Fund Name | SRI Style | Product | Region | Asset Type | Launch Date | |
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Jupiter Global Sustainable Equities Fund |
Sustainability Select | OEIC/Unit Trust | Global | Equity | 09/04/2020 | |
As at: 31/12/23 |
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OverviewAwaiting update from fund manager - fund last updated in May 2021
The fund targets the best risk-adjusted returns by investing in high-quality companies that are leading the transition to a more sustainable world.
It seeks to align clients’ savings with companies that enhance outcomes for planet, people and profit through how they behave and what they sell, integrating ESG throughout the investment process and aligning with the UN Sustainable Development Goals, Net Zero by 2050 and the UN Global Compact. It looks for companies that are managed in a way that minimises their impact on the environment and maximises value for society.
With the objective to provide a return, net of fees, that is higher than that provided by the MSCI AC World Index over the long term (at least five years), the team views the strategy as a genuine alternative to default Global Equity strategies as a diversified, liquid, unconstrained offering that combines financial returns with positive environmental and social returns. |
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FiltersFund informationSustainabilityEnvironmental policy Sustainability policy Limits exposure to carbon intensive industries Resource efficiency 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 UN Sustainable Development Goals (SDG) focus Report against sustainability objectives Encourage more sustainable practices through stewardship Nature & BiodiversityDeforestation / palm oil policy Plastics policy / reviewing plastics Unsustainable / illegal deforestation exclusion policy Biodiversity / nature policy Climate Change & EnergyCoal, oil & / or gas majors excluded Climate change / greenhouse gas emissions policy Fracking and tar sands excluded Arctic drilling exclusion Require net zero action plan from all/most companies Encourage transition to low carbon through stewardship activity Targeted Positive InvestmentsEU Sustainable Finance Taxonomy holdings 5-25% 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 Social / EmploymentSocial policy Diversity, equality & inclusion Policy (fund level) Labour standards policy Favours companies with strong social policies Ethical Values Led ExclusionsTobacco and related product manufacturers excluded Banking & FinancialsOnly invest in TCFD (ISSB) aligned banks / financial institutions Governance & ManagementGovernance policy Anti-bribery and corruption policy Avoids companies with poor governance Digital / cyber security policy Encourage board diversity e.g. gender Encourage TCFD alignment for banks & insurance companies Encourage higher ESG standards through stewardship activity Fund GovernanceESG integration strategy Asset Size & MetricsOver 50% large cap companies Invests in small, mid and large cap companies Invests mostly in large cap companies How The Fund WorksBalances company 'pros and cons' / best in sector Limited / few ethical exclusions* Positive selection bias Norms focus Combines norms based exclusions with other SRI criteria Combines ESG strategy with other SRI criteria Focus on ESG risk mitigation Assets mapped to SDGs Impact MethodologiesAims to generate positive impacts (or 'outcomes') Measures positive impacts Positive environmental impact theme Positive social impact theme Invests in environmental solutions companies Labels & AccreditationsSFDR Article 8 fund / product (EU) 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) Sustainable property strategy (AFM company wide) Integrates ESG factors into all / most fund research In-house diversity improvement programme (AFM company wide) 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 AccreditationsUK Stewardship Code signatory (AFM company wide) PRI A+ rated (AFM company wide) Engagement ApproachRegularly lead collaborative ESG initiatives (AFM company wide) Encourage responsible corporate taxation (AFM company wide) 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) Net Zero commitment (AFM company wide) In-house carbon / GHG reduction policy (AFM company wide) Publish 'CEO owned' Climate Risk policy (AFM company wide) 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 |
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PolicyThe team believes that companies that manage their businesses for planet, people and profit are better positioned to deliver attractive long-term returns to investors. By actively looking for companies that operate in this way, the ‘Sustainable” in the strategy's name refers to all of economic, environmental and societal sustainability.
Planet – on which we all depend It is vital that companies manage the environmental footprint of not only their own operations, but those of their suppliers and the products they produce. We want companies to focus on using their resources efficiently and helping on the path to decarbonisation of the global economy.
