Ethical rating pushes 20% of funds to improve practices
Around 20% of funds assessed by the Ethical Advisers’ Co-op (EAC) Leaf Ratings have made changes to the way their fund reports on their ethical or sustainable investments.
The Leaf Ratings compared funds that claimed to have ethical or sustainable mandates while showing investors how the funds incorporated and applied those values.
The EAC’s annual report said the co-op had positive engagement with fund managers that operated in the ethical and sustainable investment sector such as:
- Fund managers contacted by the EAC about inclusion within ‘Leaf Ratings’ expressed strong support for the ratings system, with a number of managers proactively contacting the EAC to request their funds be included for rating;
- Approximately 20% of those funds assessed through the EAC ‘Leaf Ratings’ system have then acted to make changes to the way their fund reports, following discussions with those coordinating the 'Leaf Ratings' assessment process; and
- Changes undertaken by fund managers following their rating have included;
- providing greater transparency around their underlying investment portfolio;
- agreeing to implement clearer reporting of their record on proxy-voting;
- strengthening the positive and negative filters used; and
- adjusting their investment portfolios based on feedback and concerns expressed.
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