2022 Responsibility Report
 
 

The Critical Role of Responsibility

At AB, we’re invested in being a responsible firm—both in how we act and how we invest on behalf of our clients. We believe that research, engagement and integration of material ESG issues can help us better assess risks and identify opportunities, ultimately leading to enhanced decision-making and better client outcomes.

The industry expertise of our investment team is important to developing an understanding of material ESG issues. Moreover, AB’s Responsibility team complements the investment teams’ research and engagement efforts. The Responsibility team members have domain expertise in E, S and G issues, which can be used to challenge the investment teams’ thinking and equip our fundamental analysts with tools and training to consider material ESG issues, where applicable. 

 

Responsibility Is Embedded Throughout the Firm

AB’s Responsibility team, comprising experts in corporate responsibility and environmental, social and governance issues, partners with our investment teams at the heart of our responsible investing practices. Their work is supported by internal and external resources, and overseen by our Responsibility Steering Committee and AB’s Board of Directors. 

 

Proxy Voting 

To be effective stewards of our client’s investments and maximize shareholder value, we need to vote proxies on behalf of our clients responsibly. As a research-driven firm, we approach our proxy voting responsibilities with the same commitment to rigorous research and engagement that we apply to all our investment activities.

Global Related Proxy Information

Vote Disclosure

 

History of Our Commitment

  • Joined the Access to Medicine Foundation as Signatory Investor
  • Joined the World Benchmarking Alliance as Investor Ally
     
  • Became Member of Sustainable Trading
  • Joined The Institutional Investors Group on Climate Change
  • Joined the One Planet Sovereign Wealth Funds Initiative
  • Joined the Net Zero Asset Managers initiative
  • Accepted as a Signatory to the UK Stewardship Code for the second year in a row
     
  • Joined the Forum of Investors—Japan
  • Joined the TCFD Consortium in Japan
  • Joined the Japanese Stewardship Initiative
  • Joined the Investors Against Slavery and Trafficking—APAC
  • Joined Ceres
  • Became Founding Member of the Corporate Affiliate Program at the Columbia Climate School
  • Became Member of Emerging Markets Investors Alliance
  • Accepted as a Signatory to the UK Stewardship Code
     
  • Joined the AIGCC and ACGA
  • Became Boston College Center for Corporate Responsibility Supporting Member
  • Became Eurosif Transparency Code Signatory
  • Became FAIRR Member
  • Became Investor Stewardship Group Principles Signatory
     
  • Joined Investor Group on Climate Change
  • Started climate change and investing initiative with the Earth Institute at Columbia University in New York
  • Became Associate Member of LuxFlag
     
  • Joined ICI Global ESG Task Force
  • Joined ICI Proxy Committee
  • Joined ICGN Board Governance Committee
  • Became TCFD Supporter
  • Became engagement colead for Climate Action 100+
     
  • Became committee member of Securities and Futures Commission of Hong Kong’s Public Shareholders Group
  • Published Engagement Policy
     
  • Became CII Corporate Governance Advisory Council Member
     
  • Joined Climate Bonds Initiative
  • Joined Catalytic Finance Initiative
  • Joined Climate Disclosure Project
     
  • Published formal response to Japan Stewardship Code
  • Chaired AN/Securities/IB Working Group PFA21
  • Joined International Corporate Governance Network (ICGN)
     
  • Released Statement on Controversial Weapons
  • Became Japan PFA213 signatory
  • Became PRI signatory
  • Published formal response to UK Stewardship Code1
  • Joined Council of Institutional Investors (CII)
     
 

Why Investment Teams Need to Lead the Way

At AB, our Responsibility team helps portfolio managers and analysts consider and engage on material ESG risks and opportunities holistically and consistently, challenging investment teams’ thinking and encouraging analysts to incorporate this perspective into their financial models and outlooks. This robust approach helps teams consider material ESG risks and opportunities throughout their investment processes—ultimately driving better client outcomes.

