Responsible Investing (RI) is an investment approach that has expanded in broader appeal over the past three decades, with investors showing greater awareness of and willingness to consider Environmental, Social and Governance (ESG) factors as a part of their investment process. While there is no uniform consensus or standardization in approach, the Global Sustainable Investment Alliance1 has identified seven classifications to help define the investment approach taken:
-
1ESG Integration
-
2Active Ownership
-
3Thematic Investing
-
4Positive Screening
-
5Negative Screening
-
6Norms-based Screening
-
7Impact Investing
AN EMPHASIS ON ESG INTEGRATION AND THE POWER OF DIALOGUE
Guardian Capital LP (Guardian Capital) incorporates two RI approaches – ESG Integration and Active Ownership – across all our portfolios, and have actively formalized this process in recent years. With a clear objective of enhancing long-term investment performance, Guardian Capital’s highly experienced investment teams conduct holistic ESG-related assessments on the individual companies in our portfolios as a part of their investment process.
ESG INTEGRATION
We embed ESG Integration throughout our proprietary research methods. Portfolio managers do not apply any preset exclusions; instead, they assess the impact ESG factors have on a company’s valuation and outlook when determining its long-term sustainability. Responsibility for implementing ESG integration rests with the investment team, with the process unique to the investment mandate.
ACTIVE OWNERSHIP
We focus on dialogue with companies to influence their approach to
ESG factors that are material and relevant for their specific
circumstances. We recognize that change for a large organization,
with its built-in infrastructure and entrenched industry practices
takes time, however we aim to raise awareness and consideration of
ESG factors with corporate leadership as they make decisions. Our
portfolio managers’ use their meetings with companies as an
opportunity to raise ESG issues with the aim of encouraging
companies to explore solutions to effect the desired change.
SPECIALIZED APPROACHES
-
> NEGATIVE SCREENING
Our Guardian Ethical Management (GEM)2 Pools utilize Negative ESG Screening in conjunction with an extensive Active Ownership program through their ESG partner, Northwest & Ethical Investments LP.3 Learn more about GEM.
-
> MULTI-ASSET SOLUTION
Guardian Capital’s Sustainable Funds are a fund-of-funds that apply ESG oversight by objectively screening each of the underlying funds based on sustainability thresholds, as measured by Morningstar® Sustainability Ratings™4 Learn more about our Sustainable Funds.
-
> THEMATIC INVESTING
Guardian Capital offers a carbon-constrained version5 of our Guardian Canadian Equity strategy. The strategy applies careful consideration in eliminating companies based on energy production, fossil fuel distribution and other factors.
EDUCATIONAL MATERIALS
-
Guardian Capital Responsible Investing Report 2021
Glossary of Responsible Investing Terms
Engagement vs. Divestment
Perspective on the Energy Transition
POLICY DOCUMENTS
2 GEM Pools are a private offerings available to qualified investors only.
3 Northwest & Ethical Investments LP (NEI) provides the Environmental, Social, and Governance (ESG) screening and engagement while Guardian Capital LP provides the investment fund management portfolio.
4 The Sustainable Funds are multi-asset solutions that aim to achieve their investment objectives primarily through investment in Guardian mutual funds and ETFs and or third-party mutual funds and ETFs (the “underlying funds”).
5 The Canadian Equity Carbon Constrained strategy is currently only offered as a segregated account mandate.
Guardian Capital LP is a signatory of the United Nations-supported Principles of Responsible Investment (UN PRI). The UN PRI does not prescribe the exclusion of any particular type of company or industry; rather it requires that, as the Manager, we are informed on the ESG issues, and that we are comfortable with the activities and practices of the companies that we invest in. Our Responsible Investing policies are available above on this webpage.
Responsible investing is an approach to investing that incorporates ESG considerations into investment decisions. This approach may incorporate considerations beyond traditional financial information into the investment selection process, which could result in investment performance deviating from other products with comparable objectives or from broad market benchmarks.
Guardian’s Sustainable Funds and GEM Pools have ESG-related investment objectives, while other Guardian Mutual Funds and ETF do not have ESG-related investment objectives. All Guardian Funds integrate ESG considerations into the investment analysis of all holdings within their respective portfolio. A Fund’s ESG characteristics and performance may change from time to time. Please review the Fund’s prospectus for details on how the Fund’s investment strategy incorporates responsible investing considerations and the associated risks, and consult your financial professional prior to investing.
Issues with the potential to affect the natural environment, such as climate change, greenhouse gas emissions, biodiversity and deforestation.
The issues affecting people: human rights, working conditions including slavery and child labour, diversity and inclusion, health and safety, conflict zones and local communities.
How companies ‘govern’ themselves can include the composition and skillset of its board members, executive remuneration, bribery and corruption policies, and tax and audit practices
Guardian Capital LP, as a signatory to the United Nations-supported Principles for Responsible Investment (PRI) – the leading proponent worldwide of responsible investing, is committed to the PRI's six voluntary guiding principles.
Guardian Capital LP also supports the recommendations of the Task Force on Climate-related Financial Disclosures and is a member of the IFRS Sustainability Alliance and the Responsible Investment Association.
Signatory of:
Member of:
