We seek to earn the trust and confidence of our clients by providing superior long-term investment performance and outstanding client service. When we make investment decisions we always have our clients’ interests at heart and aim to act with a view to the interests of the Funds we manage on behalf of our clients. Effectively exercising our ownership responsibilities is consistent with this objective, and we aim to fulfil our stewardship responsibilities in two broad ways. First, by engaging with investee companies (actual and potential) and, if deemed appropriate, other shareholders to further the interests of our Funds as shareholders. And second, by voting at shareholder meetings.
As long-term investors, we have always believed it is critical to understand the full range of factors that might affect a company’s business and its stockmarket performance. ESG issues are therefore very important to us, and our analysts consider them for every company as part of our bottom-up investment process. For example, if a company makes money in a manner that is not sustainable from an environmental or social perspective, we will not gain conviction in the sustainability of its current level of profits. Similarly the consideration of governance issues is a critical part of our assessment of a company’s intrinsic value. Our analysts’ research of ESG factors informs decisions not to invest in a company as much as it informs decisions to invest, although there is no ESG issue that would automatically prevent us from investing in a company unless otherwise restricted by a Fund’s investment mandate. All “Phase Three” fundamental research reports that are submitted to a Policy Group Meeting – a forum for rigorous peer review – include a section on relevant ESG matters.
The key principles above have been in place since we launched the Orbis Funds in 1990. We first published a Statement on Responsible Investing in early 2017 in order to explain to clients our approach to such matters. We review this document approximately every two years.