Liontrust Responsible Capitalism Report 2022 - Flipbook - Page 29
In 2020, Liontrust updated the governance framework and
established a Sustainability and Stewardship Committee chaired
by the Chief Executive Officer, part of whose remit is oversight
and accountability of climate-related issues. This Committee is
supported by a Working Group, chaired by the Chief Risk Officer,
who have implementation responsibilities.
Strategy
Liontrust is not legally obliged to report on the TCFD recommendations,
but we endeavour to be transparent by reporting on our trajectory.
The TCFD recognises that climate-related disclosure is a journey
for many companies that will evolve over time as organisations,
investors, and others contribute to the quality and consistency of the
information disclosed.
throughout 2020. This analysis however does not identify transitional
and physical climate related risks and opportunities. We are currently
in talks with service providers to procure data that capture the effects
of these risks on a systematic basis.
In the absence of a formal process currently in place, we expect
our fund managers to perform due diligence by using a common
sense approach in implementing these climate-related risks into their
investment decision making, such as consideration of the effects
of carbon pricing, substitution of existing products and services
with lower emissions options, changing customer behaviour and
stranded assets. Our fund managers access third party research
from a number of providers which often contain this analysis on a
company or sectoral basis.
In 2019, Liontrust became familiar with the TCFD recommendations,
established board-level oversight and an internal climate-risk
management process, developed an implementation plan and
aligned the governance structures around delivery of this plan,
provided appropriate training and guidance to the Board,
conducted portfolio analysis and identified the highest carbon
emitting companies held across portfolios.
Following our analysis and work throughout the year, we are now
in a position to take the following steps in 2020:
• approve our strategy and approach towards climate risk at
Board level;
Liontrust engaged MSCI Carbon Analytics for all investment
teams to provide detailed carbon emissions analysis across all
portfolios. Analysis of these portfolios has
been conducted and, having identified the
highest carbon emitting companies held
across portfolios, we will endeavour
to engage with these companies
• continue to support the fund managers with tools and appropriate
training;
• finalise the integration of climate risks in Liontrust’s investment risk
management;
• expand our coverage of climate risk in our risk framework;
• implement our monitoring plans; and
• start to engage with those companies with significant emissions
across all portfolios.
Liontrust Sustainability Report 2020 - 29