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Liontrust Investment Partners LLP

PRI reporting framework 2019

You are in Strategy and Governance » ESG issues in asset allocation

ESG issues in asset allocation

SG 13. ESG issues in strategic asset allocation

13.1. Indicate whether the organisation undertakes scenario analysis and/or modelling and provide a description of the scenario analysis (by asset class, sector, strategic asset allocation, etc.).

13.3. Additional information. [OPTIONAL]

The Sustainable Future funds carry out analysis from a stock specific level within the fund portfolios, this both excludes exposure to companies at high risk of losing out from ESG externalities being charged back to the business as well as finding opportunities to invest in companies benefitting from secular demand for their products because of their ESG characteristics – either in what the company does or how good management are at managing these aspects. We view our bottom up fundamental analysis that includes ESG as well as traditional asset management aspects as a way of achieving portfolios with very low exposure to ESG related risk and high exposure to ESG opportunities in our economies. As a result of our investment decisions, we can see that these funds have much lower exposure to carbon emissions from operations as compared to the market (around 70% lower). We believe this makes these funds super-resilient to the inevitable regulatory tightening to eventually put a price on the cost of carbon and start passing this onto the polluters that make these emissions. These portfolio’s margins are super resilient to carbon costs as they have far fewer carbon costs to pass onto customers.

SG 13 CC.

SG 14. Long term investment risks and opportunity (Private)

SG 14 CC.

SG 15. Allocation of assets to environmental and social themed areas (Private)