Rathbone Greenbank Defensive Growth Portfolio Fund
SRI Style:
Sustainable Style
SDR Labelling:
Unlabelled with sustainable characteristics
Product:
OEIC
Fund Region:
Global
Fund Asset Type:
Mixed Asset
Launch Date:
29/03/2021
Last Amended:
Aug 2024
Dialshifter (
):
Fund Size:
£152.56m
(as at: 31/03/2024)
Total Screened Themed SRI Assets:
£2738.66m
Total Assets Under Management:
£15000.00m
ISIN:
GB00BMQC6K53, GB00BMQC6L60
Contact Us:
Objectives:
There are four portfolios in the Rathbone Greenbank Multi Asset range, all with clear return, risk and sustainability objectives. The sustainability objective for all the funds is to invest in entities whose activities or ways of operating are aligned with sustainable development and therefore support the achievement of the 17 UN-backed Sustainable Development Goals (SDGs). Our aim is to invest in companies and entities that display strong environmental, social and governance policies and practices because we believe they are well-positioned to deliver long-term value creation for investors.
The funds use a negative screening process to avoid investing in companies that create significant negative impacts that are considered to be incompatible with sustainable development. In order to qualify for inclusion in the funds, companies and entities that pass the negative screen must also display alignment with sustainable development through their operations and/or activities (positive alignment analysis).
We aim to deliver a greater total return than the Consumer Price Index (CPI) measure of inflation + 2%. Total return means the return we receive from the value of our investments increasing (capital growth) plus the income we receive from our investments (interest and dividend payments). We use the CPI + 2% as a target for our fund’s return because we aim to grow your investment above inflation.
We aim to deliver this return with no more than half of the volatility of the FTSE Developed stock market index. As an indication, if global stock markets fall our fund value should be expected to fall by around half that amount. Because we measure volatility over a five year period, some falls may be larger or smaller over shorter periods of time. We aim to limit the amount of volatility risk our fund can take because we want our investors to understand the risk they are taking in terms of the global stock market.
Sustainable, Responsible
&/or ESG Overview:
The fund seeks to invest in entities whose activities or ways of operating are aligned with sustainable development and therefore support the achievement of the UN Sustainable Development Goals. We believe companies displaying strong policies and practices to manage environmental, social and governance issues are likely to be well-positioned to deliver long-term value creation for investors. The fund avoids entities creating significant negative impacts that are considered to be incompatible with sustainable development.
The fund follows a four-step investment process combining the expertise of Rathbones Asset Management and Greenbank:
- ESG risk integration: conducting in depth research to ensure we only invest in companies who are managing their ESG risks appropriately.
- Negative screening: avoiding investments which are incompatible with sustainable development.
- Positive alignment analysis: aligning investments to Greenbank’s eight sustainable development themes which map to the SDGs.
- Stewardship: dialogue through engagement to align with our sustainability criteria.
Primary fund last amended:
Aug 2024
Information directly from fund manager.
Fund Filters
Sustainability - General
Funds that have policies that consider (environmental and social) sustainability issues. Strategies vary but are likely to consider environmental issues like climate change, carbon emissions, biodiversity loss, resource management, environmental impacts; and social issues like equal opportunities, human rights, labour standards, diversity and adherence to internationally recognised codes. See fund information.
Environmental - General
Funds that have policies which relate to environmental issues. These will typically set out the fund's stance on issues such as pollution, climate change, resource management, biodiversity loss, carbon emissions, plastics and/or additional environmental impacts. Strategies vary. See fund information for further information.
Funds that limit or 'reduce' their exposure to carbon intensive industries (ie sectors which are major contributors to climate change. Funds vary - some funds may be 'underweight' in this area which means they may have some investment in highly carbon intensive areas. Funds of this kind may choose companies they consider to be 'best in sector' and encourage ever higher standards. Strategies vary. See fund information for further details.
Nature & Biodiversity
Find funds that have a written biodiversity policy or theme aimed at encouraging and improving environmental protection and safeguarding the natural world (sometimes referred to as the preservation or enhancement of 'natural capital'). See eg https://www.un.org/en/climatechange/science/climate-issues/biodiversity
Find funds that have policies in place designed to ensure they do not invest in companies that are significantly involved in deforestation. This typically relates to palm oil plantations where biodiversity loss is a major concern (as well as other issues). Strategies vary. See fund information for further detail.
Find funds that have policies in place explaining that they avoid companies involved in illegal and/or unsustainable deforestation. This may relate to palm oil, cattle farming or other concerns. Strategies vary. See fund information for further detail.
Climate Change & Energy
Funds that have policies (documented strategies that explain their position on) climate change related issues such as greenhouse gas/carbon emissions, net zero, transitioning to lower carbon. Strategies vary. Read fund details for further information.
Funds that avoid investing in major coal, oil and/or gas (extraction) companies. Funds vary: some may exclude all companies that extract oil. Others may have exposure to oil extraction via more diversified energy companies. See fund literature to confirm details.
Funds that avoid companies involved in fracking and tar sands - which are widely regarded as controversial methods of oil and gas extraction. Strategies vary. See fund information for further information.
Funds that avoid companies that are involved in extracting oil from the Arctic regions. See fund literature for further details.
Funds that avoid investing in companies with coal, oil and gas reserves. See fund information for further details.
The fund manager excludes companies with direct involvement in fossil fuel exploration (eg coal, oil and gas companies)
Will only invest in companies that report greenhouse gas emissions reduction strategies in line with the framework set out the by the Taskforce for Climate Related Financial Disclosure, which is increasingly becoming mandatory. See https://www.fsb-tcfd.org/ https ://www.ifrs.org/sustainability/tcfd/
Social / Employment
Find funds that have policies which set out their approach to social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact). Funds with social policies typically avoid companies with low standards or work to encourage higher standards. See fund information for detail.
Find individual funds that have a written diversity policy – where the fund manager will aim to select companies with a carefully considered, sound approach to diversity. This should ideally cover a range of issues including gender, ethnicity, disability, beliefs, sexual orientation, etc.
All mining companies excluded
Ethical Values Led Exclusions
Companies are excluded if they are involved in any aspect of the production chain for tobacco products, including cigarettes, vaping, e-cigarettes, chewing tobacco and cigars.
Companies are excluded if they make more than 5% of their revenue from the manufacture, sale or distribution of tobacco products including cigarettes, vaping, e-cigarettes, chewing tobacco and cigars.
Find funds that avoid companies that manufacture products intended specifically for military use. Fund strategies vary - particularly with regard to non-strategic military products. See fund literature for fund specific details.
Find funds with a written civilian firearms exclusion policy - meaning that they will not invest in companies that make (or perhaps also sell) handguns made for non-military users.
Find funds that avoid investment in companies involved in the production of alcohol. Strategies vary; some funds allow a small proportion of profits to come from this area. See fund literature for further information.
Find funds that avoid companies with significant involvement in the gambling industry. Some funds may allow a small proportion of profits to come from this area. See fund policy for further details.
Find funds that avoid companies that derive significant income from pornography and related areas. Strategies vary. See fund details for further information.
Find funds with policies that require specific animal welfare standards to be met. These may reference well-known welfare standards (3Rs - Replace, Reduce, Refine) or certification schemes. Strategies vary. See fund information for further detail.
Human Rights
Find funds that have policies relating to human rights issues. Funds of this kind typically require companies to demonstrate higher standards, although some fund managers work to encourage improvements. Investee companies are often judged against internationally agreed norms or standards. Strategies vary. See fund information for further detail.
Find funds with policies that exclude companies or other assets where regimes are not democratic, or where people may be oppressed. May use eg. Freedom House research. Strategies vary. See fund literature for further information.
The fund has a policy which excludes assets with involvement in Modern Slavery
Gilts & Sovereigns
Find funds that invest in loans issued the government, commonly known as gilts or government bonds. These may or may not be ringfenced for specific projects (see additional options). See fund literature for any selection criteria.
