Fund Size: £22.68m

Total screened & themed / SRI assets: £150.47

Total Responsible Ownership assets: £345.53

Total assets under management: £345.53

As at: 31/12/22

Contact: John.Alexander@Castlefield.com

Overview

Filters

Fund information

Policy

All fund assets within our Sustainable fund range are subject to analysis under our B.E.S.T framework, which provides a consistent outline for assessing all investment opportunities at Castlefield and takes the following considerations into account: Business and Financial; Environmental and Ecological; Social; Transparency and Governance. As long-term investors, the incorporation of ESG and sustainability analysis is integral to our research on all asset classes.

Our Castlefield Sustainable Screening Policy is also applied to the fund research process and seeks to exclude specific industries and activities from our investment universe. By means of our negative screens, we aim to exclude those investments which contradict our belief that responsible and sustainable business practices (such as armaments and tobacco) will produce better returns for investors over the long term. This belief also leads to a positive bias towards investments which contribute towards key sustainability themes and those which conduct their operations with due care and attention to the environment and society. These positive themes are also detailed within the Screening Policy.

The industries and activities screened out of our investment universe are done so on a 10% revenue or operating profit threshold (whichever is higher). Materiality assessments also take place to differentiate between primary vs secondary involvement, etc. Screened out industries include: armaments, nuclear, fossil fuels, gambling, alcohol, and tobacco, amongst others. There are also issues which are not able to be addressed by a quantitative screen; these include social issues such as human rights, labour standards and responsible marketing, as well as environmental topics such as resource efficiency and pollution.

We also believe active ownership is a key part of any sustainable investment mandate and have made out Corporate Governance & Voting Guidelines available on our website for investors.

Process

Following the identification of an investment opportunity, either through quantitative screening or alternative idea generation opportunities, investment ideas are subject to our internal screening process. The industries and activities screened out of our investment universe are done so on a 10% revenue or operating profit threshold (whichever is higher). Materiality assessments also take place to differentiate between primary vs secondary involvement, etc. Screened out industries include: armaments, nuclear, fossil fuels, gambling, alcohol, and tobacco, amongst others. There are also issues which are not able to be addressed by a quantitative screen; these include social issues such as human rights, labour standards and responsible marketing, as well as environmental topics such as resource efficiency and pollution.

In order to then identify the best investment opportunities which pass our screening process. we’ve developed a proprietary investment selection system – the B.E.S.T framework - to assess the merits of competing investment choices. It’s used across and within asset classes and provides a consistent framework for assessing all investment opportunities at Castlefield. It’s not a filter or screen, but a responsible investment process which incorporates four main criteria to assess both financial and non-financial attributes that we think can affect long-term investor returns.

B – Business and Financial

E – Environmental and Ecological

S – Social

T – Transparency & Governance

In most cases we are able to meet with management or an investor relations representative before investing, which provides and opportunity to conduct further due diligence on the investment case and its E.S.T credentials. Finally, all investment ideas are subject to a peer review process in which the investment team.

Resources, Affiliations & Corporate Strategies

There is no separation between non-financial and financial research responsibilities within the investment team. The entire team is involved in Environmental, Social and Governance (ESG) considerations as well as analysing the numbers and assessing share price upside. We believe that integration is more valuable than an overlay approach as sustainability issues are embedded within company activities and therefore need to be assessed holistically from the origin of the process. This avoids the risk of ESG being viewed as a secondary or subordinate factor in the decision-making process.

Regarding additional resources, we subscribe to Ethical Screening for access to their specialist expertise in ESG assessments. We also have access to ISS research for voting purposes but have our own voting policy which takes precedence to proxy voting recommendations. We pay for broker research from Kepler Cheuvreux, who along with more traditional equity research, also assess ESG and sustainability trends.

To provide further insight to our clients and investors in the funds, we have enlisted the services of Impact Cubed to provide an assessment of how our Sustainable funds perform against a number of ESG impact metrics.

We are signatories to or members of the following collaborative investor initiatives:

• ShareAction – Workforce Disclosure Initiative (WDI)
• ShareAction – Healthy Markets
• ShareAction – Good Work Coalition
• Access to Medicine Foundation
• 30% Club
• Farm Animal Investment Risk & Return (FAIRR)
• CCLA Corporate Mental Health Benchmark
• CCLA ‘Find it, Fix it, Prevent it’
• CDP (formerly the Carbon Disclosure Project)

Dialshifter

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

Alongside excluding companies which do not meet our screening criteria, we also seek to invest in companies which positively benefit people and planet over the long term. Our ten positive themes include: Cyber & Digital Security, Health & Wellbeing, Education, Resource Efficiency, Employee Ownership & Responsible Business, Safety & Regulatory Compliance, Environmental Management, Sustainable Infrastructure, Financial Resilience and Sustainable Supply Chains. All holdings are assessed to determine their contribution to these themes, and we publish details on each funds overall alignment.

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

Castlefield have committed to making our own emissions and supply chain net zero by 2030. We have also committed to achieve net zero across our investment portfolio by 2040. Our investment approach seeks companies with excellent environmental credentials, which can help bring society closer to net zero. We also track the extent to which the companies that we invest in have set net zero and other emission reduction targets, monitoring them on an ongoing basis and actively encouraging target setting to help reduce portfolio emissions.

Literature

• Fund overview & literature (including factsheet)
• Fund literature (including Prospectus & KIID)
• Stewardship Reports
• Sustainable Screening policy

Last amended: 21/06/23 10:42