How are the SRI portfolios helping to combat environmental issues?
Each of the funds in our SRI portfolios invest in companies that are contributing to positive environmental change, or exclude companies deemed to be causing environmental damage. Additionally, the fund managers of our SRI portfolio have strong records of actively engaging with the companies in which they invest, to push for action on climate change. Below are some examples of the funds we have in our SRI portfolios.
EdenTree is a pioneer in the field of SRI, with its roots dating back to 1887, and they launched some of the first socially responsible funds in the UK in the 1980s. Climate change is a key component of EdenTree’s responsible investment engagement strategy – across their entire product range, they assess companies based on their contribution to climate change; and the managers engage with businesses on a range of environmental issues such as decarbonisation and biodiversity. Under their SRI Transparency Code, EdenTree regularly publishes details of its research and engagement on its website.
In addition to their funds, EdenTree has demonstrated that they are truly committed to combating environmental issues at a much higher level. They’re a member of the Institutional Investors Group on Climate Change (or IIGCC for short), whose mission is to drive significant and real progress towards a net zero and resilient future by 2030. EdenTree is also a signatory of the COP21 Paris Pledge, the central aim of which is to strength the global response to the threat of climate change.
WHEB was founded in the 1990s as an environmental corporate finance boutique by Rob Wylie and Kim Heyworth, hence its name: Wylie Heyworth Environmental Business. Today, WHEB is responsible for a single global equity strategy: FP WHEB Sustainability. The companies it invests in must be aligned with their sustainability investment themes, of which five are environmental: Resource Efficiency, Cleaner Energy, Environmental Services, Sustainable Transport, and Water Management.
WHEB is a Certified B corporation, where the B stands for benefit. This means that WHEB “meets the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose”.
Ninety One Global Environment Fund
In April 2022, we introduced the Ninety One Global Environment fund across our SRI portfolios. The fund focuses on investing in companies aligned with sustainable decarbonisation – for example, renewable energy (e.g. solar, wind), electrification (e.g. electric vehicles) and resource efficiency (e.g. waste management). The fund’s managers work closely with the CDP (formerly the Carbon Disclosure Project) so they have greater access to high-quality carbon emissions data. From this, the managers then engage with companies to improve their carbon footprint or, where data is not available, to improve their disclosures.
Each of the funds in our SRI portfolios must be aligned with one or more of the United Nations’ Sustainable Development Goals, such as ‘Climate Action’, ‘Clean Water & Sanitation’ and ‘Affordable and Clean Energy’; and they must demonstrate and can evidence that a socially responsible investment culture is intrinsic to their approach.