Morgan Stanley Investment Funds - Calvert Climate Aligned Fund
SRI Style:
Sustainability Tilt
SDR Labelling:
Not eligible to use label
Product:
SICAV/Offshore
Fund Region:
Global
Fund Asset Type:
Equity
Launch Date:
08/04/2022
Last Amended:
Oct 2024
Dialshifter (
):
Fund Size:
£6.31m
(as at: 31/03/2024)
ISIN:
LU2459593203, LU2459593385
Contact Us:
Objectives:
Long term growth of your investment involving economic activities that address climate transition and/or are aligned to the long term de-carbonisation objectives of the Paris Agreement. The Fund is in scope of Article 9 of the European Sustainable Finance Disclosure Regulation.
Sustainable, Responsible
&/or ESG Overview:
The Calvert Sustainable Climate Aligned Fund’s investment objective is to provide long-term capital appreciation, measured in US Dollars, primarily investing in companies that are involved in economic activities that address climate transition and/or are aligned to the long-term de-carbonisation objectives of the Paris Agreement. The Fund will maintain a carbon profile that follows the net zero objectives of the Paris Agreement, as reflected in the appropriate Paris-Aligned benchmark, or in the absence of an approved Paris-Aligned benchmark it will maintain a substantially lower carbon footprint, of at least 50% less than that of the underlying market benchmark, and taking into account the long-term carbon reduction objectives of the Paris Agreement which may warrant a revision of the targeted range of reduction over time. Carbon footprint shall be measured as weighted average carbon intensity, defined as tonnes of CO2 per $1million enterprise value including cash.
Primary fund last amended:
Oct 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.
Find funds which substantially focus on sustainability issues
Find funds where there is a significant emphasis on (environmental and social) sustainability. Funds with a 'sustainability theme' typically place more emphasis on the area than funds with a 'sustainability policy' - meaning that it is more likely to drive investment selection. Strategies vary. See fund information for further detail.
A core element of these funds aim to encourage higher sustainability standards across business practices through responsible ownership / stewardship / engagement / voting activity
Find funds that use the UN Global Compact to inform or help direct where they can or cannot invest and will typically not invest in companies with significant breaches (low standards) - although strategies vary. (The UNGC covers a wide range of issues - search 'UNGC'). See https://unglobalcompact.org/
Find funds that publicly report their performance against specifically named sustainability objectives (in addition to reporting their financial performance)
Fund has a strategy that focuses on sustainability issues in the property sector - they may eg use GRESB / BREEAM scores to inform investment decisions.
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.
Funds that aim to invest in companies with strong or market leading environmental policies and practices. Strategies vary - in particular the balance between 'financial' aspects and environmental benefits. Some may invest substantially in solutions or 'positive impact' companies - others may invest in more conventional companies providing certain environmental criteria are met. See fund information for further detail.
Climate Change & Energy
Find funds where investment in clean / renewable energy companies an other assets is central to their investment selection strategy. The proportion of the fund that is directly or indirectly invested in renewable energy varies between funds and over time. See fund information for further details.
A core element of these funds will aim to encourage the transition to lower carbon activities through responsible ownership / stewardship / engagement / voting activity
Fund funds that have an energy efficiency theme - typically meaning that a fund manager is focused on investing in organisations that manage - or help others to manage - energy use more carefully and less wastefully - and so reduce greenhouse gas emissions.
Funds that hold companies in the clean energy and renewable energy sectors (at the time research was supplied). Fund strategies vary, in particular the proportion of investment in these areas may vary significantly. Check fund literature for details.
This fund has a strategy that aims ensure its holdings will gradually reduce their greenhouse gas emissions in line with targets set at COP21 in Paris. The ultimate aim is to achieve ‘net zero emissions by 2050’ and a ‘maximum global temperature increase of +1.5 to +2 degrees above preindustrial levels’. Strategies and opinions vary. Read fund information.
Find funds that require all, or almost all, of the companies it invests in to have a ‘net zero action plan’ - meaning that the companies they invest in have worked out how they will, over time, reduce their total carbon (and other greenhouse gas) emissions to nil.
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 funds that have a labour standards policy - which can be expected to mean that the fund will invest in / favour companies that have higher standards in this area - although fund strategies can vary significantly (as with all policy areas). See eg https://www.ilo.org/international-labour-standards
Find funds that invest in line with positive strategies that relate to 'people' issues - such as having strong human rights, labour standards and equal opportunities practices. Such funds are likely to invest in companies that have market leading standards with regard to employee and supplier practices. Read fund literature for further information.
Ethical Values Led Exclusions
Find funds that have policies that set out their position on ethical or 'personal values' based issues. Strategies vary. See fund information for further detail.
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 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.
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 that have policies in place to ensure they do not invest in companies that employ children.
Gilts & Sovereigns
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 do not invest in, or exclude, gilts and/or government bonds.
Find funds that do not invest in / exclude 'sovereigns' - debt issued by governments. See eg https://www.investopedia.com/terms/s/sovereign-debt.asp
Banking & Financials
Find funds that include banks as part of their holdings / portfolio.
Funds that do or may invest in insurance companies.
Governance & Management
Find fund options that have policies that relate to corporate governance issues such as board structure, executive remuneration, bribery and/or corporate corruption. These funds will typically avoid companies with poor practices. Strategies vary. See fund literature for further information.
Find funds that aim to avoid investing in companies with poor governance practices.(e.g. board structure, management practices etc.) Views may however vary on what counts as 'poor' practices - and funds may not immediately divest as they may prefer to work to encourage higher standards. See fund literature for further information.
Exclude companies that are subject to United Nations sanctions. See eg https://main.un.org/securitycouncil/en/content/un-sc-consolidated-list
Fund managers encourage the companies they invest in to have more diverse board structures (e.g. more women on boards)
Find fund managers that encourage the banks and insurance companies they invest in to publish climate change related financial information - as set out by the Task Force on Climate Related Financial Disclosures (with the aim of helping investors measure and respond to climate risk).
A core element of these funds will aim to encourage higher ESG standards through responsible ownership / stewardship / engagement /voting activity
Asset Size
Find funds that invests more than half of their money into what are commonly regarded as 'large companies'. This will typically mean that the market capitalisation (or value) of the companies they hold is in excess of £5 to £10 billion.
Impact Methodologies
Funds that aim to measure the positive real world environmental and / or social benefits that are associated with their investment strategy. Funds that aim to deliver positive impacts and measure those impacts may be referred to as 'impact funds' - although impact measurement is not restricted to impact funds. Strategies vary. See fund information.
Find funds that direct investment towards companies where a major part of their business is about solving environmental challenges. e.g. companies helping to address climate change.
Fund aims to deliver positive environmental and or social impacts (real world benefits) through its engagement with investee assets
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 that invest more heavily in those that have higher ESG ratings/standards or scores and less heavily in companies with lower ESG ratings. Where this is central to a fund's strategy you should expect it to invest in most sectors. Strategies vary.
Find funds that make stock selection (and ongoing fund management) decisions based on ESG data or company ratings (normally supplied by third parties) rather than focusing on what individual companies do, how they operate or their plans for the future
Aims to avoid companies that do significant harm. This originates from the EU’s sustainable finance ‘DNSH’ (do no significant harm) work, which is not necessarily used by UK investors.
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).
Unscreened Assets & Cash
The percentage of assets held within the fund that match the fund’s sustainability objectives and are not being held purely for risk management purposes, such as derivatives and cash equivalent assets.
The percentage of assets held within the fund that match the fund’s sustainability objectives and are not being held purely for risk management purposes, such as derivatives and cash equivalent assets.
The percentage of assets held within the fund that match the fund’s sustainability objectives and are not being held purely for risk management purposes, such as derivatives and cash equivalent assets
Fund that only invest in cash to aid the practical management (buying and selling) of assets. These funds do not use additional financial instruments.
