Environmental, Social and Governance (ESG)

Our Philosophy

Our investment strategy is driven by the belief that long-term sustainable and successful businesses incorporate and manage all relevant factors whether they be economic, financial, operational, environmental, social or governance related. Where material to a particular investment opportunity and consistent with a strategy’s investment goals and objectives, we seek to consider environmental, social and/or governance factors that we believe may influence risks and rewards as an element of our investment research and decision making processes. However, such environmental, social and/or governance factors are not by themselves determinative to an investment decision.

Our Approach

Our investment team uses a proprietary ESG ratings framework to generate ESG scores for businesses in our portfolios as well as portfolio scores. We have identified three to five key ESG issues that we believe are relevant and material for each sector. Examples of issues considered are:

Market Review: The Bear is Awake: Q2 2022 Market Review
Toxic Emissions and Waste
Water Stress
Corporate Governance
Product Safety and Quality
Labor Management
Diversity & Inclusion
The above are sample ESG issues and can vary by business and sector.

We assess our holdings based on the appropriate key issues and assign a rating that is updated at least once per year, or more frequently should a material event occur. This rating is taken into account similar to any other investment risk and opportunity pertaining to a business.

To conduct our analysis, we use data from outside sources as supplemental to our own internal process. The investment team can evaluate a company based upon its ESG merits and has access to ESG data provided by third-party data providers. Such data may be adjusted by our team where inaccuracies are found through additional research, including fact-finding engagements with companies.