Liontrust Responsible Capitalism Report 2024 - Flipbook - Page 89
ENGAGEMENT PURPOSE/OBJECTIVES
GFT funds undertake engagement with holdings and/or potential
holdings in part to:
• Understand how a company manages the key risks and
opportunities identified by the team as being material to the
company over a fund’s investable time horizon
• Help support or refute the team’s conviction in a holding and/or
its investment rationale for holding the stock
Engagement on climate change
During the year, the team (or Liontrust’s Responsible Capitalism team
on its behalf) engaged its holdings on a variety of climate change
related issues (see examples below.)
• Understand the financial, strategic, and/or competitive position
of a company
Company
What the
group does
Date
Discussion
topic(s)
Discussion summary
Impact on investment
decision (if any)
HSBC
Banking and
financial
services
institution
February
2023
Net zero
assessment
in project
financing
HSBC reported that it is building a new centre of excellence in
terms of net zero which includes regional hubs with a focus on
regulatory changes. When evaluating projects, HSBC assesses
clients’ transition plans and whether clients’ plans align with net
zero. In assessing clients’ transition plans, HSBC uses sectorspecific indicators over three areas: climate transition plans,
policy compliance and finance-related emissions. The group
engages with clients with the greatest material exposures to
help formulate a decarbonisation plan that is stretching but
achievable. HSBC also has a policy to phase out the financing
of coal-fired power and thermal coal mining in the EU from
2030 and in the other markets by 2040.
No impact.
Standard
Chartered
International
bank
April 2023
Approach to
carbon and
risk weighted
assets
In April 2023, GFT engaged with Standard Chartered on
No impact.
carbon. The group stated that it began including its climate
assessment tool in its credit decisions following the BOE’s
recommendation in December 2019 that banks do this. The
group uses an extensive survey to understand how clients
approach climate exposures through facets like governance and
energy-related strategy. The score from this survey feeds through
to capital allocation forums and the climate risk team. Standard
Chartered’ s approach is both quantitative and qualitative in
terms of working with its clients and helping clients find ways
to achieve carbon reductions. Currently, Standard Chartered
does not have absolute restrictions on loans. The group has a
15% weighting for sustainability in its scorecard for executive
remuneration – for all other employees, this weighting is 8%.
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