Liontrust Responsible Capitalism Report 2022 - Flipbook - Page 24
Our Approach to Responsible Investment
Liontrust recognises that good governance and stewardship, sustainability and social impact are
important considerations in choosing and monitoring investments and longer term performance.
In particular, we have committed to integrate sustainability
appropriately throughout the business in order to:
• enhance returns and risk management;
• demonstrate effective consideration of ESG exposures;
• exercise responsible stewardship of investee companies; and
• show the positive impact our investment management activities
have on our clients and wider society.
In 2020, Liontrust established a Sustainability and Stewardship Committee
(SSC) chaired by the Chief Executive Officer. The SSC is supported by a
Working Group with representatives from across the firm to facilitate the
development and implementation of our sustainability strategy.
Over the coming years, we will be working on achieving the following:
• enhancing our ESG data and analytics for all our strategies;
• continue to train our investment staff;
• invest in our company engagement capacity and resourcing;
• disclose how we integrate sustainability in each strategy and
across the company;
• increase our reporting for portfolios on their ESG and climate
characteristics; and
• improve our aggregated group reporting.
ESG Integration
Our Governance and Stewardship team co-ordinates the Group’s
overarching approach: producing ESG reporting; climate and
emissions analysis; drawing up and implementing our voting policies;
and engaging with companies. The team supports our fund managers,
helping to integrate and enhance sustainability for all our clients.
Liontrust’s proprietary investment processes integrate stewardship
and sustainability into the stock selection and portfolio construction
process to different extents. Just under a third of our assets are
managed by the Sustainable Investment team who fully integrate
ESG issues into the investments and we continue to develop and
launch new funds to meet client demand for a fully integrated and
sustainable investment approach. We already explain in detail
how our Sustainable Investment team approaches ESG issues, and
we will now be providing more details on how, and to what extent,
all of our other investment teams include these aspects within their
investment processes.
ESG Initiatives
As part of our commitment, we are signatories to a number of
industry initiatives in this area:
• The United Nations Principles for Responsible Investment (UN
PRI), a set of voluntary guidelines that help companies to address
social, ethical, environmental and corporate governance issues
as part of the investment process. Liontrust’s wider approach to
the PRI’s six responsible investment principles was assessed in
2019 by the UN PRI for 2018.
• The Financial Reporting Council’s Stewardship Code, 12
principles for stewardship including the responsible allocation,
management and oversight of capital to create long-term value
for clients and beneficiaries leading to sustainable benefits for the
economy, the environment and society. Liontrust will report against
the 12 principles of the revised code in March 2021. Our website
provides more on our response to the former Stewardship Code
and how Liontrust complies with its responsibilities.
• The Financial Stability Board’s Task Force on Climate-related Financial
Disclosures, voluntary, consistent climate-related financial risk
disclosures for use by companies in providing information to investors,
lenders, insurers, and other stakeholders.
A full list of the initiatives we support can be found under the
promoting responsible investment section of this report.
24 - Liontrust Sustainability Report 2020