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Australian Ethical Investment Ltd.

PRI reporting framework 2019

You are in Direct - Fixed Income » ESG incorporation in actively managed fixed income » Implementation processes

Implementation processes

FI 01. Incorporation strategies applied

Indicate (1) Which ESG incorporation strategy and/or combination of strategies you apply to your actively managed fixed income investments; and (2) The proportion (+/- 5%) of your total actively managed fixed income investments each strategy applies to.
SSA
100 Screening alone
0 Thematic alone
0 Integration alone
0 Screening + integration strategies
0 Thematic + integration strategies
0 Screening + thematic strategies
0 All three strategies combined
0 No incorporation strategies applied
100%
Corporate (financial)
100 Screening alone
0 Thematic alone
0 Integration alone
0 Screening + integration strategies
0 Thematic + integration strategies
0 Screening + thematic strategies
0 All three strategies combined
0 No incorporation strategies applied
100%

01.2. Describe your reasons for choosing a particular ESG incorporation strategy and how combinations of strategies are used.

When applying our Ethical Charter to governments, we recognise that democratically elected governments play an important role in in advancing the interests of people, animals and the environment. To assess a government we therefore focus on its accountability and the general quality of its democracy, taking into account things like political rights, civil liberties and rule of law. We will not invest in undemocratic states, and democratic governments can also be excluded for militarism.

Even governments operating in strong democracies will have many polices which we disagree with. In these cases we think the most effective way for us to pursue positive change is to advocate for more sustainable policies through government consultations and submissions, and through our public voice in the media which can influence both governments and voters.

When investing in corporate fixed income securities, the screening under our Charter creates a universe of sustainable companies. Our broad and deep research of short and long term social and environmental impacts of companies and sectors builds a more complete understanding of the prospects and risks of the companies and sectors in our universe. As well as defining a sustainable investment universe, this enables more impactful engagement with companies.

01.3. Additional information [Optional].


FI 02. ESG issues and issuer research

02.1. Indicate which ESG factors you systematically research as part of your analysis on issuers.

Select all that apply
SSA
Corporate (financial)
Environmental data
Social data
Governance data

02.2. Indicate what format your ESG information comes in and where you typically source it

Indicate who provides this information  

Indicate who provides this information  

specify description

          Industry, government, responsible investment, scientific and civil society sources
        

Indicate who provides this information  

specify description

          Industry, government, responsible investment, scientific and civil society sources
        

Indicate who provides this information  

specific description

          Industry, government, responsible investment, scientific and civil society sources
        

Indicate who provides this information  

specify description

          Economist Intelligence Unit Democracy Index; BICC Global Militarization Index.
        

02.3. Provide a brief description of the ESG information used, highlighting any differences in sources of information across your ESG incorporation strategies.

Our ethics research and investment analysts use the above types and sources of information for the following purposes:

  • Screening of governments: Rankings and associated analysis from Economist Intelligence Unit Democracy Index, BICC Global Militarization Index and other sources help us assess the legitimacy of governments and their militarism.
  • Screening and ESG integration for corporate issuers: Data and analysis from ESG research providers, ESG broker research and from industry, government, scientific and civil society sources help us identify and assess key ESG issues affecting companies and sectors.

02.4. Additional information. [Optional]


FI 03. Processes to ensure analysis is robust

03.1. Indicate how you ensure that your ESG research process is robust:

03.2. Describe how your ESG information or analysis is shared among your investment team.

03.3. Additional information. [Optional]


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