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Sound Shore Management, Inc.

PRI reporting framework 2020

You are in Direct - Listed Equity Incorporation » ESG incorporation in actively managed listed equities » Implementation processes

Implementation processes

LEI 01. Percentage of each incorporation strategy

01.1. Indicate which ESG incorporation strategy and/or combination of strategies you apply to your actively managed listed equities; and the breakdown of your actively managed listed equities by strategy or combination of strategies.

ESG incorporation strategy (select all that apply)

Percentage of active listed equity to which the strategy is applied — you may estimate +/- 5%
100 %
Total actively managed listed equities 200%

01.2. Describe your organisation’s approach to ESG incorporation and the reasons for choosing the particular strategy/strategies.

Responsible investing is an integral component of the investment philosophy shared by Sound Shore Management and the clients for which we invest.  We are long-term investors and encourage company management teams that we partner with to manage for the long-term as well.  We believe companies that effectively oversee environmental, social and governance matters may exhibit less risk and their stocks may have the potential to outperform the market over the long term.

01.3. If assets are managed using a combination of ESG incorporation strategies, briefly describe how these combinations are used. [Optional]

Not applicable


LEI 02. Type of ESG information used in investment decision (Private)


LEI 03. Information from engagement and/or voting used in investment decision-making (Private)


(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

Assessing and managing investment risk is an essential part of our disciplined fundamental value process.  As a part of the prudent management of our clients’ assets, we aim to actively understand all relevant risks and opportunities including ESG specific factors.

This includes integrating ESG factors into our investment analysis, decisions and processes.  As an owner of equities, we monitor ESG factors and are committed to engaging company managements and their boards, where appropriate, as a way of raising awareness and promoting sustainable shareholder value.

Attractive long-term returns correlate with responsibly managed  companies.  Sound Shore utilizes its influence as an institutional shareholder to encourage companies to think long-term, which includes managing and reporting on their ESG risks.  It is our belief that transparency and disclosure can result in positive change that benefits both shareholders and all stakeholders.

Screening criteria are established on a company-specific basis.  Our research process attempts to isolate issues that can efffect valuation, including the effectiveness of senior executive leadership, revenue and earnings  growth drivers, deployment of capital, compensation alignment, transparency, governance (such as related party conflicts), and corporate strategy. 

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

Sound Shore's investment process has remained unchanged since our 1978 founding.  Any changes to screening criteria would be made as part of our regular client communication.


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.

          Meetings with management to discuss company-specific responsible factors.
        

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.

05.5. Additional information. [Optional]

Not applicable


LEI 06. Processes to ensure fund criteria are not breached (Private)


(C) Implementation: Integration of ESG factors

LEI 08. Review ESG issues while researching companies/sectors

08.1. Indicate the proportion of actively managed listed equity portfolios where E, S and G factors are systematically researched as part of your investment analysis.

ESG issues

Proportion impacted by analysis
Environmental

Environmental

Social

Social

Corporate Governance

Corporate Governance

08.2. Additional information. [Optional]


LEI 09. Processes to ensure integration is based on robust analysis

09.1. Indicate which processes your organisation uses to ensure ESG integration is based on robust analysis.

          Meetings with management to discuss company-specific responsible factors.
        

09.2. Indicate the proportion of your actively managed listed equity portfolio that is subject to comprehensive ESG research as part your integration strategy.

09.3. Indicate how frequently third party ESG ratings that inform your ESG integration strategy are updated.

09.5. Describe how ESG information is held and used by your portfolio managers.

09.6. Additional information. [Optional]


LEI 10. Aspects of analysis ESG information is integrated into (Private)


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