In February 2018, Boston Partners signed the UN Principles for Responsible Investment and established the Sustainability and Engagement Team (the “Team”). The Team is led by Bill Butterly, Head of Sustainability and Engagement, and includes ESG analysts Haley Shaw and Marissa Marandola.
Boston Partners incorporates a well-developed process that integrates ESG considerations into the investment process. Additionally, Boston Partners offers the Dynamic Sustainability Strategy. This strategy is a dedicated product offered to the investor that seeks to maximize potential return while incorporating comprehensive sustainability standards. All securities held by Boston Partners’ Dynamic Sustainability Strategy have met Boston Partners’ rigorous fundamental financial analysis and are held in one or more of Boston Partners’ other investment strategies.
In addition to using third party research to help define and filter the universe of available investments, the Boston Partners Sustainability Team engages in its own in-depth proprietary research.
Our analysis focuses on ESG risk in the following areas:
- Socially Compelling Products: Does the issuer produce a socially compelling product?
- Corporate Governance: Is there an independent chairman; a classified board; a majority of independent directors; sufficient shareholder rights; dual class stock; and an appropriate code of conduct?
- Disclosure: Does the issuer produce a sustainability report and participate in the Carbon Disclosure Project (CDP) and is the reporting thorough?
- Employees: Are the workforce and management team gender diverse; what are the safety processes and safety statistics; is executive compensation performance-based and is it excessive compared to peers; are collective bargaining rights recognized; any concerns regarding forced or child labor?
- Environmental: What are the environmental risks and how are they managed; what steps has the issuer undertaken to reduce its environmental footprint; are statistics verified by a third party?
- Supply Chain Oversight: How broad is the supply chain and where are suppliers located; does the issuer require suppliers to abide by good policies and what is the oversight process?
- Litigation and Regulatory Action. What litigation and regulatory actions has the issuer faced in the past 5 years and what do those actions say about the issuer, its processes and compliance oversight?
Importantly, the Team engages with issuers on deficiencies found through its proprietary research as we believe that proactive dialogue is often a better alternative to simply restricting an issuer. Additionally, we will engage with issuers following each proxy vote against management.