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Print Fund Name SRI Style Product Region Asset Type Launch Date More info
BMO (F&C) Responsible Sterling Bond 1 Inc Ethically Balanced OEIC/Unit Trust UK Fixed Interest 30/09/2007 More Info (click to view)

SRI / Ethical Overview

The F&C Responsible Sterling Bond Fund aims to maximise returns through investment primarily in Fixed Interest securities of an ethically screened and diversified list of companies. The Fund may also invest in warrants, collective investment schemes, money market instruments and derivatives. A rigorous management process and widely diversified portfolio will seek to control excessive credit risk. The Fund favours companies making a positive contribution to society as well as furthering sustainable development and screens for those taking positive action to improve the environment, conserve resources and operate in a transparent and open way in the reporting of their business activities.

SRI Policies (Primary strategy in bold)

  • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
  • Health & wellbeing policies Has a policy that sets out the fund's aim to support companies that offer positive lifestyle, health or 'wellbeing' related benefits.
  • Limits exposure to carbon intensive industries Aims to reduce or limit exposure to carbon intensive industries which are considered to be major contributors to climate change. Funds vary - but this is likely to mean a fund has below average levels of investment in areas such as oil & gas, mining or airlines. 'Best in sector' companies may, however, be allowable.
  • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.
  • Social policy Considers social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact).
  • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
  • Animal welfare policy The fund has a policy that requires specific animal welfare standards to be adopted by companies in order for them to be allowable for investment within the fund.
  • Nuclear policy Has a published policy that sets out the fund's position with regard to nuclear power. In most cases this is likely to mean avoidance of companies with significant involvement in the nuclear industry, although some funds may require absolute avoidance.
  • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).
  • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
  • Armaments manufacturers avoided Avoids companies that manufacture products intended specifically for military use. (Funds may, however, invest in manufacturers of products that are used by the military but are not specifically intended for military/defence use.)
  • Coal, oil &/or gas majors excluded This fund will not invest in the largest coal, oil and/or gas producing companies. Funds vary. Some may invest in smaller producers or companies where this is considered to be a relatively minor part of their business.
  • Climate change / GHG policy Considers climate change related issues such as greenhouse gas/carbon emissions. Strategies vary but funds that consider climate issues typically require the careful management of climate related risks (and opportunities) if they are to select a company for investment.
  • Invests in clean energy/renewables This fund invests in companies in the clean technology/renewable energy related industries. Fund strategies vary. In practice some may invest a small percentage in this area whereas others may have significant exposure to this area. Check fund literature for details.

SRI Features

  • Balances company 'pros and cons'/best in sector This fund manager will look at both the 'positive' things companies do and the 'negative' things they do. They will make balanced judgements, in line with their published strategy, before deciding whether or not to invest. Such funds often invest in the best/most ethical companies across most industries, rather than excluding entire sectors. The fund manager may couple this with 'responsible engagement' activity, where they aim to encourage better, more responsible business practices.
  • Sustainability themed This fund pays significant attention to sustainability issues either as its primary strategy or alongside other ethical criteria and approaches. This means that environmental and social challenges and opportunities are likely to influence stock selection decisions.
  • Favours companies with strong social policies This fund invests in line with positive strategies that relate to 'people' issues - such as human rights, labour standards and equal opportunities. Such funds are likely to invest in companies that have market leading standards with regard to employee and supplier practices.
  • 'Strictly' screened ethical fund The managers of this fund aim for it to be managed as having a high level of negative ethics led avoidance. They may refer to it as 'dark green' - meaning it excludes lots of companies, relative to other ethical options.

Corporate Activity

  • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.

SRI / Ethical Policy

At BMO Global Asset Management, we have been a leader in the development of sustainable investment strategies for almost three decades. Responsible Investment is central to our corporate identity and integral to our global investment philosophy. 

Ethical considerations are becoming increasingly important in the mind set of many investors. In addition, there is also a growing consensus that the best long term performance will come from those companies that take their wider ethical, environmental and social responsibilities seriously. The fund provides an investment medium for people who do not regard financial gain as the sole criterion for investment, but look to wider issues. It seeks to invest in UK companies offering attractive growth and income characteristics, avoiding investment in those that have harmful effects.

Positive and negative screening is undertaken to identify companies and corporations with bonds suitable for inclusions in the Fund’s investment universe. All stocks considered for investment first undergo screening by members of BMO Global Asset Management’s Governance and Sustainable Investment team (GSI Team), to determine if they meet the criteria for inclusion in the portfolio’s investable universe. The GSI team has created a thorough and robust process to analyse companies to determine whether they meet the Fund criteria. We have an extensive policy on ethical screening and we have provided a snapshot of the criteria below:

Exclusion Criteria:
Alcohol
Gambling
Nuclear power generation
Oil sands & arctic drilling
Pornography
Tobacco
Weapons

Qualitative Assessment
Animal welfare standards
Business ethics
Environmental management
Health & Safety
Human rights & oppressive regimes
Labour standards
Positive product choices
Sector-specific best practice

In summary, the screening criteria aim to avoid companies with poor human rights, inadequate social practices or bad environmental records. Once a company has passed the ethical screening, its bonds can be included in the investment universe available to the fund managers.

The GSI team has a quarterly monitoring system to identify:

  • Changes to business e.g. through mergers and acquisitions
  • Whether the criteria continues to be met by the company (ethical, environmental and social)
  • Any controversies that may affect the company rating (e.g. mis-selling, environmental damage or corruption).

Resources, Affiliations & Corporate Strategies

The F&C Responsible Sterling Bond Fund embodies the contributions of three separate specialist teams, namely our Credit team, the GSI team, and the Responsible Investment Advisory Council, who provide vital input on investment or ethical screening issues. Firstly, investment management of portfolios, in terms of credit research, choice of investments and portfolio construction, takes place within our Credit team. Secondly, issuers for portfolios need to have undergone, and passed, a rigorous screening on their ethical credentials, conducted by the GSI team. Finally, the Responsible Investment Advisory Council provides fully independent input on the firm’s ethical principles and acceptability criteria. It must be emphasised that the process remains investment led.

BMO Global Asset Management (EMEA) draws on a range of specialist ESG research sources to inform proxy voting and engagement activities. We are using Institutional Shareholder Services (ISS) for global proxy voting research and vote execution services. In addition, we are using Institutional Voting Information Service (IVIS) for supplementary advice on FTSE All-Share companies. Other relevant resources include sell-side brokers (corporate governance and sustainability research) and MSCI (ESG factors). We also consider research by broader stakeholders including NGOs such as Transparency International (anti-corruption), Oxfam and Human Rights Watch.

Our research is also informed by our networks that may provide briefings and publications, including the UN PRI, International Corporate Governance Network (ICGN) and the Asian Corporate Governance Association (ACGA). We may also draw on external consultants with expertise in particular areas, although presently we have no such arrangements underway. We are also part of a global asset management firm with investment professionals and other expert resources spread across the world, and we of course have access to their insight and expertise on an as needed basis.

Royal London Sustainable World Trust Sustainability Themed OEIC/Unit Trust Global Mixed Asset 20/09/2009 More Info (click to view)

SRI / Ethical Overview

 

RLAM’s investment philosophy is to take the principle of sustainability and apply it across different geographies and asset classes. We define sustainable investing as investing in companies that have a net positive benefit to society either through the products and services they offer or in the way they conduct their business. In doing this we support companies having a positive impact on society whilst at the same time growing investor capital.

 

Although the Trust adopts positive screening as its primary method of investment selection, it also offers reassurance from a number of areas of avoidance.

 

 

SRI / themed / ethical assets under management – overview

 

  • Fund Size (GBP):   £337.84m as of 31 May 2017.
  • Total value of SRI/ethical/environmental/ social/ environmental or sustainability themed funds under management:   £11,793.22m as of 31 May 2017.
  • Total value of assets covered by responsible ownership policy:   £1,416.04m as of 31 May 2017       (Please note that this figure only includes our sustainable range, however, RLAM’s Responsible Investment Policy will detail how this is an over-arching approach across most of the firm’s assets).
  • Total assets under management:   £104,507.32m as of 31 May 2017.

 

 

 

SRI Policies (Primary strategy in bold)

  • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.
  • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
  • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
  • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).
  • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
  • Armaments manufacturers avoided Avoids companies that manufacture products intended specifically for military use. (Funds may, however, invest in manufacturers of products that are used by the military but are not specifically intended for military/defence use.)
  • Measures positive impacts The fund aims to have a positive effect on society and/or the environment. Fund managers of this kind actively aim to measure the impact of their investments in order to ensure they are having the desired effect.
  • Limits exposure to carbon intensive industries Aims to reduce or limit exposure to carbon intensive industries which are considered to be major contributors to climate change. Funds vary - but this is likely to mean a fund has below average levels of investment in areas such as oil & gas, mining or airlines. 'Best in sector' companies may, however, be allowable.
  • Nuclear policy Has a published policy that sets out the fund's position with regard to nuclear power. In most cases this is likely to mean avoidance of companies with significant involvement in the nuclear industry, although some funds may require absolute avoidance.
  • Alcohol production excluded (new) This fund avoids companies that are involved in the production of alcohol. See fund literature for further information.
  • Fracking and tar sands excluded (new) Fund avoids companies involved in fracking and tar sands - which are controversial oil and gas extraction practices
  • Gambling avoidance policy (new) This fund avoids companies with significant involvement in the gambling industry. See fund policy for details.
  • Pornography avoidance policy (new) This fund avoids companies that derive significant income from pornography. See fund details for further information.

SRI Features

  • Positive selection bias The ethical focus of this fund is around the consideration of the positive/good or useful things companies do. The fund may also have negative avoidance criteria - but this may not be the main ethical strategy applied by the fund managers.
  • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
  • Balances company 'pros and cons'/best in sector This fund manager will look at both the 'positive' things companies do and the 'negative' things they do. They will make balanced judgements, in line with their published strategy, before deciding whether or not to invest. Such funds often invest in the best/most ethical companies across most industries, rather than excluding entire sectors. The fund manager may couple this with 'responsible engagement' activity, where they aim to encourage better, more responsible business practices.
  • Over 50% large cap This fund invests more than half of its money into very large companies. This will typically mean that the market capitalisation (or value) of the companies they hold will be over £5 to £10 billion.
  • Sustainability themed This fund pays significant attention to sustainability issues either as its primary strategy or alongside other ethical criteria and approaches. This means that environmental and social challenges and opportunities are likely to influence stock selection decisions.
  • Aims to generate positive impacts (new) This fund aims to help deliver positive social or environmental impacts or outcomes. Strategies and approaches vary. Some funds measure outcomes others do not. See fund literature for further information.
  • Available via an ISA (new) This fund is available via a tax efficient ISA product wrapper
  • Clean energy themed (new) This fund invests in clean technology / clean energy companies. See fund information for further details.

Corporate Activity

  • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
  • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
  • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
  • UK Stewardship Code signatory
  • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
  • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
  • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.
  • PRI signatory (new) This fund management company has signed up to the UN backed 'Principles of Responsible Investment' initiative.

SRI / Ethical Policy

 

Although the Trust adopts positive screening as its primary method of investment selection, it also offers reassurance from a number of areas of avoidance. In particular the portfolio avoids investment in any company that is or is likely to be exposed to:

 

  • Human rights abuses
  • Tobacco and armaments manufacture
  • Products which involve experiments on animals, except for those conducted for the benefit of human or animal health
  • The generation of nuclear power

 

The Trust also avoids investments in companies which derive a material proportion (Over 10%) of their business from:

 

  • Animal fur products
  • Pornography
  • Irresponsible gambling
  • Irresponsible drinking
  • Worker exploitation or exploitative consumer practices.

 

If a company breaches this threshold, then it is likely that that company’s involvement in that excluded sector is a noteworthy part of their business and strategy.

 

Also, this threshold is deemed to be realistic and appropriate in terms of assessing a company, given that it may not be possible to always pinpoint the exact turnover derived from an excluded activity. This threshold ensures that a minimum of 90% of each holding meets the ethical criteria.

 

Finally, the Trust avoids investments in companies that have unacceptable corporate governance and mismanage social, ethical and environmental risk.

 

Resources, Affiliations & Corporate Strategies

The core of our process is the team of five ESG investment specialists. Although each team member is capable of working across the spectrum of financial and ESG analysis required to enact our investment process, there are specialisms. We have two fund managers, one corporate governance specialist and two analysts capable of researching companies on a global basis across the spectrum of financial and ESG issues. The team has a high level of experience and have honed and improved the process over the 14 years since it was implemented. We have a very disciplined approach to investing, based around clear principles and a framework to ensure that that individually and as a team we make consistently high quality investment decisions on behalf of our clients.

 

An external advisory committee supplements this internal expertise. Not only do they provide external, independent oversight as to the adherence to the principles and ethos of the investment process, they are also invaluable in adding to the knowledge base, which exists internally. The advisory committee consists of members from the corporate, academic, investment and charities arenas.

 

We supplement this resource with the effective use of systems. Starting with a global universe of over 18,000 companies it is important we focus our work on those areas most likely to yield strong investment ideas. It particular we use MSCI to identity companies with strong ESG performance, and CSFB Holt to identify companies with inherent value creation and strong competitive advantage. Both these tools allow us to identify where and how best to use our internal resource. At this point we will conduct our own analysis as to the suitability of a potential investment.

 

It is worth emphasising that, whether primary inputs have been internally derived or otherwise, we will never delegate the final decision as to whether a security is selected in our portfolios, given our very different philosophical approach to valuation.

 

 

RLAM Voting Policy:    https://www.rlam.co.uk/Documents-RLAM/Sustainable%20Investing/2017%20RLAM%20Voting%20Policy.pdf

OMW Kames Ethical Corporate Bond Negative Ethical Pension UK Fixed Interest 26/09/2006 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Kames Ethical Corporate Bond" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

Pru Royal London Sustainable Leaders Pn Ser A Sustainability Themed Pension UK Equity 25/01/2010 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "CIS Sustainable Leaders Trust" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing. 

SRI Policies (Primary strategy in bold)

  • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

OMW F&C Responsible UK Equity Growth Pn Ethically Balanced Pension UK Equity 15/11/2006 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "BMO (F&C) Responsible UK Equity Growth" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

FL Kames Ethical Corporate Bond Pn Negative Ethical Pension Europe >50% UK Fixed Interest 31/01/2007 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Kames Ethical Corporate Bond" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing. 

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

OMW EdenTree Amity UK Pn Ethically Balanced Pension UK Equity 16/10/2008 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "EdenTree Amity UK" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing. 

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

Aviva Alliance Trust Sustainable Future UK Growth Pn S2 Sustainability Themed Pension UK Equity 05/04/2001 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Alliance Trust Sustainable Future UK Growth" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

SRI Policies (Primary strategy in bold)

  • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

SJP Ethical Pn Acc Ethically Balanced Pension Global Equity 01/11/1998
L&G Kames Ethical Corporate Bond Pn G25 Negative Ethical Pension Europe >50% UK Fixed Interest 12/04/2006 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Kames Ethical Corporate Bond" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

Pru Ethical Pn S3 Unclassified Pension UK Equity 05/04/2001
AXA Wealth AXA IM Ethical Distribution Ethically Balanced Life UK Mixed Asset 29/09/2010
Rathbone Core Investment Fund for Charities Ethically Balanced OEIC/Unit Trust Global Mixed Asset 02/10/2016 More Info (click to view)

SRI / Ethical Overview

The fund will not invest directly in companies manufacturing tobacco or tobacco products, or companies that derive more than 10% of their revenues from the manufacture of alcoholic beverages, armaments, gambling, high interest rate lending or pornography

Fund Manager: Andy Pitt
(Source: Rathbones Monthly factsheet Feb 2017.)

SRI Policies (Primary strategy in bold)

  • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

  • Limited/few ethical exclusions This fund avoids companies based on limited list of ethical exclusions (relative to other ethical funds)

Corporate Activity

-

Links

-

SRI / Ethical Policy

has a policy that states the fund considers 'ethical' issues (e.g. armaments, alcohol, animal welfare, environmental or high-carbon impact, tobacco, gambling, human rights, nuclear power, pornography and/or predatory lending). These vary significantly. Check fund literature for details. 