 

Related Insights

Investment Insights
The Weather Is Changing for Climate-Focused Investors
January 11, 2024 / 4 min read
by David Wheeler, Kent Hargis, Erin Bigley Powerful forces are creating attractive opportunities in climate-focused companies for equity investors.
Investment Insights
Reflections on COP28: Opportunities amid Challenges
December 19, 2023 / 4 min read
by Sara Rosner Investors are warming to opportunities stemming from climate change, and other takeaways from COP28.
Investment Insights
The menacing shape of an oncoming tornado dominates the skyline over a bleak landscape.
When Disaster Strikes: Gauging the Investment Risk of Natural Hazards
December 01, 2023 / 4 min read
by Sam Wilamowsky, Patrick O'Connell, Larry Bellinger, John Huang Investors need to understand the potential physical damage from natural hazards before they can assess their financial implications.
 

Our Approach to ESG Integration

From idea generation to ongoing stewardship, integrating ESG involves considering material ESG risks and opportunities throughout the investment process.

 

Process in Action

 

The Active Engagement Advantage

As active investors, engagement is important to our process. Each year, AB analysts engage with leaders of companies and noncorporate entities, including municipalities, supranational and sovereign issuers. We also engage selectively through our proxy voting activities.

These connections allow us to assess, discuss and encourage better business practices and approaches to address rapidly evolving material ESG issues. We believe that engagement can drive better research and better outcomes for our clients.

 

How ESG Integration Can Improve Outcomes

ESG risks are often financial risks. With strong research, engagement and integration of material ESG issues, we can better assess risks and identify opportunities—the path to improved investment decision-making.

 
Columbia University

Climate Academy

AB and the Columbia Climate School are partnering to address the risks and opportunities related to climate change. Together, we hope to research the most pressing climate issues, embed those insights throughout our investment process where applicable and educate others.

 

Engagement in Action

The World Bank

The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries to help fund capital projects. A project aimed to protect endangered black rhinos has garnered global attention. Black rhinos are a critically endangered species, and their population size reflects broader issues in biodiversity and conservation. Their endangerment is a good barometer of how these protected areas are faring. 

Our objective in this engagement was to craft an ESG-labeled bond issued by the World Bank that achieves improved biodiversity in South Africa by targeting growth in the black rhino population. The challenge in this project was that the Global Environment Facility (GEF) wanted to incentivize black rhino population growth, while gamekeepers wanted certainty of cash flows to help build a rhino-protection team. We met with the World Bank and Credit Suisse numerous times throughout 2022 to arrive at a transaction that satisfied all parties.

AB ultimately helped craft a bond whose coupon would be tied to the GEF success criteria, including a Conservation Success Payment that bondholders would receive if the rhino population continued to grow in line with recent trends. This structure allowed investors to address rhino population risk while gamekeepers were assured of consistent payments. This is one of the first biodiversity outcome–based bonds in the market.

Chilean cityscape with mountains in background

Petrobras

Petrobras is a major state-owned oil and gas producer in Brazil that has one of the largest corporate carbon footprints in Latin America. AB is an investor participant in the Petrobras CA100+ investor cohort and has held a series of engagements on the company’s climate strategy since joining the initiative.

During AB’s tenure on this engagement, Petrobras has continued to progress its climate strategy, despite persistent changes in top leadership and operating in the context of a dynamic political environment. In particular, in line with guidance provided by AB and the CA100+ investor cohort, Petrobras has recently made decisive new commitments around its climate activities. The company has now pledged to achieve net zero greenhouse gas (GHG) emissions by 2050.

In the most recent Petrobras engagement, the Environmental Defense Fund (EDF) joined AB and the investor cohort to provide perspective and expertise on managing risks related to methane emissions, which are major contributors to climate change, given that methane’s warming potential is much greater than that of CO2.

AB and the other investors encouraged Petrobras to join the Oil and Gas Methane Partnership 2.0 (OGMP). The OGMP is a multi-stakeholder initiative launched by the United Nations Environment Programme and the Climate and Clean Air Coalition, which works with major oil and gas companies to help tackle methane emissions, which pose financially material risks and opportunities to issuers that we seek to manage on behalf of our clients.

