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  • Policy for Responsible Investment

    Article 1. For responsible investment, corporate social responsibility, and sustainable development, China Life Insurance Co., Ltd. (hereinafter referred to as “the Company”) has formulated the Policy for Responsible Investment (hereinafter referred to as the “Policy”) that incorporates Environment, Society, and Governance (ESG) standards as per the TWSE Stewardship Principles for Institutional Investors and the United Nations Principles for Responsible Investment (UN PRI).
    Article 2. The Company’s principal investment should be governed by the Policy.
    Article 3. While evaluating investment targets, making investment decisions, and managing portfolios, the Company should consider ESG aspects and execute stewardship to create value and facilitate sound development of the Company’s investment business. Specific measures include:
     
    1. Ⅰ. While evaluating potential investment targets, it’s imperative on the part of the investment teams to consider ESG aspects, and exclude businesses having significant environmental, social or governance disputes as mentioned below:
      Criteria for Exclusion
      Rainforest logging, tobacco industry, polychlorinated biphenyl (PCB), nuclear weapons, illegal gambling, pornography, drugs, money laundering, terrorism financing, child labor, or the Board's violation of laws, corporate charter, or shareholder resolutions with substantial evidence.
    2. Ⅱ. Investment teams should continuously monitor, analyze, and evaluate relevant information on investment targets. If investment targets are involved in areas fitting the above criteria for exclusion during the investment period, the investment teams should quickly review and evaluate whether improvements have been made or planned, and mention in the evaluation report whether to alter investment strategies or lower investments.
    3. Ⅲ. In cases where investment targets operate coal-mining businesses or coal/thermal power plants and are penalized for environmental pollution over the past 12 months by the environmental competent authority, investment teams should report whether improvements have been made or planned, and makes relevant notes in the evaluation report.
    Article 4. The following sub-policy governing voting procedure is formulated for shareholders' meeting of the portfolio companies for long-term benefit of the Company's customers and shareholders:
     
    1. Ⅰ. Active voting and comment on proposals at shareholders' meetings of portfolio companies.
    2. Ⅱ. Cautious deliberations over proposals at shareholders' meetings of portfolio companies before attendance, recording the evaluation and analysis for exercise of voting right, and regularly submitting written records of exercise of voting rights to the Board of Directors after attendance.
    3. Ⅲ. In-principle, disapprove of proposals that impact the portfolio companies' sustainable development, corporate governance, or violate ESG standards.
    4. Ⅴ. Voting right is not exercised in the election of portfolio companies' directors or supervisors, and the Company cannot serve as their directors or supervisors.
    5. Ⅵ. A summary record of annual attendance and vote at shareholders' meetings of portfolio companies is compiled and disclosed.
    Article 5. The following sub-policy governing engagement with portfolio companies or investment targets is formulated to acquire adequate and useful information:
     
    1. Ⅰ. Any interaction and engagement with portfolio companies or investment targets that generate positive impact on ESG may be considered in the evaluation of investment strategies.
    2. Ⅱ. When invested companies or investment targets violate the law, are in breach of the Company’s ESG policies and long-term values for certain issues, attention must be drawn on the cause as well as follow-up procedures of the issue.
    3. Ⅲ. Side letters should be provided for invested private funds that have yet to sign PRI agreements, in suggesting that PRI is referenced in assessing investments.
    Article 6. The Company should publish PRI on its website, disclose the implementation of responsible investment and related information in the annual CSR report, and periodically train employees responsible for executing the Policy.
    Article 7. Relevant laws and internal regulations shall apply where the Policy does not adequately spell out details.
    Article 8. The Policy and future amendments come into effect on the day of announcement after approval by the Board of Directors.

    Compliance Declaration of Stewardship Principles for Institutional Investors

    The core business of China Life Insurance Co., Ltd (hereinafter referred to as the “Company”), an asset owner, is life insurance. The Company complies with the Stewardship Principles for Institutional Investors as follows:

    Signatory: China Life Insurance Co., Ltd
    December 24th, 2020

     

    • Principle I. Formulate and disclose stewardship policies
      1. The Company conducts life insurance businesses and uses self-owned funding and reserves to invest. It takes factors that ensure corporate sustainability, such as industry development, environment, social responsibilities, ESG, etc. into account to increase the long-term value of investment, and the long-term interests of the Company, customers, shareholders, and other stakeholders.

      2. By participating in investees’ analyst calls and shareholders meetings, and conducting irregular visits or conference calls, the Company is able to continue monitoring investees’ business and financial situations, which will be used for investment decision-making. The Company also follows the Insurance Act, other laws and regulations, and official letters by carefully reviewing items to be discussed before attending shareholders meetings of investees in exercising the Company’s voting right.