Intended Clients & Product Options
Finds funds designed to meet the needs of individual investors with an interest in sustainability issues.
Labels & Accreditations
Finds funds classified under Article 9 of the EU’s SFDR (Sustainable Finance Disclosure Requirements). Article 9 of the SFDR applies to financial products that have sustainable investment 'objectives' - including emissions reduction objectives. (These may currently be referred to as 'impact' funds or aiming to deliver clear, specific positive outcomes.) These rules do not currently apply in the UK so fund managers may leave this field blank.
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.
Find fund management companies that consider environmental, social and governance (ESG) issues when deciding whether or not to invest in a company for all / almost all of their funds and other assets. This is increasingly seen as part of sound risk management.
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).
Collaborations & Affiliations
Find fund management companies that have signed up to the UN backed 'Principles of Responsible Investment'.
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
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
Working to address sustainability, ESG and related concerns around artificial intelligence.
Company Wide Exclusions
Find fund management companies (not funds) that avoid investment in 'controversial weapons' across all of their funds and other investment vehicles.
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.
Fund manager AGM / EGM voting strategy has processes in place that mean they will normally be expected to vote in a way that will encourage the transition to net zero greenhouse gas emissions.
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.
This asset management company plans to achieve net zero greenhouse gas (CO2e) emissions by reducing their emissions. Calculations and scope vary.
Transparency
Find fund management companies that publish a report detailing their responsible investment ownership - also known as 'Stewardship' - activity.
Find companies that publish information about their sustainable and responsible investment strategies on their company website.
Find fund management companies that will supply information about their sustainable and responsible investment activity on request.
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.
This asset management company has published a plan that explains how they are going to achieve net zero greenhouse gas / CO2e emissions.
Find fund management companies that have supplied Dialshifter information. See Dialshifter tab within record for more information.
Comments
Calvert Research and Management (Calvert or CRM) is part of Morgan Stanley Investment Management (MSIM), the asset management division of Morgan Stanley.
As part of MSIM, Calvert has a distinctive investment philosophy, approach and viewpoint and provides ESG customized solutions to clients spanning the global markets.
Calvert’s infrastructure support including portfolio implementation and trading is supported by MSIM and its affiliates. As such, the responses in this questionnaire will refer to both companies where appropriate.
For the following responses in the Affiliations & Collaborations section, we have also included Morgan Stanley affiliations where appropriate: GFANZ member (AFM company wide), UN Net Zero Banking Alliance member (AFM company wide), Fund EcoMarket partner, UN Principles of Responsible Banking framework signatory (AFM company wide) and TNFD forum member (AFM company wide).
Sustainable, Responsible &/or ESG Policy:
Calvert broadly sees a multi-decade transformation of the global economic system defined by broad decarbonization efforts of the global energy system, endeavors to create business processes that are far more resource efficient and circular and an evolving social contract between individuals and institutions. This transformation must address investment risks from externalities, or impacts that companies have on the environment and society for which we do not currently have a pricing mechanism. Climate change is arguably the greatest of all externalities with once-in-a-generation events such as floods, droughts, hurricanes and heatwaves increasing in frequency. These externalities come with material negative economic impacts which raise the urgency with which to divert capital to tackle climate change and adapt to its impacts. As we look forward to the coming decades, we believe that capital markets are on the precipice of an increase in the impact of corporate environmental, social and governance (ESG) performance on security prices. We expect a corresponding acceleration of capital deployed to solve the environmental challenges we face today.
With this future state in mind, leadership on issues of sustainability such as climate change requires companies across industries to evolve their product strategies, refine their corporate strategies and continually strengthen their abilities to provide effective oversight and execution of the sustainable transition before us. The Calvert Sustainable Climate Aligned Strategy seeks to invest in these companies and address climate related issues through Calvert’s proprietary Environmental, Social and Governance (ESG) research process, investment in climate aligned companies and corporate engagement.
Success for the strategy will be determined by:
- Similar or Excess Returns to the MSCI World Index
- Diversification across a portfolio of approximately 200 stocks with factor risk exposures and financial characteristics similar to the MSCI World Index
- Ongoing, year-by-year decrease in portfolio level Green House Gas Emissions intensity
- Focused investment on climate and environmental solutions providers
- Low Annual Turnover
- Tracking Error to the MSCI World Index of 1%-2%
The Fund utilizes a quantitative and qualitative ESG research process that applies the Calvert Principles for Responsible Investment to define the investment universe while making sure that such companies do not significantly harm any environmental or social objective.
The Calvert Principles for Responsible Investment can be found on www.morganstanleyinvestmentfunds.com and on www.morganstanley.com/im. The Investment Adviser may engage company management around financially material ESG issues that it deems to have a positive impact on society or the environment.
Process:
The Sustainable Climate Aligned Strategy seeks to identify companies we consider climate aligned in areas that are material to long term performance. Our approach consists of three distinct parts:
- Security Selection Identifies Companies that are Climate Aligne
- Portfolio Construction Aligns with Net Zero, Decarbonization and Risk Management Goals
- Strengthen Companies on Climate through Engagement
The portfolio construction process takes the following steps:
Step 1 – Quantitative Research/Security Selection
The goal of security selection is to identify companies from the Calvert Global Developed Markets universe that are most Climate Aligned. Climate Aligned companies are ones that we believe are:
- Substantially free from ESG controversies
- Aligned with Paris Aligned Benchmark Requirements
- Providing solutions to mitigate climate change impacts or help society adapt
The starting point of this process is the Calvert Global Developed Markets Universe which is defined by the Calvert ESG Research Process. This universe is made up of global companies in developed markets that meet Calvert’s Principles for Responsible Investment and exhibit environmental sustainability, resource efficiency, support for equitable societies and human rights, and accountable governance and transparent operations. This universe is made up of companies that manage their financially ESG issues, including climate, well and are largely free from controversies and controversial activities. Calvert’s ESG Research Process already identifies and typically removes companies involved in controversies however we apply a specific set of screens largely focusing on revenues to ensure compliance with EU Paris Aligned Benchmark (PAB) requirements including:
- Removal of companies involved in manufacturing or producing controversial weapons and civilian firearms
- Removal of companies involved in manufacturing or producing tobacco
- Removal of companies that violate the UN Global Compact (UNGC)
- Removal of companies that have significant revenue from coal, revenue from oil and revenue from gas (not applied to electric utility companies)
- Removal of electric utilities that either generate a significant portion of their revenue from fossil fuel based power or have significant revenue from trading oil & gas
Step 2 – Qualitative Overlay
The second step of the process is a qualitative review performed by the ARIS and ESG Research Teams. The Qualitative Overlay provides quality control on the initial portfolio to ensure that included companies are climate aligned and show a distinct leadership position on climate issues. The security selection process is highly effective at identifying these companies, however we believe best practice is to review the portfolio for accuracy and consistency. The qualitative overlay ensures:
Companies Demonstrate Leadership
• Product and corporate strategy - companies offers more sustainable long-term growth opportunities and/or allows for management of existing and emerging financially material climate related issues likely to affect current operations
• Oversight and Execution – climate related issues that impact the business’s financial condition are identified and effectively managed. Once climate related issues are identified, successful companies develop measurement systems, strategies and targets to manage associated risks and opportunities. These companies are also transparent and report on their progress in managing these issues.
Removal of Companies
• Companies showing stagnation or potential reversal in performance on climate and environmental related issues
• Companies with increased potential controversy risk
• Companies with increased potential governance risks
Inclusion of Improving Companies
• The Qualitative assessment allows for inclusion of companies that are improving on financially material climate and environmental issues though their scores in the Calvert Research System may not yet reflect this improvement. Companies demonstrating improvement may be added to the portfolio.
