Liontrust Responsible Capitalism Report 2022 - Flipbook - Page 25
Investing in ESG
Liontrust has continued to invest in additional, specialist resources to
increase our commitment to integrating ESG throughout the business
and its inclusion in our investment processes and risk analysis with
dedicated governance and stewardship staff.
Liontrust has engaged MSCI ESG Manager providing ESG ratings for
all investment teams, ESG controversy monitoring and carbon analytics
of all portfolios, which empowers our investment managers to consider
ESG issues in their decision-making processes for each strategy as well
as providing group-wide analysis and action.
The chart below shows the distribution of the MSCI ESG ratings of our
holdings as at 31 March 2020. This includes a slight increase in the
leading rated AA and AAA companies in the portfolios’ scores from last
year (2020:30% 2019: 29%), a very slight decrease in the average
rated BB and BBB, A companies in the portfolios (2020:52% 2019:
53%), and a slight increase in the laggard rated B, CCC companies in
the portfolios score from last year (2020: 5% 2019: 3%).
ESG Rating Distribution
23%
20%
21%
13%
9%
9%
4%
1%
CCC
Not rated
Laggard
B
BB
BBB
Average
A
AA
AAA
Leader
*’Not Rated’ shows the percentage of the portfolios that are
invested in companies that do not have an ESG rating from MSCI,
i.e. outside of their coverage, mainly due to size.
Minimum
Standards
for Our Investments
We aim to invest only in businesses
which are committed to:
• respecting the human rights of their
workers;
• maintaining safe and healthy working
conditions; and
• treating their employees fairly.
We try to ensure that the businesses we
invest in comply (among other things)
with all applicable employee-related laws
and, where appropriate, that they work towards meeting relevant
international standards (such as the ILO Fundamental Conventions)
where these are more stringent.
We invest in companies throughout the world and although
investments are not covered by the Modern Slavery Act, we take
our responsibilities to be good stewards for our investors seriously.
We use a third party to provide ESG reporting on the vast majority
of our investments and when any controversial matters involving
the identification of modern slavery or trafficking practices are
identified we will engage with those companies to resolve and
end those activities. Where we believe our engagement is not
successful, we may look to withdraw our investment.
We are continuing to work on our approach to Responsible
Investment and look forward to publishing more details in this area
on our website later in 2020.
Liontrust Sustainability Report 2020 - 25