Schroder BSC Social Impact Trust
SRI Style:
Social Style
SDR Labelling:
Sustainability Impact label
Product:
Investment Trust
Fund Region:
UK
Fund Asset Type:
Equity
Launch Date:
22/12/2020
Last Amended:
Jan 2024
Dialshifter (
):
Fund/Portfolio Size:
£90.30m
(as at: 31/12/2022)
Total Screened Themed SRI Assets:
£90.30m
Total Responsible Ownership Assets:
£825.00m
Total Assets Under Management:
£915.30m
ISIN:
GB00BF781319
Objectives:
The Company’s investment objective is to deliver measurable positive social impact as well as long term capital growth and income, through investing in a diversified portfolio of private market impact funds, co-investments alongside impact investors and direct investments in order to gain exposure to private market Social Impact Investments.
Sustainable, Responsible
&/or ESG Overview:
The Company invests in impact driven organisations benefiting vulnerable and disadvantaged people in areas of high need, including housing, health, social care, education & skills. All investments must demonstrate significant and measurable positive outcomes, as well as robust processes for managing impact and mitigating impact risks.
The Company’s strategy is based on first developing a deep understanding of the social issue and the sustainable enterprise solutions that can bring about change. It then designs and improves investment routes that can bring together the needs of enterprises and investors. In the process of building these investment routes, the Company actively engages with managers to understand and support the development of their impact approach. By taking an impact-driven approach the Company signals that impact matters to other investors. BSC believes sustainable solutions can more readily attract capital and ultimately grow to have the largest impact on people's lives.
Primary fund last amended:
Jan 2024
Information directly from fund manager.
Fund Filters
Sustainability - General
Aim to encourage higher sustainability standards through responsible ownership / stewardship / engagement / voting activity
Aim to invest (and manage assets) in ways that help to address all or some of the UN's Sustainable Development Goals (SDGs). See https://sdgs.un.org/goals).
Has a strategy on - and may focus investment on sustainability issues in the property sector - they may eg use GRESB / BREEAM scores to inform investment decisions.
Environmental - General
Options that limit or 'reduce' their exposure to carbon intensive industries (ie sectors which are major contributors to climate change). Strategies vary.
Climate Change & Energy
Avoid investment in major coal, oil and/or gas (extraction) companies. Strategies vary.
Has an energy efficiency theme - typically meaning that the manager is focused on investing in organisations that manage - or help others to manage - energy use more carefully and less wastefully - and so reduce greenhouse gas emissions.
Invest in renewable energy companies and / or companies where renewable energy is a significant part of their business. Strategies vary.
Excludes companies / assets with indirect involvement in fossil fuel exploration. This may relate to providers of finance and / or insurance and providers of other services.
Will only invest in companies that report greenhouse gas emissions in line with this international reporting framework. See https://www.fsb-tcfd.org/ https ://www.ifrs.org/sustainability/tcfd/
Social / Employment
Has a written diversity policy – where the manager will aim to select companies with a carefully considered, positive employment standards. This may cover a range of issues including gender, ethnicity, disability, beliefs and sexual orientation.
Ethical Values Led Exclusions
Companies are excluded if they are involved in any aspect of the production chain for tobacco products, including cigarettes, vaping, e-cigarettes, chewing tobacco and cigars.
Avoids companies that manufacture weapons intended specifically for military use. Strategies vary - may or may not include non-strategic military products.
Has a written civilian firearms exclusion policy - meaning that they will not invest in companies that make (or perhaps also sell) handguns made for non-military users.
Avoids companies that produce alcohol. Strategies vary; some may allow a small proportion of revenue to come from this area.
Avoids companies with significant involvement in the gambling industry. Some may allow a small proportion of revenues to come from this area.
Avoids companies that derive significant income from pornography and related areas. Strategies vary.
Human Rights
Has policies that exclude companies or other assets which operate in, or are owned by regimes which are not democratic, or where people may be oppressed. May use eg. Freedom House research. Strategies vary.
Has a policy which excludes assets with involvement in Modern Slavery
Meeting Peoples' Basic Needs
Invest in social housing property freeholds. Strategies vary.
Have investments in social housing or similar assets.
Invest in ‘social bonds’ which raise funds for the purpose of financing projects with positive social (people related) outcomes.
