Northern Trust launches quant ESG strategy
Northern Trust Asset Management (NTAM) has expanded its suite of responsible quantitative investment solutions with the launch of the NT World Quality ESG Strategy.
The fund had been available for US investors since 2015 but was now being launched for the Australian market.
The strategy sought to efficiently target high-quality stocks and companies with higher relative environmental, social and governance (ESG)-ratings whilst defining a responsible investment universe and managing climate change risk.
The NT World Quality ESG Strategy would take a holistic view on sustainability that incorporated both financial quality and ESG profile into security selection. The approach would enable investors to access a differentiated ESG integration that incorporates ESG metrics and removes exposure to certain lower-scoring ESG securities, seeking to reduce carbon footprint relative to the benchmark.
Julie Moret, global head of sustainable investing and stewardship at NTAM, said: “We believe material environmental, social and governance factors are pre-financial indicators that can affect a company’s future financial viability and clients’ long-term risk-adjusted investment returns. When managed well, they can position a company for success and when mismanaged, they can result in significant risks.
“The intersection of high quality and highly rated ESG and quality factors means investors in this strategy may benefit from both factor-based investing and ESG characteristics.”
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