Fund Name | SRI Style | Product | Region | Asset Type | Launch Date | |
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Rathbone Greenbank Global Sustainability Fund |
Sustainability Select | OEIC/Unit Trust | Global | Equity | 16/07/2018 | |
Fund Size: £67.21m Total screened & themed / SRI assets: £2427.64 Total assets under management: £11400.00 As at: 31/03/23 Contact: rutm@rathbones.com |
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OverviewThe fund will seek to invest in companies whose activities or ways of operating are aligned with sustainable development and therefore support the achievement of the UN Sustainable Development Goals. We believe that companies displaying strong policies and practices with regard to environmental, social and governance issues are likely to be well-positioned to deliver long-term value creation for investors. The fund will avoid companies creating significant negative impacts that are considered to be incompatible with sustainable development. Whilst there is no income target, there will be a natural bias to cash generative companies.
PLEASE NOTE: Fund size figure as at 28 February 2022
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FiltersFund informationSustainabilityEnvironmental policy Sustainability policy Resource efficiency policy or theme Sustainable transport policy or theme Sustainability theme or focus Environmental damage and pollution policy Waste management policy or theme Sustainability focus Report against sustainability objectives Encourage more sustainable practices through stewardship Circular economy theme Nature & BiodiversityUnsustainable / illegal deforestation exclusion policy Biodiversity / nature policy Water stewardship policy Climate Change & EnergyNuclear exclusion policy Climate change / greenhouse gas emissions policy Invests in clean energy / renewables Fracking and tar sands excluded Arctic drilling exclusion Fossil fuel reserves exclusion Energy efficiency theme Paris aligned fund strategy Fossil fuel exploration exclusion - direct involvement Fossil fuel exploration exclusion – indirect involvement Human RightsHuman rights policy Child labour exclusion Responsible supply chain policy or theme Oppressive regimes (not free or democratic) exclusion policy Modern slavery exclusion policy Social / EmploymentSocial policy Health & wellbeing policies or theme Diversity, equality & inclusion Policy (fund level) Labour standards policy Favours companies with strong social policies Mining exclusion Meeting Peoples' Basic NeedsWater / sanitation policy or theme Demographic / ageing population theme Antimicrobial resistance policy 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 Gilts / government bonds - exclude all Gilts / government bonds - exclude some Animal testing - excluded except if for medical purposes Civilian firearms production exclusion Banking & FinancialsExclude banks with significant fossil fuel investments Governance & ManagementGovernance policy Avoids companies with poor governance Encourage board diversity e.g. gender UN sanctions exclusion Fund GovernanceESG integration strategy ESG factors included in Assessment of Value (AoV) report Asset Size & MetricsInvests in small, mid and large cap companies How The Fund WorksStrictly screened ethical fund 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 Over 50% in assets providing environmental or social ‘solutions’ Labels & AccreditationsEurosif Transparency Intended Clients & Product OptionsIntended 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) Vote all* shares at AGMs / EGMs (AFM company wide) Diversity, equality & inclusion engagement policy (AFM company wide) In-house diversity improvement programme (AFM company wide) Vulnerable client policy on website (AFM company wide) 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 GFANZ member (AFM company wide) TNFD forum member (AFM company wide) Investment Association (IA) member AccreditationsUK Stewardship Code signatory (AFM company wide) PRI A+ rated (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 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 mental health issues Engaging on responsible supply chain issues Climate & Net Zero TransitionEncourage carbon / greenhouse gas reduction (AFM company wide) Net Zero commitment (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) 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 available on request Paris Alignment plan publicly available (AFM company wide) Net Zero transition plan publicly available (AFM company wide) |
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PolicyThe fund’s ethical and sustainability investment criteria are applied by Rathbone Greenbank’s Ethical, Sustainable and Impact Research team which maintains a proprietary database of company profiles. Companies are assessed against a number of positive and negative top-level social and environmental criteria, comprising over 100 distinct sub-criteria.
