Sustainability at 7IM
In both the way we invest money and the way we run our business, we know the importance of sustainability
Here at 7IM, we are guided above all by the responsibility we have towards our clients and their assets.
That includes taking a holistic look at our asset allocation, and recognising that environmental, social and governance (ESG) issues are becoming an increasingly important metric when considering long-term risk and return.
Sustainability is a long-term trend and we believe it’s important that asset managers keep in mind the risks posed by issues like climate change. It’s not only a reflection of social values, it’s good business.
Principles for Responsible Investment (PRI)
7IM signed up to the United Nations PRI in 2019 – not only did we feel it was the right thing to do, it also gives our clients clarity about where we stand. We are also signatories to the UK Stewardship Code.
As part of our commitment to the PRI, we are fully integrating ESG issues into our investment process and will produce our first full PRI report in March 2021. We believe that incorporating the Principles into our investment process makes us more accountable in our aims of:
Estimating the environmental footprint and the corporate & country governance of all 7IM Strategic Asset Allocation portfolios each year
Analysing all tactical asset allocations in terms of ESG impact – including emissions, human rights and governance – on portfolios
Weighting ESG issues in our fund research and analysis
Measuring the impact of ESG consideration on portfolio exposures and returns
Since 2007, we have been running the 7IM Sustainable Balance Fund, which assesses ESG factors in its investment process by excluding companies from non-sustainable industries or those with poor track records of ethical conduct. Alongside actively excluding certain companies, we also identify and favour companies with positive ethical conduct.
But we want to go beyond the Sustainable Balance Fund, so we’re integrating ESG factors into how we manage money throughout our funds. Each of our three main investment teams – Investment Strategy, Portfolio Management and Investment Risk – has an ESG focus and designated ESG champion to ensure that these issues are addressed in the investment process.
As part of our sustainability roadmap, we expect to be able to do ESG risk assessments for all of our portfolios, and are currently trialling different methodologies that will help us best assess their ESG rating and carbon footprint.
We believe that incorporating ESG into our business should go beyond our investments, that sustainability and good governance start at home. Taking our responsibilities as a corporate citizen seriously, we have a number of sustainability initiatives in place and are always looking for further positive changes we can make.