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Boussard & Gavaudan

PRI reporting framework 2020

You are in Strategy and Governance » Investment policy

Investment policy

SG 01. RI policy and coverage

New selection options have been added to this indicator. Please review your prefilled responses carefully.

01.1. Indicate if you have an investment policy that covers your responsible investment approach.

01.2. Indicate the components/types and coverage of your policy.

Select all that apply

Policy components/types

Coverage by AUM

01.3. Indicate if the investment policy covers any of the following

01.4. Describe your organisation’s investment principles and overall investment strategy, interpretation of fiduciary (or equivalent) duties,and how they consider ESG factors and real economy impact.

The Boussard & Gavaudan group (“BG” or the “Group”) is committed to maintaining an investment approach that incorporates environmental, social and governance (“ESG”) as well as responsible investment considerations in order to best serve its client’s interests. BG manages investment funds for the benefit of its investors. As a fiduciary of its clients, BG seeks to act in the best interests of its clients. While this duty is interpreted as acting in the best financial interest of the client the Group recognises that a company’s environmental, social and governance practices affect its valuation and investment returns. The effect on valuation and returns varies considerably between companies and sectors, BG therefore takes a practical approach to assessing and considering ESG where it could materially affect the performance of an investment or pose a reputational risk to the Group. BG employs diverse investment strategies which are implemented using a wide variety of asset classes. Implementation of ESG factors into investment analysis and the decision-making process varies between investment strategies and BG has identified ESG factors as being most relevant in relation to its equity and credit fundamental long strategies. 

 

 

01.5. Provide a brief description of the key elements, any variations or exceptions to your investment policy that covers your responsible investment approach. [Optional]

I. RESPONSIBLE INVESTMENT GUIDELINES

ESG is an important part of BGs investment process. ESG parameters are incorporated into the fundamental investment analysis of the companies in the Firm’s investment universe and considered throughout the investment cycle where they are relevant. BG operates a controversial weapons exclusion list which is regularly updated to restrict investment in companies with business activity related to the manufacturing of controversial weapons. Companies involved in the manufacturing of cluster munitions are specifically restricted with the firm operating a strict no investment policy.  The Group’s compliance function maintains and monitors the restricted list as well as restricted lists provided by investors as agreed with them from time to time. BG takes a proactive approach with its core fundamental investments and has a voting policy in place which governs when and how BG votes in relation to the companies it invests in.


II. INTEGRATING ESG INTO THE INVESTMENT PROCESS

BG seeks to integrate ESG considerations into its investment decisions where they are relevant to the proposed investment. Assessing a company’s corporate governance practice has always been a key part of BG’s investment process. The Group firmly believes that companies which are well governed and operate transparently are well placed to increase shareholder value over time. Each individual analyst is responsible for integrating Governance considerations when analysing a company for approval of their proposed investment by the Investment Committee. Within BG’s fundamental equity strategies certain sectors and companies have increased exposure to environmental and social risk and BG’s analysts factor these considerations into their analysis and investment proposals. ESG considerations are not normally the primary driver of an investment decision however they often serve as a catalyst for further research, investigation and discussion. BG has contracted a specialized ESG data provider in order to conduct screening and reporting. Reports are compiled from the provider's data and sent to the Risk committee on a monthly basis enabling the committee to maintain oversight of ESG risk. BG’s fixed income and derivatives trading will take ESG factors into account where ESG issues could have a material impact on the financial performance of the securities. Quantitative strategies do not currently factor in qualitative ESG considerations as the trading strategies are designed to take advantage of short term moves and temporary arbitrage opportunities with trading conducted in baskets often across hundreds of individual stocks. Quantitative strategies are nevertheless restricted from trading in stocks listed in the Group’s controversial weapons excluded list

01.6. Additional information [Optional].

          
        

SG 01 CC. Climate risk (Private)


SG 02. Publicly available RI policy or guidance documents

 

02.1. Indicate which of your investment policy documents (if any) are publicly available. Provide a URL and an attachment of the document.

02.2. Indicate if any of your investment policy components are publicly available. Provide URL and an attachment of the document.

02.3. Additional information [Optional].


SG 03. Conflicts of interest

03.1. Indicate if your organisation has a policy on managing potential conflicts of interest in the investment process.

03.2. Describe your policy on managing potential conflicts of interest in the investment process.

BG has identified situations where conflict of interest could potentially arise in its activities. Such situations may be encountered by BG or its employees at the time of delivery of their services for their clients. In each situation BG has analysed whether it is an existing or potential risk for one or more of its clients.
BG has a conflict of interest policy in place enabling the Group to prevent potential conflicts of interest. This policy relies on prevention, detection and management of conflicts of interest as well as communication with clients and archiving of information.

To deal with situations where there are existing or potential conflicts of interest, BG can:
• refuse to act, where acting could potentially create a conflict of interest,
• accept the deal and the conflict of interest created, by putting in place measures to manage the situation in an appropriate fashion, so that the interests of the client are not undermined, or

• advise the client in cases where a conflict of interest cannot be dealt with correctly, by communicating with them the necessary information regarding to the nature and origin of the conflicts of interest.

03.3. Additional information. [Optional]


SG 04. Identifying incidents occurring within portfolios (Private)


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