Resources, Affiliations & Corporate Strategies

OMW Alfred Berg Penningmarknads Halibar Unclassified Life Not Set Fixed Interest 18/12/1992
Aviva Royal London Sustainable World Trust S4 Sustainability Themed Life Global Mixed Asset 22/11/2010
FL Ethical Distribution AP Acc Negative Ethical Pension UK Mixed Asset 30/04/1998 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "AXA Ethical Distribution" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

 

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

Zurich Kames Ethical Equity ZP Negative Ethical Pension UK Equity 30/07/2006 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Kames Ethical Equity" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing. 

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

Fl Threadneedle UK Social Bond PN Social Themed Pension UK Fixed Interest 01/10/2014
ReAssure HL Global Socially Responsible Pn 1 Unclassified Pension Global Equity 22/08/2004
Standard Life SLI Ethical Corporate Bond Pn S4 Negative Ethical Pension UK Fixed Interest 11/03/2013 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Standard Life Inv Ethical Corporate Bond" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing. 

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

NextEnergy Solar Fund Limited Red Ord Npv Environmentally Themed Investment Trust UK Equity 24/04/2014
FL Jupiter Ecology AL Environmentally Themed Life Global Equity 23/07/2006
FNW F&C Responsible UK Income Ethically Balanced Life UK Equity Income 20/07/2006
Standard Life Investments Responsible Ownership Corporate Activity Not Set Unclassified 29/01/2016 More Info (click to view)

SRI / Ethical Overview

At Standard Life Investments, our approach to responsible ownership is materiality focused, identifying the key issues affecting performance. We aim to be the industry leader in ESG, contributing to a sustainable world and a better financial future for our customers. Our approach centres on protecting and enhancing the investments held on behalf of our clients and includes the following:

•    Materiality-driven analysis: Our dedicated Responsible Investment and Governance & Stewardship Teams provide robust analysis of the themes and trends that have the potential to impact financial performance. 
•    Sustainability ratings: We identify companies at the forefront of their industries (leaders) and those that are behind the market (laggards) in their management of sustainability issues.
•    Systematic engagement: The active engagement with companies undertaken by our teams highlights risks and opportunities, and encourages greater transparency and accountability. 
•    Active voting process: We vote all shares for which we have voting authority except when otherwise instructed by the beneficial owner of these shares or, where, for practical reasons (such as share-blocking), this is not appropriate. 

As of 30 September 2015, Standard Life Investments had £250.6 billion of assets under management. Our approach applies across the firm to varying extents as appropriate, based on the particular asset class. Within equity, fixed income and real estate, we had £141.1 billion assets under management. In addition to integrating ESG matters into our investment process, our in-depth analysis can also be applied across a range of dedicated responsible investment styles, including ethical products, sustainable & responsible investment (SRI) and impact investing solutions.

Our responsible ownership strategies apply to equity and fixed interest assets in all geographic regions.

SRI Policies (Primary strategy in bold)

-

SRI Features

-

Corporate Activity

  • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
  • Responsible Ownership policy for non SRI funds This fund manager applies Responsible Ownership or 'Stewardship' policies to all or most of their investment assets. This means that active involvement (e.g. voting, dialogue) with the companies they invest in is not limited to ethical or SRI options.
  • Integrates ESG factors into all/most fund research This fund manager researches environmental, social and governance issues when deciding whether or not to invest in a company. This applies to all funds, not only those which are promoted as being 'ethical' or 'SRI themed'.
  • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
  • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
  • Responsible Ownership/ESG a key differentiator The fund managers have said they consider this area to be a key differentiator for their business
  • UK Stewardship Code signatory
  • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
  • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
  • Review(ing) carbon/fossil fuel exposure for all funds This company has reviewed or is currently reviewing (or in other ways 'actively managing') their exposure to carbon intensive industries including (but not only) mining, oil and gas companies. This work is being carried out in the light of climate change related concerns and the company's view of its anticipated impact on the companies they invest in.
  • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.

SRI / Ethical Policy

In-Depth Research and Engagement
At Standard Life Investments, we pride ourselves on our in-depth analysis to ensure we fully understand our investments. Our multi-layered process consists of two complementary disciplines: in-depth research and company engagement. These activities are conducted in conjunction with our investment desks across Standard Life Investments and ultimately feed into our investment process. 

We analyse ESG themes and trends on a global scale, which also includes a focus on a region or a sector particularly impacted. Using macroeconomic analysis of megatrends, as well as existing and future regulation and sector and company-specific risks, we determine the themes that are of greatest significance for our investments. We then use our ongoing engagement programme to encourage companies to change their behaviour where required and help them meet the high standards that we set. 

Our ESG-focused teams undertake a systematic programme of engagement with companies in which we are or may become a shareholder. In 2015, Standard Life Investments conducted over 600 direct engagements with companies on ESG issues, including more than 100 direct engagement meetings conducted by the Responsible Investment Team on environmental, social or business ethics issues. Meeting directly with companies enables us to learn more about a company’s sustainability strategy and performance, appraise company management, encourage best practice on ESG issues and/or exchange views. Our approach is materiality focused, identifying the key issues affecting performance. Our engagement activities are prioritised by targeting six areas: 

Materiality Targets
1. Financial exposure – our top holdings by financial value (both equity and debt) and geography
2. Weight of influence – where we hold a sizable portion of shares outstanding 
3. Client-driven – based on specific requirements and concerns

Value-driven Targets
4. Thematic engagement – engaging with companies exposed to recent trends
5. Poor performers – those in breach of international standard and conventions
6. Event-driven engagement – based on environmental or social events

In our ESG analysis, we assess the extent to which the financial value of an investment is impacted by ESG issues by considering their exposure to the relevant issue as well as their management of this exposure. Based on research and engagement with companies, the Responsible Investment Team scores companies on their policies, management systems, performance and reporting. These ratings benchmark companies against others in their sector using a proprietary, in-house assessment tool and are incorporated into our internal research platforms, together with detailed meeting notes and thematic research. In addition, if the Governance & Stewardship Team has significant concerns about a company, it initiates a health warning on that stock.  

Further information on our engagement approach can be seen on our website at http://www.standardlifeinvestments.com/governance_and_stewardship/what_is_corporate_governance/engagement.html and http://www.standardlifeinvestments.com/sustainable_and_responsible_investing/engagement.htm

Stewardship
Standard Life Investments is a strong supporter of the principles of good stewardship that are set out in the Stewardship Code published by the Financial Reporting Council in July 2010, and updated in September 2012. We believe that it is mutually beneficial for companies and long-term investors such as Standard Life Investments to have a relationship based on accountability, engagement and trust. Such a relationship helps to ensure that each has a good understanding of the other's views and expectations and it enables us to exercise constructive influence as and when appropriate. We believe that this serves to enhance the long-term value of our clients' investments and to protect their interests when necessary.

Likewise, it is very important that we are accountable to our clients for our stewardship of their assets. Accordingly, we seek to have a transparent and open dialogue with them about how we engage with the companies in their portfolios. Their feedback helps to shape our views and approach.  Our Responsible Investment Team publishes quarterly updates on our website, outlining emerging themes and topics and detailing the engagements undertaken, and our Governance & Stewardship Team produces an annual review outlining their activity. We also provide full transparency of our voting activity on our website. These can be found at: http://www.standardlifeinvestments.com/sustainable_and_responsible_investing/documents.html and http://www.standardlifeinvestments.com/governance_and_stewardship/what_is_corporate_governance/voting_disclosure.html. Our engagement and our voting records are audited annually by PricewaterhouseCoopers LLP. This demonstrates our commitment; we are one of the few teams that apply such rigor to our transparency.

We are signatories to the Stewardship Code. We comply fully with all the Code's principles in respect of our UK equity investments. We continue to take steps to strengthen our stewardship capabilities in line with the Code in respect of our European equity investments, and we also use our best endeavours to apply the spirit of the Code's principles in respect of our other global equity investments on a case-by-case basis. Please refer to http://www.standardlifeinvestments.com/governance_and_stewardship/the_uk_stewardship_code/index.html for further details.

Active Voting Process 
Voting is the primary method by which we exercise our clients’ rights as shareholders and is the means by which boards of companies can formally be held to account. The Governance & Stewardship Team has oversight of all our voting globally. Standard Life Investments votes all shares for which we have voting authority except when otherwise instructed by the beneficial owner of these shares or, where, for practical reasons (such as share-blocking), this is not appropriate. We use our Global Voting Platform to achieve this. 

We implement considered voting policies based on the Governance & Stewardship Principles & Policy Guidelines approved by our board when voting the shares we manage. Our Regional Voting Guidelines, covering all major regions of the world where we invest on behalf of our clients, are available on our website at http://www.standardlifeinvestments.com/governance_and_stewardship/what_is_corporate_governance/principles_and_policies.html. We apply our guidelines with appropriate professional care and flexibility, holding boards to account, engaging where necessary, and at all times representing the best interest of our clients. 

Resources, Affiliations & Corporate Strategies

Dedicated Resources
Our Responsible Investment and Governance & Stewardship Teams currently comprise 12 investment professionals with an average of 19 years of experience in the industry and an average of eight years at Standard Life Investments. These teams work closely together to help understand how companies are being managed, bringing very different skills and knowledge to the process. While the latter focuses mainly on board level issues, the former assesses whether the policies put in place at the top are implemented at the operational level. This level of resource and their different access points for engagement add considerable value to the investment process.

To facilitate this process, the teams meet regularly and share information across a broad range of issues. For example, the Teams have jointly developed a policy for voting on all environmental and social resolutions lodged at company AGMs and EGMs, ensuring that the Responsible Investment Team’s in-depth knowledge and expertise on environmental and social matters is integrated into the voting process managed by the Governance & Stewardship Team. The heads of both teams also meet bi-monthly to discuss wider strategic issues.

Team biographies can be found on our website at: http://www.standardlifeinvestments.com/sustainable_and_responsible_investing/our_team.html and http://www.standardlifeinvestments.com/governance_and_stewardship/our_team/index.html 

The Responsible Investment and Governance & Stewardship Teams are active throughout Standard Life Investments, working closely across asset classes with all of our investment teams. The overall objective is to ensure every facet of ESG is integrated across our business, and our dedicated in-house resources are on-hand to provide advice and expertise to our Portfolio Managers and Analysts. Importantly, we have the buy-in from all our colleagues regarding ESG issues and the positive impacts this can have on our business as a whole, as well as on the performance of our clients’ investments. 

Internal vs External Resources
The majority of our research and analysis of responsible investment issues is conducted internally by our Governance & Stewardship and Responsible Investment Teams. Currently, our main data providers are MSCI, Sustainalytics, Bloomberg, Institutional Shareholder Services (ISS) and IVIS. Further sources of idea generation include climate indices, CDP, MSCI, ATNI and ATMI, to name just a few. Our sources are under continual review to ensure we have access to the most appropriate, up-to-date research that supports our investment approach, processes and systems.

Internal research is supplemented by the use of the third-party ESG research providers, which provide screen-out tools for our ethical and SRI funds. However, our Responsible Investment Team reviews the analysis and will upgrade/downgrade companies if our analysis of the company differs from the provider's.

Within individual portfolios, ESG risk and opportunities is considered alongside other more traditional metrics and analysis. The appointed Portfolio Manager is ultimately responsible for investment decisions within their fund.

Participation and Dialogue
Standard Life Investments is active in the public debate about stewardship and sustainability. We are a signatory to the UK Stewardship Code and were a major contributor to its formulation. We support and are a signatory to the UN-backed Principles for Responsible Investment (PRI). We formally participated in the investor-led collaborations with fellow members of the PRI on anti-corruption strategies and water risks in the agricultural supply chain, and are currently members of three PRI Steering Committees:

  • Human Rights in Extractive Industry, which focuses on collaborative engagement with extractive companies facing human rights risks
  • Employee Relations, whose work identified a number of labour key performance indicators linked to financial performance that now form the basis of the PRI’s collaborative engagement initiative on employee relations
  • Listed Equities, which aims to outline examples of best practices as to how ESG is integrated into the equity investment process

In addition, we are also part of Investment Leaders Group (ILG), a group of 11 leading asset managers and owners who have joined forces with the University of Cambridge in a three-year project designed to promote understanding of how investors can realise positive environmental and social outcomes alongside robust, long-term investment returns. The project is championed at the most senior levels in the member companies, including Rod Paris, Head of Investments at Standard Life Investments, with a view to integrating the research and best-practice recommendations across their businesses. The members collaborate with academics at the Cambridge Judge Business School on some of the most fundamental issues in responsible investment.

We also participate extensively in UKSIF, EUROSIF, ICGN, ECGI, Asian Corporate Governance Association, CBI Companies Committee, Conference Board, Investment Association’s Governance and Engagement Committee, Corporate Governance Forum, Global Investor Governance Network, Global Auditor Investor Dialogue, Extractive Industries Transparency Initiative and GRI. We take an active role in monitoring and seeking to influence European policy developments, visiting Brussels at least twice per year to meet with officials.

Furthermore, we are and have been involved in a number of public policy debates relating to both the role of government and business to promote Corporate Responsibility. These include:  

  • The European Commission’s consultation on human rights and information and communication technology
  • The Equator Principles draft guidance
  • The DTI Consultation Document on the Operating and Financial Review and Directors’ Report

These initiatives have provided useful opportunities to work with others to share information and collaborate on matters of common interest, and all of the insight gained is fed back to our investment teams via the ongoing communications described previously. The purpose of our participation is at all times to promote the development of an environment that enhances investment returns for our clients and derives insights for their benefit. Further details of the above and other initiatives can be found on our website at: 
http://www.standardlifeinvestments.com/governance_and_stewardship/affiliations/index.html  

RLP Jupiter Ecology Pn Environmentally Themed Pension Global Equity 26/03/2010
FL Mym Legal & General (PMC) Ethical GLobal Equity Index Pn Sustainability Themed Pension Global Equity 02/05/2016
Pru L&G Ethical Global Equity Index Pn Sustainability Themed Pension Global Equity 10/07/2011 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "L&G Ethical" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

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SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

OMW Kames Ethical Corporate Bond Negative Ethical Life Not Set Fixed Interest 26/09/2006
Aviva Royal London Sustainable Leaders S4 Sustainability Themed Life UK Equity 05/04/2006
Vanguard SRI Global Stock Fund (UCITS) Negative Ethical SICAV/Offshore* Not Set Unclassified 23/10/2011 More Info (click to view)

SRI / Ethical Overview

Limited avoidance

SRI Policies (Primary strategy in bold)

  • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).

SRI Features

  • Norms focus This fund uses international standards, conventions and 'norms' to help direct where the fund can and cannot invest (e.g. the UN Global Compact).
  • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
  • Limited/few ethical exclusions This fund avoids companies based on limited list of ethical exclusions (relative to other ethical funds)

Corporate Activity

-

Links

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SRI / Ethical Policy

UCITS structure (not OEIC). Domiciled in Ireland with GBP share class.

Resources, Affiliations & Corporate Strategies

EdenTree Amity Balanced Fund for Charities Ethically Balanced OEIC/Unit Trust Global Mixed Asset 03/04/2011
Zurich UK Opportunities 2 EL Unclassified Life UK Equity 08/10/1990 More Info (click to view)

SRI / Ethical Overview

SRI Policies (Primary strategy in bold)

  • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).

SRI Features

-

Corporate Activity

-

SRI / Ethical Policy

Fund objective The fund seeks to invest in well governed companies with prospects for growth. The fund invests primarily in the UK but there may be some investment in overseas companies. Fund availability This fund was known as Zurich Environmental Opportunities EL until 17 October 2011. Fund features This fund invests in assets which tend to produce the highest level of return but with higher risk. Over the longer term these assets should generate superior growth. There will be greater fluctuations in value, which at times may be dramatic.

Resources, Affiliations & Corporate Strategies

Epworth Affirmative Fixed Interest for Charities Ethically Balanced OEIC/Unit Trust UK Fixed Interest 30/08/2001
Standard Life Vanguard SRI European Stock Pn S4 Negative Ethical Pension Europe Ex-UK Equity 05/05/2013 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Vanguard SRI European Stock Fund (UCITS)" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "Vanguard SRI European Stock Fund (UCITS)" Product listing. 

This is a 'limited avoidance' fund. 

