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Jardim Botânico Investimentos (Delisted)

PRI reporting framework 2020

You are in Strategy and Governance » Investment policy

投資ポリシー

SG 01. RI policy and coverage

この指標には新しい設問が追加されています。事前に入力されている回答を精査してください。

01.1. 責任投資アプローチをカバーする投資ポリシーを策定しているかどうかを明示してください。

01.2. ポリシーの構成要素/種類と対象範囲を示してください。

当てはまるものをすべて選択してください。
ポリシーの構成要素/種類
AUMの対象範囲

01.3. 投資ポリシーが以下のどの項目をカバーしているか明示して下さい:

01.4. 組織の投資原則および全体の投資戦略、受託者義務(または同等のもの)の解釈、ならびに、ESGファクターおよび実体経済の影響をどのように考慮に入れているかについて説明してください。

Investment principles and strategy:

Emphasis on corporate governance, analysis of social and environmental issues.

We are value investors - focus on long term business fundamentals.

Good governance, sustainability and ethics are the basis of all our decisions.

We are not driven by market consensus - focus on price and value distortions.

We see risk as the possibility of permanent capital loss, not volatility.

We do not follow any market index for portfolio construction.

The investment philosophy is 100% value-oriented with special emphasis on capital preservation. The Manager runs a concentrated portfolio strategy of usually 12 to 20 stocks taking the view as a long-term minority investor. The Manager seeks target returns of 15% p.a. (net of fees) in a minimum five-year window. To achieve this goal, JBI’s team looks for profitable businesses at reasonable prices. Considering the over 450 stocks listed in the Brazilian Stock Ex-change (BM&F Bovespa), JBI applies 3 filters to generate the Fund’s Investment Universe, composed of approximately 80-100 stocks.

01.5. 責任投資アプローチをカバーする組織の投資ポリシーの重要な構成要素、バリエーション、例外事項を簡潔に説明してください。[任意]

Screening criteria:

1. First filter - liquidity: daily traded volume: all invested companies must have a minimum daily traded volume of USD500k. Bid-ask spread: JBI wants to be a price taker, not a price maker.

2. Second filter - sector risk: exclusion of highly regu-lated sectors. Exclusion of risky sectors with low competitiveness. Exclusion of companies dealing with armament, asbestos or tobacco.

3. Third filter - governance: business analysis like transparency standards, dividend and share buy-back policies, alignment of interests (reason for the exclu-sion of state-owned companies, since political incentives > economic incentives). Rigorous due diligence of control structure: reputation of management/controlling shareholder(s) / Board of Directors, check of past regulatory issues, related parties transactions, incentive policies, commitment and/ or independence. Analysis of legal and ethical standards.

Selection criteria:

Value: use of fundamental analysis based on conservative parameters. JBI looks for business managers with the right incentives to create long-term value. Price vs. Value analysis: JBI looks for underperforming stocks where intrinsic value is larger than market value plus a margin of safety.

Events: The Funds may pursue new investments following a corporate event with potential impact in the value of a given company (e.g. M&A, corporate govern-ance changes, special dividends). The regulatory knowledge of the portfolio managers plays a key role in assessing the impact of such events.

Themes: strong long term trends affecting certain sectors or the economy as a whole may also result in new investment ideas.

 

Why does JBI incorporate environmental and social factors into investment process?

In line with what we think and practice.
Purpose of reducing the medium / long term risk of the portfolio.
Continuity to our Governance analysis, which has always been part of our investment philosophy.
A combination of doing good for society and not doing harm to investment returns.
ESG factors are material to developing a complete understanding of risk and opportunity which is needed to succeed in achieving long-term, sustainable investment returns.
Cooperation with companies in our universe to engage in these causes.

 

When we became signatories of the PRI, we committed JBI to incorporating environmental, social and governance (ESG) factors into our investment process.

It was our opinion then, and it still is, that governance is the most relevant factor for any responsible investment process. It has been the basis for our investment philosophy and process since we started. We have simply moved a step further and added factors relating to "E" and "S" to our analysis. This is an ongoing process and ESG factors are becoming fundamental components of our investment process.


We have chosen six environmental factors to monitor: i) water and energy use; ii) carbon emissions; iii) waste / hazardous materials disposal and treatment; iv) environmental policies and certificates; v) key raw materials usage; and vi) appropriate handling processes.

On social issues we are analysing: i) health and safety procedures; ii) social engagement; iii) disclosure of employee-related information; and iv) working conditions.

Based on responses to a questionnaire, a “JBI E&S Score” is assigned to each company. This score is then used to check for imbalances and / or different risks. It should be noted that, as opposed to governance findings, those relating to "E" and "S" are not necessarily levers to exclude companies from our universe, except for the negative screens already in place such as: tobacco, armaments, asbestos and child / “slave” labour.


After establishing our E&S score, we classify companies according to their sectors and compare their performance relative to their respective peer groups. Our main concern is to understand why companies in the same sector or industry have different scores. In order to do so, we determine which companies can be considered benchmarks in their sectors and, where appropriate, engage with the other companies in order to improve their E&S scores. As responsible investors, we want to make sure that managers incorporate possible environmental, social and ethical impacts into their strategic thinking and business decisions.

Our ESG analysis aims to identify risks and opportunities in every company we invest, taking into account the risk characteristics for each sector. 


