This report shows public data only. Is this your organisation? If so, login here to view your full report.

Impax Asset Management

PRI reporting framework 2017

Export Public Responses

You are in Direct - Listed Equity Incorporation » ESG incorporation in actively managed listed equities » Implementation processes » (C) Implementation: Integration of ESG issues

(C) Implementation: Integration of ESG issues

LEI 10. Review ESG issues while researching companies/sectors

10.1. Indicate if E, S and G issues are reviewed while researching companies and/or sectors in active strategies.

ESG issues

Coverage/extent of review on these issues

Environmental

Environmental

Social

Social

Corporate Governance

Corporate Governance

10.2. Additional information. [Optional]


LEI 11. Processes to ensure integration is based on robust analysis

11.1. Indicate which processes your organisation uses to ensure ESG integration is based on a robust analysis.

11.2. Describe how ESG information is held and used by your portfolio managers.

11.3. Additional information.[Optional]

We analyse company governance aspects from a country-perspective, as governance is mainly driven by local codes, rules, traditions etc. We look for potential outliers from a country-perspective.

We analyse company environmental and social aspects from a sector-perspective. We have determined what the most material environmental and social risks are for our sub-sectors and analyse how well companies address these risks through effective management systems and processes. We are minded that companies do not necessarily "fit well" into industry/sector groups and company activities are analysed for most material risks.  

We identify any controversies that companies have faced.

We write an ESG-write up and these elements are the basis for our proprietary ESG-rating. We review the ESG analysis and score on an annual basis or if a material event occurs.  

The ESG-ratings are available for the entire investment team in our market data provider system, in the universe and investable universe databases and in the risk management and portfolio review as well as portfolio construction materials.

ESG issues are a standing agenda item at the weekly Investment Committee meetings and during the weekly portfolio review meetings for the various listed equity strategies.


LEI 12. Aspects of analysis ESG information is integrated into

New selection options have been added to this indicator. Please review your prefilled responses carefully.

12.1. Indicate which aspects of investment analysis you integrate ESG information into.

12.2a. Indicate which methods are part of your process to integrate ESG information into fair value/fundamental analysis and/or portfolio construction.

12.3. Describe how you integrate ESG information into portfolio construction

  • We have established the material ESG-risk criteria at the sub-sector levels.
  • Our ESG-analysis is very focused on the operational management of the company, as well as its governance structures, internal control and e.g. accounting and tax practices.
  • Policy and regulatory issues facing companies are an important part of our ESG-analysis.
  • Company strategy is a very important aspect of analysis and in our view companies that thoroughly understand their main ESG-risks and have strong sustainability processes in place to address these, are much better positioned and resilient in the face of challenges.
  • Our portfolio construction process takes ESG into account; companies with some ESG-weakness (scoring "fair") have their position sizes capped in the portfolios for risk management purposes, while the companies scoring strongly on ESG, give conviction to the lead analyst / portfolio manager.  

 

12.4a. Describe the methods you have used to adjust the income forecast / valuation tool

We have made some early work on applying a higher WACC (weighted average cost of capital) on companies with higher company or sector-specific ESG risks.

12.2b. Indicate which methods are part of your process to integrate ESG information into fair value/fundamental analysis and/or portfolio construction.

12.4b. Describe the methods you have used to adjust the income forecast / valuation tool

We have made some early work on applying a higher WACC (weighted average cost of capital) on companies with higher company or sector-specific ESG risks.

12.5. Additional information.


Top