Our approach to responsible investment is based on integrating both financial and non-financial criteria into the way we research, select and manage investments.
Traditional investment approaches focus mainly on financial criteria such as balance sheet strength and future earnings forecasts. We take a wider perspective which also takes environmental, social and governance (ESG) factors into account. These may include:
As these factors are some of the drivers of long-term investment risks and returns, we believe our approach is in the best long-term interests of both our investors and wider society.
We are a signatory to the United Nations supported Principles for Responsible Investment. These six principles provide guidelines for institutions on incorporating environmental, social and governance factors into their investment processes. As a signatory, we commit to:
Our philosophy applies to all of our managed investment schemes, discretionary investment management services, wholesale mandates, superannuation schemes and wholesale schemes that we manage. This includes investments that are managed by our external fund managers who we have appointed to manage the assets of some of our underlying funds.
It’s important to note that if we buy units in a fund that isn't managed by us, our investment might be exposed to companies we would ordinarily exclude. This possibility is factored into our decision to buy any such units.
We continually review our investments and prospective investments against our financial and ESG criteria. Companies or industries that have any ESG issues are subject to further review. These reviews cover both existing and prospective investments and consider some or all of the following:
Depending on the results of our review we might continue to hold, review on a periodic basis, divest, or exclude the company or industry as an investment.
We currently exclude investments in companies that are involved in:
We have also excluded some companies, across a range of industries, that have breached global norms or standards to a severe degree.
Read the list of excluded companies here.
The Sustainable International Share Fund invests in companies that pursue sustainable development goals while delivering above-average financial returns.
It does this through its investment in the NN (L) Global Sustainable Equity Fund (the GSE Fund). The GSE fund selects ‘best in class’ sustainable equities which combine a respect of social and environmental principles with a focus on financial targets.
The GSE Fund is managed by NNIP Asset Management B.V. (NNIP). In deciding what to invest in, NNIP follows a four-step investment process involving primary research, portfolio construction, execution, and monitoring. NNIP invests in those sustainable equities which are attractively priced and have both above-average growth and above¬-average return expectations.
When conducting its primary research NNIP takes responsible investment into account by:
Find out more about the Sustainable International Share Fund