Ashmore takes credit analysis extremely seriously. Willingness to pay is more subjective and can change quickly subject to the vagaries of the political cycle and the politicalresponse to economic events. Ashmore places emphasis on the factors that affect a government’s willingness to pay and relies on scenario-analysis to determine the risks and opportunities presented by these governments’ assets. Ashmore speaks regularly with appointed policy makers to glean their views on significant events, such as local elections, as well as try to gauge their bias towards populist agendas which may impact ESG factors.
Ashmore formalises EM country credit and ESG considerations at least quarterly, in conversations between various members of the Investment team and the Head of Research. In addition, the Investment Committee will consider the assessment for each country on an ad-hoc basis as it discusses country visit reports from Portfolio Managers returning from research trips, or when discussing significant events such as elections. Therefore, credit and ESG analysis are an integral part of Ashmore’s investment process for publicly traded fixed income securities.