Find funds that avoid investing in 'some' gilts or government bonds. Strategies vary, but this may relate to avoiding specific countries or particular reasons for bond issuance. 'Green gilts' for example would be likely to be acceptable. See fund literature for further information.
Find funds that invest in financial instruments issued by governments, but will only hold those that meet certain environmental and or social criteria. This may, for example mean certain assets are excluded in line with eg Freedom House research. Strategies vary, see fund literature for more information.
Banking & Financials
Find funds that include banks as part of their holdings / portfolio.
Funds that do or may invest in insurance companies.
Governance & Management
A core element of these funds will aim to encourage higher ESG standards through responsible ownership / stewardship / engagement /voting activity
Fund Governance
Find funds that employ an external committee (i.e. not company employees) that has power to veto (i.e. overrule) fund managers stock selection decisions. (This would typically mean the committee can tell the manager of this particular fund not to buy / sell a specific investment when they consider it appropriate to do so.)
Find funds that factor in 'environmental, social and governance' issues as part of their investment decision making process. A focus on 'ESG' typically means a fund is carrying out additional research to help reduce ESG related risks. It does not necessarily mean a focus on sustainability. Strategies vary. See fund literature.
Asset Size
International entities or bodies with agreed remits that are broadly similar to those that may otherwise be undertaken by individual governments eg the UN
How The Fund Works
Find funds that focus on finding and investing in companies with positive / beneficial attributes. This strategy can be applied in addition to exclusion criteria and engagement/stewardship activity.
Find funds where their main 'ethical approach' is to avoid companies by using negative screening criteria. Read fund literature for further information.
Find funds that make significant use of internationally agreed 'norms' (e.g. United Nations Global Compact - UNGC - or the UN Sustainable Development Goals - SDGs) as part of their investment selection process alongside additional SRI criteria such as positive or negative stock selection policies and/or stewardship strategies.
Find funds that have an ESG strategy (which is typically focused on avoiding companies that pose environmental, social or governance related risks) with additional criteria such as positive and/or negative screens, themes and stewardship strategies.
Find funds that have published explanations of their ethical, social and/or environmental policies online (i.e. fund decision making strategies/ buy/sell &/or asset management strategies).
See fund information for different risk options of this fund strategy
Unscreened Assets & Cash
All assets held in the fund - except cash - meet the sustainability criteria published in fund documentation.
Intended Clients & Product Options
Finds funds designed to meet the needs of individual investors with an interest in sustainability issues.
Find funds designed for clients who care about ethical and values-based issues, often alongside sustainability issues also.
Find funds that are available via a tax efficient ISA product wrapper.
Fund Management Company Information
About The Business
Finds fund management companies that have a published company wide stewardship, engagement and / or responsible ownership policy or strategy that covers all investments. Stewardship typically involves encouraging higher ESG standards through voting and dialogue.
Find fund management companies that actively encourage higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices across investee companies - typically where the aim is to encourage positive change that is aligned with the best interests of investors. Strategies vary. See additional information and options.
Find fund managers that vote all* the shares they own at Annual General Meetings and Extraordinary General Meetings. A commitment to voting shares is a key indicator of 'responsible share ownership' demonstrating their support for or disagreement with management policy. (*situations can legitimately, occasionally occur where voting proves impossible, but in principle all shares should be voted.)
Find fund managers that consider responsible ownership and ESG to be a key differentiator for their business.
Find funds run by fund managers that apply Responsible ownership or 'Stewardship' policies to all or most of their investment assets. This means active involvement (e.g. voting, dialogue) with the companies they invest in across funds (not normally limited to ethical or SRI options.) Read fund literature for further information.
Finds organisations / fund managers that have an in-house (company wide) diversity improvement programme - meaning that they are working to ensure that within their own businesses they employ people from diverse backgrounds - often typically focused on ethnicity and/or sex.
Find fund management companies that encourage the companies they invest in to have strong diversity, race, gender and other equality policies across all assets held, not simply screened or themed SRI/ESG funds. (ie Asset Management company wide).
Asset manager has information on their website that explains how they treat 'vulnerable clients' (as set out in FCA regulation)
Asset management company has investments in bonds designed to meet sustainability requirements - however these assets may not be 'ringfenced' for this purpose. See fund manager website for details.
Fund management entity offers unstructured intermediary training on sustainable investment (ie for financial advisers and wealth managers)
Collaborations & Affiliations
Find fund management companies that have signed up to the UN backed 'Principles of Responsible Investment'.
Find fund management companies that are members of UKSIF - the UK Sustainable Investment and Finance association
Find fund management companies that have partnered with Fund EcoMarket - meaning that they are helping to improve access to information on sustainable and responsible investment by paying an annual fee to us which enables us to publish information for free. Partner funds are listed ahead of other funds and have their logos displayed.
A member of the Taskforce for Nature Related Financial Disclosures group which aims to aid risk management and shift money towards nature-positive outcomes.
Fund management entity is a member of the Investment Association https://www.theia.org/
Resources
Find fund management companies that employ people to steer and support fund managers in voting shares at company AGM's and EGMs in ways that are consistent with encouraging higher ESG/sustainability standards.
Find a fund management company that directly employs specialist ESG/SRI/sustainability researchers or analysts. This allows asset managers to discuss environmental, social and governance risks and opportunities directly with companies.
Accreditations
Finds organisations / fund managers that have an A+ PRI rating - meaning they are highly rated according to the 'Principles of Responsible Investment'
Find fund managers that are signatories to the FRC UK Stewardship Code, which sets out a framework for constructive investor / investee relations where fund managers are encouraged to behave like responsible, typically longer term 'company owners'.
Engagement Approach
Fund manager has stewardship /responsible ownership strategy that is focused on addressing climate change with investee assets.
Asset manager has a stewardship /responsible ownership strategy that involves working with fossil fuel companies on climate change related issues. See fund manager website for details.
Asset manager has stewardship /responsible ownership strategy with involves encouraging investee asset to reduce plastic waste and pollution.
Asset manager has a stewardship / responsible ownership policy that means they are working to encourage more responsible mining practices - where environmental and social issues are properly dealt with by the companies they invest in.
The asset manager has a responsible ownership / stewardship strategy that focuses on biodiversity and nature issues relating to the assets they invest the aim of which will be to reduce harm and or deliver improvement. Strategies vary. https://tnfd.global
Asset manager has a responsible ownership / stewardship strategy which means they are working to encourage the shift to more sustainable business practices in ways that respect and are sensitive to social issues and the impact change has on people effected by the changes that are taking place. https://www.transitionpathwayinitiative.org/ https://transitiontaskforce.net/
Asset manager has responsible ownership / stewardship strategy in place which aims to address human rights issues in investee companies (and potentially their suppliers) with the aim of raising standards
Asset manager has responsible ownership / stewardship strategy in place that aims to improve labour standards for the benefit of employees in investee companies (and potentially their suppliers)
Asset management company has a stewardship strategy in place which involves working to raise diversity, equality and inclusion standards across investee assets
working with the assets they hold to help stamp out modern slavery - where direct or indirect company employees are exploited for business benefits.
Fund managers have stewardship strategies in place that focus on improving governance standards across investee assets
Has a stewardship / responsible ownership strategy that encourages responsible supply chain - ie the managers will discuss environmental, social and governance issues with investee companies with the aim of raising standards
Company Wide Exclusions
This asset manager has a strategy in place that will lead them to exit direct investments in the coal mining industry. Managers ability to do this may depend on the geographic regions in which they invest.
Climate & Net Zero Transition
Fund management organisations that have pledged to reduce their greenhouse gas emissions to ‘net zero’. Strategies vary - this area is changing rapidly.