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

  • Norms focus This fund uses international standards, conventions and 'norms' to help direct where the fund can and cannot invest (e.g. the UN Global Compact).
  • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
  • Limited/few ethical exclusions This fund avoids companies based on limited list of ethical exclusions (relative to other ethical funds)

Corporate Activity

-

Links

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SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

Threadneedle Ethical UK Equity Sustainability Themed OEIC/Unit Trust UK Equity 30/10/2015 More Info (click to view)

SRI / Ethical Overview

Launched in October 2015, our Threadneedle Ethical UK Equity Fund takes a novel approach in combining ESG performance, an outcomes focus and negative screening. The Fund actively targets UK companies that exhibit the best ESG performance and/or produce innovative products positioned to contribute to a better future, and avoids companies that we deem to be involved in unethical or controversial activities. In November, it was awarded Best New Entrant, at Investment Week’s Sustainable Investment Awards 2016.

 

The differentiated aspect of the Fund is its three-pronged approach, combining ESG performance, an outcomes focus and negative screening.

 

I.             First, we exclude companies that are unable to satisfy our ethical restrictions, using the MSCI UK IMI Extended SRI index to aid exclusion of sectors e.g. alcohol, weapons, gambling.

 

II.            We consider ESG performance, using both internal and external research, as we believe that those companies with excellent corporate governance can enhance their potential into the future. We also seek to engage with the companies to ensure continual improvement.

 

III.           We seek companies that deliver innovative solutions to achieving sustainable outcomes. To achieve this, we look at the UN sustainable development goals and key themes, including climate change, healthcare, safety, security and verification.

 

 

SRI / themed / ethical assets under management – overview

 

As at 31 March 2017

 

  • Fund Size (GBP):   £24.0m
  • Total value of SRI/ethical/environmental/ social/ environmental or sustainability themed funds under management:   £288.8m
  • Total value of assets covered by responsible ownership policy:   £9,223m*
  • Total assets under management:   £108,367m**

 

*range of styles, including: best in class, UN Global Compact, ESG screen, thematic, impact etc.

** Columbia Threadneedle Investments, EMEA & Asia only

 

SRI Policies (Primary strategy in bold)

  • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.
  • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
  • Social policy Considers social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact).
  • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
  • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
  • Armaments manufacturers avoided Avoids companies that manufacture products intended specifically for military use. (Funds may, however, invest in manufacturers of products that are used by the military but are not specifically intended for military/defence use.)
  • Health & wellbeing policies Has a policy that sets out the fund's aim to support companies that offer positive lifestyle, health or 'wellbeing' related benefits.
  • Nuclear policy Has a published policy that sets out the fund's position with regard to nuclear power. In most cases this is likely to mean avoidance of companies with significant involvement in the nuclear industry, although some funds may require absolute avoidance.
  • Invests in clean energy/renewables This fund invests in companies in the clean technology/renewable energy related industries. Fund strategies vary. In practice some may invest a small percentage in this area whereas others may have significant exposure to this area. Check fund literature for details.
  • Alcohol production excluded (new) This fund avoids companies that are involved in the production of alcohol. See fund literature for further information.
  • Gambling avoidance policy (new) This fund avoids companies with significant involvement in the gambling industry. See fund policy for details.
  • Pornography avoidance policy (new) This fund avoids companies that derive significant income from pornography. See fund details for further information.

SRI Features

  • Balances company 'pros and cons'/best in sector This fund manager will look at both the 'positive' things companies do and the 'negative' things they do. They will make balanced judgements, in line with their published strategy, before deciding whether or not to invest. Such funds often invest in the best/most ethical companies across most industries, rather than excluding entire sectors. The fund manager may couple this with 'responsible engagement' activity, where they aim to encourage better, more responsible business practices.
  • Favours companies with strong social policies This fund invests in line with positive strategies that relate to 'people' issues - such as human rights, labour standards and equal opportunities. Such funds are likely to invest in companies that have market leading standards with regard to employee and supplier practices.
  • Sustainability themed This fund pays significant attention to sustainability issues either as its primary strategy or alongside other ethical criteria and approaches. This means that environmental and social challenges and opportunities are likely to influence stock selection decisions.
  • Norms focus This fund uses international standards, conventions and 'norms' to help direct where the fund can and cannot invest (e.g. the UN Global Compact).
  • Positive selection bias The ethical focus of this fund is around the consideration of the positive/good or useful things companies do. The fund may also have negative avoidance criteria - but this may not be the main ethical strategy applied by the fund managers.
  • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
  • Over 50% large cap This fund invests more than half of its money into very large companies. This will typically mean that the market capitalisation (or value) of the companies they hold will be over £5 to £10 billion.
  • Favours cleaner, greener companies This fund is likely to invest in companies with strong environmental policies and practices. This may mean it invests in smaller companies offering market leading environmental services or products and/or larger companies that are working towards the improved management of their negative impacts.
  • 'Strictly' screened ethical fund The managers of this fund aim for it to be managed as having a high level of negative ethics led avoidance. They may refer to it as 'dark green' - meaning it excludes lots of companies, relative to other ethical options.
  • Aims to generate positive impacts (new) This fund aims to help deliver positive social or environmental impacts or outcomes. Strategies and approaches vary. Some funds measure outcomes others do not. See fund literature for further information.
  • Available via an ISA (new) This fund is available via a tax efficient ISA product wrapper
  • Clean energy themed (new) This fund invests in clean technology / clean energy companies. See fund information for further details.

Corporate Activity

  • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
  • Responsible Ownership policy for non SRI funds This fund manager applies Responsible Ownership or 'Stewardship' policies to all or most of their investment assets. This means that active involvement (e.g. voting, dialogue) with the companies they invest in is not limited to ethical or SRI options.
  • Integrates ESG factors into all/most fund research This fund manager researches environmental, social and governance issues when deciding whether or not to invest in a company. This applies to all funds, not only those which are promoted as being 'ethical' or 'SRI themed'.
  • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
  • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
  • Responsible Ownership/ESG a key differentiator The fund managers have said they consider this area to be a key differentiator for their business
  • UK Stewardship Code signatory
  • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
  • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
  • Review(ing) carbon/fossil fuel exposure for all funds This company has reviewed or is currently reviewing (or in other ways 'actively managing') their exposure to carbon intensive industries including (but not only) mining, oil and gas companies. This work is being carried out in the light of climate change related concerns and the company's view of its anticipated impact on the companies they invest in.
  • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.
  • PRI signatory (new) This fund management company has signed up to the UN backed 'Principles of Responsible Investment' initiative.

SRI / Ethical Policy

The Fund targets UK companies that exhibit the best, or improving, ESG performance in the way they operate that fit within our tried and tested UK Equity process. However, investing responsibly is also about opportunity; the opportunity to combine financial objectives with a positive focus on investing with purpose.

 

This positive focus is about more than just internal standards; the Fund also actively seeks to target companies that deliver products or services that are positioned to contribute to a better future. In our view, this ESG-integrated and outcome-focused approach sets this Fund apart from the more traditional ethical fund approach, offering a ‘best in class’ solution for those looking to invest responsibly and with purpose.

 

The Fund invests at least three-quarters of its assets in shares of companies in the United Kingdom (or companies that have significant operations there) that meet its ethical investment criteria. Investments are assessed by the fund manager by reference to ethical investment guidelines additional to those usually considered by the fund manager when making investment decisions.

 

There are two ways in which UK companies are evaluated to create the ethical investment universe to which the Fund Manager will apply his investment process: ethical exclusion screening and positive inclusion and selection.

 

1.      Ethical exclusion screening

 

For the Fund to invest in a company, it must satisfy the Fund’s ethical restrictions. Stocks are excluded from the Fund’s investable universe if they do not exhibit appropriate Environmental, Social or Governance (ESG) behaviour, for example if a certain amount of the company’s business activities are involved in industries such as alcohol, gambling, tobacco. These ethical restrictions are derived from the methodology of the MSCI Socially Responsible Investment (SRI) Index, the Fund’s Reference Index, but may vary slightly in some instances.

 

2. Positive inclusion & selection

 

As well screening out companies that do not perform well against ESG criteria, the Fund actively seeks to include UK companies that exhibit strong ESG performance in the way they operate. Companies that pass the ethical exclusion screening are further assessed and selected on the extent of their ESG performance relative to other companies within their sector, drawing on the team’s strong capabilities and experience with ESG analysis. The Fund also selects companies that deliver or are developing products, services and practices that are positioned to contribute to a better future, i.e. that fit in with key sustainability themes.

 

These comprise: health and wellbeing, climate and energy transition, demographics, communities, education, environment, safety and security.

 

Companies which embrace the efficient use of resources and invest in both people and technology to generate sustainable returns over time create the context in which investors can do well by doing good.

 

Embracing this creates a productive investment focus in which we apply our research process to find suitable investments with the appropriate investment characteristics. As bottom-up stock pickers, the fund management team look for companies with robust business and financial models that trade on attractive valuations and have solid management teams that look to the future. We seek to invest in and support companies over a long-term horizon, which ties in with our UK equity team investment philosophy, while also supporting an ethical approach to investing.

Resources, Affiliations & Corporate Strategies

Resources

 

We have a dedicated Responsible Investment (RI) team devoted to researching and engaging on ESG issues and have invested significant resources in the development of our expertise in this area. This includes not only internal research but the use of supplementary external research and ratings as required. Our RI team has worked alongside our investment professionals since 1998. 

 

The RI team is composed of six members in the UK with responsibility for ESG research, integration, engagement, proxy voting and ESG reporting and, in one case RI portfolio management, which is a new position last year. A Director, Global Responsible Investment (US) is located in the US, as is a proxy voting team. Responsibility for the governance and responsible investment capabilities lies with Iain Richards, the Head of Governance and Responsible Investment at Columbia Threadneedle Investments.

 

Sources of Information to the RI team include:

 

  • Company data and dialogue including traditional and sustainability reporting
  • Brokers focused on ESG research
  • External ESG rating provider: MSCI ESG research
  • Corporate governance database: BoardEx
  • Proxy voting related governance research: ISS and IVIS
  • Bloomberg
  • NGOs
  • Academia
  • News
  • National and International government bodies

 

The RI team undertake the research which drives the fund, in particular where stocks are not covered by MSCI ESG research, or where there is more work to be done in identifying the salience of sustainable opportunities. Examples include smaller companies providing cyber security opportunities, or innovating in renewable energy production. The team produce bespoke ESG review, incorporating exposure to sustainability themes, where these are identified. The RI team also typically conduct or assist engagement to gain further insight and drive improvement on ESG and sustainability issues. Finally, the team make voting recommendations regarding the companies in the Fund, which can be informed by ESG issues – diversity for instance is now systemically considered as a standing voting consideration with potential to trigger action across all companies and funds. 

 

In addition, the financial analysis is undertaken by our UK equities team, using their established investment process to identified companies with robust business and financial models that trade on attractive valuations and have solid leadership.

 

Fund manager

 

The fund is managed by Matt Evans, who co-managers the Threadneedle UK Smaller Companies Fund, the Threadneedle UK Mid 250 Fund and a range of small cap institutional portfolios. Supported by the RI team, and the UK team, and mindful of the exclusionary criteria, the manager makes the final investment decision.

 

General corporate affiliations

 

Given the number of potential initiatives, we seek to prioritise, focusing on those which best align with our priorities and add greatest value to our processes. Some of the key associations and organisations are outlined below.

 

We were a founding member of the UN PRI and remain actively involved in the organisation, whose influence has increased since its foundation in 2006: in our last assessment from the PRI we received an A+ (the highest rating) for our overall approach to responsible investment.

 

Other key memberships are those of: the United Kingdom Sustainable Investments and Finance Association (UKSIF), the European Social Investment Forum (EUROSIF), and the Asian Corporate Governance Association (ACGA).  These memberships reflect our commitment to RI across a range of markets, reflecting the geographic diversity of our investments, as well our significant holdings in UK-listed companies. 

 

We have a longstanding relationship with UKSIF in particular.  We are represented on the UKSIF Leadership committee, and this year we participated at UKSIF events, including an event on the strategy of the SIF, at which we contributed ideas for increased member engagement and participation. We also contributed to their 2016 survey, enhancing their research into the nature of the responsible investment market.

 

Our Chief Investment Officer is also on the board of the Investor Forum, which seeks to contribute to long-term investment performance by promoting cultural change and enhancing shareholder stewardship in the UK. Similarly, we are also an active member of the UK Corporate Governance Forum, an investor network made up of asset managers and owners to discuss individual companies, industry and ESG developments, and are signatories to the UK Stewardship Code

 

We are also signatories to the CDP (formerly the Carbon Disclosure Project), including their recent forestry and water programmes.

L&G Kames Ethical Equity Pn G25 Negative Ethical Pension UK Equity 12/04/2006 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Kames Ethical Equity" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

AXA Wealth Kames Ethical Cautious Managed Pn S4 Negative Ethical Pension UK Mixed Asset 19/10/2008 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Kames Ethical Cautious Managed" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

-

Corporate Activity

-

Links

-

SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

FL Ethical Safeguard Optimiser Ethically Balanced Life UK Equity 10/06/2004
Pru Jupiter Ecology Pn S3 Environmentally Themed Pension Global Equity 13/09/2012 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "Jupiter Ecology" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

SRI Policies (Primary strategy in bold)

  • Invests in clean energy/renewables This fund invests in companies in the clean technology/renewable energy related industries. Fund strategies vary. In practice some may invest a small percentage in this area whereas others may have significant exposure to this area. Check fund literature for details.

SRI Features

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Corporate Activity

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Links

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SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

Premier Ethical R Inc Ethically Balanced OEIC/Unit Trust UK Equity 06/07/1986
SJP Ethical Ethically Balanced Life Global Equity 02/11/1998
Aviva F&C Responsible Global Pn S6 Ethically Balanced Pension Global Equity 28/09/2008 More Info (click to view)

SRI / Ethical Overview

This pension product is linked to the "BMO (F&C) Responsible Global Equity" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

SRI Policies (Primary strategy in bold)

  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

SRI Features

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Corporate Activity

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Links

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SRI / Ethical Policy

Resources, Affiliations & Corporate Strategies

Henderson ESG Integration Corporate Activity Not Set Unclassified 29/01/2016 More Info (click to view)

SRI / Ethical Overview

Henderson’s portfolio managers, sector analysts, ESG and corporate governance personnel maintain regular dialogue with companies. This dialogue allows the firm to monitor the development of companies’ businesses, including areas such as overall strategy, business planning and delivery of objectives, capital structure, proposed acquisitions or disposals, corporate responsibility and corporate governance. Henderson subscribes to research covering corporate governance and corporate responsibility issues, to supplement in-house analysis. 

Analysis is shared on internal IT systems and frequent discussion takes place between governance, ESG and sector analysts and fund managers. Electronic records of all engagement, voting and other corporate governance and corporate responsibility activities, including the rationale for voting decisions, are kept.  

Overall responsibility for monitoring company performance rests with portfolio managers. Analysts specialising in corporate governance and corporate responsibility issues work alongside portfolio managers to identify relevant issues, which are fed into our investment process, and may also form the basis for company engagement. 

Fund managers are ultimately responsible for the integration of ESG issues into investment decision making and engagement as part of their investment processes. To help facilitate this we subscribe to a wide range of specialist external ESG research to complement in-house research and engagement. This research is made directly available to all investment teams, as well as being used by the in-house Governance and Responsible Investment (GRI) team to screen for ESG issues of concern.

The GRI team is a specialist resource that supports fund managers on corporate governance issues (including voting) as well as wider environmental and social issues. They make use of a wide range of external specialist ESG research, including MSCI, EIRIS, Trucost, IVIS, RepRisk, ISS and broker research. The team work on behalf of fund managers and our clients by ensuring that ESG issues are raised prior to key company meetings and investment risk meetings. 

SRI Policies (Primary strategy in bold)

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SRI Features

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Corporate Activity

  • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
  • Responsible Ownership policy for non SRI funds This fund manager applies Responsible Ownership or 'Stewardship' policies to all or most of their investment assets. This means that active involvement (e.g. voting, dialogue) with the companies they invest in is not limited to ethical or SRI options.
  • Integrates ESG factors into all/most fund research This fund manager researches environmental, social and governance issues when deciding whether or not to invest in a company. This applies to all funds, not only those which are promoted as being 'ethical' or 'SRI themed'.
  • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
  • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
  • Responsible Ownership/ESG a key differentiator The fund managers have said they consider this area to be a key differentiator for their business
  • UK Stewardship Code signatory
  • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
  • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
  • Review(ing) carbon/fossil fuel exposure for all funds This company has reviewed or is currently reviewing (or in other ways 'actively managing') their exposure to carbon intensive industries including (but not only) mining, oil and gas companies. This work is being carried out in the light of climate change related concerns and the company's view of its anticipated impact on the companies they invest in.
  • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.

