FEM logo
Fund EcoMarket

the sustainable, responsible and ethical investment information hub

Style Name:  Limited Exclusions

Investment funds which exclude a relatively small number of companies as a result of their ESG strategy.

Brief description of Style

Funds with ‘Limited Exclusion’ strategies exclude a small number of companies as a result of their published ethical or ESG strategy.

They may for example, have one or two areas of ‘ethical’ exclusion, such as ‘Avoid tobacco companies’ or ‘Avoid companies involved in the manufacture of cluster munitions’.

Alternatively, they may exclude for example the worst 20% of companies (across all sectors) when assessed against a named ESG rating methodology. The aim of strategies of this kind is typically to reduce ESG (environmental, social and governance) related risks for investors.

These exclusions may be the fund’s core ‘ESG’ strategy – or the management company may be more focused on stewardship (engagement)  activity which requires them to have access to contraversial companies in order to encourage necessary and beneficial changes.

Impact on investment strategy

These exclusions tend to have a relatively minor impact on where a fund can invest – meaning that they may appear to be ‘unscreened’ funds.

Who is this Style most likely to appeal to?

This SRI Style is most likely to suit clients who want to avoid only the industry the fund excludes – or companies that are widely agreed to be ESG laggards.

This style may also appeal to people who want to encourage the transition to more sustainable practices but users should check the ‘Responsible Ownership’ fields on Fund EcoMarket to see if individual funds are active in this way as strategies vary.

 

 

 

 

Sign Up to our Newsletter

If you are a Financial Services Industry professional you can sign up for our newsletter

Click Here

Latest News

How global events are affecting impact and sustainable investments
April 28, 2022

A video recording of the 60 minute presentation M&G climate fund manager Randeep Somel, CFA and I gave earlier this week is now available on the M&G Wealth Platform (previously Ascentric). My main task was to introduce the impact investment fund spectrum – the similarities and differences between funds that focus on generating positive impacts as […]

Further thoughts on sustainable fund labelling
March 31, 2022

A similar version of the following text was first published in our March 2022 newsletter.   FCA Disclosures and labels (DLAG) – my involvement with the FCA, on their Disclosures and Labelling Advisory Group is proving both interesting and tough. We have had many meetings and the level of engagement has been impressive – but […]

Some thoughts on the Purpose, Positioning and Priorities of sustainable investment
March 18, 2022

A big thank you to our friends at Investment Life and Pensions Moneyfacts for publishing – and putting on the front cover – my latest piece on sustainable investment. You can download a pdf of the text here: 16-17 Purpose, Positioning and Priorities   The text – as submitted – is below. Sent to Investment […]