Step 3 – Optimization
With a confirmed portfolio of climate aligned companies, the portfolio management team then seeks to create a risk-controlled portfolio that tilts toward companies with better climate and environmental impacts. The team does this through a multipronged optimization approach that aligns with Net Zero goals and promotes decarbonization.
The team uses Barra Optimizer to apply a standard mean-variance optimization on the initial portfolio of climate aligned stocks using a number of investment and environmental goals and constraints.
Common goals we may use in optimizing securities positions include:
Investment Goals
• Maximize expected returns
• Minimize risk
• Minimize transaction costs
• Minimize taxes
• Minimize penalties
• Weights of Assets
• Cash Contributions and Withdrawals
• Transaction Type Limitations
• Cash Position
ESG Goals
• Reduce portfolio-level absolute carbon footprint
• Increase allocation to Climate Leaders
• Increase allocation to ESG Leaders
• Increase allocation to companies benefiting from energy transition
• Increase allocation to companies investing in the energy transition
• Decrease allocation to companies with high physical risk
• Decrease allocation to higher emitters
• Decrease allocation to companies that without a progressive reduction in carbon intensity
• Decrease allocation to companies with average or below average Calvert ESG scores
The optimizer reallocates to different securities within the portfolio to create an allocation that maximizes the portfolio’s ability to meet the goals described above.
Data Sources
All of Calvert’s ESG research is conducted internally. Calvert’s ESG analysts review a wealth of data from diverse sources to evaluate a company’s ESG practices, policies and track record.
Calvert uses more than 20 ESG data sources across its entire ESG Research Process. These sources include:
Alphasense
Bloomberg
CDP
Climate Bond Initiative
CSR Hub
Equileap
Factset, Field Gibson Media
Green Street, GRESB
ISS
Malpecroft
Morningstar
MSCI
Proxy Insight
Refinitiv
RepRisk
S&P/Tru Cost
SASB
SigWatch
SNP – S&P Global Market Intelligence
Sustainanlytics
TruValue
Calvert’s ESG analysts also work with experts from academic, policy, and advocacy-oriented non-governmental organizations (NGOs), to inform their analysis. Calvert investment staff may also review SEC filings, reports from the United Nations, the World Bank and other international institutions; sustainability reports from the public or private sector, government databases, a company’s website and media coverage; and sell-side research.
It is important to know that Calvert does not use ESG ratings from other companies. We incorporate data from these sources to form our own view of how companies are managing their financially material ESG exposures.
Resources, Affiliations & Corporate Strategies:
ESG FIRM RESOURCES
ESG and Sustainable Investing is the purview of different teams across Calvert, MSIM and Morgan Stanley.
Led by MSIM’s Global Head of Sustainability, the MSIM Sustainability team supports MSIM’s collective sustainable and governance processes. This group works with the sustainability leads from our investment teams to co-ordinate global sustainable investing and stewardship initiatives. The MSIM Sustainability team’s activities include supporting investment teams in relation to incorporating ESG considerations into their investment approaches, developing sustainable fund products, and integrating sustainability data, tools, and research, as required.
MSIM believes that a successful sustainability governance framework requires committed leadership, strong collaboration, and robust policies and oversight. MSIM’s portfolio managers and investment teams have access to support from the centralized MSIM Sustainability Team and the Firm’s Global Sustainability Office. The MSIM Sustainability Team currently consists of 10 full-time employees.
MSIM Sustainability Governance
We view effective management of sustainability issues as a core component of our business strategy and continue to evolve our philosophy as we believe it is fundamental to the long-term success of our organization and our ability to deliver value for our clients. We have established the appropriate governance systems, risk management and controls to support our intention to integrate sustainability considerations across our business.
These groups include:
• MSIM ESG Committee
• Sustainable Investing Team Leads
• MSIM Sustainability Team
• MSIM’s Global Stewardship function, as part of the MSIM Sustainability team
• Morgan Stanley Institute for Sustainable Investing and Global Sustainable Office Group
• Calvert Research and Management
MSIM ESG Committee
The Firm has established an ESG Committee co-chaired by the MSIM Co-Head and Chief Investment Officer of the Solutions & Multi-Asset Group and MSIM’s Global Head of Risk & Analysis. The Committee consists of senior representatives from MSIM’s Sustainability team, Office of the Chief Operating Officer and other advisory and related functions who oversee and guide MSIM’s support for the sustainable investment strategies of each investment business. Aspects overseen by this Committee include: MSIM’s ESG-related goals and strategy, ESG-related product launches and the product development and marketing frameworks relating thereto, MSIM’s ESG-related engagement program, ESG-related training and ESG-related technology and data initiatives. The Committee is responsible for this Sustainable Investing Policy, which it reviews periodically to ensure that it accurately reflects the philosophy and processes that govern MSIM’s sustainability strategy.
Sustainable Investing Team Leads
It is the investment teams’ responsibility to define their approach to consideration of ESG factors. Many of our investment teams or asset class platforms have appointed at least one dedicated Sustainable Investing/ESG specialist to co-ordinate and support this work for the relevant group. A key responsibility of these specialists is to work with the portfolio managers in their respective teams to help ensure strong ESG incorporation, in line with each team’s investment philosophy and strategy. Other elements of the role include supporting investment staff to continuously enhance incorporation of ESG factors/features in investment processes through research, training, knowledge-sharing, engagement with investee management teams, and representing their asset class/team in client meetings, consultant meetings and other forums and groups as necessary.
MSIM Sustainability Team
Led by MSIM’s Global Head of Sustainability, the MSIM Sustainability team supports MSIM’s collective sustainable and governance processes. This group works with the sustainability leads from our investment teams to coordinate global sustainable investing and stewardship initiatives. The Firm’s Sustainability team’s activities include supporting investment teams in relation to incorporating ESG considerations into their investment approaches, developing sustainable fund products, and integrating sustainability data, tools and research, as required.
Global Stewardship Team
MSIM’s Global Stewardship function, as part of the MSIM Sustainability team, supports and helps coordination of our Firm’s proxy voting and investee engagement activities.
Morgan Stanley Institute for Sustainable Investing and Global Sustainability Office Group
The Firm’s Sustainable Investing efforts are also supported by Morgan Stanley’s decade-plus commitment to sustainable finance and Firm-level resources. The Morgan Stanley Institute for Sustainable Investing and the Global Sustainability Office (GSO) are positioned at the nexus of the Firm’s three business pillars (i.e., Institutional Securities Group, Wealth Management and MSIM), and serve as expert resources and partners on innovation, knowledge sharing and thought leadership across the Firm. GSO regularly advises MSIM on product development and ESG data analysis, collaborates on thought leadership, and partners on internal knowledge-sharing and external industry collaborative efforts.
In addition, Calvert is comprised of the following specialist teams and committees:
Equity ESG Research Analysts – Calvert’s Equity ESG Research Analysts are specialised by sector. They are responsible for creating investment theses for each peer group they cover, as well as constructing the peer group models used as the framework for both quantitative and qualitative issuer reviews, driven by financial materiality. These models incorporate the best available information to review each potential investment, rating and ranking companies within their subindustries, ultimately producing an assessment that reflects both peer-relative and absolute performance in a defined index universe. They maintain the models, as well as conduct qualitative reviews of issuers without enough data to be reviewed through the Calvert Research System. They are also responsible for thought leadership on industry trends, as well as engaging with companies they cover and collaborating with the fundamental research analysts.
Applied Responsible Investment Solutions (ARIS) – The ARIS Team has extensive experience managing Calvert’s proprietary responsible index strategies, active quant equity strategies and customised investment solutions.