This asset management company has set a date by which they plan to achieve net zero greenhouse gas / CO2e emissions.
Find fund management companies that are working with the companies they invest in to encourage reductions in carbon dioxide and other greenhouse gas emissions.
Finds organisations / fund managers that have published ‘forward looking climate metrics’ e.g. 'implied temperature rise' data that are a total of the asset management company's share (% owned) of all the investee company emissions of the assets they manage, as well as their own direct and other indirect emissions.
This asset management company plans to achieve net zero greenhouse gas (CO2e) emissions by reducing their emissions. Calculations and scope vary.
Finds organisations / fund management companies that are in the process of working out how to make a ‘net zero commitment’ - meaning that when that is finalised they will have started the process of reducing their total greenhouse gas emissions to'zero'.
See https://sciencebasedtargets.org/
Transparency
Find fund management companies that publish a report detailing their responsible investment ownership - also known as 'Stewardship' - activity.
Fund management companies that publish a full record of how they vote their shares at AGMs (annual general meetings) and EGMs (extraordinary general meetings). Voting strategies have an important role to play encouraging higher environmental, social and governance standards.
Sustainable, Responsible &/or ESG Policy:
The fund aims to invest in entities whose activities or ways of operating are aligned with sustainable development and which we believe have the potential to support the achievement of the UN Sustainable Development Goals (SDGs). To do this, the sustainable funds take the following approaches:
- Integrating environmental, social and governance (ESG) factors into risk management and stewardship activities
- Applies negative screening to avoid investments that are failing to effectively manage potential social or environmental harms.
- Applies positive screening to identify investments that are aligned to one or more sustainable development themes.
Each asset class requires a separate process for assessing whether it meets the sustainable objectives of the fund. We believe transparency is important in sustainable investing, so we have developed specific criteria that each asset must meet before it can be included in the funds.
All potential investments are put forward by the fund managers, with the team at Greenbank then undertaking the necessary sustainability analysis and making the final decision about its eligibility for inclusion in the funds.
A short summary is provided below of some of the criteria applied to key asset classes. Further details are provided in the Rathbone Greenbank Multi-Asset Portfolios Sustainability Process brochure which is available at Rathbone Greenbank Multi-Asset Portfolios | Rathbones (rathbonesam.com).
Government bonds
Government bonds have historically been an area of debate for sustainable investors because the majority of bond-issuing countries devote some of their budgets to military spending and generate tax revenues from controversial industries such as tobacco and alcohol. However, we believe this needs to be considered alongside the significant positive impact that many governments have on the environment and society. This may be through policies, regulations and subsidies designed to protect the environment, or the significant proportion of spending devoted to education, welfare, healthcare, etc.
Nevertheless, governments are not automatically deemed to be acceptable and, for us to invest in their bonds, they must meet at least three of the following four criteria:
- Civil and political freedom: The country must respect people’s right to political and civil liberty. We use sources such as the Freedom in the World report by the non-governmental organisation Freedom House (freedomhouse.org) to benchmark countries on issues such as electoral process, functioning of government, freedom of expression and belief, rule of law and individual rights.
- Corruption: The country must meet high standards regarding bribery and corruption. We use sources such as Transparency International’s Corruption Perception Index to assess the risk of public sector corruption in different countries.
- Defence: The country must not exceed the global average on military expenditure as a proportion of GDP, calculated on a three-year rolling basis.
- Climate change: The country must be committed to reducing its contribution to climate change. We use sources such as the Climate Change Performance Index and Climate Action Tracker to assess effectiveness of climate change policy, alignment with decarbonisation pathways and progress in reducing emissions.
Equities and corporate bonds
Companies are assessed against a number of positive and negative top-level social and environmental criteria. The team analyse in detail the specific merits of each company’s individual activities and sustainable business practices.
Green, social or sustainability bonds
Green bonds, social bonds, sustainability bonds, or similar bonds where the proceeds are used to support specified environmental or social objectives, may be eligible for inclusion in the fund. Each is subject to the usual sustainability criteria applied to the issuer. If the corporate issuer itself does not pass our positive and negative screens, a bond may still be approved for inclusion in the fund on the merits of how the bond’s proceeds will be used, rather than the issuer’s principal activity. When analysing a ring-fenced bond against our criteria, we will look at:
- The issuer’s green/social financing framework and whether an independent second party opinion on this has been sought (what the proceeds of the bond can be used for).
- The processes in place to govern ongoing management of proceeds from the bond (how certain can we be that the money will be used as intended).
- Full transparency on the use of proceeds through regular reporting, ideally with third party verification and reporting on impact in addition to allocation of funds (what was the money used for and what benefit did it create).
- Whether the funding is transformational for the issuer or part of ‘business as usual’ with a green/social label (would the activity have occurred anyway?).
The exclusions and negative screens
The funds apply screening criteria to avoid investing in companies creating significant negative impacts that are considered to be incompatible with sustainable development.
The funds shall exclude companies in breach of specific criteria related to one or more of the following:
- Alcohol
- Animal welfare: animal testing
- Animal welfare: fur
- Animal welfare: intensive livestock farming
- Armaments
- Climate change
- Employment
- Environment
- Gambling
- Human rights
- Nuclear power
- Pornography
- Tobacco
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 funds, companies that pass the negative screen must also display leading or well-developed business practices and policies (operational alignment), and/or allocate capital towards the provision of products or services aligned with sustainable development (activity alignment).
In September 2015, the UN launched the 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. Greenbank have mapped the SDGs to a set of eight sustainable development categories and a number of underlying sub-categories. These categories ultimately align with the same ambitions as the SDGs, but focus on the areas most relevant to companies. We use these categories to determine how successful individual companies are at translating aspirations into tangible results.
- Energy and climate: Support decarbonisation aligned to the goals of the Paris Agreement on climate change.
- Habitats and ecosystems: Preserve and enhance natural systems by encouraging companies to have a net positive impact on biodiversity.
- Resource efficiency: Promote a circular economy that supports sustainable levels of consumption.
- Inclusive economies: Promote an equitable economy in which there is expanded opportunity for shared prosperity.
- Decent work: Ensure proper emphasis on the quality of jobs being created and maintained alongside their quantity.
- Innovation and infrastructure: Support infrastructure that is fit to achieve broader planetary and societal goals.
- Resilient institutions: Strengthen well-functioning institutions that protect the rule of law and fundamental rights.
- Health and wellbeing: Ensure companies do not undermine the health of their beneficiaries and encourage improved health outcomes.
Operational alignment
Our focus is on three principal areas of operations: employment, environment and human rights. If a company is to be aligned to one of the eight categories based on operational alignment, it must display positive action which is well developed and leading across one or more of these areas.
Activity alignment
We analyse whether companies 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 SDGs, and if this practice is central to their business models.
Process:
Rathbone Greenbank Multi-Asset Portfolios are designed to enable investors to invest in line with both their financial objectives and their sustainable values — where they don’t have to sacrifice their values for financial gain. We aim to deliver attractive risk-adjusted returns via a pragmatic and straight-forward investment approach, with sustainability being a central pillar of the process. The fund range seeks to provide investors with resilient and genuinely diversified range of funds.
We believe it is possible to achieve long-term growth by investing in companies that conduct their business, and thereby apply capital, in a responsible way. Corporate activity has an impact on society and the environment, and this type of investing takes these factors into consideration.
Our investment team look to identify material ESG risks in their investment analysis. This enables us to uncover any potential ESG risks or identify any potential ESG opportunities a company may have, before deciding whether or not we believe those factors could be financially material to that particular company and therefore affect our investment decision. We only consider material ESG factors in our investment process. When assessing whether an ESG factor is material to a particular company we consider (1) Probability: how likely it is to affect the financial or operating performance of the company (2) Impact: how large would the impact be on the financial or operating performance of the company if the ESG issue occurred.
