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Impax Asset Management

PRI reporting framework 2019

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SG 18. Innovative features of approach to RI

18.1. Indicate whether any specific features of your approach to responsible investment are particularly innovative.

18.2. Describe any specific features of your approach to responsible investment that you believe are particularly innovative.

1. Defining the investment universe for "Environmental Markets"

Impax has been working with index company FTSE since 2008 managing and developing the classification system underpinning the FTSE Environmental Markets Index Series. We analyse, calculate and maintain the exact percentage of “Environmental Revenue” for each company in our universe. In 1999 this universe was 250 companies. It has grown rapidly and totals c.1,600 companies today, forming the investment universe for Impax's active environmental thematic listed equity strategies.

Environmental Markets classification:

2. Impax Impact Measuring Methodology

In 2015, Impax developed an environmental impact measurement and reporting methodology for net carbon emissions, renewable energy generation, water savings and materials recovery and recycling. This methodology and the calculations are conducted annually for three of our active environmental thematic listed equity strategies and our renewable energy private equity funds and have been externally assured by Ernst & Young, regarding the methodology, data and the calculations.

Impax Environmental Impact Methodology Paper, 2018:

3. The Impax Global Women’s Leadership Index is a customized index of the highest-rated companies in the world in advancing women, as rated by Impax Gender Analytics, and that meet key environmental, social and governance (ESG) standards, as rated by MSCI ESG Research. Companies are rated by Impax Gender Analytics based on multiple criteria of gender leadership, including:

  • Representation by women on the board of directors
  • Representation of women in executive management
  • Woman CFOs
  • Woman CEOs
  • Whether they are signatories to the Women’s Empowerment Principles, a joint initiative of the UN Global Compact and UN Women.

Impax Global Women’s Leadership Index:

4. Impax Spotlight on Gender Diversity Engagement. We are a world leader in investing in women, advancing pay equity and promoting greater gender diversity on corporate boards. We have an active gender engagement and voting approach in place.

5. Impax has developed a methodology to manage carbon risk in portfolios  - "Smart Carbon™"

In its role as a thought leading investment manager, Impax engages with clients and investors to raise awareness of climate change as a near-term investment risk. Over the years, Impax worked to develop a prudent investment approach to managing climate risk, beyond “low carbon” strategies, resulting in the Smart Carbon portfolio approach. The approach quantifies the potential impairment to future cash flows of companies whose valuations are linked to fossil fuel assets (i.e. coal, oil and gas exploration and production (E&P) companies) and that may be impacted by government and regulatory intervention. The Smart Carbon methodology reduces carbon risk while maintaining energy price risk by suggesting the E&P stocks be replaced by Energy Efficiency stocks.

Impax Smart Carbon White Paper, 2018:

6. Impax Spotlight on Climate Engagement. Approach and examples to climate engagement.

7. Impax White Paper on Investing in Asian Environmental Markets

8. Impax White Paper on investment risk management