Fund Name | SRI Style | Product | Region | Asset Type | Launch Date | |
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L&G MSCI World Socially Responsible Investment (SRI) Index Fund | Ethical | OEIC/Unit Trust | UK | Passive Equity | 26/08/2005 | |
Fund Size: £418.90m Total screened & themed / SRI assets: £332200.00 Total Responsible Ownership assets: £1195690.00 Total assets under management: £1195690.00 As at: 31/12/22 Contact: fundsales@lgim.com |
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OverviewThe Benchmark Index, MSCI World SRI Index, is comprised of shares in developed markets. The Index provides exposure to companies with outstanding environmental, social and governance (ESG) ratings and excludes companies which have a negative social or environmental impact.
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FiltersFund informationSustainabilityEnvironmental policy Sustainability policy Sustainability theme or focus Environmental damage and pollution policy Waste management policy or theme UN Global Compact linked exclusion policy Favours cleaner, greener companies Sustainability focus Report against sustainability objectives Encourage more sustainable practices through stewardship Nature & BiodiversityDeforestation / palm oil policy Unsustainable / illegal deforestation exclusion policy Climate Change & EnergyNuclear exclusion policy Coal, oil & / or gas majors excluded Fossil fuel reserves exclusion Encourage transition to low carbon through stewardship activity Fossil fuel exploration exclusion - direct involvement Fossil fuel exploration exclusion – indirect involvement Human RightsHuman rights policy Child labour exclusion Oppressive regimes (not free or democratic) exclusion policy Social / EmploymentSocial policy Diversity, equality & inclusion Policy (fund level) Labour standards policy Favours companies with strong social policies Meeting Peoples' Basic NeedsWater / sanitation policy or theme Ethical Values Led ExclusionsEthical policies Animal welfare policy Animal testing exclusion policy Tobacco and related product manufacturers excluded Armaments manufacturers avoided Gambling avoidance policy Pornography avoidance policy Civilian firearms production exclusion Governance & ManagementGovernance policy Avoids companies with poor governance Encourage higher ESG standards through stewardship activity Asset Size & MetricsOver 50% large cap companies Invests in small, mid and large cap companies How The Fund WorksBalances company 'pros and cons' / best in sector Strictly screened ethical fund Limited / few ethical exclusions* Positive selection bias Negative selection bias Combines ESG strategy with other SRI criteria Passive / index driven strategy Focus on ESG risk mitigation SRI / ESG / Ethical policies explained on website Impact MethodologiesAims to generate positive impacts (or 'outcomes') Measures positive impacts Positive environmental impact theme Positive social impact theme Intended Clients & Product OptionsFaith friendly Intended for investors interested in sustainability Intended for clients who want to have a positive impact Available via an ISA (OEIC only) Fund management company informationAbout The BusinessESG / SRI engagement (AFM company wide) Responsible ownership / stewardship policy or strategy (AFM company wide) Responsible ownership policy for non SRI funds (AFM company wide) Responsible ownership / ESG a key differentiator (AFM company wide) Vote all* shares at AGMs / EGMs (AFM company wide) Diversity, equality & inclusion engagement policy (AFM company wide) Sustainable property strategy (AFM company wide) Integrates ESG factors into all / most fund research SDG aligned aims / objectives (AFM company wide) In-house diversity improvement programme (AFM company wide) Just Transition policy on website (AFM company wide) Invests in newly listed companies (AFM company wide) Invests in new sustainability linked bond issuances (AFM company wide) ResourcesIn-house responsible ownership / voting expertise Employ specialist ESG / SRI / sustainability researchers Use specialist ESG / SRI / sustainability research companies ESG specialists on all investment desks (AFM company wide) Collaborations & AffiliationsPRI signatory Climate Action 100+ or IIGCC member UN Net Zero Asset Owners / Managers Alliance member GFANZ member (AFM company wide) TNFD forum member (AFM company wide) Investment Association (IA) member AccreditationsPRI A+ rated (AFM company wide) Engagement ApproachRegularly lead collaborative ESG initiatives (AFM company wide) Encourage responsible corporate taxation (AFM company wide) Engaging on climate change issues Engaging with fossil fuel companies on climate change Engaging to reduce plastics pollution / waste Engaging to encourage responsible mining practices Engaging on biodiversity / nature issues Engaging to encourage a Just Transition Engaging on human rights issues Engaging on labour / employment issues Engaging on diversity, equality and / or inclusion issues Engaging on governance issues Engaging on responsible supply chain issues Company Wide ExclusionsReview(ing)carbon / fossil fuel exposure for all funds (AFM company wide) Coal exclusion policy (group wide coal mining exclusion policy) Coal divestment policy (AFM company wide) Controversial weapons avoidance policy (AFM company wide) Fossil fuel exclusion policy (AFM company wide) Climate & Net Zero TransitionEncourage carbon / greenhouse gas reduction (AFM company wide) Net Zero commitment (AFM company wide) Working towards a ‘Net Zero’ commitment (AFM company wide) Carbon transition plan published (AFM company wide) ‘Forward Looking Climate Metrics’ published / ITR (AFM company wide) Carbon offsetting – do NOT offset carbon as part of net zero plan (AFM company wide) In-house carbon / GHG reduction policy (AFM company wide) Publish 'CEO owned' Climate Risk policy (AFM company wide) Net Zero - have set a Net Zero target date (AFM company wide) Voting policy includes net zero targets (AFM company wide) Committed to SBTi / Science Based Targets Initiative TransparencyPublish full voting record (AFM company wide) Publish responsible ownership / stewardship report (AFM company wide) Full SRI policy information on company website Full SRI policy information available on request Paris Alignment plan publicly available (AFM company wide) Net Zero transition plan publicly available (AFM company wide) Sustainability transition plan publicly available (AFM company wide) |
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PolicyThe MSCI World SRI Index includes large and mid-cap stocks across 23 Developed Markets (DM) countries*. The index is a capitalization weighted index that provides exposure to companies with outstanding Environmental, Social and Governance (ESG) ratings and excludes companies whose products have negative social or environmental impacts. The Index is designed for investors seeking a diversified Socially Responsible Investment (SRI) benchmark comprised of companies with strong sustainability profiles while avoiding companies incompatible with values screens. Constituent selection is based on research provided by MSCI ESG Research.