There is not one exhaustive list of the types of ESG issues we may integrate into our analysis (and these will likely differ depending on the sector and region the company operates in) however some examples of the types of ESG factors we may look at include:
Environmental
This covers matters relating to the quality and functioning of the natural environment including:
- Climate change and carbon emissions
- Air and water pollution
- Biodiversity
- Deforestation
- Energy efficiency
- Waste management
- Water scarcity
Social
This focuses on the rights, well-being and interests of people and communities including:
- Customer satisfaction
- Data protection and privacy
- Gender and diversity
- Employee engagement
- Community relations
- Human rights
- Labour standards
Governance
This relates to the governance of companies and other investment vehicles including:
- Board composition
- Audit committee structure
- Bribery and corruption
- Executive compensation
- Lobbying
- Political contributions
- Whistleblower schemes
After the fund managers have identified material ESG risks in their investment analysis and assessed the potential impact of these on companies before making an investment decision, all assets in the fund are then scrutinised against pre-determined sustainability criteria by Greenbank Investment’s (Greenbank) Ethical Sustainable and Impact ESI research team, which maintains a proprietary database of in-depth profiles on companies and countries. The criteria have been designed to exclude entities whose activities or behaviours hinder sustainable development and identify those that are delivering benefits for society and the environment.
New investments that are considered suitable for the funds are investigated as requested by the fund managers and subjected to the team’s screening process. The team looks to update all of its in-depth company profiles on a 12-18 month cycle. A full review of the fund’s eligible investment universe will be carried out an annual basis ahead of a formal annual review meeting.
The fund’s holdings are monitored regularly, and reviewed in the light of any relevant news, merger and acquisition activity or findings from ongoing analysis. As new governments are elected, or companies change their activities, merge with others or develop new policies and practices, their sustainability credentials may alter. The Greenbank ESI research team works closely with the fund managers to highlight changes in sustainability performance and ensure that the funds only hold approved investments.
Divestment on sustainability grounds is likely to be uncommon, as investments we hold are unlikely to change their ‘spots’ overnight. If the activities of a company change, such that it is no longer suitable for the funds, the fund managers would normally seek to sell the holding within three to six months.
Finally, stewardship forms an essential part of our approach to responsible investment. Stewardship is a crucial fourth 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.
Our full sustainability criteria can be found in the Rathbone Greenbank Sustainability Process brochure which is available on Fund Eco-Market and our website.
ESG dataThe Multi-Asset team source ESG data from several vendors in order to support the fund manager’s ESG integration work. The team utilises resources including:
- MSCI ESG ratings and research: measures a company’s resilience to long-term, financially relevant ESG risks and opportunities
- Sustainalytics ESG risk ratings and research: measures the magnitude of a company’s unmanaged ESG risks
- Industry ESG conferences and company meetings: provide information on both sector-wide and company specific ESG or sustainability issues
- ESG research/comments from internal and third-party analysts: provide additional insight into any relevant ESG issues affecting potential investment opportunities
- Weekly sustainability news flow: provides weekly news on material sustainability issues and topics across our multi asset holdings
To apply the sustainability criteria, the ESI research team use MSCI ESG Manager as a tool to help identify which companies we need to screen out of our portfolios for not meeting our exclusionary criteria. The screening tool looks at companies’ revenue exposure or ESG score to different areas we screen out and flags if there is a breach.
In addition to the reporting outputs from companies themselves, the Greenbank team uses a variety of sources, including reports and publications from industry groups, non-governmental organisations, sell-side analysts, external research bodies and specialist responsible investment publications, to arrive at a balanced view of companies’ overall performance. Some examples of sources of information include the Workforce Disclosure Initiative, Access to Medicine Index, Access to Nutrition Initiative and CDP (Carbon Disclosure Project). Since June 2015, the team has also subscribed to MSCI ESG Manager to reinforce this process, utilising tools such as their SDG alignment tool, as an initial starting point for their analysis in some cases. Greenbank also conducts research into wider topics such as climate change, clean energy, human rights, community investment and employee welfare and utilises this research when conducting the sustainability screening for the funds.
Regarding government bonds, Greenbank has access to a variety of sources but primarily uses Freedom House’s ‘Freedom in the World’ Report, Transparency International’s Corruption Perception Index, military spend data from the Stockholm International Peace Institute, the Climate Change Performance Index and the Climate Action Tracker for their assessment.
For sustainability bonds, Greenbank will also take into consideration whether the financing framework is aligned to an external standard, which can include, but is not limited to, the International Capital Market Association’s Green Bond Principles and the Climate Bonds Initiative’s Climate Bonds Standard and Certification Scheme.
Resources, Affiliations & Corporate Strategies:
Fund Managers Will McIntosh-Whyte and David Coombs have ultimate responsibility for investment decisions and stock selection on the funds. Once an investment has been researched and deemed suitable for the funds from a financial perspective, it then needs to be scrutinised in line with the pre-determined sustainability criteria. Greenbank Investments has the power of veto if the investment fails to meet the sustainability criteria, ensuring validation by an independent, third party. The relationship with Greenbank Investments provides the discipline and the independence of governance that ensures the commitment to sustainability.
In addition to this, we work collegiately with the wider asset management business where we have fund managers and analysts working on a range of equity and fixed income mandates. There is also a dedicated resource of investment professionals in the wider Rathbones business working purely in an analytical capacity within the research function.
For biographies of the team please visit https://www.rathbonesam.com/uk/financial-adviser/greenbank-multi-asset-portfolios
Greenbank Investments’ ESI research team
Greenbank investments’ specialist ethical, sustainable and impact (ESI) team conduct ethical research and apply the fund’s ethical screening criteria. The team at Greenbank have 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 Greenbank, utilising their many years’ experience of managing private client portfolios as well as providing screening services for the other Rathbones’ sustainable funds (including the Rathbone Greenbank Global Sustainability Fund and the Rathbone Greenbank Global Sustainable Bond Fund).
Greenbank Investments work with over 1,200 clients across the UK and manage over £2.3bn in assets (as at 31 March 2024).
Kate Elliot is Head of Greenbank’s ESI research team, which comprises:
- Perry Rudd - Ethical, Sustainable and Impact Research Adviser
- Sophie Lawrence - Stewardship and Engagement Lead
- Emma Williams - Senior Ethical, Sustainable and Impact Researcher
- Kai Johns - Senior Ethical, Sustainable and Impact Researcher
- Charlie Young - Ethical, Sustainable and Impact Researcher
- Lauren O’Leary - Ethical, Sustainable and Impact Researcher
- Caitlin Westlake - Assistant Ethical, Sustainable and Impact Researcher
For biographies of the team please visit the Our People page on the Rathbones website.
Rathbones Stewardship team
The Rathbones Group Stewardship team is led by Matt Crossman and comprises:
- Archie Pearson: ESG & Stewardship Analyst, Voting Lead
- Kazuki Shaw: ESG & Stewardship Analyst
- Philippa Bliss – ESG & Stewardship Analyst
- Tilia Astell: Junior ESG & Stewardship Analyst
In addition to this, Jenny Foster is an Engagement Analyst for Rathbones Asset Management, working with all of the fund managers to deliver Rathbone Asset Management's engagement strategy and lead direct engagements with companies.
