We examine and assess financially material ESG risk and opportunity through the following means:
1. Through our in-house ESG Research: Our Sustainable and Impact Investing team works closely with the Equity investment team to systematically integrate financially material ESG factors into fundamental research.
Our SI Analysts are responsible for:
- Integration framework: Identification of financially material ESG factors to consider in bottom-up and top-down research. A materiality framework has been established which identifies the most financially material ESG topics per sector.
- Top-down: Research on SI issues and trends
- Bottom-up: Ongoing support for company analysis
- Engagement: Proactively engaging with companies on material ESG issues
2. Though Data and Research: We use the following external sustainability data and analysis resources to support our SI capabilities:
- Thomson Reuters-Asset4
In addition to these sources, we further support our equity platform with insights from the UBS Proprietary ESG Model which includes fundamental sustainability data at the company and sector level. The data from this model is used alongside valuation data from our analysts to rank the investment universe on both fundamental, including sustainability attractiveness. The model follows the approach taken by the Sustainability Accounting Standards board in building its Materiality Map™. We believe that this model is unique and gives us a significant edge in the incorporation of fundamental, material sustainability data in the investment process.