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Morphic Asset Management

PRI reporting framework 2019

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, interpretation of fiduciary (or equivalent) duties,and how they consider ESG factors and real economy impact.

Our mission is as follows:

  • To deliver risk-adjusted returns over the long term, in a responsible way that doesn’t harm the environment, society and doesn’t make the world a poorer place.
  • We will have a positive impact both as investors and as a business.
  • We will invest in those companies whose products and services have positive impacts.
  • We will engage with those companies that need further change for the better and we may act against those companies who fail to recognise their negative impact in order to persuade them of the need for change.
  • As a business, we will support charities via donating a proportion of our revenue and by managing assets on their behalf.
  • We will promote the adoption of the principals of Responsible Investment throughout the broad investment community.
  • Finally, our behaviour as individuals and collectively as a business will reflect the values that are fundamental to our Responsible Investment philosophy.


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]

The consideration of ESG factors is a natural component of Morphic’s investment process. We believe that understanding material risks and opportunities related to ESG factors, enhances the insights of the conventional investment process. The founders of Morphic have been investing for most of their careers with an investment process that reflects the evolution of Responsible Investment over this period.

Building on an historic approach of excluding companies whose activities are incompatible with our values (known as ethical or negative screening) the identification and consideration of material ESG factors is now fully integrated within our investment process.

Our own experience and a growing body of academic research suggest that incorporating ESG considerations into the investment process can lead to more informed investment decision-making and better investment outcomes for our investors.

Our Responsible Investing Policy (“Policy”) document affirms Morphic’s commitment to responsible investing and outlines our approach to practising responsible investing which comprises of four key components:

  • Screening – Negative & Positive
  • Integration of ESG considerations in our investment process – research, analysis & investment decision making
  • Engagement – with portfolio companies & all relevant stakeholders, & voting appropriately
  • Transparency – full disclosure

The Joint Chief Investment Officers are responsible for the implementation of this Policy and it is reviewed on a regular basis and amended to reflect developments in best practice and our commitments to PRI and industry peak bodies (such as RIAA). The Head of Research will be responsible for the annual review in the second quarter of each financial year.

Any changes to this Policy will be advised promptly to all members of the Morphic investment team and our investors by publication on our website.

Consistent with our Responsible Investing commitments we provide full transparency on how we integrate ESG into our investment process.

  1. Portfolio Holdings - we publish our full list of holdings on our website on an regular basis.
  2. Performance Reporting - every month, we provide our investors with a monthly performance report which shows the Funds’ top ten holdings (long and short positions).
  3. Semi-Annual and Annual Reporting – every six months we provide our investors with extensive commentaries on performance, portfolio management activities and relevant subjects.
  4. Voting – we will publish our voting records on an annual basis.
  5. Company Engagement – if appropriate we will publicise our engagement with portfolio companies, however, it is often the case that this more effective if kept private.
  6. Short Selling – we believe that public disclosure, via articles and blogs detailing our short-selling investment thesis, can have a powerful signalling impact.
  7. Other Content – our website contains regular “blogs” and longer articles on specific portfolio companies and relevant subjects.
  8. External Media – we regularly contribute to financial newspaper and television and copies of this content can also be found on our website.

01.6. Additional information [Optional].

I confirm I have read and understood the Accountability tab for SG 01 I confirm I have read and understood the Accountability tab for SG 01

SG 01 CC. Climate risk (Not Applicable)

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.




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

02.3. Additional information [Optional].

Our Responsible Investment Policy is published on our website (per the link referred to in the above responses) and covers all of the aforementioned policy documents and components.

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.

Per Morphic Responsible Investment Policy, section 5.2 Managing Conflicts of Interest:

Morphic Asset Management (Morphic) maintains a Compliance Manual (signed off by the Independent Board of Directors) which all employees receive on commencement of employment and review annually.

The Compliance Manual provides the framework and rules by which Morphic defines itself and its relationships with its stakeholders including clients, staff and shareholders. Section 3 of Morphic's Compliance Manual “Managing Conflicts of Interest” addresses this specific issue as follows:

  • Definition of conflicts of interest
  • Procedures for managing conflicts of interest
  • Mechanisms for controlling conflicts of interest
  • Monitoring and reporting

03.3. Additional information. [Optional]

SG 04. Identifying incidents occurring within portfolios (Private)