ESG affiliations and memberships
Rathbones Group is a member of PIMFA and UK Finance. They are also members of or signatories to:
- UK Stewardship Code
- PRI
- CDP
- IIGCC
- Climate Action 100+
- Living Wage employer
- The Workplace Wellbeing Charter
- The FTSE Women Leaders Review
- Signatories to UN Global Compact
- Signatories to Women in Finance Charter
- Listed on FTSE4Good
- Net Zero Asset Managers Initiative
- Business Ambition 1.5ºC
- Inclusive Companies
- UKSIF
Please see the Rathbones website for further details at: About Us | Partnership and memberships
Greenbank (Rathbones’ specialist sustainable investment division) partners with many different members of the responsible investment community. These are shown below:
- Ecumenical Council for Corporate Responsibility (ECCR)
- Workforce Disclosure Initiative (WDi)
- The Food Foundation
- Access to Medicine Index
- Access to Nutrition Initiative
- Finance for Biodiversity
- Business Benchmark on Farm Animal Welfare (BBFAW)
- Long-term Investors in People’s Health – ShareAction
- FAIRR
- Financing a Just Transition Alliance
- New Plastics Economy Global Commitment
- Paris Aligned Investment Initiative
- Investor Alliance on Human Rights
- Business Coalition for a Global Plastics Treaty
Please see the Greenbank Investments website for further details at: Partnerships | Greenbank
SDR Labelling: Unlabelled with sustainable characteristics
Literature
Voting Record
Disclaimer
Note re Filters:
PRI A+ rated
In 2022, PRI updated their scoring mechanism. This in turn has altered how Rathbones Group Plc reports its scores.
Rathbone Group Scores:
- Investment and stewardship policy: our score was 72% in 2020. For this category, now expanded to cover stewardship activities too, and renamed policy, governance and strategy, we earned a score of 77%.
- Direct – listed equity active fundamental: up from 37% in 2020 to 42% now.
- Fixed income – SSA and corporate: up from 28% and 29% in 2020 to 67% in both cases. 'SSA' stands for sovereign, supranational and agency debt (mainly government bonds).
- Confidence-building measures: 80%. This is a new category, which assesses how we review and verify the data reported to the PRI. Issues considered include our overall approach to review and verification, whether a third party has checked the data, whether our internal audit team has done the same, and the seniority of the Rathbones executive who reviewed the report before submission.
The Rathbones Group scores published in 2023 can be found on page 41 of our responsible investment report for our 2023 activity.
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Disclaimer
Important Information
The information contained in this document is for use by investment advisers and is not intended for circulation to private clients or the general public.
Past performance should not be seen as an indication of future performance. The value of investments and the income from them may go down as well as up and you may not get back your original investment.
Rathbones Asset Management is authorised and regulated by the Financial Conduct Authority and Rathbones Asset Management is a member of the Investment Association.
Rathbones Asset Management Limited: Registered address 8 Finsbury Circus, London, EC2M 7AZ.
Registered No. 02376568 - A Member of the Rathbone Group.
| Fund Name | SRI Style | SDR Labelling | Product | Region | Asset Type | Launch Date | Last Amended |
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Rathbone Greenbank Defensive Growth Portfolio Fund |
Sustainable Style | Unlabelled with sustainable characteristics | OEIC | Global | Mixed Asset | 29/03/2021 | Aug 2024 | |
ObjectivesThere are four portfolios in the Rathbone Greenbank Multi Asset range, all with clear return, risk and sustainability objectives. The sustainability objective for all the funds is to invest in entities whose activities or ways of operating are aligned with sustainable development and therefore support the achievement of the 17 UN-backed Sustainable Development Goals (SDGs). Our aim is to invest in companies and entities that display strong environmental, social and governance policies and practices because we believe they are well-positioned to deliver long-term value creation for investors. The funds use a negative screening process to avoid investing in companies that create significant negative impacts that are considered to be incompatible with sustainable development. In order to qualify for inclusion in the funds, companies and entities that pass the negative screen must also display alignment with sustainable development through their operations and/or activities (positive alignment analysis). We aim to deliver a greater total return than the Consumer Price Index (CPI) measure of inflation + 2%. Total return means the return we receive from the value of our investments increasing (capital growth) plus the income we receive from our investments (interest and dividend payments). We use the CPI + 2% as a target for our fund’s return because we aim to grow your investment above inflation.
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Fund Size: £152.56m (as at: 31/03/2024) Total Screened Themed SRI Assets: £2738.66m (as at: 31/03/2024) Total Assets Under Management: £15000.00m (as at: 31/03/2024) ISIN: GB00BMQC6K53, GB00BMQC6L60 Contact Us: ram@rathbones.com |
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Sustainable, Responsible &/or ESG OverviewThe fund seeks to invest in entities whose activities or ways of operating are aligned with sustainable development and therefore support the achievement of the UN Sustainable Development Goals. We believe companies displaying strong policies and practices to manage environmental, social and governance issues are likely to be well-positioned to deliver long-term value creation for investors. The fund avoids entities creating significant negative impacts that are considered to be incompatible with sustainable development. The fund follows a four-step investment process combining the expertise of Rathbones Asset Management and Greenbank:
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Primary fund last amended: Aug 2024 |
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Information received directly from Fund Manager |
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Fund FiltersSustainability - General
Sustainability policy
Funds that have policies that consider (environmental and social) sustainability issues. Strategies vary but are likely to consider environmental issues like climate change, carbon emissions, biodiversity loss, resource management, environmental impacts; and social issues like equal opportunities, human rights, labour standards, diversity and adherence to internationally recognised codes. See fund information. Environmental - General
Environmental policy
Funds that have policies which relate to environmental issues. These will typically set out the fund's stance on issues such as pollution, climate change, resource management, biodiversity loss, carbon emissions, plastics and/or additional environmental impacts. Strategies vary. See fund information for further information.
Limits exposure to carbon intensive industries
Funds that limit or 'reduce' their exposure to carbon intensive industries (ie sectors which are major contributors to climate change. Funds vary - some funds may be 'underweight' in this area which means they may have some investment in highly carbon intensive areas. Funds of this kind may choose companies they consider to be 'best in sector' and encourage ever higher standards. Strategies vary. See fund information for further details. Nature & Biodiversity
Biodiversity / nature policy
Find funds that have a written biodiversity policy or theme aimed at encouraging and improving environmental protection and safeguarding the natural world (sometimes referred to as the preservation or enhancement of 'natural capital'). See eg https://www.un.org/en/climatechange/science/climate-issues/biodiversity
Deforestation / palm oil policy
Find funds that have policies in place designed to ensure they do not invest in companies that are significantly involved in deforestation. This typically relates to palm oil plantations where biodiversity loss is a major concern (as well as other issues). Strategies vary. See fund information for further detail.
Illegal deforestation exclusion policy
Find funds that have policies in place explaining that they avoid companies involved in illegal and/or unsustainable deforestation. This may relate to palm oil, cattle farming or other concerns. Strategies vary. See fund information for further detail. Climate Change & Energy
Climate change / greenhouse gas emissions policy
Funds that have policies (documented strategies that explain their position on) climate change related issues such as greenhouse gas/carbon emissions, net zero, transitioning to lower carbon. Strategies vary. Read fund details for further information.
Coal, oil & / or gas majors excluded
Funds that avoid investing in major coal, oil and/or gas (extraction) companies. Funds vary: some may exclude all companies that extract oil. Others may have exposure to oil extraction via more diversified energy companies. See fund literature to confirm details.
Fracking and tar sands excluded
Funds that avoid companies involved in fracking and tar sands - which are widely regarded as controversial methods of oil and gas extraction. Strategies vary. See fund information for further information.
Arctic drilling exclusion
Funds that avoid companies that are involved in extracting oil from the Arctic regions. See fund literature for further details.
Fossil fuel reserves exclusion
Funds that avoid investing in companies with coal, oil and gas reserves. See fund information for further details.
Fossil fuel exploration exclusion - direct involvement
The fund manager excludes companies with direct involvement in fossil fuel exploration (eg coal, oil and gas companies)
TCFD reporting requirement (Becoming IFRS)
Will only invest in companies that report greenhouse gas emissions reduction strategies in line with the framework set out the by the Taskforce for Climate Related Financial Disclosure, which is increasingly becoming mandatory. See https://www.fsb-tcfd.org/ https ://www.ifrs.org/sustainability/tcfd/ Social / Employment
Social policy
Find funds that have policies which set out their approach to social issues (e.g. human rights, labour standards, equal opportunities, child labour and adherence to internationally recognised codes such as the UN Global Compact). Funds with social policies typically avoid companies with low standards or work to encourage higher standards. See fund information for detail.