SRI / Ethical Policy

ESG issues are integrated into our risk reporting and fund review processes. Fund managers receive ESG investment risk reports detailing portfolio exposure to companies rated highest risk for ESG issues, as well as overall portfolio performance and any changes to company ratings. These ESG risk reports are discussed at regular fund risk review meetings. 

Resources, Affiliations & Corporate Strategies

Fund managers are ultimately responsible for the integration of ESG issues into investment decision making and engagement as part of their investment processes. They are assisted in this by the GRI team (please see above). 

Sources of ESG related data that are used to build the ESG investment risk reports include: EIRIS, MSCI, ISS, RepRisk, IVIS, CDP, TruCost, HOLT

Henderson is actively involved / member of the following initiatives: Carbon Disclosure Project (CDP), Extractive Industries Transparency Initiative (EITI), Institutional Investors Group on Climate Change (IIGCC), National Association of Pension Funds (NAPF), UN Principles of Responsible Investment (PRI), UK Sustainable Investment Forum (UKSIF), European Sustainable Investment Forum (EUROSIF), UN Environment Programme Finance Initiative (UNEP FI), Asian Corporate Governance Association (ACGA), The Investor Forum, Access to Medicines Initiative.

Standard Life Inv European Ethical Equity Ret Negative Ethical OEIC/Unit Trust Europe Ex-UK Equity 23/09/2007 More Info (click to view)

SRI / Ethical Overview

The European Ethical Equity Fund aims to provide long-term growth by investing in a diversified portfolio of European (excluding UK) equity assets that meet the strict ethical criteria determined by ongoing ethical investor research. The Fund is actively managed by our investment team, utilising a bottom-up, fundamental investment process that is both research intensive and risk aware. The Portfolio Manager excludes companies that fail to meet our ethical criteria while seeking to include companies whose business activities are regarded as making a positive contribution to society. These criteria are agreed with the Standard Life Ethical Funds Advisory Group and may be amended from time to time.

 

SRI / themed / ethical assets under management – overview :

  • Fund Size (GBP): £174.9 million as of 31 March 2017
  • Total value of SRI/ethical/environmental/ social/ environmental or sustainability themed funds under management: £2,571.2 million as of 31 March 2017
  • Standard Life Investments has a total of £277,929.6 million assets under management as of 31 December 2016

 

SRI Policies (Primary strategy in bold)

  • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
  • Health & wellbeing policies Has a policy that sets out the fund's aim to support companies that offer positive lifestyle, health or 'wellbeing' related benefits.
  • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
  • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.
  • Social policy Considers social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact).
  • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
  • Nuclear policy Has a published policy that sets out the fund's position with regard to nuclear power. In most cases this is likely to mean avoidance of companies with significant involvement in the nuclear industry, although some funds may require absolute avoidance.
  • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).
  • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
  • Armaments manufacturers avoided Avoids companies that manufacture products intended specifically for military use. (Funds may, however, invest in manufacturers of products that are used by the military but are not specifically intended for military/defence use.)
  • Climate change / GHG policy Considers climate change related issues such as greenhouse gas/carbon emissions. Strategies vary but funds that consider climate issues typically require the careful management of climate related risks (and opportunities) if they are to select a company for investment.
  • Invests in clean energy/renewables This fund invests in companies in the clean technology/renewable energy related industries. Fund strategies vary. In practice some may invest a small percentage in this area whereas others may have significant exposure to this area. Check fund literature for details.
  • Alcohol production excluded (new) This fund avoids companies that are involved in the production of alcohol. See fund literature for further information.
  • Fracking and tar sands excluded (new) Fund avoids companies involved in fracking and tar sands - which are controversial oil and gas extraction practices
  • Gambling avoidance policy (new) This fund avoids companies with significant involvement in the gambling industry. See fund policy for details.
  • Pornography avoidance policy (new) This fund avoids companies that derive significant income from pornography. See fund details for further information.

SRI Features

  • Positive selection bias The ethical focus of this fund is around the consideration of the positive/good or useful things companies do. The fund may also have negative avoidance criteria - but this may not be the main ethical strategy applied by the fund managers.
  • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
  • Balances company 'pros and cons'/best in sector This fund manager will look at both the 'positive' things companies do and the 'negative' things they do. They will make balanced judgements, in line with their published strategy, before deciding whether or not to invest. Such funds often invest in the best/most ethical companies across most industries, rather than excluding entire sectors. The fund manager may couple this with 'responsible engagement' activity, where they aim to encourage better, more responsible business practices.
  • Eurosif transparency This fund has met the standards of the EUROSIF transparency Code. This means that they are a leading fund in terms of openness and transparency, publishing - for example - extensive information about where they invest and how they deal with companies.
  • Over 50% large cap This fund invests more than half of its money into very large companies. This will typically mean that the market capitalisation (or value) of the companies they hold will be over £5 to £10 billion.
  • Favours cleaner, greener companies This fund is likely to invest in companies with strong environmental policies and practices. This may mean it invests in smaller companies offering market leading environmental services or products and/or larger companies that are working towards the improved management of their negative impacts.
  • Favours companies with strong social policies This fund invests in line with positive strategies that relate to 'people' issues - such as human rights, labour standards and equal opportunities. Such funds are likely to invest in companies that have market leading standards with regard to employee and supplier practices.
  • 'Strictly' screened ethical fund The managers of this fund aim for it to be managed as having a high level of negative ethics led avoidance. They may refer to it as 'dark green' - meaning it excludes lots of companies, relative to other ethical options.
  • Aims to generate positive impacts (new) This fund aims to help deliver positive social or environmental impacts or outcomes. Strategies and approaches vary. Some funds measure outcomes others do not. See fund literature for further information.
  • Available via an ISA (new) This fund is available via a tax efficient ISA product wrapper

Corporate Activity

  • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
  • Integrates ESG factors into all/most fund research This fund manager researches environmental, social and governance issues when deciding whether or not to invest in a company. This applies to all funds, not only those which are promoted as being 'ethical' or 'SRI themed'.
  • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
  • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
  • UK Stewardship Code signatory
  • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
  • PRI signatory (new) This fund management company has signed up to the UN backed 'Principles of Responsible Investment' initiative.

SRI / Ethical Policy

Standard Life Investments recognises that the world faces significant environmental and social challenges. Our Ethical Funds seek to invest in companies that are supporting the solutions to these challenges and uphold the highest standards of corporate responsibility. The criteria of the ethical investment policy aim to reflect this.

Positive Criteria

Using positive criteria, we favour companies that are involved in activities that benefit society and the environment. We use the UN Global Compact to define the four areas where we seek positive business practices and services.

  • Environment: We seek to invest in companies that have a positive impact on the environment, and contribute to environmental protection and enhancement through its products and services.
  • Human Rights & Community: We seek companies that respect and support the human rights of those affected by its business, offer products and services that provide access to some of the world’s most basic rights, and have strong relationships within their communities.
  • Employment: We seek to invest in companies that have strong labour practices, and implement strong safety, health and welfare policies.
  • Anti-bribery & Corruption: We favour investment in companies that uphold the highest standards of business ethics and demonstrate strong anti-corruption policies, and adopted and embed a code which encourages employees to follow principles of good business behaviour and positive corporate culture.

Corporate Governance

The funds adopt a formal corporate governance policy. We actively vote at the AGMs of the companies held in the funds. Due consideration is given to issues such as board independence, excessive remuneration and audit issues. Voting is conducted within the terms of the Ethical Funds Investment Policy and in the best of interests of the investors in the funds.

In addition, the funds will adopt a policy of voting:

  • against the Chairman of any company where the board fails to have set policy, have oversight or take responsibility for environmental, social, health & safety and human rights issues.
  • against members of any health, safety and environment committee where insufficient oversight has resulted in poor performance in these areas.

Engagement

The fund pursues an active engagement policy. We engage with companies on a range of environmental and social issues with the aim that good corporate behaviour is adopted by the companies in which the funds invest. Where engagement proves ineffective and concerns remain over corporate behaviour and oversight of these issues, we will disinvest from a company. It is our ambition that this active engagement will challenge and encourage companies in which the funds invest to improve their environmental and social performance and practices.

Negative Criteria

If a company is involved in the activities listed below, the funds will avoid investment in them.

  • Environmental damage and pollution
  • Weapons
  • Human rights abuses
  • Nuclear
  • Alcohol production
  • Animal  testing
  • Animal husbandry
  • Fur
  • Pornography
  • Marketing breast milk substitutes
  • Tobacco
  • Gambling
  • Poor business practices

 Fracking is not explicitly excluded, though is unlikely to pass our environmental screen

The funds will also avoid companies that have failed one or more of the ten principles of the UN Global Compact.

    Resources, Affiliations & Corporate Strategies

    Standard Life Investments has had a long history of taking ESG issues into account. We have heavily invested in resources dedicated to the analysis of ESG themes. In particular, we have two teams focusing on the integration of these issues into our investment process:

    1) our Governance & Stewardship Team, who analyses how a company is governed and implements an active voting process, and

    2) our Responsible Investment Team, who assess companies on sustainability issues. 

    Within our regional equity teams, fund management and research is a combined role, whereby each equity manager is individually accountable for stocks held in their portfolios, while at the same time working as a team through review and debate of investment ideas based on the research they have conducted in each sector. Each of our regional equity teams (UK, Europe, North America and GEM/Asia) is organised in this way, creating a common research platform for all equity products where analysis and resources are freely shared.

    The vast majority of our investment ideas are generated from information and analysis from one-on-one company meetings. Collectively, more than 3,000 company meetings are conducted annually across Standard Life Investments. These meetings are used to ascertain the company’s own views and expectations of the future prospects for their company and the markets in which they invest. External secondary research is also generated to gain insight on the consensus view and supplement our own proprietary research. This includes the use of industry experts such as Gerson Lehrman Group (GLG), and the Coleman Research Group, to challenge and test our theses in specialist products or developing new areas. The sell-side research available in the market provides a useful gauge as to what is already known or priced in by the markets.

    In addition, both our Governance & Stewardship and Responsible Investment Teams have a systematic programme of ongoing engagement with companies to encourage and monitor sustainability practices, and to discuss a range of relevant corporate governance issues such as Board balance and composition, remuneration policies, and audit and risk issues. These Teams are closely integrated with our asset class teams and regularly attend company meetings together, providing analysis from both a financial and ESG perspective to get a comprehensive view of the company. Our main ESG data providers are Sustainalytics, Bloomberg, GMI, Institutional Shareholder Services (ISS) and IVIS. Additionally, EIRiS, an independent research agency, is a key system used to determine which companies comply with our strict ethical criteria within our Ethical Funds. We input our negative and positive criteria into the EIRiS web-based database system, which then generates lists of the companies that pass or fail the criteria. We also use the system to identify which companies are rated as “preferred” on the basis of their positive criteria. These ratings are added to our proprietary quantitative model, which used by our regional equity investors as a screening input and decision support tool to their stock analysis process using normal investment criteria.

    Ultimate accountability for the investment decisions within the portfolio is the responsibility of the appointed Portfolio Manager.

    OMW Henderson Global Care Growth Pn Sustainability Themed Pension Global Equity 22/07/2012 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Henderson Global Care Growth" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Social policy Considers social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact).

    SRI Features

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    Corporate Activity

    -

    Links

    -

    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    OMW F&C Responsible UK Equity Income Ethically Balanced Life UK Equity Income 28/09/2005
    7IM Sustainable Balance C Acc Sustainability Themed OEIC/Unit Trust Global Mixed Asset 02/02/2007 More Info (click to view)

    SRI / Ethical Overview

    The Equity and Fixed Interest components of the fund are managed by Sarasin LLP, leaders in the field of researching sustainable investments. 7IM manage the investment overlay which includes exchange traded funds as well as carefully chosen funds which are within the ethical and sustainable criteria.

    While there are some ethical exclusions (nuclear, armaments, pornography, GMOs, etc,) the choices of investments are made mainly on positive social and environmental factors.  The equity and bond choices are based on their positioning, in terms of social analysis and environmental matters, compared with their peers both in quantitative or qualitative terms as judged by Sarasin using their proprietary Sarasin Sustainability Matrix®.  The ETFs and funds chosen by 7IM must also comply with the Sarasin principles as well as the ethical exclusions and are generally thematic plays on sustainable themes as well as alternative investments in areas such as sustainable forestry.

    The social factors judged to be important in positioning on the matrix include having a good relationship with suppliers, capital providers, the general public, its employees, clients and competitors based on criteria of health, participation, distribution of wealth, knowledge and controversial activities.

    The environmental aspects include such things as environmental strategy, policy and management systems, pre-production sourcing, production processes, products and services.

     

    SRI / themed / ethical assets under management – overview

    • Fund Size (GBP): £75m
    • Total value of SRI/ethical/environmental/ social/ environmental or sustainability themed funds under management:  £75m
    • Total value of assets covered by responsible ownership policy: £75m
    • Total assets under management: £11bn

     

    SRI Policies (Primary strategy in bold)

    • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.
    • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
    • Social policy Considers social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact).
    • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
    • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
    • Armaments manufacturers avoided Avoids companies that manufacture products intended specifically for military use. (Funds may, however, invest in manufacturers of products that are used by the military but are not specifically intended for military/defence use.)
    • Limits exposure to carbon intensive industries Aims to reduce or limit exposure to carbon intensive industries which are considered to be major contributors to climate change. Funds vary - but this is likely to mean a fund has below average levels of investment in areas such as oil & gas, mining or airlines. 'Best in sector' companies may, however, be allowable.
    • Nuclear policy Has a published policy that sets out the fund's position with regard to nuclear power. In most cases this is likely to mean avoidance of companies with significant involvement in the nuclear industry, although some funds may require absolute avoidance.
    • Invests in clean energy/renewables This fund invests in companies in the clean technology/renewable energy related industries. Fund strategies vary. In practice some may invest a small percentage in this area whereas others may have significant exposure to this area. Check fund literature for details.
    • Alcohol production excluded (new) This fund avoids companies that are involved in the production of alcohol. See fund literature for further information.
    • Gambling avoidance policy (new) This fund avoids companies with significant involvement in the gambling industry. See fund policy for details.
    • Pornography avoidance policy (new) This fund avoids companies that derive significant income from pornography. See fund details for further information.

    SRI Features

    • Positive selection bias The ethical focus of this fund is around the consideration of the positive/good or useful things companies do. The fund may also have negative avoidance criteria - but this may not be the main ethical strategy applied by the fund managers.
    • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
    • Balances company 'pros and cons'/best in sector This fund manager will look at both the 'positive' things companies do and the 'negative' things they do. They will make balanced judgements, in line with their published strategy, before deciding whether or not to invest. Such funds often invest in the best/most ethical companies across most industries, rather than excluding entire sectors. The fund manager may couple this with 'responsible engagement' activity, where they aim to encourage better, more responsible business practices.
    • Eurosif transparency This fund has met the standards of the EUROSIF transparency Code. This means that they are a leading fund in terms of openness and transparency, publishing - for example - extensive information about where they invest and how they deal with companies.
    • Sustainability themed This fund pays significant attention to sustainability issues either as its primary strategy or alongside other ethical criteria and approaches. This means that environmental and social challenges and opportunities are likely to influence stock selection decisions.
    • Favours cleaner, greener companies This fund is likely to invest in companies with strong environmental policies and practices. This may mean it invests in smaller companies offering market leading environmental services or products and/or larger companies that are working towards the improved management of their negative impacts.
    • Favours companies with strong social policies This fund invests in line with positive strategies that relate to 'people' issues - such as human rights, labour standards and equal opportunities. Such funds are likely to invest in companies that have market leading standards with regard to employee and supplier practices.
    • 'Strictly' screened ethical fund The managers of this fund aim for it to be managed as having a high level of negative ethics led avoidance. They may refer to it as 'dark green' - meaning it excludes lots of companies, relative to other ethical options.
    • Aims to generate positive impacts (new) This fund aims to help deliver positive social or environmental impacts or outcomes. Strategies and approaches vary. Some funds measure outcomes others do not. See fund literature for further information.
    • Available via an ISA (new) This fund is available via a tax efficient ISA product wrapper

    Corporate Activity

    • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
    • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
    • UK Stewardship Code signatory
    • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
    • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.