* DM countries include: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the UK and the US.
MSCI SRI Indexes are constructed by applying a combination of values-based exclusions and a Best-in- Class selection process to companies in the regional indexes that make up MSCI World, an index consisting of developed countries. After securities of companies involved in Nuclear Power, Tobacco, Alcohol, Gambling, Military Weapons, Civilian Firearms, GMOs, Thermal Coal and Adult Entertainment are excluded, MSCI’s Best in Class selection process is applied to the remaining eligible securities in the selection universe. The MSCI SRI Indexes target sector and region weights consistent with those of the underlying indexes to limit the systematic risk introduced by the ESG selection process. The methodology aims to include the securities of companies with the highest ESG ratings making up 25% of the market capitalization in each sector and region of the parent indexes. Companies that are not existing constituents of the MSCI SRI Indexes must have an MSCI ESG Rating above BBB and the MSCI ESG Controversies score above 3 to be eligible. Current constituents of the MSCI SRI Indexes must have an MSCI ESG Rating above B and the MSCIESG Controversies score above 0 to be eligible. The selection universe for the MSCI SRI Indexes is the constituents of the MSCI Global Investable Market Indexes. The Index is float-adjusted market capitalization weighted. |
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ProcessAt an Extraordinary General Meeting of unitholders of the Ethical Trust held on 22 December 2020, the unitholders voted in favour of the proposal to change the benchmark of the fund to the MSCI World Socially Responsible Investment Index. These changes took effect from 28 January 2021. At this time, the fund’s name and valuation point also changed.
MSCI SRI Indexes Key Features: The MSCI SRI Indexes are designed for investors seeking a diversified index that integrates ESG considerations while also considering investment constraints:
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Resources, Affiliations & Corporate StrategiesAs of May 2023, there are a total of 88 LGIM employees with roles dedicated to ESG, some of which are outlined in more detail below.
Investment Stewardship team
Responsible Investing Strategy team
Climate Solutions team
Distribution
Real Assets
Product Development and Strategy
ESG Programme The LGIM ESG Programme has been running since 2020 and is aligned to LGIM purpose to create a better future through responsible investing. The ESG Programme has been deemed firm critical and necessary to transform the firm capabilities to meet client, industry and regulatory needs around responsible investing. Delivery in 2023 is focussed on strategically meeting mandatory regulatory obligations, and to further enhance and extend usage of ESG data sets and leverage central data mastering capabilities.
Roles substantially contributing to our responsible investing capabilities As of May 2023, we also have a further 70 colleagues across Investments whose roles have very substantial contribution to our responsible investing capabilities and whose objectives reflect this although their responsibilities are broader than solely ESG. Investments
Global Research and Engagement Groups Our Global Research and Engagement Groups (GREGs) bring together colleagues from across LGIM to identify the challenges and opportunities that will determine the resiliency of sectors and the companies within them. The output from the group strengthens and streamlines the firm’s engagement activities across investments and stewardship, to enable us to collectively set goals and targets at a company level with one voice, whilst supporting and guiding our investment decisions across the capital structure. As of May 2023, there are over 80 participants which includes members of our investment teams primarily along with representation from Investment Stewardship, who overlap on these groups.
Memberships and associations We are members of multiple industry-wide associations and networks which promote and encourage strong ESG practices and responsible investing standards. Our involvement with the organisations summarised below highlights how we promote collaborative engagement.