Diversity, equality & inclusion Policy (fund level)
Find individual funds that have a written diversity policy – where the fund manager will aim to select companies with a carefully considered, sound approach to diversity. This should ideally cover a range of issues including gender, ethnicity, disability, beliefs, sexual orientation, etc.
Mining exclusion
All mining companies excluded Ethical Values Led Exclusions
Tobacco and related product manufacturers excluded
Companies are excluded if they are involved in any aspect of the production chain for tobacco products, including cigarettes, vaping, e-cigarettes, chewing tobacco and cigars.
Tobacco and related products - avoid where revenue > 5%
Companies are excluded if they make more than 5% of their revenue from the manufacture, sale or distribution of tobacco products including cigarettes, vaping, e-cigarettes, chewing tobacco and cigars.
Armaments manufacturers avoided
Find funds that avoid companies that manufacture products intended specifically for military use. Fund strategies vary - particularly with regard to non-strategic military products. See fund literature for fund specific details.
Civilian firearms production exclusion
Find funds with a written civilian firearms exclusion policy - meaning that they will not invest in companies that make (or perhaps also sell) handguns made for non-military users.
Alcohol production excluded
Find funds that avoid investment in companies involved in the production of alcohol. Strategies vary; some funds allow a small proportion of profits to come from this area. See fund literature for further information.
Gambling avoidance policy
Find funds that avoid companies with significant involvement in the gambling industry. Some funds may allow a small proportion of profits to come from this area. See fund policy for further details.
Pornography avoidance policy
Find funds that avoid companies that derive significant income from pornography and related areas. Strategies vary. See fund details for further information.
Animal welfare policy
Find funds with policies that require specific animal welfare standards to be met. These may reference well-known welfare standards (3Rs - Replace, Reduce, Refine) or certification schemes. Strategies vary. See fund information for further detail. Human Rights
Human rights policy
Find funds that have policies relating to human rights issues. Funds of this kind typically require companies to demonstrate higher standards, although some fund managers work to encourage improvements. Investee companies are often judged against internationally agreed norms or standards. Strategies vary. See fund information for further detail.
Oppressive regimes (not free or democratic) exclusion policy
Find funds with policies that exclude companies or other assets where regimes are not democratic, or where people may be oppressed. May use eg. Freedom House research. Strategies vary. See fund literature for further information.
Modern slavery exclusion policy
The fund has a policy which excludes assets with involvement in Modern Slavery Gilts & Sovereigns
Invests in gilts / government bonds
Find funds that invest in loans issued the government, commonly known as gilts or government bonds. These may or may not be ringfenced for specific projects (see additional options). See fund literature for any selection criteria.
Gilts / government bonds - exclude some
Find funds that avoid investing in 'some' gilts or government bonds. Strategies vary, but this may relate to avoiding specific countries or particular reasons for bond issuance. 'Green gilts' for example would be likely to be acceptable. See fund literature for further information.
Invests in sovereigns subject to screening criteria
Find funds that invest in financial instruments issued by governments, but will only hold those that meet certain environmental and or social criteria. This may, for example mean certain assets are excluded in line with eg Freedom House research. Strategies vary, see fund literature for more information. Banking & Financials
Invests in banks
Find funds that include banks as part of their holdings / portfolio.
Invests in insurers
Funds that do or may invest in insurance companies. Governance & Management
Encourage higher ESG standards through stewardship activity
A core element of these funds will aim to encourage higher ESG standards through responsible ownership / stewardship / engagement /voting activity Fund Governance
External (fund) committee has veto powers
Find funds that employ an external committee (i.e. not company employees) that has power to veto (i.e. overrule) fund managers stock selection decisions. (This would typically mean the committee can tell the manager of this particular fund not to buy / sell a specific investment when they consider it appropriate to do so.)
ESG integration strategy
Find funds that factor in 'environmental, social and governance' issues as part of their investment decision making process. A focus on 'ESG' typically means a fund is carrying out additional research to help reduce ESG related risks. It does not necessarily mean a focus on sustainability. Strategies vary. See fund literature. Asset Size
Invest in supranationals
International entities or bodies with agreed remits that are broadly similar to those that may otherwise be undertaken by individual governments eg the UN How The Fund Works
Positive selection bias
Find funds that focus on finding and investing in companies with positive / beneficial attributes. This strategy can be applied in addition to exclusion criteria and engagement/stewardship activity.
Negative selection bias
Find funds where their main 'ethical approach' is to avoid companies by using negative screening criteria. Read fund literature for further information.
Combines norms based exclusions with other SRI criteria
Find funds that make significant use of internationally agreed 'norms' (e.g. United Nations Global Compact - UNGC - or the UN Sustainable Development Goals - SDGs) as part of their investment selection process alongside additional SRI criteria such as positive or negative stock selection policies and/or stewardship strategies.
Combines ESG strategy with other SRI criteria
Find funds that have an ESG strategy (which is typically focused on avoiding companies that pose environmental, social or governance related risks) with additional criteria such as positive and/or negative screens, themes and stewardship strategies.
SRI / ESG / Ethical policies explained on website
Find funds that have published explanations of their ethical, social and/or environmental policies online (i.e. fund decision making strategies/ buy/sell &/or asset management strategies).
Different risk options of this strategy are available
See fund information for different risk options of this fund strategy Unscreened Assets & Cash
All assets (except cash) meet published sustainability criteria
All assets held in the fund - except cash - meet the sustainability criteria published in fund documentation. Intended Clients & Product Options
Intended for investors interested in sustainability
Finds funds designed to meet the needs of individual investors with an interest in sustainability issues.
Intended for clients interested in ethical issues
Find funds designed for clients who care about ethical and values-based issues, often alongside sustainability issues also.
Available via an ISA (OEIC only)
Find funds that are available via a tax efficient ISA product wrapper. Fund Management Company InformationAbout The Business
Responsible ownership / stewardship policy or strategy (AFM company wide)
Finds fund management companies that have a published company wide stewardship, engagement and / or responsible ownership policy or strategy that covers all investments. Stewardship typically involves encouraging higher ESG standards through voting and dialogue.
ESG / SRI engagement (AFM company wide)
Find fund management companies that actively encourage higher 'environmental, social and governance' and/or 'sustainable and responsible investment' practices across investee companies - typically where the aim is to encourage positive change that is aligned with the best interests of investors. Strategies vary. See additional information and options.
Vote all* shares at AGMs / EGMs (AFM company wide)
Find fund managers that vote all* the shares they own at Annual General Meetings and Extraordinary General Meetings. A commitment to voting shares is a key indicator of 'responsible share ownership' demonstrating their support for or disagreement with management policy. (*situations can legitimately, occasionally occur where voting proves impossible, but in principle all shares should be voted.)
Responsible ownership / ESG a key differentiator (AFM company wide)
Find fund managers that consider responsible ownership and ESG to be a key differentiator for their business.
Responsible ownership policy for non SRI funds (AFM company wide)
Find funds run by fund managers that apply Responsible ownership or 'Stewardship' policies to all or most of their investment assets. This means active involvement (e.g. voting, dialogue) with the companies they invest in across funds (not normally limited to ethical or SRI options.) Read fund literature for further information.
In-house diversity improvement programme (AFM company wide)
Finds organisations / fund managers that have an in-house (company wide) diversity improvement programme - meaning that they are working to ensure that within their own businesses they employ people from diverse backgrounds - often typically focused on ethnicity and/or sex.