People – with whom we all co-exist Companies that invest in their people, providing a supportive and inclusive working environment, and contribute positively to society will be best placed to thrive. We put particular emphasis on wealth and gender equality in the workforce and in society.
Profit – that we all require for our savings Producing resilient profits is crucial for any company’s long-term future in this changing world. We value companies that manage their business for long-term sustainability, not short-term gains.
This could not be achieved without deep ESG integration throughout the active investment process; ESG is the team’s input and sustainability is its output. The team focuses on the core ESG factors they have carefully identified as material and relevant for a company and the investment case. They typically identify what to prioritise through three clear considerations:
Additionally, the team ensures that every portfolio holding is aligned with three key sustainability frameworks. Firstly, the team will not invest in any companies that violate the UN Global Compact – a set of ten Principles of responsible business behaviour related to human rights, labour rights, the environment and anti-corruption. Secondly, the team looks positively to align all its investments with the UN Sustainable Development Goals – 17 key areas of focus for global sustainability – either directly (through what they sell) or indirectly (through how they operate). Lastly, the team ensures that all its investments are low carbon and aligned with delivering the temperature goal of the Paris Agreement to keep global warming to 1.5 degrees above pre-industrial levels.
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ProcessESG and sustainability play key roles throughout the strategy’s proprietary, repeatable and rigorous investment process. The team believes there are significant advantages in active fund management in being able to integrate ESG and deliver sustainable outcomes for clients; the centrality of the consideration of ESG risks and opportunities to the investment process means that the team identifies and assesses all material ESG issues itself and does not rely on ESG ratings or outsource any decisions either internally or externally. To do so, alongside the significant experience and expertise in ESG and sustainable investing among the team members, the team employs all tools available to it and supports its own analysis with external research and analysis from several ESG data providers, as well as other sources of data such as NGOs, academics and technical experts. The team also draws on Jupiter’s firm-wide, proprietary ESG data analytics tool called ESG Hub, which has been built by the Data Science team, as well as advice and expertise on engagement and voting matters from Jupiter’s central Governance and Sustainability team.
The investment process is described briefly below:
Idea generation. Economic sustainability is primary. The team looks for companies with a robust capital structure, resilient cashflows and durable profitability. While not incorporating ESG factors explicitly, this stage helps identify companies whose management approach is more likely implicitly aligned with the time horizons and risk profiles the team looks for in its investments. This stage reduces the investible universe from around 10,000 companies to an opportunity set of around 300 companies for enhanced research.
Enhanced research. Incorporated within the team’s deep analysis of a company’s long-term positioning, competitive advantage and investibility, the proprietary Sustainable Evaluation Model analyses the ESG attributes and sustainability of how a company behaves and what it sells, focusing on materiality to future cash flows and relevance to generating superior investment returns The model incorporates assessments on product and service longevity, quality of management, governance and social and environmental impact. Only companies that perform well at this stage can be included in the portfolio. The team does not invest in companies that violate the UN Global Compact. This stage further reduces the opportunity set to around 80 companies. Positive impact. As described earlier, alignment to the delivery of two structural sustainability frameworks is a core requirement for investment, with the investment team undertaking detailed, in-house analysis to ensure compatibility. These are:
Portfolio construction. This stage looks to mitigate avoidable risks in geography, sector exposure and liquidity as well as balance stock specific risks through security selection and portfolio weighting. Importantly, ESG insights determine conviction levels that can correspond to position sizing, which is made without reference to the benchmark. For sectors, the team is mindful of benchmark sector weights but happy to hold no exposure if there are no companies suitable for investment in a sector including purely on ESG grounds. As a result of the prior stages and portfolio construction considerations, the fund tends to hold between 35 and 50 equities at any one time.
