This report shows public data only. Is this your organisation? If so, login here to view your full report.

CBUS Superannuation Fund

PRI reporting framework 2020

Export Public Responses
Pdf-img

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 100%

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

Cbus believes that as a responsible investor we can improve long term risk adjusted returns through active involvement in Environmental, Social and Governance (ESG) issues. Companies that take account of ESG factors are likely to have sustainable business models and an ability to generate long term shareholder returns for our beneficiaries. The consideration of ESG factors is required form all portfolio managers across all asset classes, to the extent that it is possible, including listed equities.

We also believe we have a role in:

-influencing and contributing to the shift towards a sustainable finance system — (the Sustainable Development Goals - SDGs)
-demonstrating leadership in the built environment
-operating in a manner consistent with our responsible investment approach and
-being transparent in our approach to achieving our objectives

To help define what is important to us with regards to responsible investment, our organisation has also surveyed our staff and members for their views.Cbus has also adopted a specific Responsible Investment Policy and Responsible Investment Principles, which are: Climate Change, Cognitive Diversity, Safety, Labour Rights, Human Capital Management. Cbus also believes in transparency to members and report our Carbon Intensity each year in the integrated annual report, which also includes a dedicated Responsible Investment Supplement.

Cbus has implemented a negative screen process as well as different ESG integration practices alongside its Stewardship program to ensure the Policy objectives are met.

Negative screening is in place across the entire listed equities portfolio to ensure all portfolios exclude and divest from manufactures of tobacco products and also companies directly involved in the manufacture of controversial weapons.

Along with the adoption of negative screening all equity teams incorporate ESG factors into their investment decision making. The fundamental principle of our ESG integration approach is based on assessing the financial materiality of ESG issues both during decision making as well as through ongoing monitoring of our portfolios. In order to help us implement this approach we utilise third party ESG research & data, align to materiality frameworks such as SASB and utilise portfolio management tools. 

With regards to our Stewardship activities, Cbus engages with domestic and international companies both directly and via collaborative engagement initiatives and service providers such as Hermes, ACSI, CGI Glass Lewis, Climate Action 100+ and IGCC. Cbus has been a signatory to the ACSI Asset Owner Stewardship Code since 2018.

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

Cbus has implemented a negative screen process as well as different ESG integration practices alongside its Stewardship program to ensure the Policy objectives are met.

Negative screening is in place across the entire listed equities portfolio to ensure all portfolios exclude and divest from manufactures of tobacco products and also companies directly involved in the manufacture of controversial weapons.

Along with the adoption of negative screening all equity teams incorporate ESG factors into their investment decision making. The fundamental principle of our ESG integration approach is based on assessing the financial materiality of ESG issues both during decision making as well as through ongoing monitoring of our portfolios. In order to help us implement this approach we utilise third party ESG research & data, align to materiality frameworks such as SASB and utilise portfolio management tools.

With regards to our Stewardship activities, Cbus engages with domestic and international companies both directly and via collaborative engagement initiatives and service providers such as Hermes, ACSI, CGI Glass Lewis, Climate Action 100+ and IGCC. Cbus has been a signatory to the ACSI Asset Owner Stewardship Code since 2018.


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

Tobacco and controversial weapons.

If any changes are made information would be available on the Funds website together with Annual reporting.

Cbus Risk & Compliance team will distribute a formal notification to all equity managers to advise any changes to the negative screen list. Internal trading restrictions are placed in the Bloomberg trading platform.

Screened by

          DFAT Exclusions List
        

Description

Cbus has taken a conservative view in relation to geopolitical sanctions and negatively screens the universe against companies on the DFAT list. 

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

We have not made any changes to the ESG screening process.

If a change were made information would be available on the Funds website together with Annual reporting.

 


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.

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]

Bloomberg trading platform restriction rules are maintained by the Cbus Risk & Compliance team and are also monitored by the custodian, JP Morgan. 

On an annual basis, we review our negative screen list and update our Bloomberg rule for internal portfolios if required. 


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]

ESG factors are considered and included as an input in the investment process. Issues deemed likely financially material are analysed in more detail to determine if there are any valuation impacts or if monitoring of the issue is required.

Fundamental analysis is undertaken which utilises internally developed research templates, company management meetings, third party ESG data and research. In some instances, specific ESG thematic’s are also analysed, such as supply chain, labour relations or climate change risk of a company or portfolio.

 


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.

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.

09.4. Indicate how frequently you review internal research that builds your ESG integration strategy.

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

09.6. Additional information. [Optional]

ESG forms a core part of the investment process. ESG risks are assessed on a financial materiality basis as well as any thematic issues deemed a priority by Cbus, such as safety. These can be built into future engagement with the company.

Stock Peer Review meetings are held whereby information presented by a team member is reviewed. Information is circulated and stored on the  information management systems and all team members can contribute or critique work undertaken in relation to a given company.

The equity teams monitor company reporting in order to identify issues, look for improvements or otherwise in the disclosures made by the company. Third party ESG materiality frameworks such as SASB help direct this review.

Regular meetings between the portfolio manager and members of the Responsible Investment team are scheduled fortnightly.

The review of external ESG providers is the responsibility of the Cbus Responsible Investment team and they receive input from stakeholders across the organisation. Both the Responsible Investment team and the Internal Equities team engage with these providers on a regular basis.


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


Top