Combining performance and integration of ESG criteria

Incorporating ESG criteria across the board

 

We take a responsible and sustainable approach to investing by applying environmental, social, and governance (ESG) criteria to more and more of our investment products. That means we go beyond a company’s financials and look at how it contributes to sustainable development – based on ESG criteria – before deciding whether to include it in the investment products we offer our clients. Ultimately, we aim to incorporate ESG criteria into every aspect of our asset management process.

To learn more about key SRI concepts, you can consult our glossary.

ESG

Our core SRI approaches

We use five key approaches for incorporating ESG factors into our investment selection and portfolio-management processes. These core approaches are: negative screening, ESG integration, best-in-class selection and positive screening, and active ownership (see definitions below). We also offer thematic investment solutions focused on companies that are making a positive environmental and social difference through their products and services.

Approach

What BCV does

1. Negative screening

Excluding companies linked to major controversies or practices that violate certain norms and values, or that pose risks

2. ESG integration

Incorporating ESG factors into the standard financial-analysis and stock-picking processes

3. Approaches based on ESG ratings

Positive screening: investing in companies in order to create a portfolio with an ESG rating that exceeds a benchmark or a minimum level

Best-in-class selection: comparing the ESG performance of companies within a sector and only investing in those whose performance is above a defined threshold

4. Active ownership (stewardship)

Exercising voting rights based on ESG principles and/or engaging in active dialogue with the management of investee companies to encourage them to apply ESG criteria within their sphere of influence

5. Thematic investments

Investing in companies that provide solutions to environmental and social challenges (such as those set out in the United Nations Sustainable Development Goals)

What’s an ESG rating?

Some of the approaches described above rely on ESG ratings. These ratings assess companies’ resilience to long-term ESG risks in their sector and take into account non-financial opportunities in the environmental, social, and governance aspects of a company’s operations.

It is also important to understand the limitations of ESG ratings. They do not assess a company’s negative impact on the environment and society, they are not climate ratings, and they do not measure a company’s “sustainability.”

ESG ratings can help construct a robust portfolio and improve long-term risk-adjusted returns.

BCV’s range of ESG Impact products

BCV Actions ESG Impact certificate

Invest in a structured product based on a basket of investment funds designed to help drive environmental and social change, while diversifying your equity investments by sector, region, and currency.

This equity certificate applies BCV’s principles of discretionary management and incorporates ESG criteria across its portfolio. It consists of a core asset allocation fund that invests in equities, along with an allocation of at least 25% to thematic investment solutions addressing key environmental and social challenges (e.g., in the areas of renewable energy, energy efficiency, clean technology, water treatment, and social progress).

BCV Climate Impact certificate

Invest in companies whose products and services are helping combat climate change

This certificate invests directly in climate change mitigation. It focuses on companies working to tackle this issue by developing products and services in solar and wind energy, transportation, power storage, smart grids, and energy efficiency.

BCV Stratégie Equipondéré ESG Impact fund

Invest in a diversified fund that seeks long-term capital growth along with additional income, and that selects companies whose business models factor in ESG risks and opportunities.

This fund applies BCV’s principles of discretionary management and incorporates ESG criteria across its portfolio. It consists of a core balanced asset allocation fund, along with an allocation of at least 25% to thematic investment solutions addressing key environmental and social challenges (e.g., in the areas of renewable energy, energy efficiency, clean technology, water treatment, and social progress).

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