The active fund incorporates all three strategies. First, a screening is conducted based on the ACTIAM Fundamental Investment Principles. Companies that are excluded from investment can be found on our website: http://www.actiam.nl/en/sustainability/exclusions.
Second, we allocate an “ESG score”, which aggregates policy and conduct of several ESG indicators, a sector-based score and an analyst score, to all remaining companies in the universe.
And third, we add a thematic overlay based on material themes, such as climate change, water, health and land. The worst performers per theme are excluded from investment in the active fund, for example companies that are too dependent on coal mining and therefore a negative contributor to climate change. Companies that are considered positive contributors, such as renewable energy producers, are positively selected by upgrading their ESG score. Engagements can be set up in case these companies deliver a sustainable core product but are lagging in their ESG score due to, for example, a relatively low level of disclosure.
The ESG team and the Equity portfolio management team are jointly responsible for managing the integrated strategy.