Governance & Management
Avoids investing in companies with poor governance practices.(e.g. board structure, management practices etc.) Views may however vary on what counts as 'poor' practices - and funds may not immediately divest as they may prefer to work to encourage higher standards.
Aim to encourage higher ESG standards through responsible ownership / stewardship / engagement /voting activity
Product / Service Governance
Find options that have an external committee that helps steer or advise managers on sustainability, ethical, stewardship or ESG policy or strategy related issues. These people may be paid for their time but are not employees of the fund manager.
Find fund / asset managers that factor in 'environmental, social and governance' issues as part of their investment decision making process. A focus on 'ESG' typically means a fund is carrying out additional research to help reduce ESG related risks. It does not necessarily mean a focus on sustainability. Strategies vary. See fund literature.
Asset Size
Invests in a combination of small, medium and larger (potentially multinational) companies / assets.
Targeted Positive Investments
Invests >25% of their capital in companies where a major part of their business is focused on helping to address environmental or social challenges.
Invests >50% of their capital in companies where a major part of their business is focused on helping to address environmental or social challenges.
Impact Methodologies
Has policies that aim to help or support the delivery of positive social or environmental impacts (or societal/real world outcomes) by investing in companies they regard as beneficial to people and / or the planet. Strategies vary.
Aims to measure the positive real world environmental and / or social benefits that are associated with their investment strategy. Investments that aim to deliver positive impacts and measure those impacts may be referred to as 'Impact' - although impact measurement is not restricted to Impact investments. Strategies vary.
Investments which are specifically marketed as ‘Impact investments' and work to deliver both financial performance and specific, measurable positive, real world social and/or environmental benefits. Strategies vary.
Specifically states that they aim to deliver positive social (i.e. people related) impacts and/or outcomes.
Invest in companies where a major part of their business is specifically aimed at helping to address social challenges. e.g. companies helping to address poverty.
Aims to deliver positive environmental and or social impacts (real world benefits) through its engagement with investee assets
Invests more than 50% of capital in assets which are regarded as being significantly focused on providing solutions to environmental or social challenges. Strategies vary.
How The Fund/Portfolio Works
Focuses on finding and investing in companies with positive / beneficial attributes. This strategy can be applied in addition to exclusion criteria and engagement/stewardship activity.
Has principle 'ethical approach' to avoid companies by using negative screening criteria. Strategies vary.
Invests in assets which can be 'mapped' (reviewed) their investment selection and management strategies to identify which of the UN Sustainable Development Goals (SDGs) the fund is helping to address.
Focuses on the careful management of environmental, social and governance (ESG) related risks - typically by avoiding or being underweight in companies seen as posing major risks in these areas (i.e. not necessarily by using themes, exclusions etc).
Publish explanations of their ethical, social and/or environmental policies online (i.e. investment decision making strategies/ buy/sell &/or asset management strategies).
Unscreened Assets & Cash
All assets - except cash - meet the sustainability criteria published in strategy documentation.
Intended Clients & Product Options
Designed to meet the needs of individual investors with an interest in sustainability issues.
Designed to meet the needs of individual investors with an interest in ‘Impact investment’ which help or support the delivery of positive social or environmental impacts (or societal/real world outcomes) by investing in companies regarded as beneficial to people and / or the planet. Strategies vary.
Labels & Accreditations
Find options that have chosen to adopt one of the Financial Conduct Authority (FCA) SDR labels. Please note: there are a range of reasons why potentially relevant options may not use an SDR label eg. adopting a label may be work in progress, the manager may not yet be allowed to do so because of the product type, a manager may feel they are insufficiently aligned to SDR requirements.
Fund Management Company Information
About The Business
Find fund / asset management companies (or subsidiaries) that specialise in - or focus entirely on - investing in assets that are helping to deliver positive environmental and / or social impacts.
Finds fund / asset management companies that have a published company wide stewardship, engagement and / or responsible ownership policy or strategy that covers all investments. Stewardship typically involves encouraging higher ESG standards through voting and dialogue.
Find fund / asset management companies that aim to align all their investments (across all funds) to help meet the aims of the UN Sustainable Development Goals.
Find fund / asset management companies that consider environmental, social and governance (ESG) issues when deciding whether or not to invest in a company for all / almost all of their funds and other assets. This is increasingly seen as part of sound risk management.
Finds organisations / fund managers that have an in-house (company wide) diversity improvement programme - meaning that they are working to ensure that within their own businesses they employ people from diverse backgrounds - often typically focused on ethnicity and/or sex.
