Sustainable, Responsible &/or ESG Policy:

Our Sustainable World services are purposefully a ‘broad church’ of sustainable investment. Allied with this, we have developed a framework for considering and evaluating different types of sustainable funds – Impact, Integration and Exclusion.

• Impact funds actively seek to invest in companies making a positive impact on the environment and/or society (Examples of themes include improving the efficiency of using natural resources and providing financial services to under-served populations)
• Integration funds go above and beyond traditional negative screening in order to incorporate at least one element of positive screening (Examples include companies with strong community and labour relations and those with best-in-class health and safety provision)
• Exclusion funds adopt a traditional negative screening approach in order to avoid investment in companies and industries undertaking contentious activities (Examples include fossil fuels and armaments)

This is not black and white, but we invest in funds that sit in each of these three categories. This framework helps us, our Investment Managers, financial advisers and their clients to think about and position different types of sustainable funds. We are not prescriptive in terms of our Impact, Integration and Exclusion framework – for example, we don’t require a portfolio to have a certain percentage in any one category. Whilst it can be difficult to ‘draw a line in the sand’, we adopt a common sense approach regarding the negative screening processes of funds which sit in our Exclusion category – a reasonable minimum standard would be the presence of five robust exclusions (although many of our chosen funds have far more comprehensive screening processes than this). We consider each fund we research on its own merits, from both an investment perspective and a sustainability perspective.

Process:

Given the variety of different approaches to sustainable investment, our proprietary fund research process is very important. We believe there is no substitute for meeting managers and holding calls with them, finding out what they’re really trying to achieve, what investment style they have, how they’re positioned, why they’re positioned that way, how their fund has performed and how we might expect it to perform in future, amongst other factors. Our fund research process helps to ensure that we avoid ‘greenwashing’ and ‘rainbow-washing’.

Hawksmoor’s Sustainable World services feature exactly the same asset allocation, portfolio construction, fund research and risk control processes as per our ‘traditional’ portfolios. Our risk scoring system applies across the board, whereby each security is assigned a risk score, and each portfolio has both a weighted-average risk score and a maximum individual risk score (both of which must adhere to strict parameters). In parallel to this, we have developed a sustainability scoring system employing similar principles. The purpose is to cater more accurately to individual mandates, and to highlight any sustainability-based risks or inappropriate holdings in portfolios.

Resources, Affiliations & Corporate Strategies:

Hawksmoor’s in-house Research team represents our sustainable investment resource. The Research team comprises Chief Investment Officer (Private Clients) Jim Wood-Smith, Senior Fund Analyst James Clark, Investment Analysts George Salmon and Ben Luck, and MPS/Research Assistant Emily Cave. We have been working in the field of sustainable investment since early 2017. Our proprietary fund research process is a key resource in itself, including attending regular meetings, holding conference calls and attending investment conference sessions with managers of sustainable funds. We also utilize Vigeo Eiris.

SDR Labelling:

Not eligible to use label