      3. The Company discloses and updates its results of executing stewardship on the Company website annually.

    • Principle II. Formulate and disclose policies to manage conflicts of interest
      1. In order to fulfill the Company’s promises to customers and safeguard equities, the Company has formed the Ethical Management Committee under the Board of Directors, which has been converted into a functional committee, to demonstrate China Life’s commitment. Internally, the Company has formulated guidelines for corporate governance and ethical management to delineate the types of conflicts of interest and managing methods. For detailed information, please visit: Company corporate website / Homepage / Overview of Disclosed Information / Corporate Governance.

      2. Should major conflicts of interest emerge and damage the Company’s reputation or financial soundness, the Company is advised to explain the matter and ways to process the situation on the corporate website so as to inform customers and beneficiaries.

    • Principle III. Continue to monitor investees

      To lay a solid foundation for the Company’s investment decisions, the Company assesses the nature, time, and depth of its conversation and interaction with investees. To make sure the Company is able to obtain both sufficient and relevant information, the Company monitors related news, financial performance, industrial landscape, management strategy, environmental protection practices, social responsibilities, labor rights and interests, and ESG performance of investees.

    • Principle IV. Conduct appropriate conversation and interaction with investees
      1. Through appropriate conversation and interaction with investees, the Company is able to gain a better understanding of investees’ management strategies and the risks they face. It is committed to reaching a certain level of consensus over long-term value creation with investees.

      2. Through conference calls, face-to-face interaction, and participation in analyst calls, regular shareholders meetings, or major ad hoc shareholders meetings, the Company is able to communicate with the management of investees.

      3. Should investees significantly violate the Company’s principles of corporate governance, or damage the long-term values of the Company’s customers and shareholders, the Company will inquire the management of investees about adopted measures for improvement. The Company may also engage in joint appeals with other investors.

    • Principle V. Formulate and disclose specific voting policies and voting results

      The following are the Company’s voting policies:

      1. The Company will actively cast votes during shareholders meetings of investees, and express its views on items discussed to best ensure the rights and interests of its customers and shareholders.

      2. Before attending shareholders meetings of investees, the Company will put its analyses for items to be voted in writing. After the shareholders meetings, written records of exercising voting rights will be regularly presented to the Board of Directors.

      3. The Company respects the professional management of its investees, and will carefully evaluate items proposed by investees for discussion to boost their effective development. In principle, the Company will not support items that violate corporate governance (e.g. misrepresented financial statements, improper compensation for Directors and Supervisors), and items with negative environmental or social impacts (e.g. pollution, human rights violation, labor exploitations), as both hinder corporate sustainable development.

      4. According to Sec.3, Art. 146-1 of the Insurance Act, the Company may not cast votes in the election of investees’ Directors or Supervisors, nor can it be a Director or Supervisor at investees.

      5. The Company properly records voting in investees’ shareholders meetings, analyzes the voting results in accordance with the aforementioned policies, and discloses the records and reports annually.

    • Principle VI. Regularly disclose execution of stewardship

      The Company discloses its execution of stewardship on the corporate website annually, including this compliance declaration, explanations for partial principle non-compliance, participation in investees’ shareholders meetings, compiled voting results, channels for shareholder communication, and other major items.

    Update on the Company's Ethical Management

    The Company has established an “Ethical Management Committee” in promoting ethical business operations. The operation and execution of the Ethical Management Committee is as follows:

    1. I.Report to the BOD on the Company’s ethical management status on a yearly basis.
    2. II.In order to prevent conflict of interest or unethical actions, the Company has compiled the “Ethical Corporate Management Best Practice Principles”, “Ethical Corporate Management Conduct Guideline”, “Procedures for Reporting Illegal, Immoral, or Unethical Behavior,” clearing stating whistleblowing report channels as well as relevant protection measures for the whistleblower.
    3. III.Quantitative data regarding effectiveness of the Company’s ethical management has been disclosed on the Company website under the following webpage: Home / Sustainability / Resources / Corporate Policies And Regulations / Ethical corporate management page. 
    4. IV.China Life’s illegal, immoral or unethical action report channel:
      • 1. Paper copy mail box: No. 122, Dunhua N. Rd., Songshan Dist., Taipei City

        (Recipient: China Life Insurance Legal Compliance/Please mark as “confidential”)

      • 2. Whistleblowing by email: whistleblower@chinalife.com.tw
      • 3. Report hotline: (02)8712-5192
      • 4. Report in person
    5. V.China Life’s Ethical Management Training:
      Every year, China Life conducts ethical management training for both office staff members and sales agents. In 2020, all of the Company’s office workers completed the legal regulation training for 2020. The training content included the corporate ethical management and morals, prevention of insider trading (including insider trading laws, conditions and civil & criminal responsibilities) as well as whistleblowing systems, PI protection and human rights. In addition, China Life conducted 2020 law training for all of its field workers. Contents of the training include sales quality training, ethical management and morals, prevention of insider trading as well as whistleblowing systems. A total of 15,027 employees underwent training, with a total of 17,423 training hours.