Insight Investment

There is variation in ESG data from different providers. For many smaller issuers, particularly emerging market or high-yield companies, the availability of relevant non-financial data lags information from larger issuers.

For these reasons, we developed the Prime corporate ESG ratings, with customised metrics to make the data as pertinent as possible to our analysis.

Insight’s Prime corporate Insight ESG ratings are generated by following a risk-centric approach with high coverage of global benchmarks.

To read more on our ratings and how we use them, please click here.

In 2017, we introduced our Prime climate risk ratings, which now over 18,200 issuers according to how they manage climate change-related risks.

We believe it to be the investment industry’s first comprehensive ranking of how fixed income corporate credit issuers manage their climate change-related risks and opportunities, and how they are positioning themselves for the transition to a low-carbon economy. The index is designed to be used to assess risks and opportunities related to climate change.

Please click here for more details, including:

• how Insight uses the index
• the methodology underlying it, and
• details of key findings.

Beyond considering climate risks as part of their core investment approach, some clients are looking to pursue net-zero targets.

To help these clients invest in line with their net-zero goals, Insight has created ratings to categorise corporate and sovereign issuers according to the extent of their commitment to and alignment with achieving net zero by 2050.

To read more on our net-zero ratings, please click here.

Our responsible investment policy explains that we believe reflecting material and relevant ESG issues within investment processes, and in our dialogue with issuers and other stakeholders, can help to support better investment decisions and has the potential to help our clients achieve their desired outcomes.

This belief leads us to pursuing the following activities:

1. Putting responsibility at the heart of how we do business
2. Integrating ESG issues into our investment processes
3. Acting as stewards of companies and other entities
4. Supporting efforts that seek to improve the operation, resilience and stability of financial markets
5. Collaborating with others on ESG issues
6. Exercising transparency and disclosing our activities

Our progress in implementing the aspirations set out above will differ across our investment strategies and teams for various reasons, including the mixed availability of relevant data and differing integration opportunity sets.

Click here to read our responsible investment policy.

Insight does not actively invest in companies involved with the production, sale or maintenance of cluster munitions or landmines.

There are two major international conventions that address cluster munitions and landmines specifically:

• The Convention on Cluster Munitions (2008): This Convention restricts the manufacture, use, and stockpiling of cluster munitions and the components of these weapons
• The Convention on the Prohibition of the Use, Stockpiling, Production and Transfer of Anti-Personnel Mines and on Their Destruction (1997): This Convention, often referred to as the Anti-Personnel Landmines Convention, aims to eliminate antipersonnel landmines around the world

In line with these international conventions and following their ratification into domestic law by a number of countries, Insight has adopted a global policy which commits it to avoiding direct investments in companies that:

• Design, produce, sell or maintain cluster munitions and/or landmines
• Undertake research and development to develop cluster munitions and/or landmines
• Breach the requirements of the Convention on Cluster Munitions or the Anti-Personnel Landmines Convention

This policy:

• Applies across all asset classes
• Excludes affiliated companies: that is, companies with affiliations or commercial relationships with screened companies will not be excluded from investments
• Does not apply to passive holdings in index-tracking instruments

With respect to share ownership, in the majority of investment strategies Insight does not have material investments in physical holdings. Where Insight does hold physical equity positions we routinely vote on behalf of our clients with regard to the companies in which they have a shareholding.

Insight retains the services of a third party for proxy voting services and votes at all meetings where it is deemed appropriate and responsible to do so. The third party provider offers research expertise and voting tools through sophisticated proprietary IT systems allowing Insight to take and demonstrate responsibility for voting decisions. Independent governance analysis is drawn from thousands of market, national, and international legal and best practice provisions from jurisdictions around the world.

Independent and impartial research provides advance notice of voting events and rules based analysis to ensure contentious issues are identified. The third party provider analyses any resolution against Insight-specific voting policy templates which will determine the direction of the vote. Where contentious issues are identified these are escalated to Insight for further review and direction. Insight will undertake a review of the voting policy templates on an annual basis.

To read Insight Investment’s proxy voting policy, please click here.