    SRI / Ethical Policy

    The fund will only invest in individual securities where the underlying companies, countries and institutions score well on social and environmental criteria.

    Certain products and manufacturing processes are so high-risk that they are not rated as being compatible with the criteria. Companies from certain industries or with significant exposure to certain activities are precluded, such as: Tobacco industry, Armaments, Pornography, Nuclear power generation or Chlorine, agrochemicals and GMOs in agriculture. Alcohol and Gambling will shortly be added as exclusions in the new Prospectus.

    The fund may also invest in collective investment vehicles (including exchange traded funds and open or closed ended funds) that track recognised ethical or socially responsible indices or are managed with appropriate ethical, social or environmental criteria.

     

    Resources, Affiliations & Corporate Strategies

    In-house research: macro and economic analysis based on a wide range of research material divided between broker research (too many to list here but the main ones such as Citi and Goldman Sachs as well as smaller brokers such as Numis and Winterflood) and external research (ASR, BCA, Capital Economics, Gavekal, MRB) and on conclusions of quarterly asset allocation committee meetings which are attended by representatives from independent research houses and independent contributors from the fund management industry.

    7IM outsources the individual equity selection and the individual bond selection to Sarasin who have strong ethical, ESG and SRI research capabilities with a large team of analysts who are able to assess company and country SRI criteria.

    7IM controls the overall asset allocation of the fund both strategic, keeping it within IA sector guidelines (Mixed Investment 20-60% Shares), within a balanced risk profile as defined by 7IM.

     

    Aviva Royal London Select Portfolio (50%-100% Shares) Sustainability Themed Life Global Mixed Asset 05/04/2006
    Aviva Alliance Trust Sustainable Future Corporate Bond S1 Sustainability Themed Life Europe >50% UK Fixed Interest 24/06/2001
    BlackRock Aquila Life Over 5 Year Index Linked Pn Nav Unclassified Pension UK Fixed Interest 31/08/1996
    OMW EdenTree Amity International Pn Ethically Balanced Pension Global Equity 16/10/2008 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "EdenTree Amity International" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

    SRI Features

    -

    Corporate Activity

    -

    Links

    -

    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    Royal London Sustainable Diversified Sustainability Themed OEIC/Unit Trust Global Mixed Asset 23/07/2009 More Info (click to view)

    SRI / Ethical Overview

    RLAM’s investment philosophy is to take the principle of sustainability and apply it across different geographies and asset classes. We define sustainable investing as investing in companies that have a net positive benefit to society either through the products and services they offer or in the way they conduct their business. In doing this we support companies having a positive impact on society whilst at the same time growing investor capital.

     

    Although the Trust adopts positive screening as its primary method of investment selection, it also offers reassurance from a number of areas of avoidance.

     

    SRI / themed / ethical assets under management – overview

    • Fund Size (GBP):  £416.11m as of 31 May 2017.
    • Total value of SRI/ethical/environmental/ social/ environmental or sustainability themed funds under management:    £11,793.22m as of 31 May 2017.
    • Total value of assets covered by responsible ownership policy:   £1,416.04m as of 31 May 2017    (Please note that this figure only includes our sustainable range, however, RLAM’s Responsible Investment Policy will detail how this is an over-arching approach across most of the firm’s assets).
    • Total assets under management:   £104,507.32m as of 31 May 2017.

     

    SRI Policies (Primary strategy in bold)

    • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
    • Limits exposure to carbon intensive industries Aims to reduce or limit exposure to carbon intensive industries which are considered to be major contributors to climate change. Funds vary - but this is likely to mean a fund has below average levels of investment in areas such as oil & gas, mining or airlines. 'Best in sector' companies may, however, be allowable.
    • Measures positive impacts The fund aims to have a positive effect on society and/or the environment. Fund managers of this kind actively aim to measure the impact of their investments in order to ensure they are having the desired effect.
    • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.
    • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
    • Animal welfare policy The fund has a policy that requires specific animal welfare standards to be adopted by companies in order for them to be allowable for investment within the fund.
    • Nuclear policy Has a published policy that sets out the fund's position with regard to nuclear power. In most cases this is likely to mean avoidance of companies with significant involvement in the nuclear industry, although some funds may require absolute avoidance.
    • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).
    • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
    • Armaments manufacturers avoided Avoids companies that manufacture products intended specifically for military use. (Funds may, however, invest in manufacturers of products that are used by the military but are not specifically intended for military/defence use.)
    • Alcohol production excluded (new) This fund avoids companies that are involved in the production of alcohol. See fund literature for further information.
    • Fracking and tar sands excluded (new) Fund avoids companies involved in fracking and tar sands - which are controversial oil and gas extraction practices
    • Gambling avoidance policy (new) This fund avoids companies with significant involvement in the gambling industry. See fund policy for details.
    • Pornography avoidance policy (new) This fund avoids companies that derive significant income from pornography. See fund details for further information.

    SRI Features

    • Positive selection bias The ethical focus of this fund is around the consideration of the positive/good or useful things companies do. The fund may also have negative avoidance criteria - but this may not be the main ethical strategy applied by the fund managers.
    • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
    • Balances company 'pros and cons'/best in sector This fund manager will look at both the 'positive' things companies do and the 'negative' things they do. They will make balanced judgements, in line with their published strategy, before deciding whether or not to invest. Such funds often invest in the best/most ethical companies across most industries, rather than excluding entire sectors. The fund manager may couple this with 'responsible engagement' activity, where they aim to encourage better, more responsible business practices.
    • Over 50% large cap This fund invests more than half of its money into very large companies. This will typically mean that the market capitalisation (or value) of the companies they hold will be over £5 to £10 billion.
    • Sustainability themed This fund pays significant attention to sustainability issues either as its primary strategy or alongside other ethical criteria and approaches. This means that environmental and social challenges and opportunities are likely to influence stock selection decisions.
    • Favours cleaner, greener companies This fund is likely to invest in companies with strong environmental policies and practices. This may mean it invests in smaller companies offering market leading environmental services or products and/or larger companies that are working towards the improved management of their negative impacts.
    • Aims to generate positive impacts (new) This fund aims to help deliver positive social or environmental impacts or outcomes. Strategies and approaches vary. Some funds measure outcomes others do not. See fund literature for further information.
    • Available via an ISA (new) This fund is available via a tax efficient ISA product wrapper

    Corporate Activity

    • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
    • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
    • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
    • UK Stewardship Code signatory
    • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
    • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
    • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.
    • PRI signatory (new) This fund management company has signed up to the UN backed 'Principles of Responsible Investment' initiative.

    SRI / Ethical Policy

    Although the Trust adopts positive screening as its primary method of investment selection, it also offers reassurance from a number of areas of avoidance. In particular the portfolio avoids investment in any company that is or is likely to be exposed to:

     

    • Human rights abuses
    • Tobacco and armaments manufacture
    • Products which involve experiments on animals, except for those conducted for the benefit of human or animal health
    • The generation of nuclear power

     

    The Trust also avoids investments in companies which derive a material proportion (Over 10%) of their business from:

     

    • Animal fur products
    • Pornography
    • Irresponsible gambling
    • Irresponsible drinking
    • Worker exploitation or exploitative consumer practices.

     

    If a company breaches this threshold, then it is likely that that company’s involvement in that excluded sector is a noteworthy part of their business and strategy.

     

    Also, this threshold is deemed to be realistic and appropriate in terms of assessing a company, given that it may not be possible to always pinpoint the exact turnover derived from an excluded activity. This threshold ensures that a minimum of 90% of each holding meets the ethical criteria.

     

    Finally, the Trust avoids investments in companies that have unacceptable corporate governance and mismanage social, ethical and environmental risk.

    Resources, Affiliations & Corporate Strategies

    he core of our process is the team of five ESG investment specialists. Although each team member is capable of working across the spectrum of financial and ESG analysis required to enact our investment process, there are specialisms. We have two fund managers, one corporate governance specialist and two analysts capable of researching companies on a global basis across the spectrum of financial and ESG issues. The team has a high level of experience and have honed and improved the process over the 14 years since it was implemented. We have a very disciplined approach to investing, based around clear principles and a framework to ensure that that individually and as a team we make consistently high quality investment decisions on behalf of our clients.

     

    An external advisory committee supplements this internal expertise. Not only do they provide external, independent oversight as to the adherence to the principles and ethos of the investment process, they are also invaluable in adding to the knowledge base, which exists internally. The advisory committee consists of members from the corporate, academic, investment and charities arenas.

     

    We supplement this resource with the effective use of systems. Starting with a global universe of over 18,000 companies it is important we focus our work on those areas most likely to yield strong investment ideas. It particular we use MSCI to identity companies with strong ESG performance, and CSFB Holt to identify companies with inherent value creation and strong competitive advantage. Both these tools allow us to identify where and how best to use our internal resource. At this point we will conduct our own analysis as to the suitability of a potential investment.

     

    It is worth emphasising that, whether primary inputs have been internally derived or otherwise, we will never delegate the final decision as to whether a security is selected in our portfolios, given our very different philosophical approach to valuation.

     

    RLAM Voting Policy:  https://www.rlam.co.uk/Documents-RLAM/Sustainable%20Investing/2017%20RLAM%20Voting%20Policy.pdf

     

    Aviva Alliance Trust Sustainable Future Absolute Growth Pn S2 Sustainability Themed Pension Global Equity 05/04/2001 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Alliance Trust Sustainable Future Absolute Growth" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).

    SRI Features

    -

    Corporate Activity

    -

    Links

    -

    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    Royal London Sustainable Managed Income Trust B Acc Sustainability Themed OEIC/Unit Trust Global Fixed Interest 01/12/2012 More Info (click to view)

    SRI / Ethical Overview

    RLAM’s investment philosophy is to take the principle of sustainability and apply it across different geographies and asset classes. We define sustainable investing as investing in companies that have a net positive benefit to society either through the products and services they offer or in the way they conduct their business. In doing this we support companies having a positive impact on society whilst at the same time growing investor capital.

     

    Although the Trust adopts positive screening as its primary method of investment selection, it also offers reassurance from a number of areas of avoidance.

     

     

    SRI / themed / ethical assets under management – overview

     

    • Fund Size (GBP):   £28.76m as of 31 May 2017.
    • Total value of SRI/ethical/environmental/ social/ environmental or sustainability themed funds under management:   £11,793.22m as of 31 May 2017.
    • Total value of assets covered by responsible ownership policy:   £1,416.04m as of 31 May 2017     (Please note that this figure only includes our sustainable range, however, RLAM’s Responsible Investment Policy will detail how this is an over-arching approach across most of the firm’s assets).
    • Total assets under management:    £104,507.32m as of 31 May 2017.

     

    SRI Policies (Primary strategy in bold)

    • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
    • Limits exposure to carbon intensive industries Aims to reduce or limit exposure to carbon intensive industries which are considered to be major contributors to climate change. Funds vary - but this is likely to mean a fund has below average levels of investment in areas such as oil & gas, mining or airlines. 'Best in sector' companies may, however, be allowable.
    • Measures positive impacts The fund aims to have a positive effect on society and/or the environment. Fund managers of this kind actively aim to measure the impact of their investments in order to ensure they are having the desired effect.
    • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.
    • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
    • Nuclear policy Has a published policy that sets out the fund's position with regard to nuclear power. In most cases this is likely to mean avoidance of companies with significant involvement in the nuclear industry, although some funds may require absolute avoidance.
    • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).
    • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
    • Armaments manufacturers avoided Avoids companies that manufacture products intended specifically for military use. (Funds may, however, invest in manufacturers of products that are used by the military but are not specifically intended for military/defence use.)
    • Alcohol production excluded (new) This fund avoids companies that are involved in the production of alcohol. See fund literature for further information.
    • Fracking and tar sands excluded (new) Fund avoids companies involved in fracking and tar sands - which are controversial oil and gas extraction practices
    • Gambling avoidance policy (new) This fund avoids companies with significant involvement in the gambling industry. See fund policy for details.
    • Pornography avoidance policy (new) This fund avoids companies that derive significant income from pornography. See fund details for further information.

    SRI Features

    • Positive selection bias The ethical focus of this fund is around the consideration of the positive/good or useful things companies do. The fund may also have negative avoidance criteria - but this may not be the main ethical strategy applied by the fund managers.
    • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
    • Balances company 'pros and cons'/best in sector This fund manager will look at both the 'positive' things companies do and the 'negative' things they do. They will make balanced judgements, in line with their published strategy, before deciding whether or not to invest. Such funds often invest in the best/most ethical companies across most industries, rather than excluding entire sectors. The fund manager may couple this with 'responsible engagement' activity, where they aim to encourage better, more responsible business practices.
    • Over 50% large cap This fund invests more than half of its money into very large companies. This will typically mean that the market capitalisation (or value) of the companies they hold will be over £5 to £10 billion.
    • Sustainability themed This fund pays significant attention to sustainability issues either as its primary strategy or alongside other ethical criteria and approaches. This means that environmental and social challenges and opportunities are likely to influence stock selection decisions.
    • Favours cleaner, greener companies This fund is likely to invest in companies with strong environmental policies and practices. This may mean it invests in smaller companies offering market leading environmental services or products and/or larger companies that are working towards the improved management of their negative impacts.
    • Aims to generate positive impacts (new) This fund aims to help deliver positive social or environmental impacts or outcomes. Strategies and approaches vary. Some funds measure outcomes others do not. See fund literature for further information.
    • Available via an ISA (new) This fund is available via a tax efficient ISA product wrapper

    Corporate Activity

    • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
    • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
    • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
    • UK Stewardship Code signatory
    • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
    • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
    • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.
    • PRI signatory (new) This fund management company has signed up to the UN backed 'Principles of Responsible Investment' initiative.

    SRI / Ethical Policy

    Although the Trust adopts positive screening as its primary method of investment selection, it also offers reassurance from a number of areas of avoidance. In particular the portfolio avoids investment in any company that is or is likely to be exposed to:

     

    • Human rights abuses
    • Tobacco and armaments manufacture
    • Products which involve experiments on animals, except for those conducted for the benefit of human or animal health
    • The generation of nuclear power

     

    The Trust also avoids investments in companies which derive a material proportion (Over 10%) of their business from:

     

    • Animal fur products
    • Pornography
    • Irresponsible gambling
    • Irresponsible drinking
    • Worker exploitation or exploitative consumer practices.

     

    If a company breaches this threshold, then it is likely that that company’s involvement in that excluded sector is a noteworthy part of their business and strategy.

     

    Also, this threshold is deemed to be realistic and appropriate in terms of assessing a company, given that it may not be possible to always pinpoint the exact turnover derived from an excluded activity. This threshold ensures that a minimum of 90% of each holding meets the ethical criteria.

     

    Finally, the Trust avoids investments in companies that have unacceptable corporate governance and mismanage social, ethical and environmental risk.

     

    Resources, Affiliations & Corporate Strategies

    The core of our process is the team of five ESG investment specialists. Although each team member is capable of working across the spectrum of financial and ESG analysis required to enact our investment process, there are specialisms. We have two fund managers, one corporate governance specialist and two analysts capable of researching companies on a global basis across the spectrum of financial and ESG issues. The team has a high level of experience and have honed and improved the process over the 14 years since it was implemented. We have a very disciplined approach to investing, based around clear principles and a framework to ensure that that individually and as a team we make consistently high quality investment decisions on behalf of our clients.

     

    An external advisory committee supplements this internal expertise. Not only do they provide external, independent oversight as to the adherence to the principles and ethos of the investment process, they are also invaluable in adding to the knowledge base, which exists internally. The advisory committee consists of members from the corporate, academic, investment and charities arenas.

     

    We supplement this resource with the effective use of systems. Starting with a global universe of over 18,000 companies it is important we focus our work on those areas most likely to yield strong investment ideas. It particular we use MSCI to identity companies with strong ESG performance, and CSFB Holt to identify companies with inherent value creation and strong competitive advantage. Both these tools allow us to identify where and how best to use our internal resource. At this point we will conduct our own analysis as to the suitability of a potential investment.

     

    It is worth emphasising that, whether primary inputs have been internally derived or otherwise, we will never delegate the final decision as to whether a security is selected in our portfolios, given our very different philosophical approach to valuation.