Companies are assessed using two approaches:
In addition to the reporting outputs of companies themselves, the team accesses a variety of sources, including industry groups, non-governmental organisations, sell-side analysts, external research bodies and specialist SRI publications, to arrive at a balanced view of companies’ overall performance. Since June 2015, Rathbone Greenbank’s Ethical, Sustainable and Impact Research team has subscribed to MSCI ESG Manager to reinforce this process.
Research is also conducted on a thematic basis, examining such topics as climate change, clean energy, human rights, community investment and employee welfare. The fund’s holdings are monitored regularly, and reviewed in the light of any relevant news, merger and acquisition activity or findings from ongoing company analysis. A full review of the fund’s eligible investment universe is carried out an annual basis ahead of the annual review meeting.
New stocks that are considered suitable for investment are investigated as requested by the fund’s manager, and subjected to the team’s screening process.
The team conducts reviews of its ethically themed ‘peer groups’ on a rolling basis and looks to update all of its in-depth company profiles on a 12-18 month cycle.
Divestment on ethical and sustainability grounds are likely to be uncommon. If the activities of a company change, such that it is no longer suitable for the fund, the fund’s manager would normally seek to sell the holding within three to six months.
The exclusions and negative screens The fund will apply screening criteria to avoid investing in:
The fund shall exclude companies in breach of one or more of the following criteria:
The positive sustainability criteria We believe that companies displaying strong policies and practices with regard to environmental, social and governance issues are likely to be well-positioned to deliver long-term value creation for investors.
In order to qualify for inclusion in the fund, companies that pass the negative screen must also display leading or well-developed business practices and policies (operational alignment), and must also allocate capital towards the provision of products or services aligned with sustainable development (activity alignment).
In September 2015, the UN launched the Sustainable Development Goals (SDGs). These comprise 17 goals, with 169 underlying targets that aim to ‘end poverty, protect the planet and ensure prosperity for all’ by 2030. The SDGs provide a comprehensive framework for international action on the many social and environmental challenges facing the world.
Rathbone Greenbank has mapped the UN SDGs to a set of eight sustainable development themes and a number of underlying sub-themes. These themes ultimately align with the same ambitions as the UN SDGs, but translate them into something more relevant to companies. We use these themes to determine how successful individual companies are at translating aspirations into tangible results.
Operational alignment Our focus is on three principal areas of operations: employment, environment and human rights. Businesses under consideration are expected to exhibit positive action in at least one of these areas. One should think of this as a minimum threshold with regard to how the company operates.
Activity alignment Having satisfied the initial hurdle, we require companies to have significant involvement in the provision of products or services aligned with sustainable development. Essentially, we are asking whether companies are allocating capital in alignment with any of the United Nations Sustainable Development Goals, and if this practice is central to their business models.
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ProcessThe first step in the investment process is identifying companies displaying the characteristics we look for in durable franchises.
This is founded on our core investment principles:
We take a risk based approach, defining risk as the threat of a permanent fall in the value of our investments. Risk is not viewed as volatility, illiquidity, deviation from a benchmark, or underperformance.
We use a framework focusing on three key areas and how they impact on this:
Ultimately, we view the value of an investment as the present value of future cash flows. The three areas above allow us to evaluate an investment opportunity, the first two allow us to take a view on the likelihood of achieving the expected future cash flows, and the third the price we are paying for their value. We look to balance all three, with, for example, the more secure and predictable the cash flows (the lower the business/financial risk) the less margin of safety we require (higher price risk) and vice versa. There is no one particular permutation we are looking for, but assess each opportunity on its individual merits.
Once a stock has been researched and approved it then needs to be scrutinised in line with pre-determined ethical criteria. These criteria have been agreed between the fund managers and the team at Rathbone Greenbank, who will be the final arbiters. The fund managers may propose a stock, but Rathbone Greenbank has the power of veto if the company fails this primary screen, ensuring validation by an independent, third party.
Rathbone Greenbank is responsible for the monitoring of corporate news on environmental and social matters. As companies change their activities, merge with others or develop new policies and practices, their suitability and risks will alter. The Greenbank Ethical, Sustainable & Impact Research Team works with Rathbone Unit Trust Management to ensure that investments are only made in approved organisations.
