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Capital Group

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


We only apply exclusion criteria to our funds where this is a part of the objective or where we are required to by law.  We have a fiduciary duty to invest in a way that helps clients achieve their long-term investment objectives. Consistent with these objectives and our duties, our investment decisions are made based on the long-term financial opportunity offered by the selected securities.

For separate account clients who require a portfolio that avoids certain types of companies, we are able to implement screens where information regarding the screening criteria is readily accessible (such as tobacco, alcohol, etc). We also are capable of screening account holdings based on ESG metrics as provided by a third party source.

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

Screening criteria, and any changes thereto, are specified by clients.

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.

          Our analysts are questioned on screening by our global ESG team, investment specialists and portfolio managers, where relevant.

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]

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.

In circumstances where client screening guidelines have been breached or limits have been exceeded, a group of experienced associates from relevant business areas (operational, legal & compliance and marketing) review the facts and assess the various options for correcting the breach.  Corrections could include selling the security or asking for a waiver from the client to keep the security. A risk assessment team will investigate ways to mitigate the chance of future breaches.

06.3. Additional information. [Optional]