Find fund / asset management companies that encourage the companies they invest in to have strong diversity, race, gender and other equality policies across all assets held, not simply screened or themed SRI/ESG funds. (ie Asset Management company wide).
Collaborations & Affiliations
Find fund / asset management companies that have signed up to the UN backed 'Principles of Responsible Investment'.
Find fund / asset management companies that have partnered with Fund EcoMarket - meaning that they are helping to improve access to information on sustainable and responsible investment by paying an annual fee to us which enables us to publish information for free. Partner funds are listed ahead of other funds and have their logos displayed.
Resources
Find fund / asset management companies that employ people to steer and support fund managers in voting shares at company AGM's and EGMs in ways that are consistent with encouraging higher ESG/sustainability standards.
Engagement Approach
Fund / asset manager has a responsible ownership / stewardship strategy which means they are working to encourage the shift to more sustainable business practices in ways that respect and are sensitive to social issues and the impact change has on people effected by the changes that are taking place. https://www.transitionpathwayinitiative.org/ https://transitiontaskforce.net/
Fund / asset management company has a stewardship strategy in place which involves working to raise diversity, equality and inclusion standards across investee assets
Company Wide Exclusions
Find fund / asset management companies that avoid investment in tobacco (manufacturing) companies across all their assets.
Find fund / asset management companies that avoid investment in fossil fuel companies (e.g. coal, oil and gas) across all of their funds. (and/ or other assets.)
Transparency
Find fund / asset management companies that publish information about their sustainable and responsible investment strategies on their company website.
Sustainable, Responsible &/or ESG Policy:
The Company’s core goal is to deliver positive impact for people alongside strong financial returns for investors. High quality assessment and management of environmental, social and governance (“ESG”) risks and impacts is fundamental to achieving this goal.
Big Society Capital’s Responsible Investment Policy details the approach the Company takes to assess and manage risk across its social impact investment portfolio. This Policy is integrated in the Company’s investment process from due diligence to portfolio management.
The Policy complements the Company’s dedicated impact assessment and management approach (focused on many aspects of Social and Environmental risk), Organisational Due Diligence approach and ongoing intermediary support via the Building Blocks Framework (covering aspects of Governance risks amongst others). The Policy is underpinned by nine core responsible business principles and can be found on the website here.
In addition to the core principles above, Big Society Capital considers material risks by sector drawing on external frameworks were appropriate. For example, Big Society Capital has been active in the development of the Sustainability Reporting Standard for Social Housing (esgsocialhousing.co.uk).
The Responsible Investment Policy applies to Big Society Capital’s conduct as a business and in its making and management of its investments.
Fund managers in the core portfolio that receive investment and the charities and social enterprises these Fund Managers in turn invest into are required to sign up to these or a similar set of principles and exclusion list.
Process:
ESG factors are incorporated into all stages of the Company’s investment process and decision-making. As part of the origination process, deal teams identify material ESG areas for the specific prospective investment.
These issues are presented, together with other areas for further exploration, to the Company’s Investment Committee for formal approval before further diligence is conducted. In the due diligence stage, deal teams draw on several sources of data, including bespoke proprietary tools, to form a view on whether any significant ESG risks are present. The findings of this analysis are presented alongside the overall investment recommendation to the Company’s Investment Committee for final approval. Where any significant risks are identified, this will include a proposed mitigation or monitoring plan.
Following the approval of an investment, the Company requires investees to adopt and adhere to Big Society Capital’s Responsible Business Principles or an equivalent standard, as well as ensure their own investees do so. Where formal legal agreement is not possible or practicable, the deal team is required to conduct a gap or equivalency analysis of the investee’s existing policies and processes to ensure they meet the Company’s required standard.
Guidance and training to the investment team is provided by the impact team to ensure consistent application and implementation of BSC’s ESG approach.
Big Society Capital takes a fundamental approach to investment analysis, including of impact and ESG. It draws on a range of information sources (both qualitative and quantitative) which are most appropriate for the investment under consideration, taking into account as is applicable the business model, industry, and issue area.
Big Society Capital does not use third party ESG data or rating providers as it does not believe these are well suited to its core investments as they are largely private markets with a focus on relatively smaller companies that these providers cover.
Big Society Capital will continue to review the appropriateness of external frameworks and emerging best practice on the use of ESG data.
