We’re committed to responsible investing because it’s good for society, and good for our investment portfolios too.
Our responsible investment approach
When you invest with us, you can be confident we’re investing responsibly. We believe responsible investing delivers better long-term outcomes for both our communities and our investors.
There are four main parts to our approach:
What we don’t invest in
By taking an active, rather than passive, approach to managing your investments, we retain control and can act when necessary to ensure our funds meet, and continue to meet, our financial and non-financial criteria.
Our goal is to deliver sustainable performance in a sustainable way. That means assessing investments against both financial and non-financial criteria.
Traditional investment approaches focus mainly on financial criteria such as balance sheet strength and future earnings forecasts. We take a wider perspective, which also takes environmental, social, and governance (ESG) factors into account. As these factors are some of the drivers of long-term investment risks and returns, we believe that including them in our assessment criteria will help us identify investments that can deliver more sustainable long-term performance – which is in the best long-term interest of both our investors and wider society.
ESG factors may include:
Environmental: factors relating to pollution, hazardous waste, energy or resource usage, climate change, green technologies or water management.
Social: factors relating to human rights, ethical or indigenous relationships, health and safety, diversity, social programs or charitable endeavours.
Governance: factors such as bribery or corruption, transparency, board structure, executive compensation or voting procedures.
Other potential non-financial criteria in our assessment including management strength and industry composition.
As a signatory to the United Nations supported Principles for Responsible Investment, we are committed to these six principles which provide guidelines for institutions on incorporating environmental, social and governance factors into their investment processes:
Incorporating ESG issues into investment analysis and decision making processes;
Being active owners and incorporating ESG issues into our ownership policies and practices;
Seeking appropriate disclosure on ESG issues by the entities in which we invest;
Promoting acceptance and implementation of the principles within the investment industry;
Working together with other signatories to enhance our effectiveness in implementing the principles; and
Reporting on our activities and progress towards implementing the principles
We apply these principles to all of our managed investment schemes, discretionary investment management services, wholesale mandates, superannuation schemes and wholesale schemes that we manage. This includes investments that are managed by our external fund managers who we have appointed to manage the assets of some of our underlying funds.
What we don’t invest in
What we don't invest in
We don’t invest in companies involved in certain activities that contravene our responsible investing criteria.
Our active investment management approach means we continually review our investments and prospective investments against both our financial and ESG criteria. These reviews consider some or all of the following:
Global best practice
Our view on the expectations of our investors or clients
The impact of an exclusion on returns
The severity of any ESG related breaches or actions, or
The likely success of an alternative course of action (for example, engagement).
Depending on the results of our review, we might continue to hold, review on a periodic basis, divest, or exclude the company or industry as an investment.
We currently exclude investments in companies that are involved in:
manufacturing controversial weapons, including cluster munitions and anti-personnel mines
manufacturing or testing nuclear explosive devices
manufacturing tobacco products, and
manufacturing automatic and semi-automatic firearms, magazines or parts for civilian use.
We have also excluded some companies, across a range of industries, that have breached global norms or standards to a severe degree.
It’s important to note that if we buy units in a fund that isn’t managed by us, our investment might be exposed to companies we would ordinarily exclude. This possibility is factored into our decision to buy any such units.