     

    RLAM Voting Policy:   https://www.rlam.co.uk/Documents-RLAM/Sustainable%20Investing/2017%20RLAM%20Voting%20Policy.pdf

     

    Scottish Widows ThreadneedleUK Social Bond Pn S1 Social Themed Pension UK Fixed Interest 14/11/2016
    EdenTree Amity International A Ethically Balanced OEIC/Unit Trust Global Equity 12/09/1999 More Info (click to view)

    SRI / Ethical Overview

    The Fund aims to achieve long term capital growth with a reasonable level of income through a diversified portfolio of international companies. The Amity International Fund seeks to invest in a portfolio of companies which make a positive contribution to society and the environment through sustainable and socially responsible practices. These Funds seek to avoid investment in certain areas such as companies which have a material involvement in alcohol, tobacco and weapon production, gambling and publication of violent or explicit materials.

     

     

    SRI / themed / ethical assets under management – overview

    • Fund Size (GBP):   £221.89m as at 31/05/2017
    • Total value of SRI/ethical/environmental/ social/ environmental or sustainability themed funds under management:   £550m as at 31 December 2016
    • Total value of assets covered by responsible ownership policy:   100%
    • Total assets under management:   £2.5bn as at 31/05/2017

     

     

    SRI Policies (Primary strategy in bold)

    • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
    • Health & wellbeing policies Has a policy that sets out the fund's aim to support companies that offer positive lifestyle, health or 'wellbeing' related benefits.
    • Limits exposure to carbon intensive industries Aims to reduce or limit exposure to carbon intensive industries which are considered to be major contributors to climate change. Funds vary - but this is likely to mean a fund has below average levels of investment in areas such as oil & gas, mining or airlines. 'Best in sector' companies may, however, be allowable.
    • Measures positive impacts The fund aims to have a positive effect on society and/or the environment. Fund managers of this kind actively aim to measure the impact of their investments in order to ensure they are having the desired effect.
    • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.
    • Social policy Considers social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact).
    • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
    • Animal welfare policy The fund has a policy that requires specific animal welfare standards to be adopted by companies in order for them to be allowable for investment within the fund.
    • Nuclear policy Has a published policy that sets out the fund's position with regard to nuclear power. In most cases this is likely to mean avoidance of companies with significant involvement in the nuclear industry, although some funds may require absolute avoidance.
    • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).
    • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
    • Armaments manufacturers avoided Avoids companies that manufacture products intended specifically for military use. (Funds may, however, invest in manufacturers of products that are used by the military but are not specifically intended for military/defence use.)
    • Coal, oil &/or gas majors excluded This fund will not invest in the largest coal, oil and/or gas producing companies. Funds vary. Some may invest in smaller producers or companies where this is considered to be a relatively minor part of their business.
    • Climate change / GHG policy Considers climate change related issues such as greenhouse gas/carbon emissions. Strategies vary but funds that consider climate issues typically require the careful management of climate related risks (and opportunities) if they are to select a company for investment.
    • Invests in clean energy/renewables This fund invests in companies in the clean technology/renewable energy related industries. Fund strategies vary. In practice some may invest a small percentage in this area whereas others may have significant exposure to this area. Check fund literature for details.
    • Alcohol production excluded (new) This fund avoids companies that are involved in the production of alcohol. See fund literature for further information.
    • Fracking and tar sands excluded (new) Fund avoids companies involved in fracking and tar sands - which are controversial oil and gas extraction practices
    • Gambling avoidance policy (new) This fund avoids companies with significant involvement in the gambling industry. See fund policy for details.
    • Pornography avoidance policy (new) This fund avoids companies that derive significant income from pornography. See fund details for further information.

    SRI Features

    • RSMR Rated Fund rating agency 'Rayner Spencer Mills Research' have awarded this fund 'rated' status.
    • Positive selection bias The ethical focus of this fund is around the consideration of the positive/good or useful things companies do. The fund may also have negative avoidance criteria - but this may not be the main ethical strategy applied by the fund managers.
    • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
    • Eurosif transparency This fund has met the standards of the EUROSIF transparency Code. This means that they are a leading fund in terms of openness and transparency, publishing - for example - extensive information about where they invest and how they deal with companies.
    • Favours cleaner, greener companies This fund is likely to invest in companies with strong environmental policies and practices. This may mean it invests in smaller companies offering market leading environmental services or products and/or larger companies that are working towards the improved management of their negative impacts.
    • Favours companies with strong social policies This fund invests in line with positive strategies that relate to 'people' issues - such as human rights, labour standards and equal opportunities. Such funds are likely to invest in companies that have market leading standards with regard to employee and supplier practices.
    • Faith friendly These funds are likely to have attributes that some faith based investors may welcome such as opposition to armaments, gambling and alcohol.
    • 'Strictly' screened ethical fund The managers of this fund aim for it to be managed as having a high level of negative ethics led avoidance. They may refer to it as 'dark green' - meaning it excludes lots of companies, relative to other ethical options.
    • Aims to generate positive impacts (new) This fund aims to help deliver positive social or environmental impacts or outcomes. Strategies and approaches vary. Some funds measure outcomes others do not. See fund literature for further information.
    • Available via an ISA (new) This fund is available via a tax efficient ISA product wrapper
    • Over 50% small/mid cap (new) More than half of this funds assets are invested in smaller or medium sized companies.

    Corporate Activity

    • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
    • Responsible Ownership policy for non SRI funds This fund manager applies Responsible Ownership or 'Stewardship' policies to all or most of their investment assets. This means that active involvement (e.g. voting, dialogue) with the companies they invest in is not limited to ethical or SRI options.
    • Integrates ESG factors into all/most fund research This fund manager researches environmental, social and governance issues when deciding whether or not to invest in a company. This applies to all funds, not only those which are promoted as being 'ethical' or 'SRI themed'.
    • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
    • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
    • Responsible Ownership/ESG a key differentiator The fund managers have said they consider this area to be a key differentiator for their business
    • UK Stewardship Code signatory
    • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
    • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
    • Review(ing) carbon/fossil fuel exposure for all funds This company has reviewed or is currently reviewing (or in other ways 'actively managing') their exposure to carbon intensive industries including (but not only) mining, oil and gas companies. This work is being carried out in the light of climate change related concerns and the company's view of its anticipated impact on the companies they invest in.
    • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.
    • PRI signatory (new) This fund management company has signed up to the UN backed 'Principles of Responsible Investment' initiative.
    • Specialist / Boutique fund manager This fund management company is a specialist, perhaps somewhat 'niche' or smaller company with a culture or purpose that reflects with the aims of sustainable, responsible and ethical options. Check fund information and fund manager supplied links for further information.

    SRI / Ethical Policy

    Ethical Approach

     

    EIM is a pioneer of Socially Responsible Investment (SRI) and launched its first SRI investment fund in 1988. We utilise both negative and positive screening within the investment process. In respect of negative screening, we avoid companies whose activities derive in excess of 10% of their pre-tax profit or turnover from alcohol production, gambling, pornographic and violent material, tobacco production, strategic armaments, animal testing and intensive farming.

     

    We look for the positive aspects in potential investments to ensure we invest in companies that are making a positive contribution to society and the environment. These may cover good business and corporate governance practices and community relations. We also look for companies promoting good standards of education, environmental management and healthcare. We look favourably upon companies which promote human rights, good labour relations and urban regeneration. As well as our own in-house research (including special thematic reports) we use a range of sources, including independent data from Risk Metrics in respect of Environmental, Social and Governance (ESG) issues.

     

    EdenTree employs both negative and positive screening to its stock selection process and engages with companies before, during and after investing. This process is integrated into our overall investment management process and we use the following ‘screens’ when considering the suitability of an investment.

     

    Positive Screening

     

    Our positive screening approach centres on what we define as the ‘Nine Pillars’ of responsible investing.  We are particularly focused on areas that provide the necessities of life such as healthcare, water, education and housing, or products and services that are sourced ethically and produced sustainably. We also favour ‘solutions-focused’ companies that are leading the way in technologies that may help solve some of the world’s most challenging problems, such as climate change, alternative energy or water conservation. In addition, we focus on business behaviour, expecting the companies we invest in to have a well-managed policy for promoting human rights, environmental protection, labour rights and business ethics.

     

    Negative Screening

     

    Our negative screens include alcohol production, gambling operations, pornographic or violent material or weapon production. We also consider animal testing, oppressive regimes and intensive farming in our criteria when evaluating a company.

     

    Amity Panel Review

     

    The Amity Panel meet with the fund management and research team 3 or 4 times each year to review the Amity Fund portfolios, the recent investment decisions and to discuss the latest Socially Responsible research and trends. The purpose of the Amity Socially Responsible Investment Advisory Panel is to:-

     

    • Help to ensure that the EdenTree Amity Range of Funds meet the stated aims and objectives.

    • Provide advice in the formulation of policy in the light of changing social and environmental issues.

     

    The Amity Panel will provide advice to the SRI team in a number of ways

     

    • Advising on emerging issues or topics relevant to SRI criteria.

    • Provide advice and guidance on individual companies or sectors.

    • Provide advice and guidance on engagement work.

     

    The independent panel is made up of a number of industry experts, including:

     

    • The Right Reverend Dr Nigel Peyton – The Bishop of Brechin

    • William Oulton – Global Head of Responsible Investments, First State Investments

    • George Prescott – ex Ecclesiastical Deputy CEO and CFO, former ABI board member

    • Helen Crosby – Sustainability Expert.

    • Julie McDowell – Independent Consultant

     

    The SRI team is responsible for ESG research and advising Fund Managers. The team has access to a number of external resources for decision making. We have appointed Sustainalytics as our ESG data provider which serves as a starting point for our ESG research. This is complemented by NGO sources, company reports, market news and SRI initiatives. The SRI team also directly meets with companies to discuss sustainability and governance issues.

    Resources, Affiliations & Corporate Strategies

    There is an in-house team responsible for the execution of our SRI policy; they focus on research, engagement and proxy voting.

     

     All UK proxy voting decisions (includes Guernsey, Jersey and Isle of Man) are taken and executed in-house, signed off by a Fund Manager. We take IVIS (Institutional Voting Information Service) provided by the Investment Association to inform thinking. We have appointed Glass Lewis & Co. to be our sole discretionary research and proxy execution provider in all jurisdictions other than the United Kingdom (including Guernsey, Jersey and the Isle of Man), delegating to it the responsibility for the instruction and execution of international proxy voting at all general and special international company meetings.

     

    The team shares responsibility for company engagement, whether it is in house or in partnership with SRI organisations or other investors.

    Engage Mutual Green Chip Sustainability Themed Life UK Mixed Asset 24/11/1989
    FNW Standard Life Ethical Negative Ethical Life UK Equity 13/12/2005
    OMW Jupiter Ecology Pn Environmentally Themed Pension Global Equity 23/02/2007 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Jupiter Ecology" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Invests in clean energy/renewables This fund invests in companies in the clean technology/renewable energy related industries. Fund strategies vary. In practice some may invest a small percentage in this area whereas others may have significant exposure to this area. Check fund literature for details.

    SRI Features

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    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    Wesleyan Ethical Shares Negative Ethical Life UK Equity 19/12/2011
    Scottish Widows (SWIP) Responsible Ownership Corporate Activity Not Set Unclassified 01/03/2013 More Info (click to view)

    SRI / Ethical Overview

    SWIP (Scottish Widows) engage on all equity mixed and property assets in all geographic regions.

    SRI Policies (Primary strategy in bold)

    -

    SRI Features

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    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    SIP Kames Ethical Cautious Managed Pen S6 Negative Ethical Pension UK Mixed Asset 21/07/2008 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Kames Ethical Cautious Managed" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing. 

    SRI Policies (Primary strategy in bold)

    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

    SRI Features

    -

    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    Aberdeen Ethical World A Acc Ethically Balanced OEIC/Unit Trust Global Equity 30/04/1999 More Info (click to view)

    SRI / Ethical Overview

    SRI Policies (Primary strategy in bold)

    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

    SRI Features

    • RSMR Rated Fund rating agency 'Rayner Spencer Mills Research' have awarded this fund 'rated' status.

    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    FL Premier Ethical Ethically Balanced Pension UK Equity 30/04/1996 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Premier Ethical" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing. 

    SRI Policies (Primary strategy in bold)

    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

    SRI Features

    -

    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    AXA Wealth Kames Ethical Equity Pn S4 Negative Ethical Pension UK Equity 30/12/2009 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Kames Ethical Equity" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

    SRI Features

    -

    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    OMW Ethical Pn Negative Ethical Pension Global Equity 17/02/1992
    SVM All Europe SRI A Responsible Ownership OEIC/Unit Trust Europe Equity 31/10/2006 More Info (click to view)

    SRI / Ethical Overview

    SRI Policies (Primary strategy in bold)

    • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).

    SRI Features

    • RSMR Rated Fund rating agency 'Rayner Spencer Mills Research' have awarded this fund 'rated' status.

    Corporate Activity

    -

    SRI / Ethical Policy

    Fund focus is engagement but includes limited screening  (tobacco, armaments, pornography)

    Resources, Affiliations & Corporate Strategies

    FL Kames Ethical Equity EP Negative Ethical Pension UK Equity 04/11/2009 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Kames Ethical Equity" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

    SRI Features

    -

    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    L&G Ethical UK Equity Index PMC PN G17 Sustainability Themed Pension UK Equity 12/05/2004
    Aviva Kames Ethical Equity S4 Negative Ethical Life UK Equity 30/11/2009
    Stewart Investors Worldwide Sustainability A Inc GBP Acc Sustainability Themed OEIC/Unit Trust Global Equity 31/10/2012 More Info (click to view)

    SRI / Ethical Overview

    The Stewart Investors sustainability portfolios aim to generate long-term, risk-adjusted returns for our clients by investing in the shares of those quality companies which are particularly well positioned to benefit from, and contribute to, the sustainable development of the countries in which they operate. We regard sustainability as a key driver of investment performance and do not run ethical investment strategies that traditionally screen out particular companies.

     

    SRI Policies (Primary strategy in bold)

    • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).

    SRI Features

    • RSMR Rated Fund rating agency 'Rayner Spencer Mills Research' have awarded this fund 'rated' status.
    • Sustainability themed This fund pays significant attention to sustainability issues either as its primary strategy or alongside other ethical criteria and approaches. This means that environmental and social challenges and opportunities are likely to influence stock selection decisions.

    Corporate Activity

    • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.

    SRI / Ethical Policy

    Sustainability is an integral component of the our investment process, and is viewed as a driver of returns in common with consideration of other investment factors.

    There are four key stages:

    Step 1: Company classification

    Potential investment opportunities are classified into one of three sustainability themes: sustainable goods and services, responsible finance or required infrastructure. This classification is designed to help us clarify the long-term sustainability positioning of different types of businesses. They are not a formal screen. Companies are categorised in order to assist in determining the critical sustainability issues to apply to our fundamental analysis.
     

    Step 2: Quality assessment

    The quality assessment covers three distinct elements:

    A.  Quality of management

    Emphasis is placed on the existence of long term alignment between company management and minority shareholders.

    B.  Quality of the franchise

    We consider factors including brand and market share, pricing power and competitive advantage.

    C.  Quality of the financials

    A long term view is taken in evaluating how the company has performed over the economic cycle and its ability grow cash flows over the long term.

    We seek to ensure the potential impact of relevant ESG liabilities and costs are understood.

    Step 3: Valuation and portfolio construction

    Portfolio construction is a function of quality, liquidity and price. We analyse as broad a range of valuation metrics as possible to establish a sensible estimate of what a share is worth. There are investment controls, portfolio construction parameters and risk monitoring systems in place.

    Step 4: Invest, monitor and engage

    A significant amount of time is dedicated to engaging with the management team of the company. The team considers it their responsibility to address matters relating to the environment, human rights or social issues directly with management.

    Please refer to the investment strategy document for further details on our investment process:

     

     

    Resources, Affiliations & Corporate Strategies

    Investment ideas are generated on an on-going basis by extensive company visits, research trips, industry contacts, on-going debate and some third party research. Our research process fully incorporates a detailed assessment of ESG issues as they relate to a company’s financial, franchise and management quality. 