Corporate Engagement – The Calvert Corporate Engagement Team is responsible for driving Calvert’s structured engagement strategy using proprietary ESG research. The goal of our engagements is to create impact and improve investment results by having positive influence on the ESG policies and practices of portfolio companies. Engagement efforts may result in additional uncovering of information about issuers that may be incorporated into the investment process through our use of custom Key Performance Indicators. In concert with the ESG research and fundamental analysts and portfolio managers, the engagement team communicates directly with company boards and management teams, as well as with policy makers and governmental agencies. The engagement team also collaborates with investor groups and coalitions, supports public policy initiatives, files shareholder resolutions, and defines our proxy voting policies. The Fixed Income ESG team coordinates with the Calvert Corporate Engagement Team on selected company meetings and external initiatives.
Impact Team – Calvert’s cross-functional impact team is responsible for developing, integrating, scaling, and refining best-in-class platforms for measuring, managing, and reporting on the ESG impact footprint of Calvert’s multi-asset class investment portfolios. The team ensures the rigor, robustness of Calvert’s overarching impact framework and underlying impact KPIs with respect to cataloging, benchmarking, reporting on and improving the impact performance of Calvert’s investment offerings. The impact team works with Calvert’s research, engagement, investment, marketing and product/business development teams to identify and address investment impact needs, gaps, risks and opportunities. The team also undertakes initiatives to conceive or enhance enterprise-wide impact data systems and capabilities. The team tracks and incorporates relevant developments in global impact reporting standards, taxonomies, methodologies and best practices, and contributes thought leadership content on impact measurement and management across the investment value chain. The goal of Calvert’s impact strategy, initiatives and endeavors is to facilitate and catalyse Calvert’s dual mission of delivering positive social and environmental impact alongside competitive long-term financial returns to its clients.
Calvert also has established committees to oversee governance:
Calvert Responsible Research Review Committee (3RC)
Calvert has established the Responsible Research Review Committee (“3RC”) to oversee its ESG investment research processes, and engagement and advocacy efforts. The 3RC’s responsibilities include: Review and approval of research processes, including Calvert’s proprietary scoring methodology that rates companies on their management of ESG risks; Approval of companies deemed eligible/ineligible for investment based on ESG scores; Review of holdings in fixed income funds to ensure they meet ESG investment criteria; and Review of Calvert’s shareholder engagement and advocacy activities, including companies and policies targeted for engagement/advocacy.
Compliance with the processes used by research analysts and approved by the 3RC is monitored through compliance systems that determine whether securities purchased for Calvert strategies are eligible for investment, as well as the Calvert’s Chief Compliance Officer. These systems and processes are also utilized to monitor client-specific customizations and guidelines. For example, clients may have style or thematic customizations or exclusion lists that the compliance team and portfolio managers use as part of the portfolio management process. In addition, the portfolio managers meet formally no less than once every two weeks to review portfolios, risk reports collectively and market opportunities. Less formal discussions occur continuously throughout the day.
Proxy Voting and Engagement Committee
The committee administers Calvert’s policies and procedures on proxy voting.
OUR INVOLVEMENT
Through its various businesses and internal functions, MSIM and Morgan Stanley participate in, belong to or take a leading role in many ESG-related initiatives and organisations.
This includes participating in industry conference panels, exploring joint research, and supporting the work of groups focused on ESG-related issues.
MSIM and Morgan Stanley’s external sustainability/ESG-related initiatives and organisations include, but are not limited to, the following:
• 30% Club UK Investor Working Group
• Better Building Partnerships
• Black Women in Asset Management (BWAM)
• Ceres Investor Network on Climate Risk and Sustainability
• Ceres Private Equity Working Group
• CFA Institute’s Diversity, Equity and Inclusion Code
• Council for Institutional Investors (CII)
• Emerging Markets Private Equity Association (EMPEA)
• Entrepreneurs In Action (EIA)
• European Leveraged Finance Association (ELFA)
• FAIRR
• Girls Who Invest
• Global Impact Investing Network (GIIN)
• Global Real Estate Sustainability Benchmark (GRESB)
• Hong Kong Stewardship Code
• Institutional Limited Partners Association (ILPA) – Diversity in Action
• International Capital Market Association (ICMA) and the Green & Social Bond Principles (GBP/SBP)
• Irish Funds Industry Association
• ISSB – Sustainability Accounting Standards Board (SASB)
• Japanese Stewardship Code
• JUST Capital
• One Planet Summit Asset Managers Initiative
• PRI – Global Policy Reference Group
• PRI Advance (Human Rights)
• PRI Collaborative Sovereign Engagement on Climate Change
• PRI Nature Reference Working Group
• Principles for Responsible Investment (PRI)
• Sponsors for Educational Opportunity – Alternative Investments Fellowship Programme
• Trading for Trees Program
• UK Investment Association
• UK Stewardship Code
• World Benchmarking Alliance
In addition, Calvert has been a leader in responsible investing for 40 years. It is at the heart of what we do, and we have been actively involved with other organisations to promote better outcomes for investors, the environment and societies for decades. Calvert partners with the following organisations:
• Ceres
• Climate Action 100+
• IFRS Sustainability Alliance
• International Sustainability Standards Board Investor Advisory Group (IIAG)
• Sociovestix Labs (SVL)
• CDP - Carbon Disclosure Project
• Defined Contribution Institutional Investment Association (DCIIA)
• Investment Company Institute (ICI)
• Net Zero Asset Managers Initiative (NZAM)
• Pacific Pension & Investment Institute (PPI)
• Paris Aligned Working Group
• Principles for Responsible Investment (PRI)
• Robert Toigo Foundation
• The Thirty Percent Coalition
• United Nations Global Compact (UNGC)
• Global Compact Network USA
• United Nations CEO Water Mandate
• US SIF: The Forum for Sustainable and Responsible Investment
• Access to Medicine Foundation
• Access to Nutrition Initiative (ATNI)
• Asian Corporate Governance Association (ACGA)
• As You Sow
• Biopharma Sustainability Roundtable (BSRT)
• Calvert Impact Capital
• CFA Institute
• CFA Society
• Council of Institutional Investors (CII)
• Global Impact Investing Network (GIIN)
• FAIRR Initiative
• Global Network Initiative (GNI)
• Human Capital Management Coalition (HCMC)
• Intentional Endowments Network (IEN)
• Interfaith Center on Corporate Responsibility (ICCR)
• Investor Agenda
• Investor Alliance for Human Rights
• Investors & Indigenous Peoples Working Group/Yethiya wihe' (IIPWG)
• SIFMA
• UN Women (+WEPs Team)
• Urban Land Institute (ULI)
• Boston University Impact Measurement and Allocation Program (IMAP)
• Signal Climate Analytics
• Wharton School of the University of Pennsylvania
Calvert has played a leadership role in these organisations and in many cases is either a cofounder or an early signatory. As noted above, Calvert has a long history of partnering with the UN and its related entities. Calvert serves on the Investment Committee and the North American Task Force of the United Nations Environmental Programme -- Finance Initiative. As it relates to the PRI, Calvert was a founding signatory and has served on various committees over the years. Calvert currently serves on the Investor Reference Group on Corporate Reporting and collaborates on engagements. Additionally, the Calvert Women’s Principles were adopted as the UN Women’s Empowerment Principles. Calvert also strives to promote the Sustainable Development Goals through the companies it invests in, through its engagement efforts with corporations and governmental agencies, and through its own operations.
Often Calvert partners with other investors and NGOs to advance common objectives. Calvert believes there is power in numbers and in more company shares when it brings voices and interests to the table with different perspectives yet common objectives.
While Calvert does not sign on to any specific stewardship code at present, we support such organisations and their goal of providing better, more transparent information to investors.