By joining OGMP, members commit to disclosing according to the OGMP reporting framework, which works to improve the transparency and accuracy of methane emissions reporting. In previous dialogues, Petrobras expressed concerns over the technical feasibility of adhering to this reporting framework, attributing this concern to particular features of the company’s offshore drilling operations. However, AB and the investors were able to leverage the expertise of EDF to help address some of these concerns. Petrobras has since indicated that the prospect of joining OGMP membership is currently progressing through its internal approval processes.

AB and the CA100+ investor cohort are encouraged by the progress made on evolving the company’s climate strategy, as well as efforts to take investor priorities seriously.

South African energy plant

Trupanion

Trupanion is a pet insurance company based in the US. We engaged with Trupanion management and board members multiple times throughout 2022. As part of these conversations, we’ve shared examples of what AB views as best practices, including our view that we expected board declassification in coming years. While the company was not ready to immediately commit to the measure, management noted our concern and said they would discuss.

In November 2022, the CEO noted that he wanted to declassify the board during the time frame of his succession from CEO (current title) to chairman/CEO (2023–2025) to chairman (2025 and beyond), asking our advice for best practices on this process. 

We will continue to engage to monitor progress on board declassification.

Diverse group of business people sitting at a conference table
 

How Does Engagement Make a Difference?
 

Insight

Engagement enhances our research process, generating insight into issuers’ corporate strategies and competitive positioning. It also reveals how management teams, as well as company boards, address and manage medium- and long-term risks and opportunities, including material ESG considerations. By engaging, we believe we’re also able to better assess the quality of an issuer’s management, strategy, operations and corporate governance structure. We incorporate this valuable information into our quantitative and qualitative security analysis and investment decisions. We consider financial and nonfinancial performance factors when we believe that they could materially affect long-term financial outcomes.

Action

Engagement helps us support our clients’ interests by enabling us to share our ESG research assessment and corporate governance policies to encourage issuers to better address material ESG risks or take advantage of ESG opportunities, in our clients’ best interests. Discussions can focus on strategic, financial, material ESG and climate-related issues, but the goal is always the same: to encourage firms to make decisions with a long-term view that is in the best interest of our clients.

Collaboration

We sometimes work with non-AB investors, asset owners and ESG-focused organizations on engagement. This can happen when we’ve independently arrived at the same conclusion as other managers and believe that collaboration might help address specific issues. The goal of collaborating is to share information and ideas.

 

Collaborate, Explore, Advance

Proprietary Research Collaboration Platforms

We’ve innovated platforms that power collaboration between our analysts within and across asset classes as we research and engage with issuers.

 

PRISM

Our fixed-income ESG research platform, PRISM, provides independent ESG assessments and scores that impact investment decisions. The goal, of course, is straightforward: better and faster information can empower better decisions.

 

ESIGHT

ESIGHT is a one-stop online shop where AB investment teams can access and share proprietary information about corporate ESG practices. We’ve launched several ESIGHT enhancements, including an ESG knowledge center, COVID-19 research and country ESG scores for fixed income.

 

Finding Responsible Solutions

Responsible investing is a personal journey. Clients may have different environmental and social priorities, and preferences for different investment approaches. To try to meet this need, we’ve developed our suite of Portfolios with Purpose—our ESG-focused strategies.

Icon for the year 2013
Year first Portfolio with Purpose was launched
Dollars invested in Portfolios with Purpose
 
 

Portfolios with Purpose

We manage US$28 billion in Portfolios with Purpose today, one of the most rapidly growing segments of our business. We also manage US$503 billion in assets that use ESG integration and other enhancements.

 

Responsible+

Use an additional responsibility focus, such as climate resilience, ESG improvement or best-in-class allocations. These portfolios adopt a range of strategies to improve management of material ESG risks and opportunities, and they fall into one of the following three subcategories; Climate Conscious, ESG Leaders and Change Catalysts.

Sustainable

Invest in issuers that address environmental or social factors, whether through their products, services or practices. Prominent themes include climate, health and empowerment.

