Establish a leading responsible/lending team in Taiwan

Cathay fully recognized the impact financial sector can bring through responsible investment/lending. Cathay has established a Responsible Investment Working Group in 2014, which supervises Cathay FHC's responsible investment strategies and sets up policies. Cathay Life and Cathay SITE have also respectively established their Responsible Investment Task Force, which comprises the front/mid/back-offices of the investment team. The task force continuously learns the best international practices, trends and methodologies to establish action plans to refine and improve the ESG integration process. Cathay Life has established responsible investment department to further improve the responsible investment management. CUB established the Sustainable Finance Loan Management Section in 2016, which is responsible for reviewing EPs-related cases, and has renamed it as the Sustainable Finance Section in 2017. The Section is now the dedicated unit in charge of promoting corporate sustainability and ESG risks management within the bank.


Delivering ESG training to strengthen capability of ESG risks management

Cathay is active in its exchanges with external industrial, governmental and academic institutions and invited foreign experts to bring ESG analysis education and training at least twice a year for investment team to learn global trends and RI practices. In addition, we also provided training materials for EPs project financing management regulations and ESG Regulations for Corporate Loans, which are updated on management demand. In 2021, a total of 2502 employees from Cathay FHC, Cathay Life, CUB, Cathay SITE, and Cathay Century participated in Cathay's courses as well as external conferences; the average training hours per participant was 1.13 hours.


Provide investment teams the ESG analysis tools to build comprehensive ESG Investment environment

Sufficient ESG information and data is the basis for strong ESG management. Cathay thus purchased access to several international ESG databases to provide teams with comprehensive ESG data and analysis information, and created related tools to provide teams with a comprehensive ESG investment environment.

  • 《Cathay FHC RI Leading Teams and Sufficient Resources》

  • Principles for Responsible Investment, PRI

    Principles for Responsible Investment (PRI) is an international framework launched by UN, requiring investors to integrate ESG into investing process. Cathay believes institutional investors have responsibility to exercise its positive influence to investee companies. Cathay was the first Taiwanese financial institution establishing the Responsible Investment Working Group in 2014. The Working Group is led by the Chief Investment Officer of the Cathay FHC and it works together with senior investment executives of subsidiaries. Cathay Life and Cathay SITE have also respectively established their Responsible Investment Task Force with total of 57 members and 8 dedicated employees. Cathay Life have voluntarily adopted PRI in 2015. 


    Cathay PRI Implement Status  


    Cathay FHC and its subsidiaries must adhere to the "Cathay Financial Holdings Responsible Investment and Lending Policy" when investing and lending. As a financial institution, Cathay has an obligation to its stakeholders to prudently manage ESG risks, seek long-term investment performance. Cathay aims to leverage financial influence promote continuous improvement in the ESG performance of investees and borrowers, contribute to global sustainable development goals, and foster a sustainable society and management.

    Cathay FHC investment and lending ESG integration procedures



    Strengthen the climate management and transition to zero carbon

    Using science-based quantification, Cathay FHC has developed a carbon reduction pathway for investment and lending portfolios with emission-based and impact-based approaches. Cathay FHC has committed to achieving long-term goals for net zero emissions in financial assets by 2050 as well as the short- and mid-term goals. Cathay FHC will adjust carbon reduction goals every five years to ensure that the company's goals are in line with 2050 financial assets net zero pathway. The short- and mid-term carbon reduction goals set forth by Cathay FHC have been approved by the Science Based Targets initiative (SBTi) in 2022.


    To achieve the long-term goal of net zero emissions in financial assets by 2050, Cathay FHC continues to calculate the Weighted Average Carbon Intensity (WACI) of investment portfolios with the Task Force on Climate-Related Financial Disclosures' (TCFD) methodology as well as total carbon emissions and intensity from financial assets with the Partnership for Carbon Accounting Financial (PCAF) methodology. For lending, Cathay FHC has been conducting carbon accounting of lending portfolios using SBTi and PCAF methodologies since 2021. Carbon accounting was conducted for the following assets: listed equity, corporate bonds, electricity generation project finance, commercial real estate mortgage loan, and long-term corporate loans. In cases where carbon emissions data was missing, Cathay FHC estimated carbon emissions using the PCAF methodology.

  • 《Cathay FHC Monitoring Financed Emission》
  • 《Cathay FHC Coal Phase-Out Strategy》

  • Cathay believes that in addition to integrating ESG factors into the investment process, it is critical to implement active ownership, including engagement, voting, and maintaining an active and open channel of communication with investee companies. Financial institutions can incentivize companies to increase their awareness and transparency of ESG issues by engaging in active dialogues. In addition, financial institutions can help companies improve their ESG management, leading to improved long-term competitiveness. These collaborative efforts not only help financial institutions manage and mitigate risks, but also strengthen the resilience of their portfolios. In addition, active ownership brings a positive impact to the portfolio to generate sound environmental and social benefits. Therefore, Cathay is committed to active ownership measures such as engagement and voting to become a leader in responsible investment in Taiwan.


