Fund Name | SRI Style | Product | Region | Asset Type | Launch Date | |
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Sterling Henderson Global Sustainable Equity Life (Zurich) | Sustainability Select | Life | Global | Equity | 04/12/2000 | |
As at: 30/11/-1 |
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OverviewThis Life product is linked to the "Janus Henderson Global Sustainable Equity” fund. The following information refers to the primary (OIEC) fund.
The Global Sustainable Equities strategy (‘the strategy’) seeks to invest in businesses that are strategically aligned with the powerful environmental and social trends changing the shape of the global economy. These businesses should exhibit sustainable revenue growth by virtue of having products or services that enable positive environmental or social change, and thereby have an impact on the development of a sustainable global economy. It is a low carbon strategy. The investment team responsible for the strategy employs a fundamental bottom-up approach to stock selection with a style tilt towards growth and quality. The strategy has an integrated approach to Sustainable investing, combining positive and negative investment criteria as well as integrating ESG factors into the bottom-up, fundamental company analysis.
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FiltersFund informationSustainabilityEnvironmental policy Sustainability policy Limits exposure to carbon intensive industries Resource efficiency policy or theme Sustainable transport policy or theme Sustainability theme or focus Environmental damage and pollution policy Favours cleaner, greener companies Waste management policy or theme UN Global Compact linked exclusion policy Sustainability focus Report against sustainability objectives Encourage more sustainable practices through stewardship Transition focus Nature & BiodiversityDeforestation / palm oil policy Plastics policy / reviewing plastics Unsustainable / illegal deforestation exclusion policy Avoids genetically modified seeds/crop production Blue economy theme or focus Nature / biodiversity focus Sustainable fisheries policy Climate Change & EnergyNuclear exclusion policy Coal, oil & / or gas majors excluded Climate change / greenhouse gas emissions policy Invests in clean energy / renewables Fracking and tar sands excluded Clean / renewable energy theme or focus Arctic drilling exclusion Fossil fuel reserves exclusion Energy efficiency theme Require net zero action plan from all/most companies TCFD reporting requirement Encourage transition to low carbon through stewardship activity Supply chain decarbonisation policy Green / sustainable property strategy Fossil fuel exploration exclusion - direct involvement Fossil fuel exploration exclusion – indirect involvement Targeted Positive InvestmentsEU Sustainable Finance Taxonomy holdings 5-25% of fund assets EU Sustainable Finance Taxonomy holdings >25% of fund assets Invests >25% of fund in environmental/social solutions companies Invests >50% of fund in environmental/social solutions companies Human RightsHuman rights policy Child labour exclusion Responsible supply chain policy or theme Oppressive regimes (not free or democratic) exclusion policy Indigenous peoples’ policy Modern slavery exclusion policy LGBTQ+ policy Social / EmploymentSocial policy Health & wellbeing policies or theme Diversity, equality & inclusion Policy (fund level) Labour standards policy Fast fashion exclusion Favours companies with strong social policies Mining exclusion Vulnerable / gig workers protection policy Meeting Peoples' Basic NeedsWater / sanitation policy or theme Demographic / ageing population theme Healthcare / medical theme Ethical Values Led ExclusionsEthical policies Animal welfare policy Animal testing exclusion policy Tobacco and related product manufacturers excluded Armaments manufacturers avoided Alcohol production excluded Gambling avoidance policy Pornography avoidance policy Civilian firearms production exclusion Governance & ManagementGovernance policy Anti-bribery and corruption policy Avoids companies with poor governance Encourage board diversity e.g. gender Encourage TCFD alignment for banks & insurance companies UN sanctions exclusion Encourage higher ESG standards through stewardship activity Require investee companies to report climate risk in R&A Fund GovernanceESG integration strategy ESG factors included in Assessment of Value (AoV) report Employ external (fund) oversight or advisory committee External (fund) committee has veto powers Asset Size & MetricsInvests in small, mid and large cap companies How The Fund WorksPositive selection bias Combines norms based exclusions with other SRI criteria Combines ESG strategy with other SRI criteria Significant harm exclusion SRI / ESG / Ethical policies explained on website Assets mapped to SDGs All assets (except cash) meet published sustain'y criteria Impact MethodologiesAims to generate positive impacts (or 'outcomes') Positive environmental impact theme Positive social impact theme Invests in environmental solutions companies Invests in social solutions companies Invests in sustainability / ESG disruptors Aim to deliver positive impacts through engagement Over 50% in assets providing environmental or social ‘solutions’ Labels & AccreditationsRSMR rated (OEIC funds only) Intended Clients & Product OptionsIntended for investors interested in sustainability 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) Integrates ESG factors into all / most fund research In-house diversity improvement programme (AFM company wide) Invests in newly listed companies (AFM company wide) Offer structured intermediary training on sustainable investment Offer unstructured intermediary sustainable investment training ResourcesIn-house responsible ownership / voting expertise Employ specialist ESG / SRI / sustainability researchers Use specialist ESG / SRI / sustainability research companies Collaborations & AffiliationsPRI signatory UKSIF member Climate Action 100+ or IIGCC member Fund EcoMarket partner TNFD forum member (AFM company wide) Investment Association (IA) member AccreditationsUK Stewardship Code signatory (AFM company wide) Engagement ApproachEngaging 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 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) Controversial weapons avoidance policy (AFM company wide) Climate & Net Zero TransitionEncourage carbon / greenhouse gas reduction (AFM company wide) Carbon offsetting - offset carbon as part of our net zero plan (AFM company wide) In-house carbon / GHG reduction policy (AFM company wide) Committed to SBTi / Science Based Targets Initiative TransparencyPublish responsible ownership / stewardship report (AFM company wide) Full SRI policy information on company website Full SRI policy information available on request |
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PolicyThe Global Sustainable Equity Team (the ‘team’) aims to outperform the market over the long term through creating a differentiated global equity portfolio of the best sustainability ideas. The team’s investment approach is explicitly low carbon and by incorporating environmental, social, and governance factors into their analysis, they seek to construct a portfolio with a favourable risk profile. The team believes there is a strong link between sustainable development, innovation, and long-term compounding growth. Our investment framework seeks to invest in companies that have a positive impact on the environment and society. At the same time, it helps us stay on the right side of disruption by avoiding companies we consider to be involved in activities that are harmful to the environment or society. We believe that this approach will provide clients with a persistent return source, deliver future compound growth, and help mitigate downside risk. Key distinctions 30 years of sustainability thought leadership We have a long and successful track record in the consistent application of our sustainability framework – the strategy was launched in 1991 and Hamish Chamberlayne has been managing the strategy since January 2012. We have been thought leaders on sustainability issues since the inception of the strategy and were founding signatories of the UNPRI in 2006. Investing with positive impact Environmental and social considerations are integral to the investment philosophy and process, from universe definition and idea generation through to fundamental analysis, engagement, and portfolio management. A dedicated sustainability professional within the team enables deep integration of sustainability issues into investment process and enhances our ability to analyse issues from multiple angles. Deep investment resource The dedicated Global Sustainable Equity (GSE) portfolio management team works in collaboration with Janus Henderson’s global equity research platform and draws upon the deep knowledge and domain expertise of the sector and regional teams. Explicitly low carbon We consider six levels in our approach to low carbon investing. We believe this approach will be a significant source of alpha as the transition to the low carbon economy continues over the next decade and beyond. Hamish Chamberlayne has had training in climate change and has written a paper on the investment implications. The team have many years of experience in analysing, understanding, and managing both climate risk and transition risk within portfolios (the strategy has had this low carbon approach since inception in 1991). Continuous improvement We have a philosophy of continuous improvement that applies both to ourselves and the companies we invest in. We are always looking to enhance our understanding of evolving sustainability issues and how to incorporate them into our investment process. Our portfolio management is driven by this philosophy. Our alignment with sustainable development The guiding principle of our investment philosophy is: ‘Is the world a better place because of this company?’ and we always consider whether a company’s products contribute beneficially to the environment and society. Ten sustainable development investment themes help us identify long-term business opportunities. These have been informed by both the environmental and social megatrends that are pressuring the global economy, and by the UN’s 1987 Brundtland Report that defined sustainable development. Consequently, there is high alignment between our investment process and the UN Sustainable Development Goals (SDGs), and our portfolio contributes to all 17. Identifying companies that contribute towards the goals is inherent to our investment approach and we measure and report on this. We believe there are a myriad of investment opportunities arising from the migration towards a more sustainable global economy, and that the best investment returns will be generated by companies that are on the right side of these. Looking for these long-term compounding characteristics and staying focused on long-term value not short-term valuation metrics, can generate exciting investment returns. We also believe there are substantial risks to companies and shareholder returns that come from factors such as asset obsolescence, regulatory risk, weak corporate cultures, or damaged franchises that are on the wrong side of ESG. While these risks can appear small in the short term, they also compound over time and can dramatically hurt company fundamentals. |
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ProcessInvestment approach There are four pillars to our sustainable investment process which incorporates both positive and negative selection criteria and includes both product and operational impact analysis. It is through this rigorous and repeatable stock-selection process that we believe we add value to our clients.
