Carefully screening portfolios
Multi-asset investing, by definition, involves a wide range of assets, including equities, fixed income securities, and real estate investment trusts (REITs). The multi-asset team manages a broad range of portfolios using a variety of investment approaches, and our ability to integrate ESG considerations varies across our diverse client portfolios.
In situations where we use our active equity and credit funds, we undertake ESG integration and company engagement on material issues. But where we invest using passive funds, such as exchange traded funds, our ability and opportunity to integrate ESG can be limited.
As we draw on our proprietary research of the return potential for different asset classes, our experience with portfolio construction, and the expertise of our Global Sustainable Investment team, we can support clients with additional ESG requirements.
Firm-wide exclusions on cluster munitions apply across all our strategies where we have discretion. Together with an ESG specialist, we screen portfolios to identify companies that breach social safeguards such as those listed in the Ten Principles of the United Nations Global Compact and the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises on Responsible Business Conduct. Companies that have been flagged as being in breach of social safeguards will be further assessed, which might entail engagement to clarify areas of concern, before we divest as a last resort.
We always aim to invest in the best interests of our clients, so we are always transparent in our communications and discussions of how we integrate ESG considerations in our investment process.
As ESG regulations and disclosure requirements evolve, we are committed to exploring further opportunities with our Global Sustainable Investment team to further embed ESG considerations into our investment process.