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Beechbrook Capital LLP

PRI reporting framework 2020

You are in Direct - Fixed Income » ESG incorporation in actively managed fixed income » (C) Implementation: Integration

(C) Implementation: Integration

FI 10. Integration overview

10.1. Describe your approach to integrating ESG into traditional financial analysis.

We believe ESG factors are a crucial consideration in investment analysis. In addition, recent academic research suggests that ESG focused investments tend to outperform the overall market. 

We perform thorough analysis throughout the investment process. As such, ESG factors are fully integrated into the decision making. Each potential transaction will be assessed based on fundamental bottom-up analysis. This analysis includes qualitative and quantitative analysis on a macro as well as micro economic level. 

The investment professionals assess ESG-related issues and opportunities at the borrower, industry, fund and Beechbrook-wide levels.

  1. Borrower: from a credit risk perspective, what are the ESG risk/opportunity exposures on a company by company level?
  2. Industry: what are common ESG risks/opportunities prevalent across the borrower’s industry and how are participants actively approaching this?
  3. Fund: assess the existing and potential ESG risks/opportunities across the wider fund portfolio.
  4. Across Beechbrook: review of ESG risks across all Beechbrook’s investment strategies and business activities.

For further information, please refer to our ESG Policy: http://www.beechbrookcapital.com/media/content/files/beechbrook-capital-esg-policy-may19.pdf

 

10.2. Describe how your ESG integration approach is adapted to each of the different types of fixed income you invest in.

Corporate (non-financial)

Please refer to question FI10.1. Beechbrook does not invest in different types of fixed income investments. 

10.3. Additional information [OPTIONAL]


FI 11. Integration - ESG information in investment processes

11.1. Indicate how ESG information is typically used as part of your investment process.

Select all that apply
Corporate (non-financial)
ESG analysis is integrated into fundamental analysis
ESG analysis is used to adjust the internal credit assessments of issuers.
ESG analysis is used to adjust forecasted financials and future cash flow estimates.
ESG analysis impacts the ranking of an issuer relative to a chosen peer group.
An issuer`s ESG bond spreads and its relative value versus its sector peers are analysed to find out if all risks are priced in.
The impact of ESG analysis on bonds of an issuer with different durations/maturities are analysed.
Sensitivity analysis and scenario analysis are applied to valuation models to compare the difference between base-case and ESG-integrated security valuation.
ESG analysis is integrated into portfolio weighting decisions.
Companies, sectors, countries and currency and monitored for changes in ESG exposure and for breaches of risk limits.
The ESG profile of portfolios is examined for securities with high ESG risks and assessed relative to the ESG profile of a benchmark.
Other, specify in Additional Information

11.2. Additional information [OPTIONAL]


FI 12. Integration - E,S and G issues reviewed

12.1. Indicate the extent to which ESG issues are reviewed in your integration process.

Environment
Social
Governance
Corporate (non-financial)

Environmental

Social

Governance

12.2. Please provide more detail on how you review E, S and/or G factors in your integration process.

Corporate (non-financial)

Please refer to our ESG Policy for a detailed overview of how we systematically analyse Environmental, Social and Governance related aspects: http://www.beechbrookcapital.com/media/content/files/beechbrook-capital-esg-policy-may19.pdf

12.3. Additional information.[OPTIONAL]


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