Resources, Affiliations & Corporate Strategies:
Big Society Capital's Chief Investment Officer Jeremy Rogers is the sponsor of the ESG process with operational oversight by the Head of Impact and Head of Investment Management. Impact and ESG are fully integrated into the BSC investment process and across the investment team. Deal owners are responsible for analysing and managing the financial and impact outcomes & ESG risks for an investment. The Impact Team provides specific support to BSC's deal teams on complex investment and strategic reviews of areas or asset classes along impact and ESG lines. Big Society Capital hired an ESG and EDI Manager in 2022 to support deal teams in the implementation of this approach.
Listed below are the related affiliations and involvement with groups and frameworks that inform BSC’s impact management and ESG approach:
Impact Management Project Framework
Big Society Capital adopts the Impact Management Project framework as the emerging global standard for managing and articulating social impact. The Company aims to demonstrate measurable positive outcomes through transparent reporting, aligned with the UN Sustainable Development Goals and the Impact Management Project. Given Big Society Capital’s focus is on creating positive, intended impact for people, Big Society Capital has prioritised playing an active role in supporting and championing the Impact Management Project including as an Advisory Board member, as well as the Operating Principles for Impact Management (outlined further below).
Using the Impact Management Project’s ABC framework as a basis, the Company's investments are expected to be "high impact" on the basis that they are expected to sit within "Category C", "Contribute to Solutions".
The Company also assesses all investments, considering the five dimensions of impact set out by the Impact Management Project detailed as follows:
- What: Important positive outcomes, meaningful to those experiencing the issue and addressing at least one SDG. Typically demonstrated by the provision of essential services, including affordable housing, education and training, health, care and rehabilitation
- Who: Beneficiaries, who are underserved in relation to the respective outcome and/or vulnerable individuals. Typically demonstrated by focusing on more economically deprived areas and marginalised groups, for example women and children at risk of domestic abuse
- How much: Significant depth of impact, in making meaningful improvements for people, and/or high scale of impact, through reaching a large number of people. Typically demonstrated by provision of intensive and/or sustained long-term services, such as affordable housing (depth) or provision of energy efficiency and fuel poverty services to thousands of lower income households (scale)
- Contribution: Significant improvement or additional benefit as a result of investment and activities. Typically demonstrated by interventions that have a clearly defined capital need, which will enable delivery of high-impact solutions at improved scale, quality and cost
- Risks: Fund managers must assess and mitigate the risks that may prevent the intended outcomes occurring. Typically demonstrated by fund managers and enterprises with strong track records and networks, and robust impact management processes.
Operating Principles for Impact Management
Big Society Capital has been a signatory to the Operating Principles for Impact Management since March 2020. The nine Principles provide a framework that brings greater discipline and transparency around impact management practices to the impact investing market. Big Society Capital’s alignment with the Principles is documented and independently verified in its disclosure and verification statement[1].
UN Principles for Responsible Investment (PRI)
Big Society Capital is a signatory to the PRI. Key UN PRI principles applied by the Company include:
- Principle 1 – Big Society Capital has incorporated ESG issues into its investment analysis and decision making with bespoke tools to test its Principles outlined in the Responsible Investment Policy.
- Principle 2 – It is an active investor and has integrated ESG into its engagement approach to support improved outcomes from its fund managers.
- Principle 3 – It is seeking active disclosure on ESG issues for all listed direct and indirect investments for the Trust, and where ESG issues are material for those investments in its core mandate such as High Impact Housing.
Asset-class specific initiatives
Big Society Capital has been active in the development of the Sustainability Reporting Standard for Social Housing, which is applied to Company investments in the housing sector. The organisation also participates in asset class-wide initiatives, for example, the Equity Impact Project with respect to housing funds, as well as VentureESG and DiversityVC with respect to venture funds.
