The board reviews and endorses our commitment as a signatory to the Montreal Carbon pledge which we have adopted as a formal commitment to measure, disclose and reduce our carbon footprint. Our chief investment strategist, responsible for co-designing our ESG approach chairs our board of directors.
Our approach to measuring carbon risk goes beyond the energy and utilities sectors; we consider risk in transport, shipping, and agriculture, and in those industries that have ignored financial risks associated with lending to carbon intensive industries, such as banks and insurance companies. Assessing our portfolios’ carbon footprints informs our investment decision-making process, as we seek companies that are not only making efforts to reduce their GHG emissions, but also those that already have demonstrated low carbon footprints. We complement this assessment by avoiding risky companies whose GHG emissions have grown unabatedly and are more susceptible to financially related climate risks. We actively use the data to challenge companies on climate-strategic questions in our shareowner engagement initiatives. Our major strategies produce fewer emissions and are less carbon-intensive than their respective benchmarks, primarily due to stock selection.
Every quarter, the Board receives a complete review of our strategies, covering financial and ESG aspects, carbon footprint, Engagement outcomes.
In addition, the budget for our own firm level initiatives undertaken to offset our carbon footprint, select and support offsets are included in firm-level budgets approved by the Board. We also have firm-level contingency plans for operating in extreme weather events.