Sustainable investmentsa fiduciary duty to support the transition to a sustainable world
It is our fiduciary duty to support the transition to a sustainable society. On behalf of our clients, we invest in companies and countries that operate within the safe and just operating zone of ACTIAM's Sustainable Investment Framework, or are making the transition towards this zone. ACTIAM encourages companies and countries to prepare for the new challenges they are facing. In this way, we are helping to pave the pathway towards a sustainable society while creating longer term financial returns to our clients.
We deliver investment solutions to our clients with the objective to optimise longer-term financial, environmental and social returns. Our vision to sustainable investments is discussed in our Sustainability Policy
Our approach is aligned with that of the EU Sustainable Finance Disclosures Regulation (SFDR), as we are assessing the sustainability risks that could cause a material negative impact on the value of an investment. The types of sustainability issues that we consider include climate change, biodiversity loss, water scarcity, chemical emissions, waste, social and community issues, human capital, and organizational behaviour, which include governance issues. These issues may result in transition risks driven by policy, legal and technology changes as we move towards a more sustainable economy, as well as reputational, operational, and physical risks to entities if they are not able to manage the issues sufficiently. Our view is that integrating assessments of sustainability risks and opportunities leads to better informed investment decisions and better risk-adjusted returns in the long run.
A holistic and forward-thinking vision
We adopt a holistic and forward-thinking approach to all the companies and countries in which we invest. This plays an important role in the risk management of our investments, in stimulating behavioural change (which can be achieved with a mixture of instruments) and in contributing towards achieving the Sustainable Development Goals (SDGs).
The basis of our policy is that companies and countries have to comply with our socio-ethical investment principles, called our Fundamental Investment Principles. These define the bottom-line of our investments. Companies and countries not complying with these principles are considered to exhibit unacceptable behaviour.
Secondly, we assess the adaptive capacities of the companies to prepare themselves for the transition risks against seven Material Sustainability Drivers. These drivers show how companies respond to the social and market changes caused by the sustainability transition. For each driver, we have formulated a specific ambition. In order to achieve these ambitions, choices must be made, for example, to cease, reduce, replace, recycle or innovate.
ACTIAM uses a broad range of data sources to gain insight into the companies' behaviour, such as from MSCI and Satelligence. Moreover, our principles are based on a range of international agreements and principles, including the United Nations Global Compact, the UN Guiding Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprices, the Principles for Responsible Investments (PRI) and the Task Force on Cllimate-related Financial Disclosures (TCFD).