The challenges of ESG integration are multiple, whatever the asset class: to demonstrate in solid terms our commitment to responsible investment, to combine ESG issues and our fiduciary responsibility, and finally to offer know-how to the end clients that we already share with our institutional clients through partnerships and / or management mandates.

The transformation of all asset classes is initiated and will be done gradually in the interest of our clients. Since 2017, all thematic strategies launched incorporate a responsible approach to combine meaning and the search for performance. The ESG integration in 2018 in our quantitative equity range is a testament to our ambition to become one of the major players in Responsible Investment. 

A RISK-BASED APPROACH

Sustainable creation of financial value and risk prevention cannot be achieved through positive selection of the best issuers alone. On the other hand, they are reinforced by the exclusion of issuers with the worst practices. An issuer is rated on a set of generic Environmental, Social and Governance criteria as well as on criteria specific to its business sector. In order to obtain the final rating of an issuer, the weightings of the criteria are determined by the extra-financial analysis team based on their knowledge of the issues specific to each sector. The exposure of companies to risks and opportunities in each of the three E, S and G dimensions is thus assessed, as well as their management of the issues.

MATERIALITY OF CHALLENGES AS A VARIABLE

As an additional component of the comprehensive extra-financial analysis of issuers through the final score, we also believe it is essential to assess practices on a selection of the most material ESG criteria. In doing so, we rely on our research team’s expertise and look at the five criteria deemed essential within each sector. The more a company faces a material risk on a given criterion, based on its business activity, the more our analysts will be demanding in the quality of its practices. The very high degree of granularity of our proprietary methodology, with about 20 specific criteria and almost 70 sectors reviewed, makes a robust analysis possible of each issuer’s risks and opportunities