The first thing to note is, perhaps as expected, that companies that already produce an Annual Sustainabil-ity Report were better prepared to answer our questionnaire. These companies are much more willing to discuss and answer questions on environmental and social issues. Another thing to note is that companies are becoming more aware of the importance of incorporating ESG into their risk management framework. About three years ago, we flirted with the idea of analysing E and S practices in our JBI Universe and the level of response was quite disappointing.


It is also noticeable that larger companies tend to obtain higher ESG ratings. This is not at all surprising, considering the human and financial resources needed to analyse and implement ESG policies. Yet another observation is that companies that completed IPOs recently don’t disclose much information about this matter. In our experience, it takes at least one year for companies to address these questions.

As investors, we are in a singular position to influence businesses into adopting best business practices. In summary, our purpose so far has been twofold: by pushing companies to answer non-traditional investment questions, we are throwing new light on issues that could impact investment decisions; as investors, we are hopefully reducing our portfolio risk, thus improving long term returns.

Our goal is to combine the mostly quantitative analysis of “JBI E&S Score” – focused more on whether or not companies have and disclose their environmental and social policies – along with a qualitative analysis that we will be able to assess as this theme evolves. This qualitative analysis will be made through comparisons of each company’s E&S policies, track record of indicators, engagement and alignment with strategic plan. Finally, we are establishing a “JBI Key Questions by Sector”. With regards to understanding which E&S factors are most critical to a particular company, a sector-based approach is essential.

01.6. 補足情報 [任意]

          
        

SG 01 CC. Climate risk (Private)


SG 02. Publicly available RI policy or guidance documents

この指標には新しい設問が追加されています。事前に入力されている回答を精査してください。

02.1. 一般に入手できる組織の投資ポリシー文書を記載してください。その文書のURLを記入し、該当文書を添付してください。

02.2. 一般に入手できる組織の投資ポリシー文書を記載してください。その文書のURLを記入し、該当文書を添付してください。

02.3. 補足情報 [任意]


SG 03. Conflicts of interest

03.1. 組織として、投資プロセスにおける潜在的な利益相反を管理するポリシーを策定しているかどうかについて明示して下さい。

03.2. 投資プロセスにおける潜在的な利益相反を管理するポリシーについて説明してください。

PURPOSE: To establish JBI’s approach in properly identifying and managing conflicts of interest.

DESCRIPTION: JBI acts as an agent for its Clients, making financial decisions on their behalf. When making investment decisions or performing its portfolio management activities, JBI will
seek to ensure that it always acts in Clients’ best interests and treats all Clients fairly.

Below are non-exhaustive examples of what may be considered typical conflicts of
interest that may arise in relation to services provided by JBI:
a. JBI is the discretionary portfolio manager for more than one Client – in particular
in respect of issues related to allocation and execution;
b. JBI employees trading for their personal accounts based on the information of
Client transactions;
c. JBI engaging in proprietary trading based on the confidential information of a
Client and/or trading using the confidential information of a Client to the
disadvantage of a Client;
d. JBI or any of its Associates receiving or providing substantial gifts or
entertainment (including non-monetary inducements) that may influence behavior
in a way that conflicts with the interests of Clients.

03.3. 補足情報 [任意]

In determining whether a conflict exists, the Compliance & Risk Management Committee will take into account as a minimum whether JBI or any of its Associates:
(i) is likely to make a financial gain, or avoid a financial loss, at the expense of a Client or in connection with any transaction involving a Client;
(ii) has an interest in the outcome of a service provided to a Client or of a transaction carried out on behalf of a Client, which is distinct from the Client's interest in that outcome;
(iii) has a financial or other incentive to favour the interest of another Client or group of Clients over the interest of the Client;
(iv) carries on the same activities for a fund and for another Client or group of Clients which are not investment funds; and/ or
(v) receives or will receive from a person other than the Client an inducement in relation to the portfolio management services provided to the Client, in the form of monies, goods or services, other than the standard commission or fee for that service.

PRACTICE: The following are some of the measures and controls adopted by JBI to prevent and
mitigate conflicts of interest:

i) JBI Governing Principles and Code of Ethics and Business Conduct set standards of behavior that apply to all JBI Associates. Their conduct must be
based on four main principles: integrity; fairness; care, skill and diligence; and confidentiality.
(ii) Restricted List – Public Equities Investment Restrictions.
(iii) Trading Errors Policy: requires all trading errors to be reported internally and states that JBI should bear the costs of all errors it caused due to violation of Clients’ guidelines or negligence.
(iv) Personal Investment Policy imposing restrictions and clear procedures on all personal trades. Any trade on listed equities must be previously approved by
the Compliance & Risk Management Committee.
(v) Disclosure of business interests: all JBI Associates must inform annually to the Compliance & Risk Management Committee outside business interests.
(vi) Gifts and benefits policy imposing limits on the value of the gift or benefit, taking into account its frequency and requiring approval of the Compliance & Risk Management Committee.
(vii) Fair allocation of trades between Clients – Public Equities Securities Allocation Policy. In addition, JBI does not trade on its own account and there are no cross trades between different portfolios.
(viii) Review of broker usage and brokerage commission through a Brokers’Selection Policy.

MONITORING: JBI monitors and keeps a record of situations where conflicts of interest arise and it is for the Compliance & Risk Management Committee to maintain these records. The Compliance & Risk Management Committee conducts periodic reviews of operations and is in charge of dealing with any conflict of interest that may arise. If however JBI at any point does not feel confident that its procedures for dealing with conflicts are capable of preventing conflicts of interest it will promptly report the situation to the Client.


SG 04. Identifying incidents occurring within portfolios (Private)


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