‘SRI Styles’ highlight key strategy features to help advisers navigate diverse sustainable, responsible and ethical investment options more easily

SRI Styles overview:

• ‘SRI Styles’ are our own ‘in house’ fund and product classification system. They are relatively high level, and represent our opinion of a strategy.
• SRI Styles group broadly similar policies and strategies together in order to make core sustainable and ethical characteristics easier to recognise.
• SRI Styles are based on the environmental, social and or governance issue(s) a fund or other product considers – and the approach(es) the product applies to those issues (eg avoids tobacco companies, invests in sustainability solutions companies).
• SRI Styles highlight the degree of strategy variation in this area – and why financial services professionals should not view a product as simply ‘sustainable’ or ‘not sustainable’.  Like client needs and preferences – product strategies vary significantly.
• SRI Styles are based on publicly available information.
• SRI Styles are intended to help people to ‘get started’ on their discovery journey.  They do not replace specific policy and strategy information published by fund managers on our site or elsewhere.
• Users should be aware that there are areas of similarity (cross over) between the SRI Styles, and strategy variations within each SRI Style. We therefore recommend, in most instances, that users consider multiple SRI Styles.
• SRI Styles should be used alongside, not instead of, additional filter options on Fund EcoMarket – particularly when working with clients who have stated specific needs.  The additional filters are more specific, and sourced directly from fund managers.

Not to be confused with regulatory regimes:

• SRI Styles should not be confused with the regulatory regimes such as the FCA’s sustainable fund (SDR) labels that became available for use by UK funds (only) in July 2024. 
• SDR labelled funds are required to meet certain regulatory requirement as described in the FCA’s Sustainability Disclosure Requirements (PS23/16).   (We explore these rules here.)     
• SRI Styles are our opinion of a strategy – based on information published by the fund or portfolio manager.
• See our SDR Support page for further information.

 ‘SRI Styles’ directory

Funds, products and services that have a significant focus on a specific issue, group of issues or themes – often complimented with screening policies, ESG risk analysis and stewardship activity:

• Sustainable Style options focus significantly on (environmental and social) sustainability issues, opportunities and themes when selecting investments. These funds tend to have forward looking policies, favouring companies and other assets that show ‘sustainability leadership’, are ‘solutions companies’ , or are helping to facilitate the ‘transition’ to more sustainable lifestyles. They may also have ‘ethical’ exclusion criteria and encourage positive change through stewardship activity. Strategies vary – see product information.
• Environmental Style options significantly integrate environmental issues into investment strategies. Their focus is often around longer term environmental and resource related issues, risks and opportunities. Some funds are very broad, others focus on a single issue, industry or resource. They may have ‘ethical’ exclusion criteria and also encourage positive change through stewardship activity. Strategies vary – see product information.
• Social Style options focus on ‘people issues’, investing in assets that help to address social challenges such as employment, education, housing and other basic necessities of life. Strategies vary, some invest in an individual sector others invest more broadly. See product information.

Funds which focus on ‘ethical’ or ‘values based’ issues – normally by employing negative and/or positive screening criteria – typically alongside ESG considerations and engagement activity:

• Ethically Focused options focus on ‘values based’ issues, and are often largely exclusions led.  These strategies will also normally describe the environmental, social, governance and sustainability issues the manager focuses on. These options have published policies and criteria which say where the product will or will not invest. Strategies vary in depth and breadth. They may balance ‘pros and cons’ in some areas, subject to strategy criteria.  The most common exclusions are armaments and tobacco.  Negative screens often operate alongside positive criteria – depending on the issue  These strategies may be covered by responsible ownership (stewardship) policies also. Strategies vary – see product information.
• Faith Based options  invest in line with specific religious principles (e.g. Shariah Law), typically have exclusions based policies. Strategies vary – see product information.

Strategies that significantly integrate ‘issues’ – where the approach involves investing widely across most sectors, often with significant stewardship (engagement) activity:

• Sustainability Tilted options integrate (environmental and social) sustainability considerations into their investment processes, favouring – being ‘overweight’ in – companies the managers believe have higher standards and being ‘underweight’ (invested less in) companies with lower sustainability standards. This means they are likely to invest in most sectors – which may include assets some clients regard as controversial. Strategy may also state areas of exclusion – and avoid certain companies or asset types. They may also encourage positive change through stewardship activity – to a greater or lesser extent. Strategies vary – see product information.

• ESG Plus options have environmental, social and governance risk mitigation strategies, often alongside other strategies which demonstrate the fund is intended for clients with an interest in ESG issues. They may have responsible ownership strategies that encourage higher standards and/or exclusion criteria. These funds may hold assets some clients review as controversial. Strategies vary – see product information.

Limited or lighter strategies:

• Limited Tilt or Exclusions options that exclude or have underweight positions in certain areas of an index or allowable universe as a result of ethical or sustainable screens, or policies.  For example, reduced exposure to tobacco, controversial weapons, fossil fuel – particularly coal, and, or companies with high carbon footprints or low ESG scores.   May reference eg UN Global Compact. Strategies of this kind typically have a small (‘limited’) impact on asset selection, meaning the tracking error is likely to similar to ‘conventionally managed’ (ie not sustainable) peers.   Not likely to be suited to clients with deep sustainability or ethical concerns.  Strategies vary – see product information.

Responsible ownership /stewardship – corporate entries

• Responsible Ownership information on Fund EcoMarket refers to company wide ‘stewardship’ strategies – ie activity that applies across all product areas not just specific named funds, products or services.
• Responsible ownership characteristics and activities can be searched within the ‘Fund Management Company Information’ filter area.
• Strategies vary – see company information.

Other SRI Styles classifications you will see on our tool

Please note the following are not used by our  StyleFinder fact find tool – which is solely intended to support adviser’s conversations with clients.

• ‘Other’ is used to indicate options that have a policy or strategy that may be aligned to this area but does not fit within our SRI Styles methodology.  For example, may focus on pet care.
• ‘Unclassified’ options that we have considered typically because they promote sustainable or ethical characteristics – but where we are not sufficiently confident to offer a classification.
• ‘Pending’ indicates options awaiting classification.
• ‘Multiple Options’ are for products and services (typically portfolios) that offer a range of ethical or sustainability characteristics, or where bespoke solutions may be provided – meaning they can not be given a single classification.

 Strategies vary, often significantly.  Please see individual entries for specific policy information.

About Fund EcoMarket listings

Fund EcoMarket aims to list all regulated, retail, onshore funds (plus many related options) that have a significant emphasis on sustainability and ethical issues, and as such are designed for clients with an interest in these areas.

• A listing on this database tool does not represent any form of endorsement, recommendation on our part – or an indication of quality or appropriateness.
• We do not charge for listing options on the tool.  The site is paid for by our partners who’s funds are listed first, with logos displayed.
• Our focus is retail markets. We do not list more specialist options such as unlisted funds or individual equities or bonds.
• Fund EcoMarket is intended for use by financial services professionals.  Please contact an authorised financial adviser or wealth manager for investment and financial planning advice.
• Please contact us if you have found any omissions or would like to request we alter any of the information we publish.  We are happy to consider including additional options on request, if appropriate.

Sustainable and ethical investment strategy variations

One of the most important aspects of this area, is the need to recognise that both investment manager and clients’ aims and opinions vary.

The table below maps our SRI Styles to three common client ‘motivations’ for investing in this area, these are intended to help you get started:

Please be aware that some of the style names shown below have been updated.

This service is for information only.  Please speak with a qualified financial adviser for further information.

We are not regulated, do not offer advice and can not deal directly with individual investors.