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LiteratureLGIM UK Disclaimer and important legal notice The information contained in this document (the ‘Information’) has been prepared by Legal & General Investment Management Limited, Legal and General Assurance (Pensions Management) Limited, LGIM Real Assets (Operator) Limited, Legal & General (Unit Trust Managers) Limited and/or their affiliates (‘Legal & General’, ‘we’ or ‘us’). Such Information is the property and/or confidential information of Legal & General and may not be disclosed by you to any other person without the prior written consent of Legal & General. No party shall have any right of action against Legal & General in relation to the accuracy or completeness of the Information, or any other written or oral information made available in connection with this publication. Any investment advice that we provide to you is based solely on the limited initial information which you have provided to us. No part of this or any other document or presentation provided by us shall be deemed to constitute ‘proper advice’ for the purposes of the Pensions Act 1995 (as amended). Any limited initial advice given relating to professional services will be further discussed and negotiated in order to agree formal investment guidelines which will form part of written contractual terms between the parties. Past performance is no guarantee of future results. The value of an investment and any income taken from it is not guaranteed and can go down as well as up, you may not get back the amount you originally invested. The Information has been produced for use by a professional investor and their advisors only. It should not be distributed without our permission. The risks associated with each fund or investment strategy are set out in this publication, the relevant prospectus or investment management agreement (as applicable) and these should be read and understood before making any investment decisions. A copy of the relevant documentation can be obtained from your Client Relationship Manager. Confidentiality and limitations Unless otherwise agreed by Legal & General in writing, the Information in this document (a) is for information purposes only and we are not soliciting any action based on it, and (b) is not a recommendation to buy or sell securities or pursue a particular investment strategy; and (c) is not investment, legal, regulatory or tax advice. Any trading or investment decisions taken by you should be based on your own analysis and judgment (and/or that of your professional advisors) and not in reliance on us or the Information. 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Without limiting the generality of the foregoing, Legal & General does not accept any liability for any indirect, special or consequential loss howsoever caused and on any theory or liability, whether in contract or tort (including negligence) or otherwise, even if Legal & General has been advised of the possibility of such loss. Third party data Where this document contains third party data ('Third Party Data’), we cannot guarantee the accuracy, completeness or reliability of such Third Party Data and accept no responsibility or liability whatsoever in respect of such Third Party Data. Publication, amendments and updates We are under no obligation to update or amend the Information or correct any errors in the Information following the date it was delivered to you. Legal & General reserves the right to update this document and/or the Information at any time and without notice. Although the Information contained in this document is believed to be correct as at the time of printing or publication, no assurance can be given to you that this document is complete or accurate in the light of information that may become available after its publication. The Information may not take into account any relevant events, facts or conditions that have occurred after the publication or printing of this document. Telephone recording As required under applicable laws Legal & General will record all telephone and electronic communications and conversations with you that result or may result in the undertaking of transactions in financial instruments on your behalf. Such records will be kept for a period of five years (or up to seven years upon request from the Financial Conduct Authority (or such successor from time to time)) and will be provided to you upon request. Legal & General Investment Management Limited. Registered in England and Wales No. 02091894. Registered Office: One Coleman Street, London, EC2R 5AA. Authorised and regulated by the Financial Conduct Authority, No. 119272. Legal and General Assurance (Pensions Management) Limited. Registered in England and Wales No. 01006112. Registered Office: One Coleman Street, London, EC2R 5AA. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, No. 202202. LGIM Real Assets (Operator) Limited. Registered in England and Wales, No. 05522016. Registered Office: One Coleman Street, London, EC2R 5AA. Authorised and regulated by the Financial Conduct Authority, No. 447041.Please note that while LGIM Real Assets (Operator) Limited is regulated by the Financial Conduct Authority, we may conduct certain activities that are unregulated. Legal & General (Unit Trust Managers) Limited. Registered in England and Wales No. 01009418. Registered Office: One Coleman Street, London, EC2R 5AA. Authorised and regulated by the Financial Conduct Authority, No. 119273. .
Notes re Filter Options
Vote all shares at AGMs/EGMs (AFM Company Wide) LGIM have voting policies in place for approximately 70 markets, and as a result, we vote 99% of the total value of our listed equity holdings. We aim not to abstain unless it is technically impossible not to.
Offer structured intermediary training on sustainable investment (AFM)/Offer unstructured intermediary training on sustainable investment (AFM) We take our role in the industry, our global influence and our position as a major global investor very seriously and continue to support and educate our clients and stakeholders on how we can tackle environmental and social challenges arising from a rapidly changing world. To improve awareness of sustainability externally, we have been working with our clients, along with engaging with policy makers, index providers, our peers and the wider industry through regular engagement, communications and training. For example, we issue regular educational materials and training sessions, including;
ESG specialists on all investment desks Given the changing landscape of ESG and responsible investments, LGIM continuously expands resources within this function. We therefore have many people across the business contributing to our ESG insights and research. They sit across various teams with different levels of responsibility relating to ESG but all feed into our responsible investing capabilities. As of August 2023, there are a total of 88 LGIM employees with roles dedicated to ESG. We also have a further 70 colleagues across Investments whose roles have very substantial contribution to our responsible investing capabilities and whose objectives reflect this although their responsibilities are broader than solely ESG.
Fossil fuel exclusion policy (AFM company wide) https://www.lgim.com/landg-assets/lgim/_document-library/capabilities/lgimh-coal-policy.pdf
Coal divestment policy (AFM company wide) https://www.lgim.com/landg-assets/lgim/_document-library/capabilities/lgimh-coal-policy.pdf https://www.lgim.com/uk/en/responsible-investing/climate-impact-pledge/
Last amended: 15/12/23 11:29 |
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05/05/2024