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Impax Asset Management

PRI reporting framework 2017

Export Public Responses

You are in Direct - Listed Equity Incorporation » Outputs and outcomes

Outputs and outcomes

LEI 14. How ESG incorporation has influenced portfolio composition

14.1. 組織のESG組み入れ戦略がポートフォリオや投資ユニバースの構成にどういう影響を与えているかを記載してください。

最初の投資ユニバースの削減またはその他の効果について説明してください

Three companies have so far been excluded from our investable universe due to UN Global Compact breaches (human rights breaches and corruption).

削減率を明記してください(+/- 5%)

1 %

投資ユニバースの変更またはその他の効果について説明してください

A company must derive at least 20% of its revenues (or other business activity indicator) from an environmental activity (specifically defined by Impax, FTSE and an independent committee) in order to enter into our investment universe. This universe currently comprises c.1,600 companies.

ESG統合後の効果を記載してください。

          More fundamental knowledge of our investee companies.
        

14.2. 補足情報。

Approximately 2% of the companies that have been analysed for entry into our investable universe, have been excluded on ESG-grounds. If a company has a weak ESG-score of just over our threshold for "pass", the position size is capped in the portfolio, for risk management purposes. A stronger ESG-score gives the lead analyst / portfolio manager higher conviction. 


LEI 15. Measurement of financial and ESG outcomes of ESG incorporation

15.1. 上場株式への責任投資アプローチがポートフォリオ(財務業績やESGパフォーマンス)に及ぼす影響を測定しているかどうかを記載してください。

a)ファンドの評判

以下への影響を説明してください: 
影響を説明してください: 
どの戦略を分析しましたか?
ファンドの評判

どの戦略を分析しましたか?

b)ファンドの財務業績: リターン

以下への影響を説明してください: 
影響を説明してください:​
どの戦略を分析しましたか?
ファンドの業績: リターン

c)ファンドの財務業績: リスク

以下への影響を説明してください: 
影響を説明してください:​
どの戦略を分析しましたか?
ファンドの業績: リスク

15.2. こうした結果を決定する方法について説明してください。

We can assess the positive effects from our ESG-approach on the reputation of our funds, from an increasing number of annual reviews by our investors, which are also increasingly scored or ranked and our detailed and integrated ESG-analysis has enabled us to do well in this ratings.

Impax's approach to ESG and Stewardship was also detailed in our updated UK Stewardship Code statement in 2016 and our approach and statement was rated "Tier 1".

We regularly assess the share price performance of the companies we have analysed for ESG and we have found that the companies that have stronger ESG-scores, consistently outperformed those that have weaker ESG-scores.

We analyse the thematic aspects of our investments from a performance and risk perspective continuously for our investors.


LEI 16. Examples of ESG issues that affected your investment view / performance

16.1. 組織の投資見解や報告年度のパフォーマンスに影響を与えたESG問題の例を挙げてください。

ESG問題および説明

Hazardous waste management company, USA, ESG-rating “Fair”. Material ESG factors for the company are toxic emissions and waste (mainly toxic air emissions), health and safety (H&S), corruption & bribery.  The company’s environmental and social processes were below average and they faced an increasing amount of controversies around toxic emissions, pricing issues, and aggressive accounting practices. Impax engaged regularly with the company to understand their circumstances and demanded improved processes and management systems to manage these risks.  The company remained non-committal toward any changes or improvements to pollution control processes citing their compliance with local regulations.  Nor did the company take decisive steps to clarify and improve the pricing issues. The company had been a long term holding of Impax due to its successful business model, however, it began making non-ideal strategic decisions. The financial and strategic issues, coupled with the ongoing ESG risks and the company’s non-committal attitude toward ESG improvements in general, led Impax to sell out of the positon in Q4 2016.

投資決定やパフォーマンスへの影響

The financial and strategic issues, coupled with the ongoing ESG risks and the company’s non-committal attitude toward ESG improvements in general, led Impax to sell out of the positon in Q4 2016.

ESG問題および説明

Water infrastructure company, Hong Kong, ESG-rating “Excluded”.  Material ESG factors for the company are water management, toxic emissions and waste, H&S, corruption & bribery. The company is a State Owned Enterprise and has been successfully building out much needed water infrastructure and water provision in mainland China. Impax’s ESG analysis raised issues around water risk management, as well as an increasingly ineffective and entrenched board, combined with an increasing number of related party transactions between the parent company and the investee company. In Q4 2016 the company announced it will be acquiring a non-core land asset from the parent company, accelerating related party transactions. This led to the company’s ESG score being downgraded from “Fair” to “Exclude” meaning that additional shares cannot be bought and within 6 months (by June 2017) the company must be sold from Impax portfolios, unless full assurance is obtained that the issue has been resolved. During this period Impax will seek all relevant information, engage with the company to seek improvement.  

投資決定やパフォーマンスへの影響

Increase in non-core related party transaction led to the company’s ESG score being downgraded from “Fair” to “Exclude” meaning that additional shares cannot be bought and within 6 months (by June 2017) the company must be sold from Impax portfolios, unless full assurance is obtained that the issue has been resolved. During this period Impax will seek all relevant information, engage with the company to seek improvement.  

ESG問題および説明

Buildings Energy Efficiency, France. ESG-rating “Excellent”. The Company provides electrical and digital building infrastructures worldwide. Key sustainability issues include toxic emissions and waste, labor management (including H&S), and corruption & bribery. The Company has been in the Impax investable universe for many years, but had not been compelling from a financial, strategic or ESG perspective (previously rated “Average”). As part of the investment team’s annual ESG reviews, Impax identified improvements to the company’s environmental and social policies and processes, and about two years ago the company started to improve its minority shareholder rights, board structure and governance transparency. The company has been a positive outlier in its local market as many French companies have improved their sustainability processes significantly in the last few years, but very few have improved governance structures. This was notable, as Impax aims to use ESG research to also identify companies that are changing positively or negatively. The company has continued to make ESG improvements and was upgraded to “Excellent” in June 2016. The ESG improvements were commensurate with positive strategic decisions by company management.  Together these developments increased Impax’s conviction resulting in the addition of the stock to portfolios over the last 12 months.    

投資決定やパフォーマンスへの影響

Positive ESG and strategic developments increased Impax’s conviction in the company, resulting in the addition of the stock to portfolios over the last 12 months.    

ESG問題および説明

Water infrastructure, USA, ESG-rating “Good”. Material ESG factors for the company are labor management, toxic emissions and waste (incl. asbestos), corruption & bribery (esp. pricing practices). Company was a spin-off in 2011. From the first start as an independent company, the management showed a very clear intention to establish a very well run organization, much stronger than the parent it came out of. Since 2011, the management team has sought to make governance enhancement every year, it has established much stronger environmental and social policies and processes than its peers or indeed its parent company. It is a company that our ESG-analysis has identified as a company in continuous improvement, which is also proactively seeking regular feedback and input from its shareholders and stakeholders, on governance and environmental and social aspects. This is unusual among its peers and very positive in our view. Identifying this unusual quality and character through our ESG-analysis, combined with strong financial and operative performance by the company, has made it to an important, trusted, long-term core holding in the portfolio.       

 

投資決定やパフォーマンスへの影響

Identifying this positive quality and character through our ESG-analysis, combined with strong financial and operative performance by the company, has made it to an important, trusted, long-term core holding in the portfolio.       

16.2. 補足情報。


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