CONNECT / 2 by Vous S.A.

AUTUMN 2011

CONNECT I N F O R M AT I O N T E L L S INSIGHT REVEALS

CONTENTS : Editorial....................................... 2 Investing sustainably...................3

LOOKING BEYOND TRADITIONAL FIGURES…

Thomson Reuters offering for ESG data.................. 4 Knowledge Network.................... 5 Women @ Work......................... 6-7 Summer Picture Contest............ 8

“ Commitment to responsible investing continues to grow ” Iris Avet

Business Manager Investment Management

EDITORIAL Dear Customers, We hear from you that companies worldwide are wondering which criteria to take into account in the investment process next to traditional financial metrics. Nowadays, investors look more often beyond fundamental figures and progressively consider other input into their process. In this issue of Connect, we are focusing on the importance of Environmental, Social and Governance (ESG) criteria throughout the investment cycle. Investors are indeed observing those ESG parameters as financial material and say they should be considered investment criteria in their own right, in the same way as traditional financial measures. Get more insight from Geert Heuninck, Head of Social Responsible Investment at one of our main clients. He points out that organizations are realizing this broader view and worry about how their response to climate change is perceived by their investors. Are their policies about workers’ rights giving them an edge or creating a reputational risk ? Are they implementing best practices in the area of corporate governance ? Is their percentage of female employment looked at ? What about the women in our Brussels financial market place ? Is it true that they take longer to come to a decision about what to invest in and are less likely to go to a third party for advice than men ? And are men more likely to consult tax specialists, accountants, private banks, brokers and the media ? Get their opinions from our round table Women@Work and find out if this is still a man’s world as traditionally expected. All together, in order to be successful in today’s rapidly changing economy, it is crucial to have access to an objective and comparable environmental, social and governance database as well as flexible and powerful tools to work with that data. Thomson Reuters offers you both. Read more about it in this second issue of Connect. It would be great to get your feedback via Thomson Reuters Messaging or in an e-mail to iris.avet@thomsonreuters.com. Let’s connect ! Warmest Regards,

Iris Avet,

Business Manager Investment Management

Cover picture : Ami Miyazaki, Portfolio Manager - Tokyo.

INVESTING SUSTAINABLY Good sustainability performance is a great proxy for management quality Governments and big business are under more pressure than ever to demonstrate their commitment and action on issues such as climate change, biodiversity, human rights and business ethics. We are living and operating in a world where the power of individual countries to safeguard a livable and lasting environment for all – including businesses – is being challenged as issues span across borders. Businesses realize that they can no longer act as if they weren’t a part of the world they operate in, but that they too, have an essential role to play in maintaining it. There is also a very clear shift in public expectation towards companies to do so.

Is this kind of investing just a luxury for boom times ? Geert Heuninck : Companies need to deserve their social license. Particularly in times of economic crisis, it is important to have loyal shareholders, employees, clients and suppliers. We see a growing interest in our society in the different elements of corporate social responsibility. Companies that are able to manage sustainability will be the future survivors. This is an investment strategy which is here to stay.

Would social criteria have warned investors of the threat of pending financial crisis ? Geert Heuninck : It is not so easy to screen financial institutions because you need to screen the core activities of a financial group. Our external advisory board has decided last year to review out methodology using the lessons we have drawn from the financial crisis. And also other crises such as recent environmental catastrophes. It is a process of continuous improvement.

What are the lessons you have learned from the financial crisis ?

We spoke to Geert Heuninck, head of the Socially Responsible Investing department at KBC, and Thomson Reuters' Henrik Steffensen, VP, Commercial Strategy ESG : they explain how these criteria can be used and can be of help to investors.

Geert Heuninck : How can you pay more attention to risk management ? But also, what about the board structure ? How is the board composed and what is the background of people in the board ? Do you have financial specialists on the board or is it only marketing related, for instance ? One important element is also : “ How are the sales people trained to offer the right product to the right person ? ”.

What is the formula that you apply ?

Henrik Steffensen : It is also a question of transparency - the products and how they are constructed. Some times it is easier to see things after they happened. What we saw in the crisis was that the companies which were mostly hurt had a lower scoring on social responsibility. We looked at companies that were bailed out by the U.S. government. The ones with the higher social ranking under our system - which are linked to transparency - were not bailed out and the ones with the lowest scores were bailed out. That was quite consistent.

Geert Heuninck : We have developed a screening methodology in which we invest in the best in class companies - the best performing companies on environmental, social and governance (ESG) criteria. This methodology is set up by a board of independent academics. We screen out of 2,200 companies 760 best-in-class companies. We take into account negative elements on, for instance, activities in controversial countries, exposure on weapons, gambling, tobacco and breaches of the UN Global Compact principles.

