ESG forefront investing

Seeking to deliver attractive risk-adjusted returns with actively managed approaches that embed ESG analysis into the investment philosophy and process

What is ESG forefront investing?

Some approaches may look for established ESG leaders. Others may focus on companies or issuers measurably improving their ESG practices and, therefore, their potential competitive advantage and relative value. Whether used as an alpha driver or risk management tool, ESG is seen as a key factor in helping to distinguish industry leaders from laggards.

ESG and stewardship inputs

Because we believe ESG factors are linked to a company’s long-term performance, we look for companies that:

Invest in people
  • Prioritize talent and culture
  • Promote diversity, equity, inclusion
  • Improve customer satisfaction
  • Take accountability for the supply chain
Positively impact the environment
  • Adapt to and invest in the energy transition
  • Reduce environmental footprint
  • Contribute to a circular economy
  • Are a vital partner to the local community
Build sustainable profit
  • Allocate capital wisely
  • Invest in innovation
  • Run the business with a long-term orientation
  • Ensure shareholders are compensated over the long term

Reason to invest

ESG forefront managers believe:

  • The ability to distinguish potential ESG leaders from laggards is important for risk management and alpha generation
  • By engaging with companies on ESG, we aim to hold leaders to account and inspire long-term thinking that includes ESG and stewardship consideration
  • The market tends to overlook ESG issues as material risks and potential sources of alpha

  • Prioritizing ESG in our analytical frameworks and investment process may help us make better investment decisions and deliver sustained risk-adjusted returns

  • Understanding a company’s approach to ESG allows us to more accurately assess its management depth, risk controls, and innovation potential

Contact the sustainable investment team

For more information on our sustainable investment solutions, speak with a member of Wellington's sustainable investment team.

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