What We Do
Approach to Sustainable Investing
Our investment process is designed to generate positive environmental and social impacts without compromising financial returns. It involves three stages:
Client objectives and risk tolerance
and data review
Alignment to UN SDGs
Annual Impact Report
Engagement with issuers, market participants and investors
During the Verification phase, our team of experts apply our proprietary SPECTRUM Bond® criteria to identify our impact investment universe. Our rigorous sustainability and credit process fully integrates environmental, social and governance (ESG) assessment.
Our Verification analysis includes a robust and disciplined approach to ESG principles. ESG issues are our starting point as we seek to identify eligible investments that encompass impact and deliver mainstream investment returns. The team uses our proprietary SPECTRUM Bond® criteria to conduct this analysis.
Aligned with our purpose to support the UN SDGs and Paris Agreement on climate change.
Positive environmental and/or social externalities are associated with their issuance.
Issuers must be creditworthy from a financial and broader ESG perspective.
Clear and transparent investment policies and processes on reporting and disclosure.
Responsible issuers with strong integrity and standards, as well as clear commitment to be a sustainable business model.
Use of Proceeds
Ability to determine use of proceeds to assure funded activities meet our criteria.
All securities must offer mainstream market yields and provide reporting on the material and measurable environmental and social impacts.
As the table below shows, our SPECTRUM Bond® criteria go further than industry standards of green bond identification and certification. This gives us a comprehensive overview of the market.
|Characteristics of different green bond identification and certification schemes|
|Tool||Table 1*||Table 2|
|CBI Climate Bonds Certification||Green Bond Indices¹||CICERO Second Opinions||Moody’s Green Bond Assessments||Standard & Poor’s Green Evaluations||Affirmative Investment Management|
|Use of funds must
be tied to green
differ by sector
for specific factors
* (Bank for International Settlements, September 2017)
¹ Bank of America Merrill Lynch, Barclays MSCI, Standard & Poor’s, and Solactive.
Having completed the Verification process, our investment team then constructs and maintains a diverse range of portfolios from this list of eligible securities purely for risk-adjusted return.
We actively engage with our holdings and are committed to measurable and material impact reporting for our clients. Engagement with issuers is core to our process throughout every stage of analysis. We work with key stakeholders to support asset class growth and to ensure quality impact measurements. We actively engage with the market to promote the development and maintenance of standards that will ensure a high level of transparency and a clear ongoing commitment.
Annual Impact Report
We provide a comprehensive Annual Impact Report for each portfolio to provide evidence of the positive environmental and social impacts of our investments, which includes portfolio alignment with the UN SDGs and an assessment of portfolio greenhouse gas emissions avoided.
To find a sample of our Annual Impact Report click here.