Diversity, equality & inclusion engagement policy (AFM company wide)
Find fund management companies that encourage the companies they invest in to have strong diversity, race, gender and other equality policies across all assets held, not simply screened or themed SRI/ESG funds. (ie Asset Management company wide).
Vulnerable client policy on website (AFM company wide)
Asset manager has information on their website that explains how they treat 'vulnerable clients' (as set out in FCA regulation)
Invests in new sustainability linked bond issuances (AFM company wide)
Asset management company has investments in bonds designed to meet sustainability requirements - however these assets may not be 'ringfenced' for this purpose. See fund manager website for details.
Offer unstructured intermediary sustainable investment training
Fund management entity offers unstructured intermediary training on sustainable investment (ie for financial advisers and wealth managers) Collaborations & Affiliations
PRI signatory
Find fund management companies that have signed up to the UN backed 'Principles of Responsible Investment'.
UKSIF member
Find fund management companies that are members of UKSIF - the UK Sustainable Investment and Finance association
Fund EcoMarket partner
Find fund management companies that have partnered with Fund EcoMarket - meaning that they are helping to improve access to information on sustainable and responsible investment by paying an annual fee to us which enables us to publish information for free. Partner funds are listed ahead of other funds and have their logos displayed.
TNFD forum member (AFM company wide)
A member of the Taskforce for Nature Related Financial Disclosures group which aims to aid risk management and shift money towards nature-positive outcomes.
Investment Association (IA) member
Fund management entity is a member of the Investment Association https://www.theia.org/ Resources
In-house responsible ownership / voting expertise
Find fund management companies that employ people to steer and support fund managers in voting shares at company AGM's and EGMs in ways that are consistent with encouraging higher ESG/sustainability standards.
Employ specialist ESG / SRI / sustainability researchers
Find a fund management company that directly employs specialist ESG/SRI/sustainability researchers or analysts. This allows asset managers to discuss environmental, social and governance risks and opportunities directly with companies. Accreditations
PRI A+ rated (AFM company wide)
Finds organisations / fund managers that have an A+ PRI rating - meaning they are highly rated according to the 'Principles of Responsible Investment'
UK Stewardship Code signatory (AFM company wide)
Find fund managers that are signatories to the FRC UK Stewardship Code, which sets out a framework for constructive investor / investee relations where fund managers are encouraged to behave like responsible, typically longer term 'company owners'. Engagement Approach
Engaging on climate change issues
Fund manager has stewardship /responsible ownership strategy that is focused on addressing climate change with investee assets.
Engaging with fossil fuel companies on climate change
Asset manager has a stewardship /responsible ownership strategy that involves working with fossil fuel companies on climate change related issues. See fund manager website for details.
Engaging to reduce plastics pollution / waste
Asset manager has stewardship /responsible ownership strategy with involves encouraging investee asset to reduce plastic waste and pollution.
Engaging to encourage responsible mining practices
Asset manager has a stewardship / responsible ownership policy that means they are working to encourage more responsible mining practices - where environmental and social issues are properly dealt with by the companies they invest in.
Engaging on biodiversity / nature issues
The asset manager has a responsible ownership / stewardship strategy that focuses on biodiversity and nature issues relating to the assets they invest the aim of which will be to reduce harm and or deliver improvement. Strategies vary. https://tnfd.global
Engaging to encourage a Just Transition
Asset manager has a responsible ownership / stewardship strategy which means they are working to encourage the shift to more sustainable business practices in ways that respect and are sensitive to social issues and the impact change has on people effected by the changes that are taking place. https://www.transitionpathwayinitiative.org/ https://transitiontaskforce.net/
Engaging on human rights issues
Asset manager has responsible ownership / stewardship strategy in place which aims to address human rights issues in investee companies (and potentially their suppliers) with the aim of raising standards
Engaging on labour / employment issues
Asset manager has responsible ownership / stewardship strategy in place that aims to improve labour standards for the benefit of employees in investee companies (and potentially their suppliers)
Engaging on diversity, equality and / or inclusion issues
Asset management company has a stewardship strategy in place which involves working to raise diversity, equality and inclusion standards across investee assets
Engaging to stop modern slavery
working with the assets they hold to help stamp out modern slavery - where direct or indirect company employees are exploited for business benefits.
Engaging on governance issues
Fund managers have stewardship strategies in place that focus on improving governance standards across investee assets
Engaging on responsible supply chain issues
Has a stewardship / responsible ownership strategy that encourages responsible supply chain - ie the managers will discuss environmental, social and governance issues with investee companies with the aim of raising standards Company Wide Exclusions
Coal divestment policy (AFM company wide)
This asset manager has a strategy in place that will lead them to exit direct investments in the coal mining industry. Managers ability to do this may depend on the geographic regions in which they invest. Climate & Net Zero Transition
Net Zero commitment (AFM company wide)
Fund management organisations that have pledged to reduce their greenhouse gas emissions to ‘net zero’. Strategies vary - this area is changing rapidly.
Net Zero - have set a Net Zero target date (AFM company wide)
This asset management company has set a date by which they plan to achieve net zero greenhouse gas / CO2e emissions.
Encourage carbon / greenhouse gas reduction (AFM company wide)
Find fund management companies that are working with the companies they invest in to encourage reductions in carbon dioxide and other greenhouse gas emissions.
‘Forward Looking Climate Metrics’ published / ITR (AFM company wide)
Finds organisations / fund managers that have published ‘forward looking climate metrics’ e.g. 'implied temperature rise' data that are a total of the asset management company's share (% owned) of all the investee company emissions of the assets they manage, as well as their own direct and other indirect emissions.
Carbon offsetting – do NOT offset carbon as part of net zero plan (AFM company wide)
This asset management company plans to achieve net zero greenhouse gas (CO2e) emissions by reducing their emissions. Calculations and scope vary.
Working towards a ‘Net Zero’ commitment (AFM company wide)
Finds organisations / fund management companies that are in the process of working out how to make a ‘net zero commitment’ - meaning that when that is finalised they will have started the process of reducing their total greenhouse gas emissions to'zero'.
Committed to SBTi / Science Based Targets Initiative
See https://sciencebasedtargets.org/ Transparency
Publish responsible ownership / stewardship report (AFM company wide)
Find fund management companies that publish a report detailing their responsible investment ownership - also known as 'Stewardship' - activity.
Publish full voting record (AFM company wide)
Fund management companies that publish a full record of how they vote their shares at AGMs (annual general meetings) and EGMs (extraordinary general meetings). Voting strategies have an important role to play encouraging higher environmental, social and governance standards. Sustainable, Responsible &/or ESG Policy:The fund aims to invest in entities whose activities or ways of operating are aligned with sustainable development and which we believe have the potential to support the achievement of the UN Sustainable Development Goals (SDGs). To do this, the sustainable funds take the following approaches:
All potential investments are put forward by the fund managers, with the team at Greenbank then undertaking the necessary sustainability analysis and making the final decision about its eligibility for inclusion in the funds.
Government bonds have historically been an area of debate for sustainable investors because the majority of bond-issuing countries devote some of their budgets to military spending and generate tax revenues from controversial industries such as tobacco and alcohol. However, we believe this needs to be considered alongside the significant positive impact that many governments have on the environment and society. This may be through policies, regulations and subsidies designed to protect the environment, or the significant proportion of spending devoted to education, welfare, healthcare, etc. Nevertheless, governments are not automatically deemed to be acceptable and, for us to invest in their bonds, they must meet at least three of the following four criteria:
Companies are assessed against a number of positive and negative top-level social and environmental criteria. The team analyse in detail the specific merits of each company’s individual activities and sustainable business practices.
