Lonsec has launched its Sustainability Rating program on its iRate platform, with eleven funds having been issued with a score from its previously-covered Responsible Investment category.
The funds covered by the research were issued with a Sustainability Score which reflected the underlying investments of the product with its compatibility with the United Nation’ 17 Sustainable Development Goals (UNSDG).
The research was provided in partnership with Sustainable Platform who provided sustainability data for investment managers and institutions.
Lorraine Robinson, Lonsec Research executive director, said the concept of environmental, social and governance (ESG) had been around for a while but there was a lack of clarity around what it meant for the end investor.
“Lonsec wants to bridge this understanding gap by offering research that looks past the process and directly analyses the assets and industries that investors are exposed to when they invest in a managed fund product,” Robinson said.
A sustainability report was issued for each fund, which was peer ranked with a top 10%, upper middle 20%, middle 40%, lower middle 20% and bottom 10%.
This report included adherence to UNSDG, exposure to any controversial industries and a snapshot of the environmental impact of the fund calculated using the Sustainable Platform data.
“There is growing awareness among investors of the importance of considering sustainability issues when constructing a portfolio,” Robinson said.
“Advisers are now typically confronted with the question: ‘What am I really invested in?’ We want to help advisers not only answer this question, but to create a portfolio that is truly aligned to their client’s preferences.”