As at: 30/06/23

Overview

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Policy

Triodos IM’s fully integrated investment approach ensures that the purpose of investing includes positive change in addition to generating a financial return, and that every step in the stewardship and investment process has been designed with this integrated purpose in mind.

The investment process starts with forming a long-term vision on sustainability and the transition towards a more sustainable economy: the global trends, resulting challenges and the sustainability solutions needed to meet these challenges. Based on this long-term vision, Triodos Pioneer Impact Fund invests in companies that positively contribute to seven transition themes which we believe are instrumental in the transition to a sustainable economy. They are:

• Sustainable Food & Agriculture
• Renewable Resources
• Sustainable Mobility & Infrastructure
• Circular Economy
• Prosperous & Healthy People
• Social Inclusion & Empowerment
• Innovation for Sustainability

Stewardship starts from the moment company analysis begins and develops into relationship, including dialogue and voting, throughout the holding period of the company in Triodos IM funds and portfolios. Through collaboration with other investors, Triodos IM expands the reach and effectiveness of its stewardship activities, further contributing to positive change with the resulting potential for enhanced financial returns.

Process

The universe for the fund is defined using a three-step process:

1.  Positive inclusion / thematic fit to Triodos transition themes

Idea generation starts with an open radar on all listed companies. Our team of in-house analysts search for companies whose products, services and business models positively contribute to one of our seven sustainable transition themes. To find the best potential investment cases, our research is a combination of in-house and externally procured inputs. Broker research is used to validate and generate ideas, but is never the sole factor in any investment analysis.

2.  Negative exclusion / minimum standards

The investable universe is further condensed, applying our strict Triodos Minimum Standards to screen for companies that hinder market adoption of sustainable solutions. Once we are invested in a company, we continuously monitor compliance with our minimum standards. If a company no longer meets our minimum standards, all positions in the company need to be sold within three months.

3.  ESG and impact integrated fundamental analysis

Our analysts integrate financially material and sector specific ESG factors into their long-term view on financial value drivers. The outcome of step three is a complete fundamental, strategic, and valuation analysis of the companies.

Resources, Affiliations & Corporate Strategies

The team:

Triodos Pioneer Impact Fund is managed by Triodos Investment Management. The Impact Equities & Bonds department of Triodos IM consists of 5 Fund Managers and 1 Portfolio Manager, with an average of 27 years of experience in the financial sector and 8 within the firm. The Portfolio Manager with the longest tenure has been with Triodos IM for 20 years and used to be Head of Research.

The Fund Manager of Triodos Pioneer Impact Fund is Dirk Hoozemans. Dirk joined Triodos in 2017 and has over 20 years of experience in the financial sector.

Our Investment Research team of 10 analysts has an average of 10 years of experience in the financial sector and 4 within Triodos IM. The investment analysts have both financial as well as non-financial backgrounds, and have international experience, living and working in places like Sweden, Germany, Hong Kong, Japan, Singapore, Dubai and the United States.

As part of the broader Impact Equities and Bonds team, the Fund Management and Investment Research teams are supported by the Investment Strategy team, which provides views on macro-economic developments and works on our impact and engagement strategy. This team is composed of 6 investment strategists with an average of 12 years of experience in the financial sector and 5 years within Triodos.

Research:

The Investment Research team is responsible for the assessment of portfolio candidates and monitors legislative and regulatory developments. Sustainable products and services are identified using seven sustainable transition themes, and only companies that contribute towards at least one theme are selected for investment. All companies need to meet the Triodos minimum standards. These standards apply to all activities conducted by Triodos Bank N.V. (including all Triodos Bank branches and Triodos Investment Management). The team conducts in-house integrated sustainability and financial analysis. We use internal proprietary research for company and market analysis supported by ISS-Oekom’s sustainable solutions data set and Truvalue Labs.

Stewardship:

As responsible managers of capital, we act as stewards of people and of the planet, and we believe that this responsibility begins with conscious, targeted, investment decisions. The core of stewardship through equity and bond funds is through engagement and voting to drive positive change. We engage in dialogue and various other feedback loops with companies to positively influence their business. We discuss relevant issues regarding company sustainability performance and collaborate with institutional investors to further steer sustainability-related best practices. Additionally, we believe that by exercising our shareholder voting rights, we can exert a positive influence on a company’s long-term strategy – so have a policy to vote in 100% of the possible proxy ballots. We are active participants in the public debate around sustainability and use our position to influence legislation and other policies for stricter sustainability standards.

SRI policy papers available on www.triodos-im.com: 

• Triodos Minimum Standards
• Triodos IM Approach to Investments on Stock and Bond Markets
• Impact Equities and Bonds Investment & Stewardship Policy
• Triodos IM Proxy Voting Guidelines
• Whitepaper on Impact Investing through listed equities and bonds

Our partners and networks:

• We are a co-founder of the Global Impact Investing Network (GIIN)
• We are a signatory of the UN PRI
• We are a signatory member of the Carbon Disclosure Project (CDP)
• We are member of Eurosif, Eumedion, the Financial Inclusion Equity Council (FIEC), the Dutch Fund and Asset Management Association (DUFAS) and the International Corporate Governance Network (ICGN)
• We are signatory of the European SRI Transparency code Global Impact Investing Network (GIIN),
• We are ISAE3402 Type II certificated

Triodos Pioneer Impact Fund has acquired the Nordic Swan Ecolabel, the German-based FNG-Siegel, the Belgian-based Febelfin label and the UK-based 3D Investing label

Dialshifter

This fund is helping to ‘shift the dial from brown to green’ by…

...investing only in bonds that contribute to the transition towards a sustainable society and by engaging with portfolio companies to drive positive change.

The fund invests in seven themes, derived from global mega-trends, that we believe to be instrumental in shaping a sustainable future.

Companies and institutions must also comply with our strict exclusionary minimum standards, which ensure that business practices do not jeopardise market adoption of sustainable solutions. We have conversations with companies to discuss sustainability topics that are important to us as an impact investor. We explore their perspectives, policies, and business practices around our transition themes and minimum standards to understand the depth of the company’s commitments to long-term positive impact.

Our organisation is helping to support the Paris Climate Agreement and the Race to Net Zero by…

...engaging with companies and institutions on climate change to limit the impact of global warming to 1.5°C above pre-industrial levels and reach net zero around 2050. In order to achieve this goal, portfolio companies of our Impact Equities and Bonds funds should set science-based emissions targets across all relevant scopes in line with a 1.5°C trajectory. All targets should be in line with the latest climate science, for which we use criteria of the Science Based Targets initiative (SBTi) as reference.

Literature

• Fund overview & literature (including factsheet)
• Investment & Stewardship Report
• Triodos Investment Management
• Triodos Bank UK
• Impact Report 2022

Last amended: 25/01/24 10:21