(1) Institutional investors are to disclose how the main elements of their investment strategy are consistent with the profile and duration of their liabilities and how they contribute to the medium to long-term performance of their assets.
(2) Where an asset manager invests on behalf of an institutional investor, the institutional investor is to disclose such information regarding its agreement with the asset manager that explains how the asset manager aligns its investment strategy and investment decisions with the profile and duration of the liabilities of the institutional investor. The disclosure particularly comprises information on
1. how the medium to long-term performance of the company is taken into account in the investment decision,
2. the engagement with the company, particularly by exercising shareholder rights, including securities lending,
3. the method applied by the asset manager, how the asset manager’s performance is evaluated and how the asset manager is remunerated,
4. how the agreed portfolio turnover and the desired portfolio turnover costs are monitored by the institutional investor,
5. the term of the agreement with the asset manager.
Where no agreement was made regarding individual of the items of information, the institutional investor is to explain why this was not done.
(3) Institutional investors are to make publicly available the information stipulated under subsections (1) and (2) either in the Federal Gazette or on their website for a period of no fewer than three years and are to update it, at a minimum, on an annual basis. The disclosure may also be effected by the asset manager on its website or on some other website that is free of charge and publicly accessible; in this case, it suffices to provide the website from which the information can be obtained.
(4) Asset managers who have concluded an agreement as defined in subsection (2) are to report on annual basis to the institutional investors how their investment strategy and the implementation thereof are aligned with said agreement and how they contribute to the medium to long-term performance of the assets. A publication of the report in keeping with subsection (3) sentence 2 may take the stead of the report to the institutional investor. The report includes information on
1. the key material medium to long-term risks,
2. the composition of the portfolio, the portfolio turnover and the portfolio turnover costs,
3. how the medium to long-term performance of the company was taken into account in the investment decision,
4. the use proxy advisers,
5. the policy on securities lending and how conflicts of interest are dealt with in the context of engagement activities in the companies, in particular by exercising shareholder rights.