You selected an `Other` option in table SAM 02.4 above, please specify
We regularly look for sustainability thematic and impact investment offerings. We ask external managers to adhere to sustainability-related exclusions, which may vary depending on the manager / solution in question. Further details are provided in SAM 04.1.
Describe how the ESG information reviewed and discussed affects the selection decision making process.[OPTIONAL]
When appointing all new managers, we look for partners who are aligned with our philosophy. As part of our extensive due diligence process, we carry out in-depth analysis of their approach, both through publicly available material, and in detailed discussion and site visits during the selection process. We review external managers’ investment strategy and ESG philosophy, as well as their approach to integration. We assess the quality of their policies and how their ESG approach is implemented in their portfolio management process. We look for robust governance and oversight of their investment approach, including ESG incorporation, as well as risk management.
We seek to ensure our partners are focused on the ESG issues that are most material to the investments they are making. We also look to ensure they have the appropriate level of expertise on their team, and that these resources are adequately integrated with their investment teams. We also asses the data they are using to ensure it is both robust and of high quality. We also look at how our external managers share their knowledge with the wider community through their promotion of responsible investment and industry engagement.
We assess all of this at the firm level, and we also look in detail at how their approach is integrated into the specific products that we select for our clients. We aim to agree with managers how ESG data will be used in their investment process, and understand the likely impact that will have on the decision making process and portfolio outcomes.
We assess their approach to exclusions and SRI restrictions and, as far as possible, we ask them to respect our two Group-level exclusions: controversial weapons and essential food commodities.
We also expect to see best-in-class transparency when it comes to reporting.
In addition to broad integration of ESG and sustainability into investment products, we also look for managers with a particular edge in providing thematic and impact investment solutions. Our clients are increasingly demanding investment solutions that are positioned to mitigate risks and capture opportunities created by the transition to a sustainable economic model. Many of our clients also aim to use their capital as a means of fostering economic and social progress, and to combine financial return with social impact.