[1] https://bigsocietycapital.com/latest/aligning-our-impact-management-approach-impact-principles/
Literature
| Fund Name | SRI Style | SDR Labelling | Product | Region | Asset Type | Launch Date | Last Amended |
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|---|---|---|---|---|---|---|---|---|
Schroder BSC Social Impact Trust |
Social Style | Sustainability Impact label | Investment Trust | UK | Equity | 22/12/2020 | Jan 2024 | |
ObjectivesThe Company’s investment objective is to deliver measurable positive social impact as well as long term capital growth and income, through investing in a diversified portfolio of private market impact funds, co-investments alongside impact investors and direct investments in order to gain exposure to private market Social Impact Investments.
|
Fund/Portfolio Size: £90.30m (as at: 31/12/2022) Total Screened Themed SRI Assets: £90.30m (as at: 31/12/2022) Total Responsible Ownership Assets: £825.00m (as at: 31/12/2022) Total Assets Under Management: £915.30m (as at: 31/12/2022) ISIN: GB00BF781319 Contact Us: Arvin.Bains@Schroders.com / Meriel.Turner@schroders.com |
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Sustainable, Responsible &/or ESG OverviewThe Company invests in impact driven organisations benefiting vulnerable and disadvantaged people in areas of high need, including housing, health, social care, education & skills. All investments must demonstrate significant and measurable positive outcomes, as well as robust processes for managing impact and mitigating impact risks. The Company’s strategy is based on first developing a deep understanding of the social issue and the sustainable enterprise solutions that can bring about change. It then designs and improves investment routes that can bring together the needs of enterprises and investors. In the process of building these investment routes, the Company actively engages with managers to understand and support the development of their impact approach. By taking an impact-driven approach the Company signals that impact matters to other investors. BSC believes sustainable solutions can more readily attract capital and ultimately grow to have the largest impact on people's lives.
|
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Primary fund last amended: Jan 2024 |
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Information received directly from Fund Manager |
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Fund FiltersSustainability - General
Encourage more sustainable practices through stewardship
Aim to encourage higher sustainability standards through responsible ownership / stewardship / engagement / voting activity
UN Sustainable Development Goals (SDG) focus
Aim to invest (and manage assets) in ways that help to address all or some of the UN's Sustainable Development Goals (SDGs). See https://sdgs.un.org/goals).
Green / sustainable property strategy
Has a strategy on - and may focus investment on sustainability issues in the property sector - they may eg use GRESB / BREEAM scores to inform investment decisions. Environmental - General
Limits exposure to carbon intensive industries
Options that limit or 'reduce' their exposure to carbon intensive industries (ie sectors which are major contributors to climate change). Strategies vary. Climate Change & Energy
Coal, oil & / or gas majors excluded
Avoid investment in major coal, oil and/or gas (extraction) companies. Strategies vary.
Energy efficiency theme
Has an energy efficiency theme - typically meaning that the manager is focused on investing in organisations that manage - or help others to manage - energy use more carefully and less wastefully - and so reduce greenhouse gas emissions.
Invests in clean energy / renewables
Invest in renewable energy companies and / or companies where renewable energy is a significant part of their business. Strategies vary.
Fossil fuel exploration exclusion – indirect involvement
Excludes companies / assets with indirect involvement in fossil fuel exploration. This may relate to providers of finance and / or insurance and providers of other services.
TCFD / IFRS reporting requirement
Will only invest in companies that report greenhouse gas emissions in line with this international reporting framework. See https://www.fsb-tcfd.org/ https ://www.ifrs.org/sustainability/tcfd/ Social / Employment
Diversity, equality & inclusion Policy (product level)
Has a written diversity policy – where the manager will aim to select companies with a carefully considered, positive employment standards. This may cover a range of issues including gender, ethnicity, disability, beliefs and sexual orientation. Ethical Values Led Exclusions
Tobacco & related product manufacturers excluded
Companies are excluded if they are involved in any aspect of the production chain for tobacco products, including cigarettes, vaping, e-cigarettes, chewing tobacco and cigars.
Armaments manufacturers avoided
Avoids companies that manufacture weapons intended specifically for military use. Strategies vary - may or may not include non-strategic military products.
Civilian firearms production exclusion
Has a written civilian firearms exclusion policy - meaning that they will not invest in companies that make (or perhaps also sell) handguns made for non-military users.
Alcohol production excluded
Avoids companies that produce alcohol. Strategies vary; some may allow a small proportion of revenue to come from this area.
Gambling avoidance policy
Avoids companies with significant involvement in the gambling industry. Some may allow a small proportion of revenues to come from this area.
Pornography avoidance policy
Avoids companies that derive significant income from pornography and related areas. Strategies vary. Human Rights
Oppressive regimes (not free or democratic) exclusion policy
Has policies that exclude companies or other assets which operate in, or are owned by regimes which are not democratic, or where people may be oppressed. May use eg. Freedom House research. Strategies vary.