Thematic framework The positive selection criteria lead the team to invest in businesses that have a positive impact on society and the environment by virtue of the products or services they sell, and by the way in which they manage their operations, thereby supporting the United Nations Sustainable Development Goals (SDGs) adopted in 2015. Idea generation Idea generation is derived from four ‘core’ megatrends that are pressuring the global economy: population growth, ageing populations, resource constrains, and climate change. The team believes that the defining investment issue of our time will be transitioning to a low-carbon and sustainable economy, while maintaining the levels of productivity necessary to deliver the goods and services that an ageing and growing population requires. Derived from these four megatrends, we identify ten environmental and social sustainable development themes. For a company to be eligible for our portfolio at least 50% of its revenues will be aligned with at least one of these sustainable development themes. Investing with positive impact is inherent in our approach and integral to all investment decisions. All investments must demonstrate positive impact and we measure and report on this. We do this by measuring the proportion of portfolio revenues that are aligned with each of our ten positive sustainable development themes, by mapping our portfolio holdings against the United Nations Social Development Goals (SDGs); by reporting our carbon footprint, and by measuring our portfolio against a set of ESG KPIs that are informed by the Global Impact Investing Network’s IRIS metrics. Do no harm, avoidance criteria The negative impact on global prosperity from the cost of economic externalities is becoming increasingly recognised. The team seeks to avoid businesses involved in activities contrary to the development of a sustainable economy, believing these types of business to be at a higher risk from government regulation or disruption. We believe our exclusions make sense ethically, socially, environmentally, and financially. We seek to avoid investing in businesses that have products or operations directly associated with: Fundamental and valuation analysis The third pillar of the investment approach is constructed around two key questions, ‘Is the world a better place because of this company?’ and ‘Is there a large growth opportunity?’. The team has a rigorous process the fundamental research process which is looking at both ESG factors and also financial factors in an integrated fashion. The team ultimately analyses every company on the basis of the ‘3 Ps’ of their ‘triple bottom line’ framework: how they generate Profits, how they impact People, and how they impact the Planet. The team seeks to identify businesses with long-term compounding characteristics, and with optionality upside, which are trading at discounts to their intrinsic value. Typically, the team looks for companies with the ability to generate and compound long-term free cash flows, where the equity market is currently under-valuing those. There is a specific focus to the financial analysis that the team does to identify intrinsic value. The team looks for:
The team also believes there are substantial risks to companies and shareholder returns from factors such as asset obsolescence, regulatory risk, the loss of key talent arising from weak corporate culture, or the loss of customers given the perception that a company operates on the wrong side of ESG. While these risks can appear small in the short term, they also compound over time and can dramatically hurt company fundamentals. We believe that the equity market often fails to see both the long-term value being created by some companies and under-appreciates the long-term risks to others. We consider all of these factors as we think about a business’ fair value and stay focused on the potential for long-term value creation rather than on shorter-term valuation metrics. Active portfolio construction and risk management Every stock selected for the portfolio must fit at least one theme; but for the purposes of portfolio construction, there is no forced distribution of themes. Portfolio construction is driven by stock selection, with each stock assessed within the disciplined analytical framework. The portfolio is constructed with the aim of generating attractive excess returns, but with a good level of overall risk diversification. The intention is to construct a high-conviction portfolio with high active share against the benchmark. There are some key principles to this. Portfolio construction is driven by stock selection, with each stock being assessed within the disciplined analytical framework. There are 3 levels of position size:
The portfolio will be regionally balanced to avoid unintended country and currency risk. Emerging market investments will be limited to a maximum of 3% of the portfolio. The portfolio will comprise 50 to 70 equity investments. Every investment is selected on its own fundamental stock attributes but must contribute to overall portfolio fit and risk diversification. The team believes that a high-conviction portfolio of stocks that align with the investment philosophy, which looks very different to the benchmark, but is managed with this high awareness of geographic, thematic and liquidity risk, can generate attractive risk-aware returns for our clients. Sell discipline Sales will be executed when the long-term investment thesis is impaired, or when corporate responsibility issues emerge and there is no possible resolution from engagement with the company. Additionally, a position will be sold if new information identifies a breach of the strategy’s avoidance criteria. Engagement and reporting Company engagement forms an important part of the investment process. We take an active approach to communicating our views to companies and seeking improvements in performance. We participate in various forms of engagement:
On a quarterly basis we publish our ‘Positive Impact Report’ and our ‘Voting & Engagement Report’. The Positive Impact Report details how the portfolio holdings are having positive environmental or social impact. The Voting & Engagement Report details our corporate engagement and proxy voting activity. On an annual basis we publish our ‘Annual Sustainability Report’ and our ‘Investment Principles Report’. The Annual Sustainability Report details our portfolio impact measurement. We review the UN SDGs and our positive impact for each SDG. This report also discloses our portfolio Carbon Footprint, measuring scope 1, 2, and 3 emissions. The Investment Principles Report details our investment philosophy, our definition of sustainability, and an in-depth description of our positive impact themes and avoidance criteria.
