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Lombard Odier

PRI reporting framework 2020

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You are in Indirect – Manager Selection, Appointment and Monitoring » Monitoring

Monitoring

SAM 05. Monitoring processes (listed equity/fixed income)

05.1. When monitoring managers, indicate which of the following types of responsible investment information your organisation typically reviews and evaluates

ESG objectives linked to investment strategy (with examples)

Evidence on how the ESG incorporation strategy(ies) affected the investment decisions and financial / ESG performance of the portfolio/fund

Compliance with investment restrictions and any controversial investment decisions

ESG portfolio characteristics

How ESG materiality has been evaluated by the manager in the monitored period

Information on any ESG incidents

Metrics on the real economy influence of the investments

PRI Transparency Reports

PRI Assessment Reports

RI-promotion and engagement with the industry to enhance RI implementation

Changes to the oversight and responsibilities of ESG implementation

Other general RI considerations in investment management agreements; specify

None of the above

LE

FI - SSA
FI - Corporate (financial)
FI - Corporate (non-financial)
ESG objectives linked to investment strategy (with examples)
Evidence on how the ESG incorporation strategy(ies) affected the investment decisions and financial / ESG performance of the portfolio/fund
Compliance with investment restrictions and any controversial investment decisions
ESG portfolio characteristics
How ESG materiality has been evaluated by the manager in the monitored period
Information on any ESG incidents
Metrics on the real economy influence of the investments
PRI Transparency Reports
PRI Assessment Reports
RI-promotion and engagement with the industry to enhance RI implementation
Changes to the oversight and responsibilities of ESG implementation
Other general RI considerations in investment management agreements; specify
None of the above

If you select any `Other` option(s), specify

Assessment of the stability of their approach to integration, the experience and expertise of their team and whether the appropriate resources are in place at the firm level. We also look at whether their sustainability and ESG resources are adequately integrated into the portfolio management team.

05.2. When monitoring external managers, does your organisation set any of the following to measure compliance/progress

ESG score or assessment

ESG weight

ESG performance minimum threshold

Real world economy targets

Other RI considerations

None of the above

LE

FI - SSA
FI - Corporate (financial)
FI - Corporate (non-financial)
ESG score
ESG weight
ESG performance minimum threshold
Real world economy targets
Other RI considerations
None of the above

If you select any `Other` option(s), specify

Compliance with our exclusion policies - evolution of their ESG methodology - ESG reporting.

05.3. Provide additional information relevant to your organisation`s monitoring processes of external managers. [OPTIONAL]

          We regularly monitor our external managers across all asset classes to ensure they continue to deliver – and ideally improve – on their ESG and sustainability approach. This is typically a bi-annual process, but we will also conduct a full, in-depth review where we see a significant event affecting one of our external partners or products (ie a manager change or a performance issue). 
This review will include an assessment of the effectiveness of the governance and oversight functions, as well as the stability of their approach to integration, the experience and expertise of their team and whether the appropriate resources are in place at the firm level. We look at whether their sustainability and ESG resources are adequately integrated into the portfolio management team. 
We review the portfolios’ ESG characteristics, and their compliance with exclusions and restrictions, including looking at any examples of controversial investment decisions. We also assess managers using out own proprietary sustainability scoring methodology and encourage them to improve their scoring. During 2019 we introduced an annual questionnaire to help us assess the evolution of external managers’ sustainable investment practices. This was initially applied to our PrivilEdge funds and we intend to carry out this exercise on an annual basis going forward, and to expand the scope of managers covered.  
We also review the ongoing work our partners carry out to promote sustainability and responsible investment by assessing their engagement with the wider community and activities around investor education, for example. 
As part of our own stewardship approach, we believe it is important to ensure our managers as setting and delivering to high standards on ESG and sustainability. We also engage with them to encourage them to develop and improve where we identify any area of weakness.
Where we conclude that an external manager is not meeting the high standards of ESG and sustainability incorporation we expect, they would be classified by us as non-sustainable. As a result, they would not be applicable for selection in a sustainable discretionary mandate, for example.
        

SAM 06. Monitoring on active ownership (listed equity/fixed income) (Not Applicable)


SAM 07. Percentage of (proxy) votes (Not Applicable)


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