What are the most prominent criteria used to single out good companies ? Geert Heuninck : We screen companies on long-term economic policy, corporate governance, environment, internal social policy and human rights. Each of these five pillars is equally weighted. In our view sustainability is a very broad domain. We also screen companies on the way they are involved in controversies - on environment or remuneration, for example. We look at press reports, legal cases and the internet. It is not about just one single issue on, for instance, gender or remuneration. It is the entire overview that we offer to our clients. Then, we use this information which enables us to detect which companies are the pioneers.

“ KBC has developed a screening methodology to look for the best in class companies to invest in. ”

Can good marketing trick the testers ? Geert Heuninck : That is indeed a pitfall. It is indeed very hard to address companies that are hidden and not looking for extra attention. You have companies that pay attention to disclosure, which makes it easier to rank them. The flip side of this, however, is that when a company is very transparent, they are also more vulnerable to actions from trade unions or employees. If a company is actively promoting itself, it is more open to scrutiny. The ultimate test is “ what are the behavior and the intentions of the company ? ”. Which structures are put in place to reach their objectives ? We also use these elements to test if a company is paying attention in environmental care.

Geert Heuninck,

Head of Socially Responsible Investing KBC

Are socially-responsible companies a good investment ? Geert Heuninck : Performance is not the sole objective. It's a by-product. The main aim is how to create an investment universe for clients interested in this way of investing. We see that performance is just as good as companies which are not screened for social responsibility. The performance is the same.

How has this market developed ? Henrik Steffensen : It's ok to invest and earn money but we should not compromise the ability of future generations to meet their needs. Companies that are pursuing this strategy by not investing in certain industries, for example, are not looking at the short term. Over the last few years, more and more investors have seen that some of the social criteria also have an impact on the value of their investments.

What is ASSET4 and how is it making a difference to you ? ASSET4 is the world’s largest collection of ESG data and we’ve recently integrated it into Datastream, in turn the largest database of historical macro-economic and financial information. ASSET4 covers roughly 4000 global companies, and over 750 data points encompassing a vast array of issues spanning : ÒÒ

Energy and water consumption

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Shareholder loyalty

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Health and safety measures

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Employee turnover or

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Reputation management (i.e. human rights abuses, bribery, fraud).

THOMSON REUTERS OFFERING FOR ESG DATA Investor Tools Issues such as climate change, environmental risk, executive remuneration and health & safety are becoming as important as traditional financial metrics. This change is why it is so crucial to have access to an objective and comparable environmental, social and governance (ESG) database as well as flexible and powerful tools to work with that data. Assess the ESG performance and risk exposure of over 3,200 global companies with the ASSET4 assetmasterProfessional toolkit. Our web-based solution enables investment professionals to monitor, rate and benchmark company and portfolio performance against any combination of 750+ data points and 250+ key performance indicators (KPIs).

Rely on ASSET4 assetmasterProfessional to :

• Improve investment performance and reduce risk by integrating ESG factors to create a holistic view of corporate performance. • Drive down research costs with access to comparable, systematic and integrated data. • Increase revenue by enhancing investment research capabilities and creating new, innovative ESG-related financial products. • Keep track of the latest environmental, social and governance news and controversies.

• Apply positive or negative screening criteria according to yours or clients' requirements. • Monitor portfolios based on ESG-related risks and opportunities. • Add long-term value by establishing objective engagement overlays.

Corporate Tools In Eikon “ Credit Views ” Eikon users can :

Assess your company’s environmental, social and governance (ESG) performance and risk exposure using ASSET4 assetmasterExecutive. Our web-based solution provides easy access to over 250 key performance indicators and daily news updates related to corporate ESG topics covering more than 3,000 global companies.

Rely on ASSET4 assetmasterExecutive to :

ÒÒ Monitor risk by integrating ESG factors into performance analysis to create a holistic view of corporate performance.

• Reduce risk by tracking, managing and benchmarking your ESG policies and practices.

ÒÒ Evaluate portfolios based on ESG-related risks and opportunities.

• Enhance corporate governance with access to objective and transparent information.

ÒÒ Compare ESG ratings to CDS, indices and other indicators.

• Stay up-to-date on industry changes or issues by monitoring ESG-related news.

Filters

More detailed rating ranges are available in FAQ

Quick acces to previously saved searches

Dowload to Excel

Environmental news on a company

Overall rating based on the entire universe

Rank in sector or subsector

Average ratings in the sector/subsector

Pillar ratings that form the overall rating

• Attract long-term investors by improving social responsibility performance and reporting. • Analyze your ESG performance and reporting strengths, weaknesses and progress over time. • Identify best-in-class emission and resource reduction policies and practices to improve your environmental sustainability. • Gain unique access to the ESG performance levels and practices of your sector, industry, index or peers. • Create simple-to-understand ESG performance reports to communicate with management and shareholders.

