NEI's ESG team completes a quantitative and qualitative ESG assessment and conducts ongoing risk monitoring of each portfolio holding. At the time of appointment, we assess the manager's ability to incorporate our ESG process and manage the account in accordance with NEI's eligibility list.
On a monthly basis, NEI portfolios are examined to ensure that holdings are aligned with NEI's eligibility list. This is part of the compliance procedure for NEI RS funds and portfolios. On an annual basis, we conduct an on-site review of all managers. A key component of the onsite manager due diligence is an update of the manager's ESG capabilities and how they continue to integrate ESG factors within investment decision making.
Adherence to the NEI Responsible Investment process has been included in the Investment Policy Statement (IPS) for select external managers with ESG mandates. Therefore, any infractions would be considered a breach of the IPS and an in-depth review of the manager and the situation would be initiated.