    Cathay has gained international recognition for our efforts over the years. The Investor Agenda announced the Investor Climate Action Plans (ICAP) in 2022, and Cathay FHC was the only asset owner in Asia to be included in the world's top ten best practice for our corporate engagement and policy advocacy performance.

  • 《Cathay FHC Corporate Engagement and Active Ownership》
  • 《Cathay FHC Climate Initiatives and Engagement》
  • Cathay Sustainable Finance and Climate Change Summit



    Taiwan Stewardship Principles for Institutional Investors

    Cathay FHC and its subsidiaries, including Cathay Life, Cathay SITE, Cathay Century, CUB and Cathay Securities, are all signatories to the Taiwan Stewardship Principles for Institutional Investors. Cathay Life, CUB and Cathay SITE received the "List of companies with better institutional investor stewardship disclosure 2022" from the Taiwan Stock Exchange (TWSE). Cathay's adherence to stewardship principles has also been recognized internationally. In 2022, BENCHMARK awarded Cathay SITE with the "Stewardship Award - Outstanding Performance," while Cathay SITE's Cathay Taiwan Select ESG Sustainability High Yield ETF Fund received the "Stewardship Award - Best in Grade."


    In addition, Cathay also engages and communicates with the senior management of investee companies by participating in conference calls, seminars, investor conferences and shareholders' meetings. In 2022, a total of 8,411 representatives from Cathay Life, CUB, Cathay Century and Cathay SITE engaged with 2,051 companies. Cathay's subsidiaries publish annual stewardship reports to disclose the status of the implementation of responsible investment and stewardship principles. For more information , please refer to the websites of Cathay Life, CUB, Cathay Century, Cathay Securities and Cathay SITE. (Some subsidiaries also disclose case-by-case voting disclosure)


    Compliance Statement-Stewardship Principles for Institutional Investors

    Cathay Life
    Cathay Century
    Cathay SITE
    Cathay United Bank
    Cathay Securities 


    Stewardship Report (including investment ESG management and engagement)

    Cathay Life

    Cathay Century (Chinese only)

    Cathay SITE (Chinese only)

    Cathay United Bank (Chinese only)

    Cathay Securities (Chinese only)


    Voting Disclosure

    Cathay Life

    Cathay Century (Chinese only)

    Cathay SITE (Chinese only)

    Cathay United Bank (Chinese only)

    Cathay Securities (Chinese only)



  • PE Fund for Sustainable Industries

    Cathay SITE became the first investment trust company in Taiwan approved to set up a subsidiary to issue private equity funds. 100% of the "Cathay Sustainability Private Equity Fund" is invested in key industries of sustainable development in Taiwan, including highlighted industries such as circular economy (e.g., sewage treatment and waste processing and reuse), renewable energy (e.g., solar energy, geothermal energy, hydropower, and energy storage), as well as the"5 + 2" innovative industries promoted by the government (e.g., Internet of Things, smart machinery, new agriculture, and long-term care). The total promised investment totaled NT$8 billion.

    Cathay MSCI Taiwan ESG Sustainability High Dividend Yield ETF

    ESG is an indicator for assessing the quality of long-term corporate management. The COVID-19 epidemic in 2020 demonstrated the importance of companies' care for employees and supply chain management. Cathay SITE worked with MSCI to provide investors with the opportunity to use international ESG services for sustainable investment. We also used weighted dividend yields to select shares in sequence and help investors stabilize profits and meet their requirements. The ETF set multiple new records on the Taiwan Stock Exchange after its IPO.

    Cathay Global Autonomous and Electric Vehicles ETF

    Statistics show that the past five years were the hottest five years on Earth in modern history! Droughts and floods are frequently occurring around the world. As a result, there is now a global consensus towards the implementation of energy conservation and carbon reduction! Many countries have committed to achieving carbon neutrality by 2050. One of the policies necessary to achieve this goal is to accelerate the development of electric vehicles (EV). Hence, Cathay believes that smart self-driving electric vehicles will inevitably become the trend of eco-friendly investments. This is the reason why Cathay SITE decided to offer the Cathay Global Autonomous and Electric Vehicles ETF (00893). 00893 is the first electric vehicle ETF in Taiwan.

    Cathay Securities ESG research reports for individual stocks

    In 2020, Cathay Securities, Cathay Futures and National Taipei University (NTPU) join forces to provide ESG research services to institutional investors. Cathay uses the SEED (social, environmental, economic, disclosure) rating methodology developed by the Corporate Sustainability Research Team of National Taipei University to create the first ESG rating system in line with international methodology. In addition to providing the latest ESG research reports, this industry-academic cooperation also began providing investors with a customized "ESG Engagement Report" in 2022. We believe that engagement with rated companies can facilitate the promotion of sustainable operations by Taiwanese companies. In addition, in response to the increasing demand for ESG investment, Cathay Securities leveraged the information provided in the "Taiwan Sustainability Review" published by NTPU in collaboration with Cathay, and launched the innovative, industry-first "Sustainability Investment" services in 2022. We aim to provide a clear overview of the impact of sustainability and help investors generate returns while understanding the power of ESG stocks.

    Note: SEED stands for social, economic, and environmental disclosure.


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