Thereafter, companies must evidence strong positive policies and practices. Using the 17 UN Sustainable Development Goals as a starting point, Rathbone Greenbank has mapped these goals to a set of eight sustainable development themes and underlying sub-themes. The fund manager seeks to invest in alignment with these themes, in the process marrying investment returns with positive social and environmental commitments.
Finally, corporate stewardship forms an essential part of our approach to responsible investment. Rathbones has directed substantial resources toward a separate corporate governance team over the last few years, and it grows in importance and relevance. Corporate engagement is a crucial third leg to the process, and involves the participation of both the fund managers and a dedicated corporate governance team, when scrutinising policies and management teams.
Research For equity research, there is a very strong emphasis on in-house research. The investment team undertake their own stock and industry analysis. Whilst this will be supplemented by external sources of research, home-grown ideas and themes are valued highly.
The investment process has been developed over many years, and every member of the team understands that an investment rationale has to be framed within certain lines of argument: - trinity of risk (price, business, financial) with a firm understanding of cash returns on invested capital. Thereafter, the individual is free to come to his or her own conclusion.
Whilst much third party research is discarded as being biased or corporate led, there are some sources that are held in high regard. This can be especially useful in understanding the wider industry. We can also benefit from research demonstrating views which oppose our own. We are open to challenge, and understanding differing views and expectations can improve our own analysis and outcomes. Elsewhere, Rathbones pays for economics and strategy research from several independent groups, in addition to in-house teams.
Finally, the team is also in a position to leverage intellectual capital from across the Rathbones Group in terms of utilising the various committees (stock selections, collectives, overseas equities, amongst others), analysts and the internal and external research available.
The ethical and sustainability research for the Rathbone Greenbank Global Sustainability Fund is provided by Rathbone Greenbank Investments, the specialist ethical investment unit of Rathbones Investment Management Limited (part of Rathbones Group Plc). The team at Rathbone Greenbank has been at the forefront of developments in the ethical investment industry since 1997, launching one of the first bespoke ethical portfolio services. This team is dedicated to the application of social, environmental and ethical principles in the management and screening of client portfolios. The ethical framework, methodology and screens have been developed by Rathbone Greenbank, based on many years’ experience of managing private client portfolios as well as providing screening services for the highly successful Rathbone Ethical Bond Fund since 2002.
Rathbone Greenbank and Rathbone Unit Trust Management have long collaborated on a fixed income product, the Rathbone Ethical Bond fund, and this relationship has been extended to produce an equity product using our well developed equity investment process.
For further detail please see the Rathbone Greenbank Global Sustainability Fund Product Brochure.
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Resources, Affiliations & Corporate StrategiesEthical and sustainability research for the fund is carried out by researchers working for Rathbone Greenbank Investments, the specialist ethical, sustainable and impact (ESI) investment unit of Rathbones Group Plc. The team at Rathbone Greenbank has been at the forefront of developments in the ethical investment industry since 1992, launching one of the first bespoke ethical portfolio services in 1997. The fund’s ethical and sustainability framework and methodology have been developed with Rathbone Greenbank, utilising their many years’ experience of managing private client portfolios as well as providing screening services for the highly successful Rathbone Ethical Bond Fund since 2002 and the Rathbone Greenbank Multi-Asset Portfolio funds.
David Harrison is the lead manager of the fund, and he is supported by Neil Smith and Siyuan Lin. Importantly, they are supported by a wider investment team with over 100 years of combined investment experience, a team at the very core of the investment process upon which the fund is established. The team approach is crucial. It orchestrates a challenging environment in which our managers test investment ideas through a form of peer review. It also creates a natural diversification because different people are interested in different things, but the core process means all these ideas are explored in the same way. Finally, work is not duplicated – trust in each other and the process breeds efficiency.
David fund manager of the Rathbone Greenbank Global Sustainability fund. David has a wealth of experience, and has been involved in Environmental Social Governance (ESG) mandates at Merrill Lynch and Hermes (he was actively involved in the day-to-day integration of ESG analysis into the fund’s management) on behalf of the BT pension scheme. He has also held positions at Goldman Sachs and Close Brothers. David joined Rathbones in June 2014, and holds the Investment Management Certificate and is a CFA (Chartered Financial Analyst) charter holder.