    Many ideas begin with a written meeting note on a company. The most promising will be followed by a company report, which takes between 1-2 months to write, exploring various aspects of a company’s quality, including corporate governance practices and alignment. We focus on a company’s history to understand how its strategy has evolved. Company reports are reviewed over email and debated at team meetings 

    Company visits are integral to our research. Meetings typically take place, on a one-to-one basis, with senior and operational management and focus on gaining deeper knowledge of management and franchise quality, balance sheet strength and the long-term growth strategy. Meetings are used to gauge management values and ability to execute by emphasising historic, cultural and ethical issues. We visit the majority of companies at least once before we invest. 

    External Research

    The use of external research is very limited. We have relationships with independent research houses, including Ethix, Trucost and RepRisk, and occasionally commission bespoke sustainability research. 

    Finally, we also have ESG contacts in our markets, including company, government and NGO representatives. These organisations provide us with a different perspective on key ESG trends and how companies are reacting to change

    FL F&C Responsible Income EP Ethically Balanced Pension UK Equity Income 01/02/2007 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "BMO (F&C) Responsible UK Income" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

    SRI Features

    -

    Corporate Activity

    -

    Links

    -

    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    Aviva Royal London Sustainable Leaders Trust S4 Sustainability Themed Life UK Equity 27/11/2007
    SWIS Ethical Ethically Balanced Life Global Equity 31/10/2000
    Menhaden Capital Plc ORD 1P Unclassified Investment Trust Global Equity 30/07/2015
    Abundance Generation (Debentures) Environmentally Themed Other Not Set Unclassified 19/04/2012
    Aviva Alliance Trust Sustainable Future Corporate Bond Pn S2 Sustainability Themed Pension Europe >50% UK Fixed Interest 05/04/2001 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Alliance Trust Sustainable Future Corporate Bond" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).

    SRI Features

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    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    Impax Environmental Markets plc Environmentally Themed Investment Trust Global Equity 22/02/2002 More Info (click to view)

    SRI / Ethical Overview

    Impax Environmental Markets plc is a London listed investment trust pursuing a long-only global equity strategy investing in pure play - or "specialist" - environmental companies.  The trust has over 80% of the underlying revenue of the portfolio companies generated by sales of environmental products or services. It is also the first listed equity fund to demonstrate a net positive carbon impact.   

      

    SRI Policies (Primary strategy in bold)

    • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
    • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
    • Social policy Considers social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact).
    • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
    • Measures positive impacts The fund aims to have a positive effect on society and/or the environment. Fund managers of this kind actively aim to measure the impact of their investments in order to ensure they are having the desired effect.
    • Climate change / GHG policy Considers climate change related issues such as greenhouse gas/carbon emissions. Strategies vary but funds that consider climate issues typically require the careful management of climate related risks (and opportunities) if they are to select a company for investment.
    • Invests in clean energy/renewables This fund invests in companies in the clean technology/renewable energy related industries. Fund strategies vary. In practice some may invest a small percentage in this area whereas others may have significant exposure to this area. Check fund literature for details.

    SRI Features

    • Norms focus This fund uses international standards, conventions and 'norms' to help direct where the fund can and cannot invest (e.g. the UN Global Compact).
    • Positive selection bias The ethical focus of this fund is around the consideration of the positive/good or useful things companies do. The fund may also have negative avoidance criteria - but this may not be the main ethical strategy applied by the fund managers.
    • Sustainability themed This fund pays significant attention to sustainability issues either as its primary strategy or alongside other ethical criteria and approaches. This means that environmental and social challenges and opportunities are likely to influence stock selection decisions.
    • Favours cleaner, greener companies This fund is likely to invest in companies with strong environmental policies and practices. This may mean it invests in smaller companies offering market leading environmental services or products and/or larger companies that are working towards the improved management of their negative impacts.
    • Favours companies with strong social policies This fund invests in line with positive strategies that relate to 'people' issues - such as human rights, labour standards and equal opportunities. Such funds are likely to invest in companies that have market leading standards with regard to employee and supplier practices.
    • Faith friendly These funds are likely to have attributes that some faith based investors may welcome such as opposition to armaments, gambling and alcohol.

    Corporate Activity

    • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
    • Specialist / Boutique fund manager This fund management company is a specialist, perhaps somewhat 'niche' or smaller company with a culture or purpose that reflects with the aims of sustainable, responsible and ethical options. Check fund information and fund manager supplied links for further information.

    SRI / Ethical Policy

    Impax Environmental Markets plc is solely focused on investing in Resource Efficiency and Environmental Markets. The trust applies a positive screening approach to companies operating within these diverse high growth markets.

    Resources, Affiliations & Corporate Strategies

    We are members of, or signatory to the following:

    • UN Principles for Responsible Investment (UNPRI)

    • Institutional Investors Group on Climate Change (IIGCC)

    • Investor Network on Climate Risk (INCR)

    • Carbon Disclosure Project (CDP)

    • UK Sustainable Investment and Finance Association (UKSIF)

    • USSIF

    • UK Stewardship Code

    • Global Impact Investing Network (GIIN)

      Impax Asset Management has also been awarded a Queen’s Award for Enterprise: Sustainable Development, the UK’s highest business accolade for business success.

    EdenTree Amity Sterling Bond A Ethically Balanced OEIC/Unit Trust UK Fixed Interest 04/03/2008 More Info (click to view)

    SRI / Ethical Overview

    The Fund aims to provide an attractive level of income. The Fund seeks to invest in a highly diversified portfolio of Government and good quality fixed interest securities issued by companies which make a positive contribution to society and the environment through sustainable and socially responsible practices. These Funds seek to avoid investment in certain areas such as companies which have a material involvement in alcohol, tobacco and weapon production, gambling and publication of violent or explicit materials.

    SRI / themed / ethical assets under management – overview

    • Fund Size (GBP):   £101.41m as at 31/05/2017
    • Total value of SRI/ethical/environmental/ social/ environmental or sustainability themed funds under management:   £550m as at 31 December 2016
    • Total value of assets covered by responsible ownership policy:   100%
    • Total assets under management:   £2.5bn as at 31/05/2017

     

    SRI Policies (Primary strategy in bold)

    • Environmental policy Has a policy which states that the fund considers environmental issues (e.g. pollution, climate change, resource management, environmental impact)
    • Health & wellbeing policies Has a policy that sets out the fund's aim to support companies that offer positive lifestyle, health or 'wellbeing' related benefits.
    • Limits exposure to carbon intensive industries Aims to reduce or limit exposure to carbon intensive industries which are considered to be major contributors to climate change. Funds vary - but this is likely to mean a fund has below average levels of investment in areas such as oil & gas, mining or airlines. 'Best in sector' companies may, however, be allowable.
    • Measures positive impacts The fund aims to have a positive effect on society and/or the environment. Fund managers of this kind actively aim to measure the impact of their investments in order to ensure they are having the desired effect.
    • Sustainability policy Considers issues relating to the sustainability agenda (e.g. resource usage, environmental impact and/or social issues such as equal opportunities, human rights and adherence to recognised codes).
    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.
    • Social policy Considers social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact).
    • Governance policy Considers issues relating to corporate governance such as board structure, remuneration, bribery and/or corporate corruption.
    • Animal welfare policy The fund has a policy that requires specific animal welfare standards to be adopted by companies in order for them to be allowable for investment within the fund.
    • Nuclear policy Has a published policy that sets out the fund's position with regard to nuclear power. In most cases this is likely to mean avoidance of companies with significant involvement in the nuclear industry, although some funds may require absolute avoidance.
    • Animal testing policy The fund has criteria that guide when it can or can not invest in companies that are involved in testing their products on animals. This may mean the fund avoids pharmaceutical companies even where testing is required by law (for safety reasons).
    • Tobacco production avoided Does not invest in manufacturers or tobacco (or related) products. The fund, however, may invest in retailers of such products (e.g. supermarkets or hotels.)
    • Armaments manufacturers avoided Avoids companies that manufacture products intended specifically for military use. (Funds may, however, invest in manufacturers of products that are used by the military but are not specifically intended for military/defence use.)
    • Coal, oil &/or gas majors excluded This fund will not invest in the largest coal, oil and/or gas producing companies. Funds vary. Some may invest in smaller producers or companies where this is considered to be a relatively minor part of their business.
    • Climate change / GHG policy Considers climate change related issues such as greenhouse gas/carbon emissions. Strategies vary but funds that consider climate issues typically require the careful management of climate related risks (and opportunities) if they are to select a company for investment.
    • Invests in clean energy/renewables This fund invests in companies in the clean technology/renewable energy related industries. Fund strategies vary. In practice some may invest a small percentage in this area whereas others may have significant exposure to this area. Check fund literature for details.
    • Alcohol production excluded (new) This fund avoids companies that are involved in the production of alcohol. See fund literature for further information.
    • Fracking and tar sands excluded (new) Fund avoids companies involved in fracking and tar sands - which are controversial oil and gas extraction practices
    • Gambling avoidance policy (new) This fund avoids companies with significant involvement in the gambling industry. See fund policy for details.
    • Pornography avoidance policy (new) This fund avoids companies that derive significant income from pornography. See fund details for further information.

    SRI Features

    • RSMR Rated Fund rating agency 'Rayner Spencer Mills Research' have awarded this fund 'rated' status.
    • Positive selection bias The ethical focus of this fund is around the consideration of the positive/good or useful things companies do. The fund may also have negative avoidance criteria - but this may not be the main ethical strategy applied by the fund managers.
    • Negative selection bias The ethical strategy of this fund relates primarily to avoidance criteria. In practice this means that positive company behaviours will not normally be allowed to override negative activities.
    • Eurosif transparency This fund has met the standards of the EUROSIF transparency Code. This means that they are a leading fund in terms of openness and transparency, publishing - for example - extensive information about where they invest and how they deal with companies.
    • Favours cleaner, greener companies This fund is likely to invest in companies with strong environmental policies and practices. This may mean it invests in smaller companies offering market leading environmental services or products and/or larger companies that are working towards the improved management of their negative impacts.
    • Favours companies with strong social policies This fund invests in line with positive strategies that relate to 'people' issues - such as human rights, labour standards and equal opportunities. Such funds are likely to invest in companies that have market leading standards with regard to employee and supplier practices.
    • Faith friendly These funds are likely to have attributes that some faith based investors may welcome such as opposition to armaments, gambling and alcohol.
    • 'Strictly' screened ethical fund The managers of this fund aim for it to be managed as having a high level of negative ethics led avoidance. They may refer to it as 'dark green' - meaning it excludes lots of companies, relative to other ethical options.
    • Aims to generate positive impacts (new) This fund aims to help deliver positive social or environmental impacts or outcomes. Strategies and approaches vary. Some funds measure outcomes others do not. See fund literature for further information.
    • Available via an ISA (new) This fund is available via a tax efficient ISA product wrapper
    • Over 50% small/mid cap (new) More than half of this funds assets are invested in smaller or medium sized companies.

    Corporate Activity

    • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
    • Responsible Ownership policy for non SRI funds This fund manager applies Responsible Ownership or 'Stewardship' policies to all or most of their investment assets. This means that active involvement (e.g. voting, dialogue) with the companies they invest in is not limited to ethical or SRI options.
    • Integrates ESG factors into all/most fund research This fund manager researches environmental, social and governance issues when deciding whether or not to invest in a company. This applies to all funds, not only those which are promoted as being 'ethical' or 'SRI themed'.
    • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
    • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
    • Responsible Ownership/ESG a key differentiator The fund managers have said they consider this area to be a key differentiator for their business
    • UK Stewardship Code signatory
    • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
    • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
    • Review(ing) carbon/fossil fuel exposure for all funds This company has reviewed or is currently reviewing (or in other ways 'actively managing') their exposure to carbon intensive industries including (but not only) mining, oil and gas companies. This work is being carried out in the light of climate change related concerns and the company's view of its anticipated impact on the companies they invest in.
    • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.
    • PRI signatory (new) This fund management company has signed up to the UN backed 'Principles of Responsible Investment' initiative.
    • Specialist / Boutique fund manager This fund management company is a specialist, perhaps somewhat 'niche' or smaller company with a culture or purpose that reflects with the aims of sustainable, responsible and ethical options. Check fund information and fund manager supplied links for further information.

    SRI / Ethical Policy

    Ethical Approach

     

    EIM is a pioneer of Socially Responsible Investment (SRI) and launched its first SRI investment fund in 1988. We utilise both negative and positive screening within the investment process. In respect of negative screening, we avoid companies whose activities derive in excess of 10% of their pre-tax profit or turnover from alcohol production, gambling, pornographic and violent material, tobacco production, strategic armaments, animal testing and intensive farming.

     

    We look for the positive aspects in potential investments to ensure we invest in companies that are making a positive contribution to society and the environment. These may cover good business and corporate governance practices and community relations. We also look for companies promoting good standards of education, environmental management and healthcare. We look favourably upon companies which promote human rights, good labour relations and urban regeneration. As well as our own in-house research (including special thematic reports) we use a range of sources, including independent data from Risk Metrics in respect of Environmental, Social and Governance (ESG) issues.

     

    EdenTree employs both negative and positive screening to its stock selection process and engages with companies before, during and after investing. This process is integrated into our overall investment management process and we use the following ‘screens’ when considering the suitability of an investment.

     

    Positive Screening

     

    Our positive screening approach centres on what we define as the ‘Nine Pillars’ of responsible investing.  We are particularly focused on areas that provide the necessities of life such as healthcare, water, education and housing, or products and services that are sourced ethically and produced sustainably. We also favour ‘solutions-focused’ companies that are leading the way in technologies that may help solve some of the world’s most challenging problems, such as climate change, alternative energy or water conservation. In addition, we focus on business behaviour, expecting the companies we invest in to have a well-managed policy for promoting human rights, environmental protection, labour rights and business ethics.

     

    Negative Screening

     

    Our negative screens include alcohol production, gambling operations, pornographic or violent material or weapon production. We also consider animal testing, oppressive regimes and intensive farming in our criteria when evaluating a company.

     

    Amity Panel Review

     

    The Amity Panel meet with the fund management and research team 3 or 4 times each year to review the Amity Fund portfolios, the recent investment decisions and to discuss the latest Socially Responsible research and trends. The purpose of the Amity Socially Responsible Investment Advisory Panel is to:-

     

    • Help to ensure that the EdenTree Amity Range of Funds meet the stated aims and objectives.

    • Provide advice in the formulation of policy in the light of changing social and environmental issues.

     

    The Amity Panel will provide advice to the SRI team in a number of ways

     

    • Advising on emerging issues or topics relevant to SRI criteria.

    • Provide advice and guidance on individual companies or sectors.

    • Provide advice and guidance on engagement work.

     

    The independent panel is made up of a number of industry experts, including:

     

    • The Right Reverend Dr Nigel Peyton – The Bishop of Brechin

    • William Oulton – Global Head of Responsible Investments, First State Investments

    • George Prescott – ex Ecclesiastical Deputy CEO and CFO, former ABI board member

    • Helen Crosby – Sustainability Expert.

    • Julie McDowell – Independent Consultant

     

    The SRI team is responsible for ESG research and advising Fund Managers. The team has access to a number of external resources for decision making. We have appointed Sustainalytics as our ESG data provider which serves as a starting point for our ESG research. This is complemented by NGO sources, company reports, market news and SRI initiatives. The SRI team also directly meets with companies to discuss sustainability and governance issues.

    Resources, Affiliations & Corporate Strategies

    There is an in-house team responsible for the execution of our SRI policy; they focus on research, engagement and proxy voting.

     

     All UK proxy voting decisions (includes Guernsey, Jersey and Isle of Man) are taken and executed in-house, signed off by a Fund Manager. We take IVIS (Institutional Voting Information Service) provided by the Investment Association to inform thinking. We have appointed Glass Lewis & Co. to be our sole discretionary research and proxy execution provider in all jurisdictions other than the United Kingdom (including Guernsey, Jersey and the Isle of Man), delegating to it the responsibility for the instruction and execution of international proxy voting at all general and special international company meetings.

     

    The team shares responsibility for company engagement, whether it is in house or in partnership with SRI organisations or other investors.