Dialshifter
This fund is helping to ‘shift the dial from brown to green’ by…
Offering clients a portfolio that primarily invests in companies that are involved in economic activities that address climate transition and/or are aligned to the long-term de-carbonisation objectives of the Paris Agreement. The Fund will maintain a carbon profile that follows the net zero objectives of the Paris Agreement, as reflected in the appropriate Paris-Aligned benchmark, or in the absence of an approved Paris-Aligned benchmark it will maintain a substantially lower carbon footprint, of at least 50% less than that of the underlying market benchmark and taking into account the long-term carbon reduction objectives of the Paris Agreement.
Our organisation is helping to support the Paris Climate Agreement and the Race to Net Zero by…
At Calvert, we subscribe to the conclusion that earth’s climate is warming, and that human activity is the primary driver of this warming. Although the Fund does not have an explicit Net Zero target, we recognize that climate change represents an existential business risk to companies that derive significant proportions of revenues from fossil fuels, and that the transition to a low-carbon economy will require significant decarbonization efforts to avoid the gravest impacts of climate change. Calvert became a signatory to the Net Zero Asset Managers Initiative in December 2020.
SDR Labelling:
Not eligible to use label
Key Performance Indicators:
- % of the Fund’s portfolio compliant with the Calvert Principles
- Carbon footprint at least 50% lower than that of the MSCI World Index. Measured by tonnes of CO2 per $1million enterprise value (including scope 1 and 2 emissions, and only including scope 3 emissions for certain sectors for which, in the view of the Investment Adviser, scope 3 emissions are likely to constitute a material factor in overall carbon emissions)
- % of portfolio holdings which demonstrated environmental and/ or climate leadership or improvement in accordance with the Investment Adviser’s proprietary methodology
- 7% reduction in emissions year-on-year to reach net zero at portfolio level by 2050 or earlier. For this purpose, the Fund considers scope 1 and 2 GHG emissions and scope 3 GHG emissions for all sectors currently required to be considered by the EU CTBs and UC PABs.
Literature
Voting Record
Disclaimer
While every care has been taken in preparing the information provided in this document, such information and materials are provided "as is" without warranty of any kind, either express or implied; in particular, no warranty regarding accuracy or completeness.
There is no guarantee that any investment strategy will work under all market conditions, and each investor should evaluate their ability to invest for the long-term, especially during periods of downturn in the market. Prior to investing, investors should carefully review the relevant strategy / product offering document. There are important differences in how the strategy is carried out in each of the investment vehicles.
Prior to investing, investors should carefully review the relevant offering document for the strategy/product. Please consider the investment objectives, risks and fees of the strategy/product carefully before investing.
This material is a general communication, which is not impartial and has been prepared solely for informational and educational purposes and does not constitute an offer or a recommendation to buy or sell any particular security or to adopt any specific investment strategy, and any such offering is subject to the execution of a written contract. All investments involve risks, including the possible loss of principal. The information herein has not been based on a consideration of any individual investor circumstances and is not investment advice, nor should it be construed in any way as tax, accounting, legal or regulatory advice. To that end, investors should seek independent legal and financial advice, including advice as to tax consequences, before making any investment decision.
Except as otherwise indicated, the views and opinions expressed herein are those of the portfolio management team, are based on matters as they exist as of the date of preparation and not as of any future date, and will not be updated or otherwise revised to reflect information that subsequently becomes available or circumstances existing, or changes occurring, after the date hereof. They are subject to change based on market, economic and other conditions. Certain information contained herein constitutes forward-looking statements, which can be identified by the use of terms such as “may,” “will,” “should,” “expect,” “anticipate,” “project,” “estimate,” “intend,” “continue,” or “believe” (or the negatives thereof) or other variations thereon. Due to various risks and uncertainties, including, but not limited to, those set forth herein, actual events or results or actual performance of any investments may differ materially from those reflected or contemplated in such forward-looking statements. The information presented represents how the portfolio management team generally implements its investment process under normal market conditions.
Forecasts and/or estimates provided herein are subject to change and may not actually come to pass. Information regarding expected market returns and market outlooks is based on the research, analysis and opinions of the authors. These conclusions are speculative in nature, may not come to pass and are not intended to predict the future performance of any specific Morgan Stanley Investment Management product.
Any performance information provided in this document is not indicative of future performance or investment returns, and you should not view such performance information as an indicator of the future performance of a particular investment.
Any strategy weights and/or number of holdings referenced herein represent typical ranges and are not a maximum number. The portfolio may exceed this from time to time due to market conditions and outstanding trades. The targets, turnovers and exposures presented for pooled vehicles are typical ranges. There is no assurance that these targets will be attained.
Risk management implies an effort to monitor risk, but should not be confused with and does not imply low risk.
Any index referred to herein is the intellectual property (including registered trademarks) of the applicable licensor. Any product based on an index is in no way sponsored, endorsed, sold or promoted by the applicable licensor and it shall not have any liability with respect thereto.
This document is intended solely for the use of the person to whom it has been delivered (including such person’s employees, representatives, agents, or advisors, as applicable). MSIM has not authorized financial intermediaries to use and to distribute this document, unless such use and distribution is made in accordance with applicable law and regulation. Additionally, financial intermediaries are required to satisfy themselves that the information in this document is appropriate for any person to whom they provide this document in view of that person’s circumstances and purpose. MSIM shall not be liable for, and accepts no liability for, the use or misuse of this document by any such financial intermediary.
This document may be translated into other languages. Where such a translation is made this English version remains definitive. If there are any discrepancies between the English version and any version of this document in another language, the English version shall prevail.
The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents disclosed to third parties without MSIM’s express written consent.
Please refer to the most recent fund factsheet which provides product specific risk disclosures.
All information contained herein is proprietary and is protected under copyright law.
| Fund Name | SRI Style | SDR Labelling | Product | Region | Asset Type | Launch Date | Last Amended |
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Morgan Stanley Investment Funds - Calvert Climate Aligned Fund |
Sustainability Tilt | Not eligible to use label | SICAV/Offshore | Global | Equity | 08/04/2022 | Oct 2024 | |
ObjectivesLong term growth of your investment involving economic activities that address climate transition and/or are aligned to the long term de-carbonisation objectives of the Paris Agreement. The Fund is in scope of Article 9 of the European Sustainable Finance Disclosure Regulation. |
Fund Size: £6.31m (as at: 31/03/2024) ISIN: LU2459593203, LU2459593385 Contact Us: Charlotte.Watkins@morganstanley.com |
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Sustainable, Responsible &/or ESG OverviewThe Calvert Sustainable Climate Aligned Fund’s investment objective is to provide long-term capital appreciation, measured in US Dollars, primarily investing in companies that are involved in economic activities that address climate transition and/or are aligned to the long-term de-carbonisation objectives of the Paris Agreement. The Fund will maintain a carbon profile that follows the net zero objectives of the Paris Agreement, as reflected in the appropriate Paris-Aligned benchmark, or in the absence of an approved Paris-Aligned benchmark it will maintain a substantially lower carbon footprint, of at least 50% less than that of the underlying market benchmark, and taking into account the long-term carbon reduction objectives of the Paris Agreement which may warrant a revision of the targeted range of reduction over time. Carbon footprint shall be measured as weighted average carbon intensity, defined as tonnes of CO2 per $1million enterprise value including cash.
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Primary fund last amended: Oct 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.
Sustainability focus
Find funds which substantially focus on sustainability issues
Sustainability theme or focus
Find funds where there is a significant emphasis on (environmental and social) sustainability. Funds with a 'sustainability theme' typically place more emphasis on the area than funds with a 'sustainability policy' - meaning that it is more likely to drive investment selection. Strategies vary. See fund information for further detail.
