Sustainability is a core part of our investment process, and we believe that it is an important driver of long-term performance. We assess the sustainability of the business model in terms of external (industry dynamics and sustainability) and internal (strategic positioning and Environmental, Social and Governance (ESG)) factors to calculate our proprietary sustainability score. This score makes up 30% of the overall stock recommendation.
Identifying sustainable Australian small companies can be challenging because this asset class often provides less comprehensive disclosure and data points to assess. We manage this with our specialist in-house research, assessing both extrinsic and intrinsic sustainability factors and evaluating a company on its exposure to material ESG factors and how it manages them. As part of our comprehensive stewardship program, we regularly engage with boards and leadership teams of companies we invest in on their ESG progress and outcomes and use proxy voting to drive long-term outcomes.
The investment team is supported by a dedicated ESG team who draw on Maple-Brown Abbott’s long history of responsible investment leadership and work alongside the Portfolio Managers on all aspects of ESG integration.