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Alphinity Investment Management Limited

PRI reporting framework 2020

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

Description

For the Sustainable Share portfolios only - other Funds are not screened other than for companies with serious governance concerns

Screened by

Description

For the Sustainable Share Fund only - other Funds are not formally screened

We do not screen for best in class, purely for positive ESG and the ability to address one or more of the SDGs. 

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

Negative screens are mandated by the Fund's Responsible Entity. Should they change, as happened in 2018 when the fund adopted SDGs, a consultation and notification process was followed as required by the governance structure ofthe Fund. Efforts over and above that are determined by the investment the team as information comes to hand, including using an external data provider to monitor sustainability ratings of all companies in our investable universe.

Positive screen: the team seeks out companies which have a particularly positive impact on E, S, G and/or the ability to address and support achievement of Sustainable Development Goals.

For the Funds without the negative screen, stocks are often excluded from consideration based on specific factors relevant to that stock, for instance a shareholding structure not conducive to good governance (ie dominated by an individual and therefore effectively a private company), poor governance practices (ie we need to vote against directors or remuneration structures consistently, with no result from engagement), poor environmental performance or particularly egregious social impact (for example payday lenders). 


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

05.1. Indicate which processes your organisation uses to ensure ESG 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]

The Sustainable Share Fund is also assessed monthly by a committee containing two external experts in sustainability 


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.

Our portfolio management system is pre-loaded with the securities which would breach fund restrictions and will block any trade from being approved that would breach the screens. But if a breach were ever to occur the process would be to rectify it immediately to bring the Fund back into compliance with the rules, and then follow the normal incident/breach procedure of working out how the breach occurred and rectify systems/practices to ensure that it cannot reoccur. 

06.3. Additional information. [Optional]


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