Modern slavery exclusion policy
Has a policy which excludes assets with involvement in Modern Slavery Meeting Peoples' Basic Needs
Invests in social property (freehold)
Invest in social housing property freeholds. Strategies vary.
Invests > 5% in social housing
Have investments in social housing or similar assets.
Invests > 5% in social bonds
Invest in ‘social bonds’ which raise funds for the purpose of financing projects with positive social (people related) outcomes. Governance & Management
Avoids companies with poor governance
Avoids investing in companies with poor governance practices.(e.g. board structure, management practices etc.) Views may however vary on what counts as 'poor' practices - and funds may not immediately divest as they may prefer to work to encourage higher standards.
Encourage higher ESG standards through stewardship activity
Aim to encourage higher ESG standards through responsible ownership / stewardship / engagement /voting activity Product / Service Governance
External oversight / advisory committee (fund / service)
Find options that have an external committee that helps steer or advise managers on sustainability, ethical, stewardship or ESG policy or strategy related issues. These people may be paid for their time but are not employees of the fund manager.
ESG integration strategy
Find fund / asset managers that factor in 'environmental, social and governance' issues as part of their investment decision making process. A focus on 'ESG' typically means a fund is carrying out additional research to help reduce ESG related risks. It does not necessarily mean a focus on sustainability. Strategies vary. See fund literature. Asset Size
Invests in small, mid & large cap companies / assets
Invests in a combination of small, medium and larger (potentially multinational) companies / assets. Targeted Positive Investments
Invests >25% in environmental / social solutions companies
Invests >25% of their capital in companies where a major part of their business is focused on helping to address environmental or social challenges.
Invests >50% of fund in environmental / social solutions companies
Invests >50% of their capital in companies where a major part of their business is focused on helping to address environmental or social challenges. Impact Methodologies
Aims to generate positive impacts (or 'outcomes')
Has policies that aim to help or support the delivery of positive social or environmental impacts (or societal/real world outcomes) by investing in companies they regard as beneficial to people and / or the planet. Strategies vary.
Measures positive impacts
Aims to measure the positive real world environmental and / or social benefits that are associated with their investment strategy. Investments that aim to deliver positive impacts and measure those impacts may be referred to as 'Impact' - although impact measurement is not restricted to Impact investments. Strategies vary.
Described as an ‘impact investment’
Investments which are specifically marketed as ‘Impact investments' and work to deliver both financial performance and specific, measurable positive, real world social and/or environmental benefits. Strategies vary.
Positive social impact theme
Specifically states that they aim to deliver positive social (i.e. people related) impacts and/or outcomes.
Invests in social solutions companies
Invest in companies where a major part of their business is specifically aimed at helping to address social challenges. e.g. companies helping to address poverty.
Aim to deliver positive impacts through engagement
Aims to deliver positive environmental and or social impacts (real world benefits) through its engagement with investee assets
Over 50% in assets providing environmental or social ‘solutions’
Invests more than 50% of capital in assets which are regarded as being significantly focused on providing solutions to environmental or social challenges. Strategies vary. How The Fund/Portfolio Works
Positive selection bias
Focuses on finding and investing in companies with positive / beneficial attributes. This strategy can be applied in addition to exclusion criteria and engagement/stewardship activity.
Negative selection bias
Has principle 'ethical approach' to avoid companies by using negative screening criteria. Strategies vary.
Assets mapped to SDGs
Invests in assets which can be 'mapped' (reviewed) their investment selection and management strategies to identify which of the UN Sustainable Development Goals (SDGs) the fund is helping to address.
ESG risk mitigation focus
Focuses on the careful management of environmental, social and governance (ESG) related risks - typically by avoiding or being underweight in companies seen as posing major risks in these areas (i.e. not necessarily by using themes, exclusions etc).
SRI / ESG / Ethical policies explained on website
Publish explanations of their ethical, social and/or environmental policies online (i.e. investment decision making strategies/ buy/sell &/or asset management strategies). Unscreened Assets & Cash
All assets (except cash) meet published sustainability criteria
All assets - except cash - meet the sustainability criteria published in strategy documentation. Intended Clients & Product Options
Intended for clients interested in sustainability
Designed to meet the needs of individual investors with an interest in sustainability issues.
