of the digital specialists.
Underwriting Policies
  • The underwriting operations comply with the "Underwriting System and Procedures" and the "Underwriting System and Procedures for Offshore Insurance Units."
  • The underwriters, who possess professional knowledge and expertise, assess the basic information of the policyholder and insured, the reasons for insurance, insurance benefits, level of demand, suitability, occupation, income, finances, the source of insurance premiums, and health status. They shall pay attention to whether the policy involves ethical risks or improper tax avoidance, and conduct underwriting from an impartial standpoint.
  • Established an "underwriting risk classification model", used claims data and underwriting experience from the past in combination with data mining technology to conduct underwriting risk management.
  • In response to the inclusive financial policy, there will be no unfair treatment in underwriting for specific insured objects or because the insured is physically or mentally handicapped.
Claims management
  • Assessing damages and casualties, issuing notifications in emergency disasters; Activating proactive care and rapid claims mechanisms.
  • We are continuously improving our claims mechanism and procedures with a claims risk model and dividing cases according to their level of risk, enhancing the efficiency of claims.
  • Security and insurance claim alliance chain: Actively constructing an insurance technology development platform, where policyholders with policies from multiple insurance companies can apply for personal claims or make policy changes online to any of the insurance companies they are insured with.
Investment management
  • We have established the "Shin Kong Life Securities Sustainable Investment Policy and Procedures," which provides guidance on sustainable investment principles. Companies on the exclusion list are prohibited from further investments. Potentially controversial Industries must comply with industry-specific guidelines, and ESG assessments must be conducted before investing. High-carbon emission industries must undergo individual climate change risk assessments.

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