Green bonds, social bonds, sustainability bonds, or similar bonds where the proceeds are used to support specified environmental or social objectives, may be eligible for inclusion in the fund. Each is subject to the usual sustainability criteria applied to the issuer. If the corporate issuer itself does not pass our positive and negative screens, a bond may still be approved for inclusion in the fund on the merits of how the bond’s proceeds will be used, rather than the issuer’s principal activity. When analysing a ring-fenced bond against our criteria, we will look at:
The funds apply screening criteria to avoid investing in companies creating significant negative impacts that are considered to be incompatible with sustainable development. The funds shall exclude companies in breach of specific criteria related to one or more of the following:
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 funds, companies that pass the negative screen must also display leading or well-developed business practices and policies (operational alignment), and/or allocate capital towards the provision of products or services aligned with sustainable development (activity alignment). In September 2015, the UN launched the 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. Greenbank have mapped the SDGs to a set of eight sustainable development categories and a number of underlying sub-categories. These categories ultimately align with the same ambitions as the SDGs, but focus on the areas most relevant to companies. We use these categories 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. If a company is to be aligned to one of the eight categories based on operational alignment, it must display positive action which is well developed and leading across one or more of these areas.
Activity alignment We analyse whether companies 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 SDGs, and if this practice is central to their business models.
Process:Rathbone Greenbank Multi-Asset Portfolios are designed to enable investors to invest in line with both their financial objectives and their sustainable values — where they don’t have to sacrifice their values for financial gain. We aim to deliver attractive risk-adjusted returns via a pragmatic and straight-forward investment approach, with sustainability being a central pillar of the process. The fund range seeks to provide investors with resilient and genuinely diversified range of funds. Our investment team look to identify material ESG risks in their investment analysis. This enables us to uncover any potential ESG risks or identify any potential ESG opportunities a company may have, before deciding whether or not we believe those factors could be financially material to that particular company and therefore affect our investment decision. We only consider material ESG factors in our investment process. When assessing whether an ESG factor is material to a particular company we consider (1) Probability: how likely it is to affect the financial or operating performance of the company (2) Impact: how large would the impact be on the financial or operating performance of the company if the ESG issue occurred. There is not one exhaustive list of the types of ESG issues we may integrate into our analysis (and these will likely differ depending on the sector and region the company operates in) however some examples of the types of ESG factors we may look at include:
This covers matters relating to the quality and functioning of the natural environment including:
This focuses on the rights, well-being and interests of people and communities including:
This relates to the governance of companies and other investment vehicles including:
New investments that are considered suitable for the funds are investigated as requested by the fund managers and subjected to the team’s screening process. The team looks to update all of its in-depth company profiles on a 12-18 month cycle. A full review of the fund’s eligible investment universe will be carried out an annual basis ahead of a formal annual review meeting. The fund’s holdings are monitored regularly, and reviewed in the light of any relevant news, merger and acquisition activity or findings from ongoing analysis. As new governments are elected, or companies change their activities, merge with others or develop new policies and practices, their sustainability credentials may alter. The Greenbank ESI research team works closely with the fund managers to highlight changes in sustainability performance and ensure that the funds only hold approved investments. Divestment on sustainability grounds is likely to be uncommon, as investments we hold are unlikely to change their ‘spots’ overnight. If the activities of a company change, such that it is no longer suitable for the funds, the fund managers would normally seek to sell the holding within three to six months. Finally, stewardship forms an essential part of our approach to responsible investment. Stewardship is a crucial fourth 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. Our full sustainability criteria can be found in the Rathbone Greenbank Sustainability Process brochure which is available on Fund Eco-Market and our website.
To apply the sustainability criteria, the ESI research team use MSCI ESG Manager as a tool to help identify which companies we need to screen out of our portfolios for not meeting our exclusionary criteria. The screening tool looks at companies’ revenue exposure or ESG score to different areas we screen out and flags if there is a breach. In addition to the reporting outputs from companies themselves, the Greenbank team uses a variety of sources, including reports and publications from industry groups, non-governmental organisations, sell-side analysts, external research bodies and specialist responsible investment publications, to arrive at a balanced view of companies’ overall performance. Some examples of sources of information include the Workforce Disclosure Initiative, Access to Medicine Index, Access to Nutrition Initiative and CDP (Carbon Disclosure Project). Since June 2015, the team has also subscribed to MSCI ESG Manager to reinforce this process, utilising tools such as their SDG alignment tool, as an initial starting point for their analysis in some cases. Greenbank also conducts research into wider topics such as climate change, clean energy, human rights, community investment and employee welfare and utilises this research when conducting the sustainability screening for the funds. Regarding government bonds, Greenbank has access to a variety of sources but primarily uses Freedom House’s ‘Freedom in the World’ Report, Transparency International’s Corruption Perception Index, military spend data from the Stockholm International Peace Institute, the Climate Change Performance Index and the Climate Action Tracker for their assessment. For sustainability bonds, Greenbank will also take into consideration whether the financing framework is aligned to an external standard, which can include, but is not limited to, the International Capital Market Association’s Green Bond Principles and the Climate Bonds Initiative’s Climate Bonds Standard and Certification Scheme. Resources, Affiliations & Corporate Strategies:Fund Managers Will McIntosh-Whyte and David Coombs have ultimate responsibility for investment decisions and stock selection on the funds. Once an investment has been researched and deemed suitable for the funds from a financial perspective, it then needs to be scrutinised in line with the pre-determined sustainability criteria. Greenbank Investments has the power of veto if the investment fails to meet the sustainability criteria, ensuring validation by an independent, third party. The relationship with Greenbank Investments provides the discipline and the independence of governance that ensures the commitment to sustainability. In addition to this, we work collegiately with the wider asset management business where we have fund managers and analysts working on a range of equity and fixed income mandates. There is also a dedicated resource of investment professionals in the wider Rathbones business working purely in an analytical capacity within the research function. For biographies of the team please visit https://www.rathbonesam.com/uk/financial-adviser/greenbank-multi-asset-portfolios
Greenbank Investments’ ESI research team Greenbank investments’ specialist ethical, sustainable and impact (ESI) team conduct ethical research and apply the fund’s ethical screening criteria. The team at Greenbank have 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 Greenbank, utilising their many years’ experience of managing private client portfolios as well as providing screening services for the other Rathbones’ sustainable funds (including the Rathbone Greenbank Global Sustainability Fund and the Rathbone Greenbank Global Sustainable Bond Fund). Greenbank Investments work with over 1,200 clients across the UK and manage over £2.3bn in assets (as at 31 March 2024). Kate Elliot is Head of Greenbank’s ESI research team, which comprises:
For biographies of the team please visit the Our People page on the Rathbones website.
Rathbones Stewardship team The Rathbones Group Stewardship team is led by Matt Crossman and comprises:
In addition to this, Jenny Foster is an Engagement Analyst for Rathbones Asset Management, working with all of the fund managers to deliver Rathbone Asset Management's engagement strategy and lead direct engagements with companies.
ESG affiliations and memberships Rathbones Group is a member of PIMFA and UK Finance. They are also members of or signatories to:
Please see the Rathbones website for further details at: About Us | Partnership and memberships
Please see the Greenbank Investments website for further details at: Partnerships | Greenbank
SDR Labelling: Unlabelled with sustainable characteristics LiteratureVoting RecordDisclaimerNote re Filters: PRI A+ rated In 2022, PRI updated their scoring mechanism. This in turn has altered how Rathbones Group Plc reports its scores.
The Rathbones Group scores published in 2023 can be found on page 41 of our responsible investment report for our 2023 activity. . Disclaimer Important Information The information contained in this document is for use by investment advisers and is not intended for circulation to private clients or the general public. Past performance should not be seen as an indication of future performance. The value of investments and the income from them may go down as well as up and you may not get back your original investment. Rathbones Asset Management is authorised and regulated by the Financial Conduct Authority and Rathbones Asset Management is a member of the Investment Association. Rathbones Asset Management Limited: Registered address 8 Finsbury Circus, London, EC2M 7AZ. Registered No. 02376568 - A Member of the Rathbone Group.
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