Intended for clients who want to have a positive impact
Designed to meet the needs of individual investors with an interest in ‘Impact investment’ which help or support the delivery of positive social or environmental impacts (or societal/real world outcomes) by investing in companies regarded as beneficial to people and / or the planet. Strategies vary. Labels & Accreditations
SDR Labelled
Find options that have chosen to adopt one of the Financial Conduct Authority (FCA) SDR labels. Please note: there are a range of reasons why potentially relevant options may not use an SDR label eg. adopting a label may be work in progress, the manager may not yet be allowed to do so because of the product type, a manager may feel they are insufficiently aligned to SDR requirements. Fund Management Company InformationAbout The Business
Specialist positive impact fund management company
Find fund / asset management companies (or subsidiaries) that specialise in - or focus entirely on - investing in assets that are helping to deliver positive environmental and / or social impacts.
Responsible ownership / stewardship policy or strategy (AFM companywide)
Finds fund / asset management companies that have a published company wide stewardship, engagement and / or responsible ownership policy or strategy that covers all investments. Stewardship typically involves encouraging higher ESG standards through voting and dialogue.
SDG aligned aims / objectives (AFM companywide)
Find fund / asset management companies that aim to align all their investments (across all funds) to help meet the aims of the UN Sustainable Development Goals.
Integrates ESG factors into all / most research (AFM companywide)
Find fund / asset management companies that consider environmental, social and governance (ESG) issues when deciding whether or not to invest in a company for all / almost all of their funds and other assets. This is increasingly seen as part of sound risk management.
In-house diversity improvement programme (AFM companywide)
Finds organisations / fund managers that have an in-house (company wide) diversity improvement programme - meaning that they are working to ensure that within their own businesses they employ people from diverse backgrounds - often typically focused on ethnicity and/or sex.
Diversity, equality & inclusion engagement policy (AFM companywide)
Find fund / asset management companies that encourage the companies they invest in to have strong diversity, race, gender and other equality policies across all assets held, not simply screened or themed SRI/ESG funds. (ie Asset Management company wide). Collaborations & Affiliations
PRI signatory
Find fund / asset management companies that have signed up to the UN backed 'Principles of Responsible Investment'.
Fund EcoMarket partner
Find fund / asset management companies that have partnered with Fund EcoMarket - meaning that they are helping to improve access to information on sustainable and responsible investment by paying an annual fee to us which enables us to publish information for free. Partner funds are listed ahead of other funds and have their logos displayed. Resources
In-house responsible ownership / voting expertise
Find fund / asset management companies that employ people to steer and support fund managers in voting shares at company AGM's and EGMs in ways that are consistent with encouraging higher ESG/sustainability standards. Engagement Approach
Engaging to encourage a Just Transition
Fund / asset manager has a responsible ownership / stewardship strategy which means they are working to encourage the shift to more sustainable business practices in ways that respect and are sensitive to social issues and the impact change has on people effected by the changes that are taking place. https://www.transitionpathwayinitiative.org/ https://transitiontaskforce.net/
Engaging on diversity, equality & / or inclusion issues
Fund / asset management company has a stewardship strategy in place which involves working to raise diversity, equality and inclusion standards across investee assets Company Wide Exclusions
Tobacco avoidance policy (AFM companywide)
Find fund / asset management companies that avoid investment in tobacco (manufacturing) companies across all their assets.