Neil joined our unit trust team in September 2017 as a research assistant. He has been instrumental in developing the methodology upon which the fund is established, especially with regard to the use of the UN Sustainable Development Goals to adjudge positive corporate responsibility.
Rathbone Greenbank ESI research team –specialists responsible for the ethical research conducted for the fund
Kate is head of Rathbone Greenbank’s ethical, sustainable and impact research team. She oversees the development and implementation of the team’s sustainability assessment framework, analysing investments against a range of environmental, social and governance criteria. She also monitors emerging sustainability themes, sets priorities for Greenbank’s stewardship and engagement activities and has developed the team’s systems for the measurement and reporting of portfolio sustainability and impact performance. She joined Rathbones in 2007 after graduating from the University of Bristol with a masters in Philosophy and Mathematics.
Sophie joined Rathbone Greenbank in January 2020 as a senior ethical, sustainable and impact researcher and has recently moved into a new role as Greenbank’s Stewardship and Engagement Lead. She is responsible for the delivery of key engagement projects, building relationships with external partner organisations, and shaping Greenbank’s engagement strategy, priorities and reporting. She started her career at Barclays Bank in 2013 and most recently spent three years at KKS Advisors, a strategy consultancy in London where she led a team specialising in sustainable and impact investment. She holds an MSc from Imperial College London in Environmental Technology and a BSc in Geographical Sciences from the University of Bristol.
Perry joined Rathbones in 1999 after a career in the IT industry. He acts as adviser to Rathbone Greenbank’s ethical, sustainable and impact research team, which he headed until 2021. He was responsible for establishing the team’s proprietary research database and continues to be involved in its development. He also conducts thematic research into key responsible investment issues as well as monitoring corporate performance on environmental, social and governance matters. Perry was a founder member of Rathbone Greenbank in 2004.
Emma joined Greenbank in September 2022 and is responsible for analysing investments against a range of environmental, social and governance criteria, as well as for conducting thematic research into key responsible investment issues. Emma has over 10 years’ experience working in business valuation, sustainability and social investment, predominantly within professional services firms PwC and Grant Thornton. Emma holds a BSc (Hons) in Natural Sciences (Physics with Philosophy) from Durham University and is also a chartered accountant (ACA).
Kai joined the Ethical, Sustainable & Impact Research Team in March 2019 after graduating from the University of Cambridge with a BA in Law. He responsible for assessing the social and environmental performance of companies.
Katherine joined the investment team at Rathbone Greenbank as an intern in March 2020 before moving into the ethical, sustainable and impact research team in January 2021. She is responsible for analysing investments against a range of environmental, social and governance criteria as well as assisting with engagement projects. She holds a BSc in Anthropology from Durham University and a CFA Institute Certificate in ESG Investing.
Charlie joined Rathbone Greenbank in January 2021 after graduating from the University of Warwick with a BASc (Bachelor of Arts and Sciences) in Economic Studies and Global Sustainable Development. He is responsible for assessing the social and environmental performance of companies.
Rathbones Stewardship team
Matt Crossman is the Stewardship Director for the Rathbones group. Overseeing the work of the Stewardship Committee, he ensures active voting at company AGMs, whilst also being the group leading on the integration of Environmental, Social and Governance (ESG) factors into the investment process. He also leads thematic engagement with companies on ESG issues, especially those undertaken via the UN backed through the Principles for Responsible Investment’s Collaboration Platform. Matt is a graduate of the University of Bristol where he studied law, with a particular interest in the administration of environmental law, and also has post-graduate qualifications in Sustainable Development theory and practice. He is a trustee of LoveBristol, and urban regeneration charity, and served on the board of the Ecumenical Council for Corporate Responsibility between 2007 and 2012. The Stewardship team is led by Matt Crossman and comprises of:
List of RI affiliations/memberships:
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LiteratureLast amended: 09/03/24 09:00 |
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05/03/2024