Encourage more sustainable practices through stewardship
A core element of these funds aim to encourage higher sustainability standards across business practices through responsible ownership / stewardship / engagement / voting activity
UN Global Compact linked exclusion policy
Find funds that use the UN Global Compact to inform or help direct where they can or cannot invest and will typically not invest in companies with significant breaches (low standards) - although strategies vary. (The UNGC covers a wide range of issues - search 'UNGC'). See https://unglobalcompact.org/
Report against sustainability objectives
Find funds that publicly report their performance against specifically named sustainability objectives (in addition to reporting their financial performance)
Green / Sustainable property strategy
Fund has a strategy that focuses on sustainability issues in the property sector - they may eg use GRESB / BREEAM scores to inform investment decisions. 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.
Favours cleaner, greener companies
Funds that aim to invest in companies with strong or market leading environmental policies and practices. Strategies vary - in particular the balance between 'financial' aspects and environmental benefits. Some may invest substantially in solutions or 'positive impact' companies - others may invest in more conventional companies providing certain environmental criteria are met. See fund information for further detail. Climate Change & Energy
Clean / renewable energy theme or focus
Find funds where investment in clean / renewable energy companies an other assets is central to their investment selection strategy. The proportion of the fund that is directly or indirectly invested in renewable energy varies between funds and over time. See fund information for further details.
Encourage transition to low carbon through stewardship activity
A core element of these funds will aim to encourage the transition to lower carbon activities through responsible ownership / stewardship / engagement / voting activity
Energy efficiency theme
Fund funds that have an energy efficiency theme - typically meaning that a fund manager is focused on investing in organisations that manage - or help others to manage - energy use more carefully and less wastefully - and so reduce greenhouse gas emissions.
Invests in clean energy / renewables
Funds that hold companies in the clean energy and renewable energy sectors (at the time research was supplied). Fund strategies vary, in particular the proportion of investment in these areas may vary significantly. Check fund literature for details.
Paris aligned fund strategy
This fund has a strategy that aims ensure its holdings will gradually reduce their greenhouse gas emissions in line with targets set at COP21 in Paris. The ultimate aim is to achieve ‘net zero emissions by 2050’ and a ‘maximum global temperature increase of +1.5 to +2 degrees above preindustrial levels’. Strategies and opinions vary. Read fund information.
Require net zero action plan from all/most companies
Find funds that require all, or almost all, of the companies it invests in to have a ‘net zero action plan’ - meaning that the companies they invest in have worked out how they will, over time, reduce their total carbon (and other greenhouse gas) emissions to nil. 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.
Labour standards policy
Find funds that have a labour standards policy - which can be expected to mean that the fund will invest in / favour companies that have higher standards in this area - although fund strategies can vary significantly (as with all policy areas). See eg https://www.ilo.org/international-labour-standards
Favours companies with strong social policies
Find funds that invest in line with positive strategies that relate to 'people' issues - such as having strong human rights, labour standards and equal opportunities practices. Such funds are likely to invest in companies that have market leading standards with regard to employee and supplier practices. Read fund literature for further information. Ethical Values Led Exclusions
Ethical policies
Find funds that have policies that set out their position on ethical or 'personal values' based issues. Strategies vary. See fund information for further detail.
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.
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. 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.
Child labour exclusion
Find funds that have policies in place to ensure they do not invest in companies that employ children. Gilts & Sovereigns
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.
Gilts / government bonds - exclude all
Find funds that do not invest in, or exclude, gilts and/or government bonds.
Does not invest in sovereigns
Find funds that do not invest in / exclude 'sovereigns' - debt issued by governments. See eg https://www.investopedia.com/terms/s/sovereign-debt.asp 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
Governance policy
Find fund options that have policies that relate to corporate governance issues such as board structure, executive remuneration, bribery and/or corporate corruption. These funds will typically avoid companies with poor practices. Strategies vary. See fund literature for further information.
Avoids companies with poor governance
Find funds that aim to avoid investing in companies with poor governance practices.(e.g. board structure, management practices etc.) Views may however vary on what counts as 'poor' practices - and funds may not immediately divest as they may prefer to work to encourage higher standards. See fund literature for further information.
UN sanctions exclusion
Exclude companies that are subject to United Nations sanctions. See eg https://main.un.org/securitycouncil/en/content/un-sc-consolidated-list
Encourage board diversity e.g. gender
Fund managers encourage the companies they invest in to have more diverse board structures (e.g. more women on boards)
Encourage TCFD alignment for banks & insurance companies
Find fund managers that encourage the banks and insurance companies they invest in to publish climate change related financial information - as set out by the Task Force on Climate Related Financial Disclosures (with the aim of helping investors measure and respond to climate risk).
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 Asset Size
Over 50% large cap companies
Find funds that invests more than half of their money into what are commonly regarded as 'large companies'. This will typically mean that the market capitalisation (or value) of the companies they hold is in excess of £5 to £10 billion. Impact Methodologies
Measures positive impacts
Funds that aim to measure the positive real world environmental and / or social benefits that are associated with their investment strategy. Funds that aim to deliver positive impacts and measure those impacts may be referred to as 'impact funds' - although impact measurement is not restricted to impact funds. Strategies vary. See fund information.
Invests in environmental solutions companies
Find funds that direct investment towards companies where a major part of their business is about solving environmental challenges. e.g. companies helping to address climate change.
Aim to deliver positive impacts through engagement
Fund aims to deliver positive environmental and or social impacts (real world benefits) through its engagement with investee assets 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.
ESG weighted / tilt
Find funds that invest more heavily in those that have higher ESG ratings/standards or scores and less heavily in companies with lower ESG ratings. Where this is central to a fund's strategy you should expect it to invest in most sectors. Strategies vary.
Data led strategy
Find funds that make stock selection (and ongoing fund management) decisions based on ESG data or company ratings (normally supplied by third parties) rather than focusing on what individual companies do, how they operate or their plans for the future
Significant harm exclusion
Aims to avoid companies that do significant harm. This originates from the EU’s sustainable finance ‘DNSH’ (do no significant harm) work, which is not necessarily used by UK investors.
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). Unscreened Assets & Cash
Assets typically aligned to sustainability objectives 70 - 79%
The percentage of assets held within the fund that match the fund’s sustainability objectives and are not being held purely for risk management purposes, such as derivatives and cash equivalent assets.
Assets typically aligned to sustainability objectives 80 – 89%
The percentage of assets held within the fund that match the fund’s sustainability objectives and are not being held purely for risk management purposes, such as derivatives and cash equivalent assets.
Assets typically aligned to sustainability objectives > 90%
The percentage of assets held within the fund that match the fund’s sustainability objectives and are not being held purely for risk management purposes, such as derivatives and cash equivalent assets
No ‘diversifiers’ used other than cash
Fund that only invest in cash to aid the practical management (buying and selling) of assets. These funds do not use additional financial instruments. 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. Labels & Accreditations
SFDR Article 9 fund / product (EU)
Finds funds classified under Article 9 of the EU’s SFDR (Sustainable Finance Disclosure Requirements). Article 9 of the SFDR applies to financial products that have sustainable investment 'objectives' - including emissions reduction objectives. (These may currently be referred to as 'impact' funds or aiming to deliver clear, specific positive outcomes.) These rules do not currently apply in the UK so fund managers may leave this field blank. 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.
Integrates ESG factors into all / most (AFM) fund research
Find fund management companies that consider environmental, social and governance (ESG) issues when deciding whether or not to invest in a company for all / almost all of their funds and other assets. This is increasingly seen as part of sound risk management.
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). Collaborations & Affiliations
PRI signatory
Find fund management companies that have signed up to the UN backed 'Principles of Responsible Investment'. 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
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
Engaging on the responsible use of AI
Working to address sustainability, ESG and related concerns around artificial intelligence. Company Wide Exclusions
Controversial weapons avoidance policy (AFM company wide)
Find fund management companies (not funds) that avoid investment in 'controversial weapons' across all of their funds and other investment vehicles. 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.
