ESG Overview / Investment ESG

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Investment ESG

Representing our clients, defending their interests and sharing our thinking.

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As investment professionals, our first responsibility is, and always has been, to our clients' interests and goals – growing and smartly managing their capital and fulfilling our fiduciary responsibilities. In every market, client demand is also increasing for us to invest with processes that incorporate ESG and sustainability.

Where ESG meets risk

ESG factors are integral to how we think about risk. In the broadest sense, this ranges from traditional governance issues, right through to the biggest existential questions. Among our clients, attitudes towards ESG and sustainability vary as much as risk profiles. We are respectful of this diversity of values and offer strategies and products accordingly.

We strive to manage an investment platform with the tools and flexibility to apply exclusions to meet the spectrum of requirements of our clients. Firm-wide exclusions cover the current manufacture of cluster munitions, anti-personnel mines, chemical weapons, and biological weapons.

We believe our ability to have the greatest impact as active managers is through engagement with the firms in which we invest. Above and beyond the expectation that investment teams incorporate ESG considerations in company engagement as appropriate to individual circumstances, teams are also asked to pro-actively engage on the following core sustainability themes:

  • Climate Change
  • Diversity & Inclusion
  • Good Corporate Governance
ESG within our Investment Processes

ESG considerations are a key component of the active investment processes employed by our investment teams. These teams apply their differentiated perspectives, insights and experience to identify sustainable business practices that can generate long-term value for investors.

Our ESG Investment Principles for long-term investment success:

  1. Investment portfolios are built with the aim of maximising long-term risk-adjusted returns for our clients.
  2. Evaluation of ESG factors is a material component of our investment processes.
  3. Corporate engagement is vital to understanding and promoting sustainable business practices.
  4. Investment teams should have the freedom to interpret and implement ESG factors in the way best suited to their asset class and investment strategy objective.

Climate Change

We believe in the spirit and goals of a net zero economy and the need for a transition to a low-carbon world. While we share concerns about climate risk and have the expertise to support climate commitments, we appreciate that different clients have different priorities. Even those that want to make climate-related commitments do not all have the same approach – some will opt for exclusions, some for scenario analysis and others will evaluate portfolio emissions versus the benchmark. As such, our current focus is on developing the tools and reporting that will help clients partner with us accordingly to realise their own climate goals.

Engagement
In 2021, we recorded in excess of 1,000 company engagements where ESG topics formed part of the interaction. Key ESG issues addressed included climate change strategy, diversity, equity & inclusion, and ESG reporting & disclosure.
Engagement
In 2021, we recorded in excess of 1,000 company engagements where ESG topics formed part of the interaction. Key ESG issues addressed included climate change strategy, diversity, equity & inclusion, and ESG reporting & disclosure.

Engagement

Our investment teams actively engage with the companies in which they invest. Our Governance and Stewardship Team, in existence since 2010, provides centralised support to investment teams on voting, company engagement and ESG research.

Sustainable Investing

Our Global Sustainable Equities team has been established for more than 30 years, making it one of the pioneers of sustainable investing. Their approach focuses on companies that have a positive impact on the environment and society, employing a low-carbon approach. The team was a founding member of the Net Zero Carbon 10 initiative in 2020.

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“We believe that a sustainable and responsible investment approach should not compromise the potential for long-term performance. When assessing opportunities we ask the question ‘Is the world a better place because of this company?”

Hamish Chamberlayne, CFA, Portfolio Manager, Global Sustainable Equities

Investing with Impact

Our Global Sustainable Equities team has been established for more than 30 years, making it one of the pioneers of sustainable investing. Their approach focuses on companies that have a positive impact on the environment and society, employing a low-carbon approach. The team was a founding member of the Net Zero Carbon 10 initiative in 2020.

Quote

“We believe that a sustainable and responsible investment approach should not compromise the potential for long-term performance. When assessing opportunities we ask the question ‘Is the world a better place because of this company?”

Hamish Chamberlayne, CFA, Portfolio Manager, Global Sustainable Equities

Expanding our Offering

While ESG considerations are incorporated in the processes of all our investment teams, we also offer focused strategies. These vary per region and as appropriate to client needs. We are committed to building upon this range to allow clients to access strategies from across asset classes.

Expanding our Resources

Our current infrastructure includes an established base of ESG-focused experts. Under our Head of ESG Investments, Paul LaCoursiere, and a Global Head of Product Strategy & ESG within Distribution, Kelly Hagg, we are meaningfully strengthening the framework.

ESG client solutions: building out a team within Distribution of ESG specialists, which includes a Director of Product Strategy & ESG, ESG Research Analyst, ESG Regulatory Specialist, and ESG Distribution Generalists.

ESG investment support: a specialist model is employed with skillsets grouped into the three pillars alongside:

Government and Stewardship
Governance & Stewardship – the long-standing Governance & Stewardship Team, which supports investment teams on governance, proxy voting advisory, and ESG company engagement, has been enhanced and additionally leads on thematic engagement.
Government and Stewardship
Governance & Stewardship – the long-standing Governance & Stewardship Team, which supports investment teams on governance, proxy voting advisory, and ESG company engagement, has been enhanced and additionally leads on thematic engagement.
ESG Investment Research
ESG Investment Research – this relatively new and dedicated team implements a consistent methodology for evaluating the ESG performance of issuers across opportunity sets with a focus on financial materiality.
ESG Investment Research
ESG Investment Research – this relatively new and dedicated team implements a consistent methodology for evaluating the ESG performance of issuers across opportunity sets with a focus on financial materiality.
ESG Strategy and Development
ESG Strategy & Development – a recently created team consisting of specialists focusing on data, content, product design and investment desk support across all asset classes.
ESG Strategy and Development
ESG Strategy & Development – a recently created team consisting of specialists focusing on data, content, product design and investment desk support across all asset classes.
Quote

“As part of our Knowledge Shared approach, we are committed to sharing our insight and analysis on the ESG themes impacting our world and our clients’ portfolios.”

Kelly Hagg, Global Head of Product Strategy and ESG for Distribution

Transparency of Thinking

It is critical that our clients fully understand our approach and objectives. Sharing our investment thinking is an integral aspect of our commitment to maintaining an open dialogue with clients throughout the investment journey.

Transparency of Thinking

It is critical that our clients fully understand our approach and objectives. Sharing our investment thinking is an integral aspect of our commitment to maintaining an open dialogue with clients throughout the investment journey.

Quote

“As part of our Knowledge Shared approach, we are committed to sharing our insight and analysis on the ESG themes impacting our world and our clients’ portfolios.”

Kelly Hagg, Global Head of Product Strategy and ESG for Distribution

Environmental, Social and Governance (ESG) or sustainable investing considers factors beyond traditional financial analysis. This may limit available investments and cause performance and exposures to differ from, and potentially be more concentrated in certain areas than, the broader market.