ESG Investing

We know that responsible investing is an ever-increasing subject: clients are asking more of us, and we are asking more of the companies we invest in. We believe that companies that have stronger environmental, social and governance (ESG) credentials will perform better over the longer term. But behind that simple statement is the reality that understanding a firm’s ESG credentials is not that easy. Assessing these is not a case of distilling a range of factors into a single number or rating: it is nuanced and, in our view, it has to be bespoke. Integrating ESG into our investment processes has been going on for years and we continue to invest in this as successful ESG analysis isn’t a task that will be ‘complete’ any time soon.

Our work in engaging with companies will also continue to develop. Yes, we want to understand the ESG risks in any investment, but we have a duty to our clients and society as a whole to engage with companies about what they are doing and how they are doing it.

We look for companies to act as responsible corporate citizens, working within the spirit and not just the letter of the laws and regulations that govern them. We believe that corporate success will only be sustained if a business’s long-run impact on society and the environment is considered. Management and boards should therefore understand and regularly review this aspect of their activities, disclosing such information publicly alongside plans for ongoing improvement.