Voting policy includes net zero targets (AFM company wide)
Fund manager AGM / EGM voting strategy has processes in place that mean they will normally be expected to vote in a way that will encourage the transition to net zero greenhouse gas emissions.
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.
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. 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.
Full SRI / responsible ownership policy information on company website
Find companies that publish information about their sustainable and responsible investment strategies on their company website.
Full SRI / responsible ownership policy information available on request
Find fund management companies that will supply information about their sustainable and responsible investment activity on request.
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.
Net Zero transition plan publicly available (AFM company wide)
This asset management company has published a plan that explains how they are going to achieve net zero greenhouse gas / CO2e emissions.
Dialshifter statement
Find fund management companies that have supplied Dialshifter information. See Dialshifter tab within record for more information. CommentsCalvert Research and Management (Calvert or CRM) is part of Morgan Stanley Investment Management (MSIM), the asset management division of Morgan Stanley. As part of MSIM, Calvert has a distinctive investment philosophy, approach and viewpoint and provides ESG customized solutions to clients spanning the global markets. Calvert’s infrastructure support including portfolio implementation and trading is supported by MSIM and its affiliates. As such, the responses in this questionnaire will refer to both companies where appropriate. For the following responses in the Affiliations & Collaborations section, we have also included Morgan Stanley affiliations where appropriate: GFANZ member (AFM company wide), UN Net Zero Banking Alliance member (AFM company wide), Fund EcoMarket partner, UN Principles of Responsible Banking framework signatory (AFM company wide) and TNFD forum member (AFM company wide). Sustainable, Responsible &/or ESG Policy:Calvert broadly sees a multi-decade transformation of the global economic system defined by broad decarbonization efforts of the global energy system, endeavors to create business processes that are far more resource efficient and circular and an evolving social contract between individuals and institutions. This transformation must address investment risks from externalities, or impacts that companies have on the environment and society for which we do not currently have a pricing mechanism. Climate change is arguably the greatest of all externalities with once-in-a-generation events such as floods, droughts, hurricanes and heatwaves increasing in frequency. These externalities come with material negative economic impacts which raise the urgency with which to divert capital to tackle climate change and adapt to its impacts. As we look forward to the coming decades, we believe that capital markets are on the precipice of an increase in the impact of corporate environmental, social and governance (ESG) performance on security prices. We expect a corresponding acceleration of capital deployed to solve the environmental challenges we face today.
Process:The Sustainable Climate Aligned Strategy seeks to identify companies we consider climate aligned in areas that are material to long term performance. Our approach consists of three distinct parts:
Step 1 – Quantitative Research/Security Selection The goal of security selection is to identify companies from the Calvert Global Developed Markets universe that are most Climate Aligned. Climate Aligned companies are ones that we believe are:
The starting point of this process is the Calvert Global Developed Markets Universe which is defined by the Calvert ESG Research Process. This universe is made up of global companies in developed markets that meet Calvert’s Principles for Responsible Investment and exhibit environmental sustainability, resource efficiency, support for equitable societies and human rights, and accountable governance and transparent operations. This universe is made up of companies that manage their financially ESG issues, including climate, well and are largely free from controversies and controversial activities. Calvert’s ESG Research Process already identifies and typically removes companies involved in controversies however we apply a specific set of screens largely focusing on revenues to ensure compliance with EU Paris Aligned Benchmark (PAB) requirements including:
Step 2 – Qualitative Overlay The second step of the process is a qualitative review performed by the ARIS and ESG Research Teams. The Qualitative Overlay provides quality control on the initial portfolio to ensure that included companies are climate aligned and show a distinct leadership position on climate issues. The security selection process is highly effective at identifying these companies, however we believe best practice is to review the portfolio for accuracy and consistency. The qualitative overlay ensures: Companies Demonstrate Leadership
Step 3 – Optimization With a confirmed portfolio of climate aligned companies, the portfolio management team then seeks to create a risk-controlled portfolio that tilts toward companies with better climate and environmental impacts. The team does this through a multipronged optimization approach that aligns with Net Zero goals and promotes decarbonization. The team uses Barra Optimizer to apply a standard mean-variance optimization on the initial portfolio of climate aligned stocks using a number of investment and environmental goals and constraints. Common goals we may use in optimizing securities positions include: Investment Goals ESG Goals
Calvert uses more than 20 ESG data sources across its entire ESG Research Process. These sources include: Alphasense
It is important to know that Calvert does not use ESG ratings from other companies. We incorporate data from these sources to form our own view of how companies are managing their financially material ESG exposures.
Resources, Affiliations & Corporate Strategies:ESG FIRM RESOURCES ESG and Sustainable Investing is the purview of different teams across Calvert, MSIM and Morgan Stanley. Led by MSIM’s Global Head of Sustainability, the MSIM Sustainability team supports MSIM’s collective sustainable and governance processes. This group works with the sustainability leads from our investment teams to co-ordinate global sustainable investing and stewardship initiatives. The MSIM Sustainability team’s activities include supporting investment teams in relation to incorporating ESG considerations into their investment approaches, developing sustainable fund products, and integrating sustainability data, tools, and research, as required. MSIM believes that a successful sustainability governance framework requires committed leadership, strong collaboration, and robust policies and oversight. MSIM’s portfolio managers and investment teams have access to support from the centralized MSIM Sustainability Team and the Firm’s Global Sustainability Office. The MSIM Sustainability Team currently consists of 10 full-time employees.
We view effective management of sustainability issues as a core component of our business strategy and continue to evolve our philosophy as we believe it is fundamental to the long-term success of our organization and our ability to deliver value for our clients. We have established the appropriate governance systems, risk management and controls to support our intention to integrate sustainability considerations across our business. These groups include: • MSIM ESG Committee
Sustainable Investing Team Leads MSIM Sustainability Team Global Stewardship Team Morgan Stanley Institute for Sustainable Investing and Global Sustainability Office Group The Firm’s Sustainable Investing efforts are also supported by Morgan Stanley’s decade-plus commitment to sustainable finance and Firm-level resources. The Morgan Stanley Institute for Sustainable Investing and the Global Sustainability Office (GSO) are positioned at the nexus of the Firm’s three business pillars (i.e., Institutional Securities Group, Wealth Management and MSIM), and serve as expert resources and partners on innovation, knowledge sharing and thought leadership across the Firm. GSO regularly advises MSIM on product development and ESG data analysis, collaborates on thought leadership, and partners on internal knowledge-sharing and external industry collaborative efforts.
Equity ESG Research Analysts – Calvert’s Equity ESG Research Analysts are specialised by sector. They are responsible for creating investment theses for each peer group they cover, as well as constructing the peer group models used as the framework for both quantitative and qualitative issuer reviews, driven by financial materiality. These models incorporate the best available information to review each potential investment, rating and ranking companies within their subindustries, ultimately producing an assessment that reflects both peer-relative and absolute performance in a defined index universe. They maintain the models, as well as conduct qualitative reviews of issuers without enough data to be reviewed through the Calvert Research System. They are also responsible for thought leadership on industry trends, as well as engaging with companies they cover and collaborating with the fundamental research analysts. Applied Responsible Investment Solutions (ARIS) – The ARIS Team has extensive experience managing Calvert’s proprietary responsible index strategies, active quant equity strategies and customised investment solutions. Corporate Engagement – The Calvert Corporate Engagement Team is responsible for driving Calvert’s structured engagement strategy using proprietary ESG research. The goal of our engagements is to create impact and improve investment results by having positive influence on the ESG policies and practices of portfolio companies. Engagement efforts may result in additional uncovering of information about issuers that may be incorporated into the investment process through our use of custom Key Performance Indicators. In concert with the ESG research and fundamental analysts and portfolio managers, the engagement team communicates directly with company boards and management teams, as well as with policy makers and governmental agencies. The engagement team also collaborates with investor groups and coalitions, supports public policy initiatives, files shareholder resolutions, and defines our proxy voting policies. The Fixed Income ESG team coordinates with the Calvert Corporate Engagement Team on selected company meetings and external initiatives. Impact Team – Calvert’s cross-functional impact team is responsible for developing, integrating, scaling, and refining best-in-class platforms for measuring, managing, and reporting on the ESG impact footprint of Calvert’s multi-asset class investment portfolios. The team ensures the rigor, robustness of Calvert’s overarching impact framework and underlying impact KPIs with respect to cataloging, benchmarking, reporting on and improving the impact performance of Calvert’s investment offerings. The impact team works with Calvert’s research, engagement, investment, marketing and product/business development teams to identify and address investment impact needs, gaps, risks and opportunities. The team also undertakes initiatives to conceive or enhance enterprise-wide impact data systems and capabilities. The team tracks and incorporates relevant developments in global impact reporting standards, taxonomies, methodologies and best practices, and contributes thought leadership content on impact measurement and management across the investment value chain. The goal of Calvert’s impact strategy, initiatives and endeavors is to facilitate and catalyse Calvert’s dual mission of delivering positive social and environmental impact alongside competitive long-term financial returns to its clients.