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Resources, Affiliations & Corporate StrategiesHamish Chamberlayne co-manages the strategy with Aaron Scully, CFA, and is supported by dedicated sustainability analysts Amarachi Seery, CEnv, MIEnvSci, MIEMA*; and portfolio analyst Jigar Pipalia. The team is based between London (Hamish, Amarachi, and Jigar) and Denver (Aaron). Hamish and Aaron have dual analyst and portfolio management responsibilities, and each has an inter-disciplinary skillset comprising both financial and sustainability analysis. Hamish has been managing the strategy since January 2012, after joining the firm in 2011. Aaron Scully joined the team as an assistant portfolio manager in August 2017 and was promoted to co-portfolio manager in May 2019. Amarachi joined in June 2018 as a dedicated sustainability analyst. This is a collegiate team, with a strong set of shared values and thoroughly enjoy working together. They are dedicated to the management of the strategy. *CEnv is the Chartered Environmentalist designation. MIEnvSci is full membership of the Institution of Environmental Sciences. MIEMA is full membership of the Institute of Environmental Management & Assessment. The team has a close working relationship with the firm’s ESG Investment Team, specifically in relation to the analysis of material ESG issues and company engagement. The ESG Investment Team is an in-house specialised group focused on ESG data analysis and research, governance, ESG company and thematic engagement, proxy voting, and advisory services that serves as a resource for all our investment desks. The team’s mission is to promote ESG integration across the business. They play a leading role internally in working with investment desks to enhance their ESG integration processes and externally leading our active participation in numerous ESG initiatives. Additionally, the dedicated GSE portfolio management team works closely with the wider Janus Henderson Central Research Team. These analysts provide idea generation, sector domain expertise and deep analytical due diligence on companies and sectors. Our alignment with sustainable development The guiding principle of our investment philosophy is: ‘Is the world a better place because of this company?’ and we always consider whether a company’s products contribute beneficially to the environment and society. Ten sustainable development investment themes help us identify long-term business opportunities. These have been informed by both the environmental and social megatrends that are pressuring the global economy, and by the UN’s 1987 Brundtland Report that defined sustainable development. Consequently, there is high alignment between our investment process and the UN Sustainable Development Goals (SDGs), and our portfolio contributes to all 17. Identifying companies that contribute towards the goals is inherent to our investment approach, and we measure and report on this. We believe there are a myriad of investment opportunities arising from the migration towards a more sustainable global economy, and that the best investment returns will be generated by companies that are on the right side of these. Looking for these long-term compounding characteristics and staying focused on long-term value not short-term valuation metrics can generate exciting investment returns. We also believe there are substantial risks to companies and shareholder returns that come from factors such as asset obsolescence, regulatory risk, weak corporate cultures, or damaged franchises that are on the wrong side of ESG. While these risks can appear small in the short term, they also compound over time and can dramatically hurt company fundamentals.
Global Sustainable Equity Team
Source: Janus Henderson Investors, as at 31 December 2022.
ESG Investment Team
Source: Janus Henderson Investors, as at 9 March 2023. |
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05/04/2024