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Record Currency 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 investment principles define who we are, how we work and the way in which we serve our clients. We take pride in providing a bespoke level of service, aimed at understanding the specific objectives of each client.

Record recognises that the services it provides to pension funds, charities, foundations, endowments and other investors are grounded in their needs to provide stable and worthwhile incomes for their beneficiaries and achieve their objectives. Reflecting the significance of these institutions for the future wellbeing of society, we have made a commitment to the future and have established an ESG policy, and an ESG team to implement it. We are continually monitoring the impact of the work we do for our clients, developing a disciplined, scientific understanding of the opportunities and processes our clients seek to exploit.

We have found a range of currency-relevant ESG factors for our EM universe, related to the United Nations SDGs and used them to construct an investment strategy which tilts our Currency Multi-Strategy portfolio in a pro-ESG manner, whilst not penalising the return profile.

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]

Environmental, social, and governance factors are proven to be important, long-term drivers of productivity. As such, we have identified indicators that capture changes in these factors – energy efficiency, for example.  In this way, our ESG-tilt works alongside our existing indicators (and investment approach) to signal those Emerging Market countries with the greatest potential for productivity gains. The tilt delivers an ESG-friendly allocation to EM currencies, which is in line with the UNDP’s Sustainable Development Goals, without detracting from returns. As such, it improves the ESG credentials of our Currency Multi-Strategy product.

Better institutions lead to higher growth, paving the way for a more sustainable path for a country. This, in particular, is directly linked to the expected returns from currency as an asset class. Faster productivity growth translates into real currency appreciation via the Balassa-Samuelson effect. To capture this, we have developed a set of ESG factors which can function as advanced indicators of productivity growth in the national economy. It is this productivity growth which contributes to sustainable returns in currency. As a result, in line with the UNDP’s Sustainable Development Goals, our ESG-tilt invests in the currencies of countries with more sustainable growth potential hence improving the systemic effects of the investments.

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].


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.

Record's Conflicts of Interest policy applies to both Record Currency Management Limited and to Record plc. Senior management culture is fully compliant with Financial Conduct Authority, Securities and Exchange Commission and Commodity Futures Trading Commission rules, as well as the FX Global Code promoted by the Global Foreign Exchange Committee, which aim to ensure that clients are treated fairly and that any conflicts of interest that may arise are both disclosed and dealt with in such a way that the result of such a conflict is not to the detriment of any client.

Record has Best Execution, Order Handling and Order Allocation Policies in place and all orders are executed in accordance with these policies. All orders are generated in compliance with the parameters agreed with each client and documented in the relevant Investment Guidelines. The majority of orders are systematically generated and the nature of the systematic investment process and the instruments that are traded mean few conflict issues arise. 

Record's Conflict of Interest policy is available on request.

03.3. Additional information. [Optional]


SG 04. Identifying incidents occurring within portfolios (Private)


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