The Investment Manager conducts extensive and high-quality fundamental and first-hand research to fully understand the investment case for every company in the portfolio. A key part of this research involves focusing its extensive resources on analysis of ESG issues. As set out in more detail below, the Investment Manager’s portfolio managers, ESG Equity Analysts and central ESG Investment Team collaborate to generate a deep understanding of the ESG risks and opportunities associated with each company. Stewardship and active engagement with every company are also fundamental to the investment process, helping to produce positive outcomes that lead to better risk-adjusted returns.
Portfolio Managers: All of the Investment Manager’s equity portfolio managers seek to engage actively with companies to gain insight into their specific risks and opportunities and provide a positive ongoing influence on their corporate strategy for governance, and environmental and social impact.
ESG Equity Analysts: The Investment Manager has dedicated and highly experienced ESG equity analysts located across the UK, US, Asia and Australia. Working as part of individual investment teams, rather than as a separate department, these specialists are integral to pre-investment due diligence and post investment ongoing company engagement. They are also responsible for taking thematic research produced by the central ESG Investment Team (see below), interpreting and translating it into actionable insights and engagement programmes for its regional investment strategies.
ESG Investment Team: This central team of more than 20 experienced specialists based in Edinburgh and London provides ESG consultancy and insight for all asset classes. Taking a global approach both identifies regions, industries and sectors that are most vulnerable to ESG risks and identifies those that can take advantage of the opportunities presented. Working with portfolio managers, the team is key to the Investment Manager’s active stewardship approach of using shareholder voting and corporate engagement to drive positive change.
Global ESG infrastructure:
abrdn has around 150 equity professionals globally. Each systematically analyses ESG risks and opportunities as part of the Manager’s research output for each company. Its central team and ESG equity analysts support the investment managers’ first-hand company analysis, producing research into specific themes (e.g. labour relations or climate change), sectors (e.g. forestry) and ESG topics to understand and highlight best practice. Examples of thematic and sector research can be found on abrdn.com/en/uk/investor/responsible-investing.
Please see pages 30 to 35 of the annual report for more information.