Impact

Invest in issuers that can provide a positive and measurable impact on society or the environment.

 
 

UN SDGS: A Road Map for Investors 

In recent years, severe weather damage, the global pandemic, and political, economic, and social unrest have made ESG issues more tangible, fueling a global movement around taking responsibility for addressing these challenges.

Sustainable development involves finding solutions to these critical challenges. Directing capital to businesses providing solutions to these issues can provide investors with exposure to fast-growing industries that may help to preserve and, ultimately, increase their wealth.

The United Nations (UN) established the SDGs as a powerful framework of 17 goals to help countries address the challenges of economic prosperity, environmental sustainability and social inclusion. They represent an aspirational view of what the world can look like by 2030. We believe the UN SDGs can help investors connect the world’s crises with actionable investment themes, serving as a road map for translating sustainability issues into investible opportunities.

Based on this mind-set, we’ve developed a practical framework focused on four themes: climate, health, empowerment, as well as strong institutions for sovereigns.

 

Sustainable Themes

Climate

Efforts to stem climate change are gaining momentum around the world. Many consumers, businesses and policymakers are recognizing the need for change.
 

  • Cleaner energy
  • Resource efficiency
  • Sanitation and recycling
  • Sustainable transportation
Single windmill with sunset in background

Health

Healthcare spending is rising, and people are living longer, which raises complex issues for access to high-quality and affordable medicine and long-term care.
 

  • Access to quality care
  • Food security and clean water
  • Medical innovation
  • Well-Being
Two people holding hands sitting across from each other

Empowerment

Many sectors of society are marginalized by economic and social forces. Physical and technological infrastructure is needed to enable sustainable economic development, employment growth, poverty eradication and social inclusion.
 

  • Education and employment services
  • Financial security and inclusion
  • Information and communication
  • Sustainable infrastructure
Women with dark hair and skin driving a truck

Strong Institutions

Responsible sovereigns provide the foundation for the private sector to innovate and for effective and accountable public policymaking.
 

  • Freedom and fundamental rights
  • Anti-corruption and government
  • Law and order
Upwards view of decorative columns on a white building
 

Reports

 

2022

 

Policies and Statements

 

2023

 

As a registered investment advisor, AllianceBernstein L.P. ("AB", "we" or "us") has a fiduciary duty to act solely in the best interests of our clients. We recognize that this duty requires us to vote client securities in a timely manner and make voting decisions that are in the best interests of our clients. Consistent with these obligations, we will disclose our clients' voting records only to them and as required by mutual fund vote disclosure regulations. In addition, the proxy committees may, after careful consideration, choose to respond to surveys regarding past votes.

This statement is intended to comply with Rule 206(4)-6 of the Investment Advisers Act of 1940. It sets forth our policies and procedures for voting proxies for our discretionary investment advisory clients, including investment companies registered under the Investment Company Act of 1940. This statement applies to AB's investment groups investing on behalf of clients in both US and non-US securities.

 

Performance Tables

 

Full-Time/Part-Time Female % Female Male % Male Grand Total % of Total
Full-Time 1,621 38 2,672 62 4,293 99
Part-Time 30 88 4 12 34 1
Total 1,651 38 2,676 62 4,327 100
 

Region Female % Female Male % Male Grand Total % of Total
Americas 1,092 36 1,947 64 3,039 70
Asia ex Japan 298 44 375 56 673 16
EMEA 206 40 311 60 517 12
Japan 55 56 43 44 98 2
Total 1,651 38 2,676 62 4,327 100
 

Exempt vs. Nonexempt Female % Female Male % Male Grand Total % of Total
Exempt 1,522 37 2,625 63 4,147 96
Nonexempt 129 72 51 28 180 4
Total 1,651 38 2,676 62 4,327 100


Data is as of December 31, 2023.

