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Wellington Management Company LLP

PRI reporting framework 2020

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(B) Implementation: Thematic

LEI 07. Types of sustainability thematic funds/mandates

07.1. Indicate the type of sustainability thematic funds or mandates your organisation manages.

07.2. Describe your organisation’s processes relating to sustainability themed funds. [Optional]

Wellington manages a variety of equity strategies that have explicit sustainability objectives. This includes impact investing strategies, in addition to strategies focused on deep ESG integration and engagement. Many of our impact approaches align with the UN Sustainable Development Goals and also produce Key Performance Indicator (KPI) reporting. Please see below for brief descriptions of our sustainable investing approaches, including those that are funded, in incubation, or under development.  

Wellington Sustainable Investment Platform

  • Climate Strategy: a global equity portfolio designed to help address carbon and sustainability under-investment in a targeted approach that delivers both environmental and financial returns on capital. This strategy is focused on climate change mitigation and adaptation through five broad sustainability categories: low carbon electricity, energy efficiency, water and resource management, low carbon transport, and resilient infrastructure.
  • Emerging Market Development: an emerging markets equity strategy that invests in companies taking advantage of social pressure and policy initiatives supporting conscious consumption of energy. This strategy is focused on four structural changes happening as a result of economic development: enhanced productivity, inclusiveness, improving living standards, and sustainability.
  • Global Impact: a global equity portfolio that invests in innovative companies whose core business addresses the world’s major social and environmental challenges with a measurable impact. This is determined by Wellington’s proprietary bottom-up global fundamental research.  This strategy is focused on 11 impact themes, which can be summarized into three categories: life essentials, human empowerment, and environment.
  • Global Stewards: concentrated, high active share, global large cap equity approach that seeks to identify best-in-class companies that are deemed attractive on a 10-year fundamental perspective, able to sustain above-industry returns on capital, and demonstrate superior stewardship qualities. We are deliberate with our portfolio construction, emphasizing stock selection to be the primary source of alpha while minimizing the costs of active management through low turnover and thoughtful trading.
  • Low Carbon Emerging Markets Systematic Equity: an emerging markets equity portfolio managed by Wellington’s Quantitative Investment Group whose objective is to maximize net-of-cost alpha relative to risk while conforming to a specific set of carbon-intensity constraints.
  • Advancement of Women: a global equity portfolio designed to invest in high-quality companies that value the inclusion and promotion of women. As part of the fundamental research process, the investment team focuses on female representation at the board and senior management levels as a proxy for companies’ commitment to diversity. This strategy uses engagement to assess whether a company’s commitment to diversity is genuine and to encourage goal-setting, transparency in reporting, and improvement toward gender parity.
  • Broader Perspectives: a global large cap equity approach that takes an alpha-first mindset to ESG integration given that an ESG perspective can yield differentiated conclusions on management behavior and business practices. The portfolio reflects a combination of ESG leaders, as well as businesses we believe are showing improvements over time.

Denotes a strategy that is currently in incubation

The firm also serves as the investment manager of various screened investment equity portfolios, where we invest in, or exclude, certain types of companies based on pre-agreed ESG guidelines and criteria from the client.

Wellington Management sub-advises two of Domini Impact Investment's mutual fund offerings in the U.S. market, one of which is an equity strategy.