Calvert also has established committees to oversee governance: Calvert Responsible Research Review Committee (3RC) Calvert has established the Responsible Research Review Committee (“3RC”) to oversee its ESG investment research processes, and engagement and advocacy efforts. The 3RC’s responsibilities include: Review and approval of research processes, including Calvert’s proprietary scoring methodology that rates companies on their management of ESG risks; Approval of companies deemed eligible/ineligible for investment based on ESG scores; Review of holdings in fixed income funds to ensure they meet ESG investment criteria; and Review of Calvert’s shareholder engagement and advocacy activities, including companies and policies targeted for engagement/advocacy. Compliance with the processes used by research analysts and approved by the 3RC is monitored through compliance systems that determine whether securities purchased for Calvert strategies are eligible for investment, as well as the Calvert’s Chief Compliance Officer. These systems and processes are also utilized to monitor client-specific customizations and guidelines. For example, clients may have style or thematic customizations or exclusion lists that the compliance team and portfolio managers use as part of the portfolio management process. In addition, the portfolio managers meet formally no less than once every two weeks to review portfolios, risk reports collectively and market opportunities. Less formal discussions occur continuously throughout the day.
The committee administers Calvert’s policies and procedures on proxy voting.
OUR INVOLVEMENT Through its various businesses and internal functions, MSIM and Morgan Stanley participate in, belong to or take a leading role in many ESG-related initiatives and organisations. This includes participating in industry conference panels, exploring joint research, and supporting the work of groups focused on ESG-related issues. MSIM and Morgan Stanley’s external sustainability/ESG-related initiatives and organisations include, but are not limited to, the following:
Often Calvert partners with other investors and NGOs to advance common objectives. Calvert believes there is power in numbers and in more company shares when it brings voices and interests to the table with different perspectives yet common objectives. While Calvert does not sign on to any specific stewardship code at present, we support such organisations and their goal of providing better, more transparent information to investors.
DialshifterThis fund is helping to ‘shift the dial from brown to green’ by… Offering clients a portfolio that primarily invests in companies that are involved in economic activities that address climate transition and/or are aligned to the long-term de-carbonisation objectives of the Paris Agreement. The Fund will maintain a carbon profile that follows the net zero objectives of the Paris Agreement, as reflected in the appropriate Paris-Aligned benchmark, or in the absence of an approved Paris-Aligned benchmark it will maintain a substantially lower carbon footprint, of at least 50% less than that of the underlying market benchmark and taking into account the long-term carbon reduction objectives of the Paris Agreement.
Our organisation is helping to support the Paris Climate Agreement and the Race to Net Zero by… At Calvert, we subscribe to the conclusion that earth’s climate is warming, and that human activity is the primary driver of this warming. Although the Fund does not have an explicit Net Zero target, we recognize that climate change represents an existential business risk to companies that derive significant proportions of revenues from fossil fuels, and that the transition to a low-carbon economy will require significant decarbonization efforts to avoid the gravest impacts of climate change. Calvert became a signatory to the Net Zero Asset Managers Initiative in December 2020.
SDR Labelling:Not eligible to use label Key Performance Indicators:
LiteratureVoting RecordDisclaimerWhile every care has been taken in preparing the information provided in this document, such information and materials are provided "as is" without warranty of any kind, either express or implied; in particular, no warranty regarding accuracy or completeness. There is no guarantee that any investment strategy will work under all market conditions, and each investor should evaluate their ability to invest for the long-term, especially during periods of downturn in the market. Prior to investing, investors should carefully review the relevant strategy / product offering document. There are important differences in how the strategy is carried out in each of the investment vehicles. Prior to investing, investors should carefully review the relevant offering document for the strategy/product. Please consider the investment objectives, risks and fees of the strategy/product carefully before investing. This material is a general communication, which is not impartial and has been prepared solely for informational and educational purposes and does not constitute an offer or a recommendation to buy or sell any particular security or to adopt any specific investment strategy, and any such offering is subject to the execution of a written contract. All investments involve risks, including the possible loss of principal. The information herein has not been based on a consideration of any individual investor circumstances and is not investment advice, nor should it be construed in any way as tax, accounting, legal or regulatory advice. To that end, investors should seek independent legal and financial advice, including advice as to tax consequences, before making any investment decision. Except as otherwise indicated, the views and opinions expressed herein are those of the portfolio management team, are based on matters as they exist as of the date of preparation and not as of any future date, and will not be updated or otherwise revised to reflect information that subsequently becomes available or circumstances existing, or changes occurring, after the date hereof. They are subject to change based on market, economic and other conditions. Certain information contained herein constitutes forward-looking statements, which can be identified by the use of terms such as “may,” “will,” “should,” “expect,” “anticipate,” “project,” “estimate,” “intend,” “continue,” or “believe” (or the negatives thereof) or other variations thereon. Due to various risks and uncertainties, including, but not limited to, those set forth herein, actual events or results or actual performance of any investments may differ materially from those reflected or contemplated in such forward-looking statements. The information presented represents how the portfolio management team generally implements its investment process under normal market conditions. Forecasts and/or estimates provided herein are subject to change and may not actually come to pass. Information regarding expected market returns and market outlooks is based on the research, analysis and opinions of the authors. These conclusions are speculative in nature, may not come to pass and are not intended to predict the future performance of any specific Morgan Stanley Investment Management product. Any strategy weights and/or number of holdings referenced herein represent typical ranges and are not a maximum number. The portfolio may exceed this from time to time due to market conditions and outstanding trades. The targets, turnovers and exposures presented for pooled vehicles are typical ranges. There is no assurance that these targets will be attained. Risk management implies an effort to monitor risk, but should not be confused with and does not imply low risk. Any index referred to herein is the intellectual property (including registered trademarks) of the applicable licensor. Any product based on an index is in no way sponsored, endorsed, sold or promoted by the applicable licensor and it shall not have any liability with respect thereto. This document is intended solely for the use of the person to whom it has been delivered (including such person’s employees, representatives, agents, or advisors, as applicable). MSIM has not authorized financial intermediaries to use and to distribute this document, unless such use and distribution is made in accordance with applicable law and regulation. Additionally, financial intermediaries are required to satisfy themselves that the information in this document is appropriate for any person to whom they provide this document in view of that person’s circumstances and purpose. MSIM shall not be liable for, and accepts no liability for, the use or misuse of this document by any such financial intermediary. Please refer to the most recent fund factsheet which provides product specific risk disclosures. All information contained herein is proprietary and is protected under copyright law. |
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