In Datastream Thomson Reuters Datastream successfully introduced ASSET4 ESG content. This development will add value to Thomson Reuters product offering, as it will allow the ESG content to be integrated into an established product with more than 35,000 users. This integration of ESG content really addresses the needs of the evolving world we live in. With globalization and interdependence, and in the aftermath of the financial crisis, issues such as climate change, biodiversity, human rights, “ license to operate ”, business ethics and corporate governance are at the forefront of public and political attention. In fact, these issues are at the forefront of the agendas of many countries, to drive tomorrow’s policies and underpin economic development.

KNOWLEDGE NETWORK THINK AGAIN ABOUT TRAINING The Knowledge Network is our multimedia training solution delivered directly to your work station. Simply visit training.thomsonreuters.com and access our video about Asset4 in one click. Just enter “Asset 4 ” in the search box on the upper right corner.

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WE KNOW…

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WOMEN @ WORK

Crisis boosts women’s image and jobs When Christine Lagarde took over at the head of the International Monetary Fund in July 2011, there was much skepticism about her ability to fill the shoes that her nowdisgraced predecessor, Dominique Strauss-Kahn, had vacated when he left. Strauss-Kahn had been known for being savvy and tough and with the force of his opinions re-establishing the Fund on the map of bodies to be reckoned with. Christine Lagarde, a trained lawyer whom the press pointed out had no grounding in economics, promised she would seek advice and rule by consensus. And yet, four months into her tenure and further into an exhausting crisis, observers in Washington say, her management style has gained the admiration of male and female colleagues alike. Sitting around a long lunch table in Brussels on a recent autumn afternoon, seven women carried something of that style. Between them they represent six banks and one utility: KBC, Dexia, ING, Degroof, BNP Paribas Fortis, Petercam and GDF Suez. “We women build our ideas, while men have their ideas,” said Cynthia Radelet, who manages business processes at Bank Degroof. “When I negotiate I try to be more like a man, hardnosed and knowing what I want. When I manage I try to be softer, and take a long-term view.”

That was clear to Yvonne Sigrist at Dexia, lunching less than a week before Dexia Bank Belgium was sold to the Belgium state. “I’ve always worked with an open book. Sometimes this means I transmit my nerves and my emotions. I hear a lot of things that I’m not allowed to talk about, but I still try to tell the team in other words where we are going to integrate the team’s suggestions and ideas’’ she says. “I think this different from a man for whom this would be more about power, who would keep such information more and people may know less about where they are.” Consensus-building and knowledge-sharing are an approach that goes down well in a highadrenaline trading environment, says Inge Meersmans, who became Head of Corporate Sales at KBC early this year. “You can’t force your will on anyone in the trading room. There is one thing they have in common there, and that is that they are stubborn. I think I’m quite a bit of a communicator, possibly because I was part of the team before and I was in a similar position outside of the group previously.”

As forex traders, heads of sales, data and business processes managers they manage dozens of people. Their work in banking and finance is still one dominated by men. These seven women are aware that their style is not just unusual but also increasingly valuable. Particularly in times of crisis. Women, the seven agree, tend to take more time to gather information before making decisions than their male colleagues, and work with a more open book. That can be risky when facing an impatient boardroom – but it can also prepare staff to deal with and handle the blow of bad news.

Rachel Armstrong, FX Sales - London

“ The number of women who get hired is going up. There are more women doing their masters degrees, they are entering the work force and they are moving up ”

Volatility in banking All seven see increased volatility in their sector in the years ahead, a fact they predict may make the work pyramid flatter, leveling out hierarchies and benefiting women at work. “ I don’t see a greater risk to women’s jobs than men’s jobs, ” says Meersmans. “ I believe there will be more volatility, teams will get smaller, then they’ll get bigger again once things get better. It will take a few cycles for things to settle down. During this time any smart manager will keep a balance of men and women in the team, ” she says. With volatility and job cuts comes a change in many existing jobs, often with a growing volume of administrative work. “ In many cases the administrative work has risen to something like 50 percent when it was much lower before, ” says Anne Massardier, who works with six male colleagues in ING’s FX sales division. “ Maybe this is good for women. You have to think a little more long-term and not just focus on the market, ” she says.

