Advocate
We seek to lead the conversation on sustainable investing. A major focus of our work is to advocate for a transition that includes emerging markets and results in real-world carbon reduction.
Why we focus on sustainability
In focusing on sustainability in our investments, we seek to position portfolios to benefit from a deep understanding of externalities that, over the long term, we believe the market will price into the value of securities. This is central to our core goal of achieving long-term excellence for our clients.
We also believe active management has a unique role in facilitating the allocation of capital to support the shift to a more sustainable future. To fulfil this role, we look to invest sustainability through inclusive capital allocation, rather than divestment.
We have a firmwide controversial-weapons exclusion policy and will not invest in companies that are directly involved in the manufacture and production of cluster munitions, antipersonnel landmines, and biological and chemical weapons. At the request of clients with segregated portfolios, we can exclude specific securities, sections or countries from our ESG-integration portfolios.
Investments involve risk; losses may be made.
Our approach to sustainability has three dimensions
1. Integration
We seek high-quality ESG-integration standards firmwide for all strategies. Our aim is to ensure that robust ESG-integration processes highlight material sustainability risks and opportunities. Our approach is based on the belief that, over time, the market will increasingly price negative externalities into the value of securities, and that investment outcomes can be improved by a deep understanding of material ESG-related risks and opportunities.
Ninety One’s investment teams have ultimate responsibility for managing sustainability risks and opportunities, and their own integration frameworks. In this, they are supported by several global functions:
- The Sustainability team, which oversees and supports Ninety One’s sustainability ecosystem
- The Investment Risk team, which includes a dedicated ESG Risk function that monitors firm- and portfolio-level sustainability risks
- The Engagement & Voting team, which provides engagement support, guidance and advice to the investment teams, leads engagement action (where required), and assists with and coordinates proxy voting
2. Active ownership
Our engagement approach is driven by our goal to preserve and grow the real value of the assets entrusted to us by our clients over the long term. We take a targeted approach, prioritising engagements where we can exert influence. Where we believe engagement is ineffective or companies are not committed to change, we may use the ultimate lever we have as an investor, which is to reallocate our capital. Ninety One votes at shareholder meetings throughout the world as a matter of principle.
During the financial year 2022, we carried out 337 engagements and cast 15,007 votes.
3. Impact
We offer a range of dedicated sustainability focused investment solutions..
While ESG considerations are integrated into all of our mainstream investment strategies, our sustainability and impact strategies focus on positive inclusion and they all have a defined impact objective. This involves assessment of the externalities associated with a country or industry in the context of best practice for managing or minimising negative externalities, as well as promoting positive externalities..
We also engage actively on these issues with our stakeholder communities through knowledge exchange and advocacy. We define sustainability and impact strategies using three axes that can be applied to all investments:
Recent highlights:
- Delivering on our transition plan and targets
- Net-zero targets and transition plan accepted by the Net Zero Asset Manager’s initiative..
- 97.6% shareholder support for our transition plan at the 2022 annual general meeting (“AGM”).
- 8.5% of financed emissions and 26.4% of corporate AUM have Science Based Target initiative (“SBTi”) commitments or targets approved.
- Completed 31 TPAs of highest-emitting investee companies.
- Established a strategic-engagement process for our highest-emitting companies, linked to the output of the TPA.
- Improved co-ordination between proxy voting and engagement strategy to maximise impact.
- Improving transparency and disclosure
- Achieved Principles for Responsible Investment (“PRI”) Assessment scores between 80 and 100 across all applicable modules.
- Maintained signatory status to the FRC UK Stewardship Code.
- Submitted our first full CDP report.