    Cler Med Evergreen Pn Ethically Balanced Pension Global Equity 01/03/1990
    SIP Kames Ethical Equity Pn S6 Negative Ethical Pension UK Equity 12/01/2009 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Kames Ethical Equity" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

    SRI Features

    -

    Corporate Activity

    -

    Links

    -

    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    BMO Global Asset Management (EMEA) Responsible Ownership Corporate Activity Not Set Unclassified 29/01/2016 More Info (click to view)

    SRI / Ethical Overview

    At BMO Global Asset Management (EMEA), we have been a leader in the development of responsible investment strategies for almost three decades. Responsible Investment is central to our corporate identity and integral to our global investment philosophy. We offer a range of screened funds – the Responsible Funds range - and advisory solutions for retail and institutional investors across the investment spectrum from corporate credit to public and private equity. Our track record in ESG dates back to 1984, when we launched the UK’s first ethical strategy, the F&C Responsible UK Equity Growth strategy (formerly stewardship Growth). Our range has since broadened to include a range of ethical and thematic strategies, as well as a comprehensive approach to engagement and voting. In 2000, we launched our flagship reo® service which continues to be a market-leading engagement overlay service. As at 31 December 2015, reocovered a total of £71 billion in assets under engagement for both internal and external assets.

    We have a range of policies in relation to our responsible investment activities which include:

    • Responsible Ownership Policy, giving an overview of our activities on integration, engagement and voting;
    • Corporate Governance Guidelines, which form the basis of our approach to voting as well as to engagement on governance issues. These guidelines are updated annually on the basis of international best practice and our own views. We believe in a transparent approach and publish all our voting decisions, as well as the rationale for these;
    • Responsible Investment Conflicts of Interest Policy, setting out how we identify and manage any potential conflicts relating to our activities in this area;
    • Statements of compliance against the UK Stewardship Code and transparency report for the UN Principles for Responsible Investment.


    We are actively engaged in efforts to improve regulation and policies related to ESG issues, both through our membership of collaborative organisations such as the UN PRI (United Nations Principle for Responsible Investment), International Corporate Governance Network (ICGN) and Asian Corporate Governance Association (ACGA) and through our own policy work.

    Engagement (underpinned by in-house and third party research), proxy voting and reporting have been an integral part of our reo® service since its launch in 2000.

    SRI Policies (Primary strategy in bold)

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    SRI Features

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    Corporate Activity

    • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
    • Responsible Ownership policy for non SRI funds This fund manager applies Responsible Ownership or 'Stewardship' policies to all or most of their investment assets. This means that active involvement (e.g. voting, dialogue) with the companies they invest in is not limited to ethical or SRI options.
    • Integrates ESG factors into all/most fund research This fund manager researches environmental, social and governance issues when deciding whether or not to invest in a company. This applies to all funds, not only those which are promoted as being 'ethical' or 'SRI themed'.
    • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
    • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
    • Responsible Ownership/ESG a key differentiator The fund managers have said they consider this area to be a key differentiator for their business
    • UK Stewardship Code signatory
    • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
    • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
    • Review(ing) carbon/fossil fuel exposure for all funds This company has reviewed or is currently reviewing (or in other ways 'actively managing') their exposure to carbon intensive industries including (but not only) mining, oil and gas companies. This work is being carried out in the light of climate change related concerns and the company's view of its anticipated impact on the companies they invest in.
    • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.

    SRI / Ethical Policy

    We have long believed that ESG factors can influence company performance and that consideration of ESG factors in the investment process can reduce investment risk and underpin long-term returns. We believe this is an important consideration that has relevance across asset classes and investment styles. ESG integration involves consideration of factors such as environmental performance, human rights, business ethics and corporate governance as a part of the investment decision-making process; we believe it should be a standard part of analysing the true long-term value of a business.

    BMO Global Asset Management was a founder signatory to the UN PRI and has been committed since the launch of UN PRI in 2006. We receive annual feedback from the UN PRI on how we implement the six voluntary principles. In the last publishable scoring provided in 2011, we ranked top quartile on all six principles compared to our investment management peers.

    For further information on BMO Global Asset Management’s capabilities in this area, a comprehensive range of related literature is available for download at the following address: http://www.bmogam.com/uk/institutional/products/responsible-investment/.

    BMO Global Asset Management (EMEA) has a robust and well-established process in selecting companies and issues to engage with. We engage: proactively – by identifying through analysis weaknesses in companies; reactively – as incidents and events take place; and thematically – by identifying issues that are relevant across sectors or regions.

    We measure our engagement success through “milestones,” which are positive engagement outcomes with companies. A milestone is an improvement in company ESG policy, management systems or practices, directly as a result of BMO Global Asset Management (EMEA) engagement.

    As mentioned in Question 2 in relation to our voting activity, BMO Global Asset Management (EMEA) offers a unique combination of specialist knowledge in the area of corporate governance and significant investment expertise. This gives us a deep understanding of the potential impact of corporate governance issues and matters arising from the Annual General Meeting (AGM)/Extraordinary General Meeting (EGM) business on company performance. Our GSI team approaches proxy voting analysis through an investment lens, with our voting decisions and our corporate governance guidelines and proxy voting policies informed by our experience of investing in and engaging with companies globally. We report to clients on our voting and engagement activities on a regular basis and publish our voting decisions immediately after company AGMs.

    It is hard to identify a single pattern in our engagement outcomes, but some of the areas where we believe we have been particularly successful are:

    • Engagement with companies in historically under-engaged markets, where we have local language and knowledge. Although building relationships takes time we find that once trust is there, significant change can be achieved. Our Japanese team member is currently seeing major governance improvements in that market (in part a result of a changed political environment, but also investor pressure). Our Chinese team member is encouraged by a marked improvement in the quality of dialogue Chinese companies are willing to have, but this remains a market where the timescales for change are slow.
    • Engagement on corporate governance issues, particularly in markets where remuneration votes are mandatory (e.g. UK, US). Increasingly, we find companies approaching us for advice or consultation well ahead of their AGM, particularly given our status as a large asset manager. This means we can achieve results before the issue even goes to a vote.
    • Engagement with extractives companies. We have highly experienced engagers specialising in the mining and oil and gas sectors. As well as relationships with the majors, they have also engaged with lesser-known companies in their sectors, using the knowledge gained from their larger peers. They have also been engaging extensively on the ‘stranded assets’ issue; by its nature, the results of this will only be seen over time.

    Resources, Affiliations & Corporate Strategies

    The GSI team is based in our Head Office in London and is outlined below:

    • Vicki Bakhshi, Head of GSI, Region Covered: Global, Themes/Sectors Covered: Climate Change, 15 years sustainability/investment experience, 9 years at firm
    • Claudia Wearmouth, Director, Region Covered: Global, Themes/Sectors Covered: Responsible Funds, 13 years sustainability/investment experience, 8 years at firm
    • Matthias Beer, Associate Director, Region Covered: Europe, Themes/Sectors Covered: Oil and Gas sector, 14 years sustainability/investment experience, 6 years at firm
    • Juan Salazar, Associate Director, Region Covered: Latin America, Themes/Sectors Covered: Mining Sector / Human Rights, 17 years sustainability/investment experience, 6 years at firm
    • Yo Takatsuki, Associate Director, Region Covered:  Asia, Themes/Sectors Covered: Pharmaceuticals, 12 years sustainability/investment experience, 4 years at firm
    • Kalina Lazarova, Associate Director, Region Covered: Europe, Themes/Sectors Covered: European / Governance, 12 years sustainability/investment experience, 1 year at firm
    • Manuel Isaza, Associate Director, Region Covered: US & Latin America, Themes/Sectors Covered: North American Governance / Banks, 13 years sustainability/investment experience, 1 year at firm
    • Liat Reback, Analyst, Region Covered: Global, Themes/Sectors Covered: Consumer Staples, 2 years sustainability/investment experience, 2 years at firm
    • Tenisha Elliott, Data & Systems Analyst, 6 years sustainability/investment experience, 3 years at firm
    • Olivia Baker, Data & Reporting Analyst, 4 years sustainability/investment experience, 2 years at firm


    Our in-house quantitative ESG Risk Tool, provides ESG related scores on more than 6,000 companies around the world. This includes input from external providers such as MSCI ESG. We focus on companies which represent the most material financial holdings in reo® clients’ portfolios. Our ESG Risk Tool captures ESG risks faced by a company as a result of its own policies and performance, as well as those faced more broadly as a result of sector and countries of operations.

    BMO Global Asset Management (EMEA) draws on a range of specialist ESG research sources to inform proxy voting and engagement activities. We are using Institutional Shareholder Services (ISS) for global proxy voting research and vote execution services. In addition, we are using Institutional Voting Information Service (IVIS) for supplementary advice on FTSE All-Share companies. Other relevant resources include: sell-side brokers (corporate governance and sustainability research), MSCI (ESG factors), Governance Metrics International (corporate governance risk ratings). We also consider research by broader stakeholders including NGOs such as Transparency International (anti-corruption), Oxfam and Human Rights Watch. Our research is also informed by our networks that may provide briefings and publications, including the UN PRI, International Corporate Governance Network (ICGN) and Asian Corporate Governance Association (ACGA). We may also draw on external consultants with expertise in particular areas, although presently we have no such arrangements underway. Our providers are reviewed on a regular basis to ensure we are getting the best possible quality of service and analysis.

    At BMO Global Asset Management (EMEA) we have always seen the importance of working with collaborative organizations and initiatives to achieve effective change. We are actively engaged in efforts to improve regulation and policies related to ESG issues, both through our membership of collaborative organisations such as the UN PRI, Investment Management Association (UK), Eumedion, Institutional Investors Group on Climate Change, International Corporate Governance Network, and through our own policy work.

    The initiatives and organisations that we are involved with to promote ESG best practice are:

    • UN Principles for Responsible Investment (UN PRI) including workstreams on Human Capital, Palm Oil and representation on the Clearinghouse Steering Committee (Signatory at launch in 2006)
    • Carbon Disclosure Project (CDP) and CDP Carbon Action (Signatory at launch in 2000)
    • Institutional Investors Group on Climate Change (IIGCC) 2001
    • Access to Nutrition Index 2013
    • Global Network Initiative (GNI)
    • Interfaith Centre on Corporate Responsibility (ICCR)
    • Eumedion
    • Ceres
    • International Corporate Governance Network (ICGN)
    • Asian Corporate Governance Association (ACGA)
    • Global Investor Governance Network (GIGN)
    • Investment Management Association (IMA)
    • 30% Club (on board diversity)
    • Council of Institutional Investors (CII)
    • Extractives Industry Transparency Initiative (EITI)
    • The UK Sustainable Investment & Finance Association (UKSIF)


    Examples of our work with various initiatives to promote responsible investment include our long term support of the UN Environment Programme Finance Initiative (UNEP FI), which our parent company, Bank of Montreal, is a member of. In 2009 we were a signatory to the 2009 Investor Statement on the Urgent Need for a Global Agreement on Climate Change, an initiative led by UNEP FI. We continue to collaborate with the initiative. An example of our work with UNEP FI is our recent endorsement of an investor statement encouraging the International Organization of Securities Commissions (IOSCO) to improve global corporate ESG disclosure. The Investor Initiative for Sustainable Exchanges (IISE), in which BMO Global Asset Management (EMEA) has participated actively for the past two years, collaborated with UN PRI and UNEP FI to launch this investor sign-on statement encouraging IOSCO to take specific steps to improve the state of global corporate ESG disclosure including: new rules assessing the current state of sustainability reporting and spearheading conversations with the regulatory community about setting global standards for ESG disclosure.

    FL Stewardship Income Ethically Balanced Life UK Equity Income 30/09/2003
    Aegon Ethical Lifestyle Pn ARC Negative Ethical Pension UK Equity 31/05/2016
    Standard Life Investments European Ethical Pn S4 Negative Ethical Pension Europe Ex-UK Equity 16/09/2013 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Standard Life Inv European Ethical Equity" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing. 

    SRI Policies (Primary strategy in bold)

    • Ethical policies Has a policy that states the fund considers 'ethical' issues (e.g.armaments, tobacco, gambling and/or pornography). These vary significantly. Check fund literature for details.

    SRI Features

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    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    Zurich Henderson Global Care Growth ZP Sustainability Themed Pension Global Equity 17/11/2003 More Info (click to view)

    SRI / Ethical Overview

    This pension product is linked to the "Henderson Global Care Growth" fund. More detailed information on its SRI / Ethical approach can be found under that fund in the "OEIC" Product listing.

    SRI Policies (Primary strategy in bold)

    • Social policy Considers social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact).

    SRI Features

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    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    Jupiter Responsible Ownership Corporate Activity Not Set Unclassified 01/03/2013 More Info (click to view)

    SRI / Ethical Overview

    Jupiter engage on all equity and mixed assets in all geographic regions.

    SRI Policies (Primary strategy in bold)

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    SRI Features

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    Corporate Activity

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    Links

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    SRI / Ethical Policy

    Resources, Affiliations & Corporate Strategies

    Aviva Alliance Trust UK Ethical Pn S2 Negative Ethical Pension UK Equity 09/05/1999
    Rathbone Active Income For Charities Negative Ethical OEIC/Unit Trust Global Mixed Asset 01/07/2012
    Aviva Jupiter Ecology S4 Environmentally Themed Life Global Equity 01/01/1970
    EdenTree Responsible Ownership Corporate Activity Not Set Unclassified 29/01/2016 More Info (click to view)

    SRI / Ethical Overview

    We are active members of the UK Sustainable Investment and Finance Association (UKSIF) and have developed key partnerships with other bodies in this field. These include the UK Stewardship Code, UNPRI and IIGCC. Through those different organisations we collaboratively engage with companies in all sectors on a large variety of ESG issues.

    EdenTree Investment Management (EIM) supports the principle of considered voting and will consequently endeavour to register and vote its proxies at all meetings in which it has a shareholding.

    Our responsible ownership strategies apply to equity and fixed interest assets in all geographic regions.

    SRI Policies (Primary strategy in bold)

    -

    SRI Features

    -

    Corporate Activity

    • ESG/SRI engagement Fund Manager actively encourages higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices amongst investee companies - when positive change is aligned with the best interest of investors. Focus will typically be on major holdings and highest risks/opportunities. This may apply to a single fund or a group of funds or other assets.
    • Responsible Ownership policy for non SRI funds This fund manager applies Responsible Ownership or 'Stewardship' policies to all or most of their investment assets. This means that active involvement (e.g. voting, dialogue) with the companies they invest in is not limited to ethical or SRI options.
    • Integrates ESG factors into all/most fund research This fund manager researches environmental, social and governance issues when deciding whether or not to invest in a company. This applies to all funds, not only those which are promoted as being 'ethical' or 'SRI themed'.
    • Vote all shares at AGMs/EGMs This fund manager always votes the shares they own at annual general meetings (and extraordinary general meetings). This is a key indicator of 'responsible share ownership' and companies taking an interest in the future of the companies they part own.
    • In house responsible ownership/voting expertise Fund managers have in-house expertise that enables them to have in-house voting guidelines, review their own shareholder voting decisions, for example.
    • Responsible Ownership/ESG a key differentiator The fund managers have said they consider this area to be a key differentiator for their business
    • UK Stewardship Code signatory
    • Publish Responsible Ownership/Stewardship report Fund manager publishes information that sets out their approach to responsible investment ownership - also known as 'Stewardship' following the introduction of 'the Stewardship Code'. This sets out their approach to voting, dialogue with company management and any related activity. This is publicly available.
    • Publish full voting record Fund manager publishes a full record of how they vote at AGMs and EGMs. This information is publicly available.
    • Review(ing) carbon/fossil fuel exposure for all funds This company has reviewed or is currently reviewing (or in other ways 'actively managing') their exposure to carbon intensive industries including (but not only) mining, oil and gas companies. This work is being carried out in the light of climate change related concerns and the company's view of its anticipated impact on the companies they invest in.
    • Regularly lead collaborative ESG initiatives This fund manager has told us they regularly initiate or help lead industry wide (collaborative) investor projects aimed at raising environmental, social and governance standards amongst investee companies.

    SRI / Ethical Policy

    Through our membership of UNPRI, IIGCC and additional partnerships we collaboratively engage with companies on various issues. Those include climate change, sustainable agricultural practices, labour conditions in the supply chain and more specialised issues including fracking, Arctic drilling and modern slavery. We also lead engagement initiatives on our own when we believe this adds value, those include controversial weapons, sustainable sourcing practices or stem cell research. Our engagement initiatives also complement our voting policies such as recent work on gender diversity at Board level.

    Resources, Affiliations & Corporate Strategies

    We have a SRI team of three people responsible for the execution of our SRI policy; they focus on research, engagement and proxy voting. 

    All UK proxy voti