We trust that the integration of ESG factors within the organisation and investment strategy allow us to better handle risks and opportunities, and that sustainable business practices drive long-term value creation in much the same way as revenues or costs.
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See our Ethos and ESG Spotlight to find out more about what we do as a firm.
We understand that ESG issues have the potential to influence returns meaningfully over the short, medium and long term, and recognise the importance of a formalised approach towards evaluating and integrating them into our investment strategy. We have created a bespoke Traffic Light System consisting of industry specific Material Risk Factors. The system is integrated across the entire investment process – research, portfolio construction and risk management - with accessibility maximised by our proprietary application, ViA, which actively monitors and displays Velox ESG analysis and key ESG risks that a particular company is facing.
For each material key issue, we look at how exposed that company is to that risk factor and how its management are prepared to deal with the risk. Using both these factors we score the company against its peers on its overall key issue.
Developed by Velox and integrated, utilising BQUANT (Bloomberg's open API), into the investment process.
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ESG factors are fully integrated into our research notes - utilising the Traffic Light System and Material Risk Factors - allowing for a holistic view of the risks faced by the company.
We integrate ESG specific signals and thematic investments to identify alpha opportunities coming from the shift in focus towards sustainability.
We exclude long investments in all of our excluded industries as we deem them unethical. In certain industries, where we feel short interest can encourage better practices, we allow shorting.
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View our ESG Policy to see the full list.
By engaging in dialogue with companies on their business practices, we enhance our understanding of a company’s exposure to key ESG risks and opportunities, providing us with an additional layer of insight that feeds into our investment decision making. We also follow the SASB framework to direct companies to provide standardised, industry-specific, and materiality-based disclosures as we believe that in order to better evaluate ESG related risks and opportunities within our investment universe, more complete and reliable information is necessary. These efforts help us direct capital to influence more sustainable business practices.
Our Ethos, international initiatives, standards and guidelines are an important foundation for the integration of ESG principles through the organisation and investment process.
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The team supports international initiatives and guidelines to promote and support sustainable enterprises. In 2019 we adopted the UN’s Principles for Responsible Investments and formally fulfils the reporting requirements.
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Our ESG Spotlight exhibits relevant case studies or thematic pieces affecting the strategy. We also produce a semi-annual Sustainability Report, which is available on our ESG Spotlight page.