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PRI reporting framework 2019

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You are in Direct - Listed Equity Incorporation » ESG incorporation in actively managed listed equities » Implementation processes » (A) Implementation: Screening

(A) Implementation: Screening

LEI 04. Types of screening applied

04.1. Indicate and describe the type of screening you apply to your internally managed active listed equities.

Type of screening

Screened by


CCLA does not invest in any company that produces cluster munitions and/or landmines (as per the definitions used and information provided by our global screening provider). We believe that these products are not acceptable and pose significant reputational risk.

CCLA won’t buy or hold pure play coal or tar sands investments for its funds and discretionary investment clients. This is in line with our assessment of the future prospects for these companies.

Screened by


CCLA undertake a three year engage/divest cycle with companies who have not responded to allegations of non-conformity with international norms (ILO Core Labour Standards, UN Guiding Principles for Business and Human Rights (GPBHR), GHG emission disclosure and severe incidents that threaten biodiversity). This process is driven by data provided by MSCI's 'ESG Controversies' product, which researches company public documents, media sources and NGO publications to:

Assess controversies based upon their severity 

Assess the status of the case 

Identify whether the case relates to company management problems 

Provide clients with data as to whether a company has 'Acknowledged or settled', 'Denied Allegations' or provided 'No Response' to the controversy.


04.2. Describe how you notify clients and/or beneficiaries when changes are made to your screening criteria.

All of our ethical and responsible investment priorities are made available on our website. We notify clients of changes to our approach by way of specific communication or within quarterly client reports.

LEI 05. Processes to ensure screening is based on robust analysis

05.1. Indicate which processes your organisation uses to ensure screening is based on robust analysis.

05.2. Indicate the proportion of your actively managed listed equity portfolio that is subject to comprehensive ESG research as part your ESG screening strategy.

05.3. Indicate how frequently third party ESG ratings are updated for screening purposes.

05.4. Indicate how frequently you review internal research that builds your ESG screens.

05.5. Additional information. [Optional]

CCLA's responsible investment screening is based upon data provided from our third-party data providers. These are currently FTSE, MSCI and Sustainalytics.

We take a number of steps to ensure that this data is accurate: 

First, we appoint our data providers every three years through a rigourous tender process. This enables us to identify the best possible providers and stay up to date with changes in the ESG data market.

Second, whilst we expect our data providers to routinely check their findings with underlying entities, we routinely audit the accuracy of the research and periodically forward their findings to the researched companies. Where we identify discrepencies we inform the data provider.

Third, the data is uploaded into our order management system. This blocks trades, made in error, that would contradict either our responsible investment or our clients' ethical investment policies. This data is updated in our internal order management systems every month. This ensures that CCLA's investment process is informed by the most up to date information possible.

Finally, we undertake regular audits of the process on a weekly, monthly and annual basis.

LEI 06. Processes to ensure fund criteria are not breached

06.1. Indicate which processes your organisation uses to ensure fund criteria are not breached.

06.2. If breaches of fund screening criteria are identified - describe the process followed to correct those breaches.

Ensuring accurate screening of our Funds is a key priority for CCLA.

Our process is based upon accurate data, sourced from a third party, that is built into our Order Management System. This prevents restricted stocks being purchased in error.

We have weekly, monthly and annual audit processes to review the function of this system. In the unlikely instance that a restricted stock is purchased this will be identified and sold. To ensure that our clients are not disadvantaged we compensate the fund for any expenses occured.

06.3. Additional information.[Optional]