Sell discipline. The sell discipline can be triggered by a variety of considerations, including fundamental changes to a business that mean it is no longer aligned with the investment criteria, market disruptions or more attractive investment opportunities elsewhere. ESG can form a reactive or proactive catalyst to sell. For example, a reactive decision may be triggered by an ESG event such as environmental damage or a culture issue. A proactive catalyst may be a strategic or business model development that undermines the team’s conviction in a company’s management of stakeholder interests that was core to the investment case. The portfolio turnover is around 20% yearly.
Engagement is also a key part of the investment process for the Jupiter Global Sustainable Equities Fund. It helps the team understand a company in more detail, its future direction and the importance of the sustainable management of key stakeholders’ interests to its core strategy. Signals provided through engagement offer vital insight into the quality of a company and its management team. During engagement, the transparency, responsiveness and consciousness of a management team are fundamental to the level of conviction the team has in a holding. If a CEO is unable or unwilling to provide information on key ESG topics and refers the team to their IR or CSR representative, that tells the team a huge amount about how authentic the management is in its consideration of all stakeholders.
The team’s structured engagement approach is based on building relationships with management teams and then engaging on company-specific issues linked to the over-arching investment case. Given the importance of engagement to the investment process the team aims to have meaningful dialogue organised directly with boards and management teams at companies, rather than focus on large volumes of meetings or letter-writing. The team believes that asking detailed questions to decision-makers is the most effective way to encourage companies to consider ESG issues and change their approach where required. |
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Resources, Affiliations & Corporate StrategiesThe Jupiter Global Sustainable Equities Fund is managed by Abbie Llewellyn-Waters, Jupiter’s Head of Sustainable Investing. The Sustainable Investing team are all ESG investment personnel dedicated to the strategy and have full responsibility for research and integration, with over four decades of experience in sustainable and responsible investment between them.
The team collaborate across the investment floor. One of the advantages of being a specialist team in a broader house is the access to deep regional expertise across asset class. This is a fundamental part of our advantage. This includes collaboration on Emerging markets, developed markets and fixed income analysis. The team also collaborate and work closely on knowledge sharing with the Environmental Solutions team, within our Sustainable product range.
The team also has the support of Jupiter's in-house Governance and Sustainability team of four, led by Ashish Ray. This additional team resource helps to identify relevant ESG factors that might affect the business performance of investee companies. The Governance and Sustainability team is responsible for proxy voting operations, the monitoring of shareholder meeting ballots and providing structured analysis of key ESG considerations, and they manage the use of independent proxy advisory and ESG research.
In further support of the Global Sustainable Equities team, Jupiter's in-house Data Science team of five led by Sam Livingstone helps clean, process, structure and analyse vast ESG data sets in order that they become more reliable sources from which to draw investment conclusions.
In order to bolster its approach, Jupiter collaborates with a number of external organisations on engagement and public policy, both through its investments and how it operates as a business. These include the below:
Jupiter is a member of:
Jupiter is also a signatory to:
Additionally Jupiter submits data to CDP (Carbon Disclosure Project). |
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DialshifterThis fund is helping to ‘shift the dial from brown to green’ by… ...explicitly aligning its investments to the temperature goal of the Paris Agreement and Net Zero by 2050. The investment team tests every investment for its historic carbon emissions and future trajectory based on the recommendations of the Science Based Targets initiative, and will not invest in a company that it does not believe to be fully aligned. Additionally, with its focus on positive outcomes for the environment, many of the companies in the portfolio help other companies reduce their own carbon emissions, directly contributing to the achievement of multiple relevant Sustainable Development Goals including 7, 9, 11, 12 and 13.
Our organisation is helping to support the Paris Climate Agreement and the Race to Net Zero by… ...committing to achieving net zero by 2050 as a business across our own operations and all our investments. Jupiter is actively engaged with some of the largest carbon emitting companies in the world on their low carbon transition strategies, both individually and collectively through groups such as IIGCC and Climate Action 100+. Furthermore Jupiter Asset Management was among the first group of companies to sign up to RE100, committing to source all its energy requirements from renewable sources, and has a range of programmes in place to mitigate its non-energy emissions. |
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LiteratureLast amended: 05/01/24 01:49 |
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05/04/2024