Fossil fuel exclusion policy (AFM companywide)
Find fund / asset management companies that avoid investment in fossil fuel companies (e.g. coal, oil and gas) across all of their funds. (and/ or other assets.) Transparency
Full stewardship / responsible ownership policy information on company website
Find fund / asset management companies that publish information about their sustainable and responsible investment strategies on their company website. Sustainable, Responsible &/or ESG Policy:The Company’s core goal is to deliver positive impact for people alongside strong financial returns for investors. High quality assessment and management of environmental, social and governance (“ESG”) risks and impacts is fundamental to achieving this goal. Big Society Capital’s Responsible Investment Policy details the approach the Company takes to assess and manage risk across its social impact investment portfolio. This Policy is integrated in the Company’s investment process from due diligence to portfolio management. The Policy complements the Company’s dedicated impact assessment and management approach (focused on many aspects of Social and Environmental risk), Organisational Due Diligence approach and ongoing intermediary support via the Building Blocks Framework (covering aspects of Governance risks amongst others). The Policy is underpinned by nine core responsible business principles and can be found on the website here. In addition to the core principles above, Big Society Capital considers material risks by sector drawing on external frameworks were appropriate. For example, Big Society Capital has been active in the development of the Sustainability Reporting Standard for Social Housing (esgsocialhousing.co.uk). The Responsible Investment Policy applies to Big Society Capital’s conduct as a business and in its making and management of its investments. Fund managers in the core portfolio that receive investment and the charities and social enterprises these Fund Managers in turn invest into are required to sign up to these or a similar set of principles and exclusion list. Process:ESG factors are incorporated into all stages of the Company’s investment process and decision-making. As part of the origination process, deal teams identify material ESG areas for the specific prospective investment. These issues are presented, together with other areas for further exploration, to the Company’s Investment Committee for formal approval before further diligence is conducted. In the due diligence stage, deal teams draw on several sources of data, including bespoke proprietary tools, to form a view on whether any significant ESG risks are present. The findings of this analysis are presented alongside the overall investment recommendation to the Company’s Investment Committee for final approval. Where any significant risks are identified, this will include a proposed mitigation or monitoring plan. Following the approval of an investment, the Company requires investees to adopt and adhere to Big Society Capital’s Responsible Business Principles or an equivalent standard, as well as ensure their own investees do so. Where formal legal agreement is not possible or practicable, the deal team is required to conduct a gap or equivalency analysis of the investee’s existing policies and processes to ensure they meet the Company’s required standard. Guidance and training to the investment team is provided by the impact team to ensure consistent application and implementation of BSC’s ESG approach. Big Society Capital takes a fundamental approach to investment analysis, including of impact and ESG. It draws on a range of information sources (both qualitative and quantitative) which are most appropriate for the investment under consideration, taking into account as is applicable the business model, industry, and issue area. Big Society Capital does not use third party ESG data or rating providers as it does not believe these are well suited to its core investments as they are largely private markets with a focus on relatively smaller companies that these providers cover. Big Society Capital will continue to review the appropriateness of external frameworks and emerging best practice on the use of ESG data. Resources, Affiliations & Corporate Strategies:Big Society Capital's Chief Investment Officer Jeremy Rogers is the sponsor of the ESG process with operational oversight by the Head of Impact and Head of Investment Management. Impact and ESG are fully integrated into the BSC investment process and across the investment team. Deal owners are responsible for analysing and managing the financial and impact outcomes & ESG risks for an investment. The Impact Team provides specific support to BSC's deal teams on complex investment and strategic reviews of areas or asset classes along impact and ESG lines. Big Society Capital hired an ESG and EDI Manager in 2022 to support deal teams in the implementation of this approach. Listed below are the related affiliations and involvement with groups and frameworks that inform BSC’s impact management and ESG approach:
Impact Management Project Framework Big Society Capital adopts the Impact Management Project framework as the emerging global standard for managing and articulating social impact. The Company aims to demonstrate measurable positive outcomes through transparent reporting, aligned with the UN Sustainable Development Goals and the Impact Management Project. Given Big Society Capital’s focus is on creating positive, intended impact for people, Big Society Capital has prioritised playing an active role in supporting and championing the Impact Management Project including as an Advisory Board member, as well as the Operating Principles for Impact Management (outlined further below). Using the Impact Management Project’s ABC framework as a basis, the Company's investments are expected to be "high impact" on the basis that they are expected to sit within "Category C", "Contribute to Solutions". The Company also assesses all investments, considering the five dimensions of impact set out by the Impact Management Project detailed as follows:
Operating Principles for Impact Management Big Society Capital has been a signatory to the Operating Principles for Impact Management since March 2020. The nine Principles provide a framework that brings greater discipline and transparency around impact management practices to the impact investing market. Big Society Capital’s alignment with the Principles is documented and independently verified in its disclosure and verification statement[1].
UN Principles for Responsible Investment (PRI) Big Society Capital is a signatory to the PRI. Key UN PRI principles applied by the Company include:
Asset-class specific initiatives Big Society Capital has been active in the development of the Sustainability Reporting Standard for Social Housing, which is applied to Company investments in the housing sector. The organisation also participates in asset class-wide initiatives, for example, the Equity Impact Project with respect to housing funds, as well as VentureESG and DiversityVC with respect to venture funds. [1] https://bigsocietycapital.com/latest/aligning-our-impact-management-approach-impact-principles/ Literature |
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