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Coronation Fund Managers

PRI reporting framework 2020

You are in Direct - Hedge Funds » Monitoring and reporting

Monitoring and reporting

HF 12. Long/short exposure and reporting

12.1. Could you indicate whether you report separately on your funds’ long/short/net exposures?

12.2. Please explain your reporting process.

Exposure

ESG data/reporting process

          We provide updates on ESG matters during regular client report back presentations including examples of how we integrate ESG considerations; engagement activities and these outcomes. We completing Adhoc surveys and questionnaires sent to us by our institutional clients. We disclose on a quarterly basis all our voting recommendations on the Coronation website https//www.coronation.com/institutional/about-us/stewardship/. Our corporate engagements and proxy voting activity is disclosed in our annual Stewardship Report (also available on our website) and provide insight into the nature of these engagements through case studies with both positive and negative outcomes.
        

KPI and assessment

          We report on exposures and the investment thesis and key contributors and detractors from performance. We thus highlight material ESG considerations and effects on our valuations.  We provide examples of ESG engagements and their outcomes which we track in our database.

The more fully integrated ESG is in the investment process, the harder it is to disaggregate the ESG driver from the broader investment decision. It is the cumulative, long-term performance that matters.
        

ESG data/reporting process

          We provide updates on ESG matters during regular client report back presentations including examples of how we integrate ESG considerations; engagement activities and these outcomes. We completing Adhoc surveys and questionnaires sent to us by our institutional clients. We disclose on a quarterly basis all our voting recommendations on the Coronation website https//www.coronation.com/institutional/about-us/stewardship/. Our corporate engagements and proxy voting activity is disclosed in our annual Stewardship Report (also available on our website) and provide insight into the nature of these engagements through case studies with both positive and negative outcomes. We tend to disclose less detail re positions we have shorted given the sensitivities and limitations.
        

KPI and assessment

          We report on exposures and the investment thesis and key contributors and detractors from performance. We thus highlight material ESG considerations and effects on our valuations.  We provide examples of ESG engagements and their outcomes which we track in our database.

The more fully integrated ESG is in the investment process, the harder it is to disaggregate the ESG driver from the broader investment decision. It is the cumulative, long-term performance that matters.
        

12.3. Additional information [OPTIONAL]

          
        

HF 13. Metrics/KPI for RI progress

13.1. Please describe what metrics/initiatives (internal and/or external) your organisation uses to measure its progress in incorporating RI into the investment process.

Hedge Funds Strategy
Equity Hedge
Metrics/Initiatives
Internal/external
Metrics/Initiatives definition
          Superior long term risk adjusted returns: The more fully integrated ESG is in the investment process, the harder it is to disaggregate the ESG driver from the broader investment decision. It is the cumulative, long-term performance that matters.
        
Assessment/outcomes
          We believe that companies and organisations that manage environmental, social and governance (ESG) factors more effectively are more likely to endure over time and create sustainable value over the long term. Ensuring that we consider relevant ESG matters when evaluating opportunities, making investment decisions and engaging with companies to seek improvements in business practices and disclosures will result in our strategies outperforming over periods that matter.
        

13.2. Additional information [OPTIONAL]

          
        

HF 14. Exposure to climate risk (Private)


HF 15. Reports to investors

15.1. How often and in what format (e.g. meetings, written reports) does your organisation report to its investors on ESG activities risks assessments? Please provide reporting examples.

Frequency of reporting
Format

specify

          report back presentations
        
ESG activities
Portfolio ESG risks assessment

specify

          We can provide portfolio reports that detail ESG ratings and carbon metrics but we favour stock level focus.
        
Outcomes
          Providing case studies of how we integrate, engage, collaborate to demonstrate our approach.
        
Frequency of reporting
Format
ESG activities
Portfolio ESG risks assessment

specify

          Engagement and voting statistics with case studies and outcomes.
        
Outcomes
          Our corporate engagements and proxy voting activity is disclosed in our annual Stewardship Report (also available on our website) and provide insight into the nature of these engagements through case studies with both positive and negative outcomes.
        
Frequency of reporting
Format
ESG activities
Portfolio ESG risks assessment

specify

          Case studies with outcomes.
        
Outcomes
          Annual due dilligence documentation describing our process and demonstrating using examples.
        

15.2. Additional information [OPTIONAL]

          We disclose on a quarterly basis all our voting recommendations on the Coronation website https//www.coronation.com/institutional/about-us/stewardship/. Our corporate engagements and proxy voting activity is disclosed in our annual Stewardship Report (also available on our website) and provide insight into the nature of these engagements through case studies with both positive and negative outcomes. PRI signatories are required to report publicly on their responsible investment activities each year. The Transparency Reports together with the Assessment Reports are accessible to signatories on the PRI Data portal. Adhoc surveys and questionnaires sent to us by our institutional clients. We also provide updates on ESG matters during regular client report back presentations. 

We are able to upload portfolios and provided summary reports that detail ESG quality scores, ESG ratings as well as exposure to carbon intensive companies (carbon risk). We don’t place much value on ESG ratings given varying judgement on materiality etc, we review these third party reports  to ensure we have considered all risks and opportunities. Measuring footprint is useful but is limited in what it can tell you about a portfolio’s exposure to carbon risks.  We view this as a blunt tool which does not provide appropriate insight into risks and challenges. More in-depth analysis and context is essential to inform actual decision making. Our policy is not to divest, rather to engage and drive the change we’d like to see.

We record and track outcomes in our ESG engagement database. This includes a decision to invest / divest or voting action taken; whether the company changed practice / committed to change/ improved disclosure / if the issue is on-going. At times the outcome is an increased understanding and sometime our recommendations failed / there is no outcome or action required. We do not try to measure the impact on performance. The more fully integrated ESG is in the investment process, the harder it is to disaggregate the ESG driver from the broader investment decision. It is the cumulative, long-term performance that matters.
        

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