 
 
  Gender Hispanic or Latino (United States of America) White (Not Hispanic or Latino) (United States of America) Black or African American (Not Hispanic or Latino) (United States of America) Native Hawaiian or Other Pacific Islander (Not Hispanic or Latino) (United States of America) Asian (Not Hispanic or Latino) (United States of America) American Indian or Alaska Native (Not Hispanic or Latino) (United States of America) Two or More Races (Not Hispanic or Latino) (United States of America) Grand Total
Executive/Senior Officials and Managers
 Female            -                3             1           -             -             -             -                4
 Male            -              14           -             -               1           -             -              15
First/Mid Officials and Managers   Female            11          140             8           -             34           -               5          198
 Male            12          360           10             1           91             2             3          479
Professionals   Female            61          208           37           -             87             1             6          400
 Male            66          390           41           -           171           -             11          679
Sales Workers   Female            15          279           19             1           43           -               8          365
 Male            42          545           33           -             55             3           19          697
Administrative Support   Female            33            55           12           -               8           -               2          110
 Male            17            21             5           -               3           -               2            48
Grand Total            257       2,015         166             2         493             6           56       2,995


There are 35 employees who did not declare ethnicity and 8 employees who did not declare gender. Data is as of December 31, 2023

 
 

  2019 2020 2021 2022
  Consumption Emissions Consumption Emissions Consumption Emissions Consumption Emissions
Scope 1
Fuel
2,705,753.00 ft3 153.00 tCO2e 2,602,938.00 ft3 151.00 tCO2e 1,832,613.00 ft3 118.00 tCO2e 1,849,950.00 ft3 102.00 tCO2e
Scope 2
Electricity
22,075,172.00 kwh 7,019.00 tCO2e 19,237,803.00 kwh 6,115.00 tCO2e 21,881,090.00 kwh 7,117.00 tCO2e 22,306,659.00 kwh 7,361.00 tCO2e
Scope 3
Air & Rail Business Travel
36,712,974.00 miles 7,207.00 tCO2e 7,116,566.00 miles 1,216.00 tCO2e 3,549,421.00 miles 572.00 tCO2e 16,767,556.00 miles 2,926.00 tCO2e
Occupancy 3,512 people 3,877 people 4,129 people 3,841 people
Area 1,153,953.00 Sq. ft. of AB footprint 1,381,361.00 Sq. ft. of AB footprint 1,310,672.00 Sq. ft. of AB footprint 1,351,036.00 Sq. ft. of AB footprint
Total emissions
14,379.00 tCO2e

7,482.00 tCO2e

7,807.00 tCO2e
10,389.00 tCO2e
Total per square ft 0.01246 tCO2e/total sq. ft. 0.00542 tCO2e/total sq. ft. 0.00596 tCO2e/total sq. ft. 0.00769 tCO2e/total sq. ft.
Total per capita 4.09 tCO2e/person
1.93 tCO2e/person

1.89 tCO2e/person
2.70 tCO2e/person


Data were extracted on June 27, 2023 from our sustainability data management platform. The display does not include 2021 US rail data.

 
 

  2019 2020 2021 2022
Charitable Contributions 2,009,822 1,849,641 2,897,254 2,324,665
Matching Gifts—US 3,116,254 2,765,289 2,219,130 2,402,311
Matching Gifts—Non-US 100,781 165,429 128,488 169,048
Total  5,226,857 4,780,359 5,244,872 4,896,024


Data is as of December 31, 2022.

 
 

  Female Male Non-Binary Did not disclose gender
Gender Identity 3 8 0 0
Demographic Background
African American or Black 0 1 0 0
Alaskan Native or Native American 0 0 0 0
Asian 0 1 0 0
Hispanic or Latinx 0 0 0 0
Native Hawaiian or Pacific Islander 0 0 0 0
White 3 6 0 0
Two or More Races or Ethnicities 0 0 0 0
Directors Born Outside of the US
0
1 0 0
LGBTQ+ 0
Did not disclose demographic background 0


As of December 31, 2022.

 
 

Shareholder Rights Directive II (SRD II) Disclosures

The SRD II aims to encourage long-term shareholder engagement and transparency between traded companies and investors. Asset managers and institutional investors can play a vital role in the responsible stewardship of assets.

 

Transparency in Coverage