“ We women build our ideas, while men have their ideas ” Cynthia Radelet Business Process Bank Degroof

Unlike the economic downturns of the last century, which saw women encouraged to cede their work places in favour of their male colleagues, this crisis is making a female approach to management into a prized commodity, says Anita Dierckx, who says she slipped into her position of Market Data Manager at GDF Suez. “ There is a difference in the management style of men and women. Men realise now that they need women for a good working system. Women play on the safer side, which is important even in the trading world, especially now. ”

“ Men have more volatility ” Career prospects aside, the global financial crisis and the volatility that entails is also proving easier for these seven women to handle emotionally than for their male colleagues. “ Men have more radical moods : they suffer more when things go wrong. We keep these things more to ourselves, ” says Céline Donnet, who works in the brokerage division of private bank Petercam. “ What I feel is that women keep their feet more on the ground. They take their losses quicker. ” says Yvonne Sigrist. “ Men like volatility more than women do. They are more likely to be players than women. ”

Education, education, education After-lunch coffee – black, no sugar for most of the seven – turns their minds to what the future holds not just for banking, but also for women entering and making their way in the world of finance and management. “ The number of women who get hired is going up. There are more women doing their masters degrees, they are entering the work force and they are moving up. It’s becoming more and more normal for men and women to work at the same level, and for men to have female bosses, ” says KBC’s Meersmans. What will help this process is not just a change in women’s educational levels, and a gradual normalisation of gender relations at work, but also positive discrimination enforced by European law, they agree.

FROM LEFT TO RIGHT Cynthia Radelet

Financial Markets I Banque - Bank Degroof

Anne Massardier

Corporate Desk I ING

Inge Meersmans

Head of Corporate Sales - Treasury & Capital Markets I KBC

Anita Dierckx

PM - Information Systems - Head of IS Support I GDF Suez

Yvonne Sigrist

Head of IR & Bond Trading - Treasury & Financial Markets I Dexia

Julie Heyters

Corporate Solutions I BNP Paribas Fortis

Céline Donnet

Head of Real Estate Team - Institutional Research & Sales I Petercam

“ More and more positive initiatives are taken in terms of diversity at BNP Paribas Fortis as at all levels of society. Women have the opportunity to seize their chance on equal terms." says Julie Heyters who works in Fixed Income Corporate Solutions at BNP Paribas Fortis. That, and growing number of role models that a next generation of women have to look to for guidance – like the seven women gathered at lunch. “ We will be one of the last generations to have fought for our path. For our daughters, it will be obvious to continue up to the ladder whereas we had to struggle more for our positions.’’ says Inge Meersmans from KBC. The other ladies agree. “ When I have a daughter she will never have the necessity to position herself to be a woman at work, ” concludes Anne Massardier from ING.

WHAT MAKES A GREAT PHOTO ?

ELECTRICITY IN THE AIR KEVIN WIPPERMAN • GDF Suez “ It would be nice to know how this picture was made because this is really not easy from a technical point of view. ”

What makes an interesting picture ? By Robin Jensen

Yves Herman, Reuters Photographer. “ One of the biggest problems facing the photographer is transforming a three dimensional scene into two. This results in a image that looks flat and uninteresting. The use of a front, middle and background will help create depth. Furthermore defining a path that the eye will travel between these different layers gives fluidity and results in an overall three dimensional feel. In this photograph of Eilean Donan castle on the west coast of Scotland, the eye begins its journey on the rocks in the foreground, travels over the bridge to the castle, on to the boat and mountains behind, which are beautifully lit, then up to the sky. ” Reuters News Pictures Service : Essential source of news imagery from every corner of the globe. Reuters Pictures : Fully searchable website offering 1,700 images per day plus an archive of 3.5 million images. Reuters Online Pictures : A variety of ready-to-publish picture feeds for online and wireless platforms.

HAIRCUT MARC VALENTIN • AB Editions “ This looks really like a photo that could be part of a nice portfolio. ” Thierry Roge, Reuters Photographer.

BEST SUMMER PICTURES

Find out more on : www.thomsonreuters.com

Ever wondered what makes a great photo ? Imagery is so infused in our daily lives : we are surrounded by stunning pictures. Is it all inspiration or is it work, perspiration and perseverance ? WILD DOGS HUNTING ANNICK DE MUYNCK • Red Wood Finance

“ You can see that this person has taken a nice “ contre jour ”. She should have centered a little bit more to the right but, it’s well done. ” Yves Herman, Reuters Photographer.

We asked all our Thomson Reuters clients to send us their best summer picture. Some of them were lucky shots but some of you might have been looking and waiting for the right combination of scenery and light. Our Reuters photographers Yves Herman, Thierry Roge and François Lenoir have decided upon the winners of our Summer Picture Contest. They were announced at our Thomson Reuters Client Party on October 13th and we proudly present them to you in this issue of Connect.

Thomson Reuters (Markets) S.A., Belgium Branch Marnixlaan / Avenue Marnix 17 – 3rd floor · B - 1000 Brussels