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Martin Currie Investment Management

PRI reporting framework 2018

You are in Strategy and Governance » Investment policy

Investment policy

SG 01. RI policy and coverage

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

01.1. Indicate if you have an investment policy that covers your responsible investment approach.

01.2. Indicate the components/types and coverage of your policy.

Select all that apply

Policy components/types

Coverage by AUM

01.3. Indicate if the investment policy covers any of the following

01.4. Describe your organisation’s investment principles and overall investment strategy, and how they consider ESG factors and real economy impact.

We recognise that we have clear responsibilities as stewards of our clients’ capital. Principal among these is to protect and enhance their capital over the long term. We believe that environmental, social and governance (ESG) factors create risks and opportunities for investors. We believe it is in the interests of our clients to consider these factors when making an investment in a company, and for the companies themselves to manage these appropriately.
We believe the sustainability of a company's business model and the understanding of the broader real impact on the economy is critical to maintaining its competitive industrial positioning and strong capital returns. Incorporating ESG analysis alongside traditional financial analysis provides valuable insight into the companies we invest in and the quality of the management in those companies. We believe that companies exhibiting strong governance and that are well managed are more likely to be successful, long-term investments. We believe our ESG approach helps identify good management teams and determine whether their interests are aligned with the needs of key stakeholders and minority investors.
As long term investors, engagement and active ownership are key elements to our overall approach to stewardship. 

01.5. Provide a brief description of the key elements, any variations or exceptions to your investment policy that covers your responsible investment approach. [Optional]

Our responsible investment policy covers the importance of ESG, our approach to ESG integration, our focus on governance and materiality and the emphasis we place on our responsibilities as active and engaged owners.

As an equity-only house our responsible investment policy applies to all equity investments made on the behalf of our clients. We believe that sustainability or Environmental, Social and Governance (ESG) factors create risks and opportunities for investors. We believe it is in the interests of our clients to consider these factors when making an investment in a company, and for the companies themselves to manage these appropriately.

We believe the sustainability of a company's business model is critical to maintaining its competitive industrial positioning and strong capital returns. Incorporating ESG analysis alongside traditional financial analysis provides valuable insight into the companies we invest in and the quality of the management in those companies. We believe that companies exhibiting strong governance and that are well managed are more likely to be successful, long-term investments. We believe our ESG approach helps identify good management teams, understand their motivation and determine whether their interests are aligned with minority investors.
As long term investors, engagement and active ownership are key elements to our overall approach to stewardship. Our focus is on issues that may impact the ability of investee companies to generate long term sustainable returns.

Our responsible investment policy is reviewed on an annual basis. 


SG 02. Publicly available RI policy or guidance documents

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

02.1. Indicate which of your investment policy documents (if any) are publicly available. Provide a URL and an attachment of the document.

URL/Attachment

URL/Attachment

URL/Attachment

02.2. Indicate if any of your investment policy components are publicly available. Provide URL and an attachment of the document.

02.3. Indicate if your organisation’s investment principles, and overall investment strategy is publicly available

02.4. Additional information [Optional].

Our sustainability and ESG related work is fully integrated into our investment process and we consider sustainability and ESG factors when analysing the investment case for a company. Whilst responsibility for analysis resides with individual research specialists and portfolio managers, David Sheasby, Head of Stewardship and ESG, has specific responsibility for overseeing this aspect of our research process.

All stock research is required to consider the material and relevant Governance, Social and Environmental factors that could impact the ability of the company to generate sustainable returns. As such the investment team has day-to-day responsibility for responsible investment activities.

Investment performance forms a core part of the reward structure for our investment team. This encompasses responsible investment performance. The process also considers contributions and behaviours and this is used as a basis for allocation of a discretionary bonus pool by the head of investment. Responsible investment forms a part of this.


SG 03. Conflicts of interest

03.1. Indicate if your organisation has a policy on managing potential conflicts of interest in the investment process.

03.2. Describe your policy on managing potential conflicts of interest in the investment process.

Martin Currie has a conflicts of interest policy that applies to Martin Currie as a whole and governs situations where conflicts could arise due to the business activities of different entities within Martin Currie.  The policy applies to all clients, irrespective of their regulatory classification, and must be observed by all employees, without exception.

In managing conflicts of interest, Martin Currie:

  • prepares, maintains and implements an effective written conflicts of interest management framework;
  • maintains detailed policies and procedures for identified activities to prevent conflicts of interest constituting or giving rise to a material risk of damage to the interests of one or more clients. These include adequate measures to:
    • prevent or limit any person from exercising inappropriate influence over the way in which services and activities are carried out; and
    • prevent or control the simultaneous or sequential involvement of a person in separate activities or services where such involvement may impair the proper management of conflicts of interest;
  • has appropriate monitoring and oversight arrangements in place
  • has sufficient and effective segregation of responsibilities
  • ensures that sensitive information is kept confidential

 

03.3. Additional information. [Optional]

Martin Currie has a clear conflicts of interest policy.

All employees are responsible for:

  • being aware of clients' interests at all times and considering whether a potential conflict could cause damage to clients' interests;
  • reporting any new or emerging potential conflicts of interest to the Compliance team; 
  • assist compliance with the assessment and evaluation of the potential conflict by proposing appropriate treatment of new or emerging potential conflicts of interest including an appropriate conflict owner and necessary disclosures;
  •  complying with all related compliance policies which are designed to minimise the risk of a conflict arising between employees and Martin Currie's clients e.g. employee dealing, hospitality and gifts;
  •  and undertaking periodic trainings to understand what constitutes a conflict and how to manage identified conflicts of interest.

The Investment team is responsible for:

  • ensuring that all investment decisions, without exception, are in the interest of their clients and that sufficient records are maintained to evidence this.
  •  observing specific conflict policies without exception, including cross trades, IPO and secondary trade allocations, liquidity management, contradictory positions, front running and shareholder voting.
  •  ensuring ongoing compliance with a client's investment policy and restrictions, and ensuring that action is taken to correct any tolerance breaches in accordance with client requirements.

For proxy voting:

Martin Currie recognises that there is a potential conflict of interest when we vote for a proxy solicited by a company with which we, or our portfolio managers, have a material business or personal relationship. In this context, the member of the investment team has a duty to disclose any potential, actual or apparent material conflict of interest relating to a proxy vote. Generally, a conflict is unlikely to arise if the vote is in accordance with our guidelines and that of our proxy advisor. However, if a member of the investment team wishes to vote contrary to the guidelines in relation to a company with which we have any material business or personal relationship, the matter must be referred to the Investment Executive for independent consideration. We would consider a potential conflict of interest to exist where Martin Currie or relevant staff has a material personal or business relationship with the proponent, issuer or other relevant participants in the proxy proposal.

In the event that a portfolio manager is materially conflicted they are obligated to disclose the conflict of interest and provide their justification for voting contrary to the guidelines to the Investment Executive for independent consideration. The Investment Executive are required to provide approval before the vote can be carried out. If the Investment Executive are unable to approve the vote one of the following courses of action will be taken:

  • vote such proxy according to the specific recommendation of our proxy advisor
  • abstain
  • request that the client votes such proxy

In the event that Martin Currie is materially conflicted, the firm will:

  • vote such proxy according to the specific recommendation of our proxy advisor
  •  abstain or
  •  request that the client votes such proxy.

The Compliance team will also be informed of all instances where a conflict of interest arises in order for them to carry out an oversight role.


SG 04. Identifying incidents occurring within portfolios (Private)


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