Martin Currie urges managers to help multiply value of ESG investments

Martin Currie has called on asset managers to come together to help drive change and influence companies in which they invest to multiply value of environmental, social and governance (ESG) investing.

This would mean asset managers should jointly influence companies in which they invest to encourage sustainable returns over the long term by addressing issues such water risks, cybersecurity and tax responsibility.

Martin Currie, which is an active equity specialist and steward of A$20 billion in assets under management, said it had recorded 178 one-on-one engagements with corporate management teams in 2019, of which the 17-member Australia team based in Melbourne undertook over 50.

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Those activities, coupled with its proxy voting record where it voted on 6,931 resolutions across 665 shareholder meetings globally, demonstrated the firm’s commitment to investing while considering ESG factors alongside financial statements, it said.

“Looking beyond a company’s financial statements helps us understand how a business is evolving, how it is impacted by changes in the external environment and how it can deliver sustainable returns over the long term while creating value for all of its stakeholders,” David Sheasby, Martin Currie’s head of stewardship and ESG, said.

Also, for the first time, Martin Currie aligned its activities with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), which develops voluntary, consistent climate-related financial disclosures to provide information to investors and other stakeholders.

“We believe the TCFD framework is a vitally important tool to understand how companies are managing climate-related risks,” Sheasby commented.

 “We’ve identified the key material risks and opportunities for each industry we invest in. We’ve also analysed the carbon footprint of our portfolios, identifying the overall profile and main contributors to the carbon footprint.

“We believe asset managers have a hugely important role to play in this journey, not only in their duty of fiduciary care to clients on this issue, but also in guiding companies towards consistent and measurable practices.”

Earlier this month, Martin Currie launched the Australia Sustainable Equity strategy, which built on Martin Currie’s long-term experience in integrating ESG into Australian equity portfolios and positively influencing the sustainability practices of the companies it invests in, with a portfolio construction process that tilts towards companies that are on a ‘Sustainability Pathway’ towards healthier outcomes for all stakeholders.

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