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KBI Global Investors

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.

We incorporate RI factors into the investment process because we believe that companies with strong governance and whose products and services enhance social or environmental goals should meaningfully outperform over time. Such companies are more likely to have long, durable, sustainable business models.

Responsible Investing can be incorporated into the investment process in three ways. Screening involves excluding stocks that ‘fail’ ESG criteria. A Thematic ESG approach means investing in certain industries or sectors that have strong ESG credentials throughout the sector. Integration is where ESG information about a company is directly built into the investment process. Currently, approximately 13% of the firm’s AUM comprises assets which are managed using all three methods (Screening, Integration and Thematic) while the remainder of the AUM is managed using Screening and Integration.

We are strongly committed to Active Ownership as detailed elsewhere in this submission.

We do not believe that Responsible Investing is a static process. In contrast, it constantly evolves to take account of changing investor preferences, and societal norms. We are continuously striving to enhance our RI policies, practices and products and we expect change to continue to be a constant feature of RI in the years ahead.



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]

Our Responsible Investing Policy (available in full on our website) has the following elements:

  • Scope: covers all internally-managed investments (the vast majority of our AUM) and in most circumstances to externally managed investments
  • Approval process: the policy is approved by the firm's Responsible Investment Committee and is reviewed annually.
  • Exceptions to some aspects of the policy may apply for some externally managed funds in which our funds or clients invest.

01.6. Additional information [Optional].


SG 01 CC. Climate risk

01.6 CC. Indicate whether your organisation has identified transition and physical climate-related risks and opportunities and factored this into the investment strategies and products, within the organisation’s investment time horizon.

Describe the identified transition and physical climate-related risks and opportunities and how they have been factored into the investment strategies/products.

We have identified a number of risks and opportunities that arise in our investment strategies, as outlined below.

For our Global Equity Strategy portfolios, which are broad-based equity portfolios seeking to outperform broad equity market benchmarks, climate change related risks exist in many industry sectors, including (but not limited to) utilities, energy, financial services (particularly insurance), transportation and materials. In most cases, companies in these sectors are at significant risk of being adversely impacted by regulatory and similar pressures to reduce greenhouse gas emissions, which may reduce future profitability and/or require significant changes to the companies' business model. In other cases, there are significant physical risks (e.g. insurance companies which have exposure to rising sea-levels).

The Global Equity Strategy portfolios also have actual or potential investments in companies which have opportunities to grow their business, and their earnings, as a result of climate change. Examples include companies which are providing products or services in the area of climate change mitigation or adaptation, such as renewable energy utilities. In some cases, e.g. auto companies, the same companies face both opportunities and risks.

For our Natural Resources equity strategies, we have identified many companies with climate-related opportunities. Our Energy Solutions strategy, in particular, invests only in companies which provide solutions to the scarcity of clean energy, but our Water and Agribusiness and our Sustainable Infrastructure strategies also invest in several companies which are well placed to benefit from the opportunities arising from climate change. We have also identified companies held in our Natural Resources strategies which face climate-related risks. Typically, the companies in which we invest for these strategies are not exposed to substantial risk from the need to reduce their own greenhouse gas emissions (due to the nature of their business activities) but some companies, for example companies which own farmland, are exposed to unclear physical risks from climate change, such as increased flooding or drought. Other companies face indirect risks, for example they may supply goods or technical services to a sector which in turn faces the need to change its fundamental business model due to climate change. 

01.7 CC. Indicate whether the organisation has assessed the likelihood and impact of these climate risks?

Describe the associated timescales linked to these risks and opportunities.

The range of risks and opportunities across our portfolios is very wide and the timescale ranges from very short-term to very long-term.

01.8 CC. Indicate whether the organisation publicly supports the TCFD?

01.9 CC. Indicate whether there is an organisation-wide strategy in place to identify and manage material climate-related risks and opportunities.


We actively monitor our portfolios for climate-related risks and opportunities, and we use the tool provided by the PRI and the Two Degrees Investing Initiative  ('PACTA'), and carbon footprint data from an external supplier, to do so, although of course we also use our own judgement and expertise. Further, we engage directly with companies to assess climate-related risks and opportunities for specific companies.

This is something that comes easily to this firm, as we identified the opportunities from climate change as long ago as 2000, when we launched our Energy Solutions strategy, investing only in companies providing solutions to the global shortage of clean energy.

In terms of risks, we have for some time concluded that the climate-related risk associated with thermal coal extraction is too large to merit investment, and so we exclude large-scale investment in thermal coal extraction and generation from all portfolios.  

Internally (and separate to our investment process) we have a Sustainability Committee which has implemented a number of measures related to climate, including encouraging a move to electric vehicles for our car fleet (now about 25% EV), elimination of single-use plastics, and similar measures.

1.10 CC. Indicate the documents and/or communications the organisation uses to publish TCFD disclosures.

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.

KBI Global Investors always endeavours to act in the best interests of its clients. The firm has a robust Conflicts of Interests policy in place which is made available to all staff and is published on our website. It also maintains a conflicts of interest log which is reviewed at least annually.  Where conflicts do arise they are always reviewed, giving priority to the client's best interests.  More detail on the type of conflicts which can arise, and the way we manage them, is available in our Conflicts of Interest Policy and in our UK Stewardship Code statement.  Both are public documents available on our website.


03.3. Additional information. [Optional]

SG 04. Identifying incidents occurring within portfolios

04.1. Indicate if your organisation has a process for identifying and managing incidents that occur within investee entities.

04.2. Describe your process on managing incidents

We subscribe to the services of MSCI ESG Research, in addition to our own monitoring of portfolio companies by the portfolio managers, so we are confident that we will quickly become aware of such incidents. Where these incidents are sufficiently material, they will become a subject for potential engagement and may be referred to the firm's Responsible Investing Committee for further discussion. Ultimately, we exclude from all our portfolios any companies which are involved in serious and continued breach of the United Nations Global Compact principles, which usually encompasses serious incidents that are not resolved.