Russell Investments Canada enhances holistic outsourced CIO solution with new ESG Global Equity Fund
- Incorporates both financial and environmental, social & governance (ESG) objectives into a single solution
- Aims to provide long-term capital appreciation through actively managed global equity security selection while meeting clear rules-based ESG principles
TORONTO, September 7, 2017 — Russell Investments Canada Limited (“Russell Investments Canada”) is enhancing its outsourced CIO solution with the launch of the Russell Investments ESG Global Equity Fund (“ESG Global Equity Fund”). This new actively managed multi-manager fund is designed to reduce a client’s total exposure to carbon footprint and fossil fuel reserves and invest more in climate resilient and renewable energy opportunities. A company’s stock also is excluded from the portfolio if its primary business is directly involved in the production and sale of alcohol, tobacco or firearms. The rules-based solution allows clients to align their investments with their core ESG values without sacrificing outcome-oriented equity exposure and the potential for growth.
“As organizations move to align investments with their values, managing a portfolio has become increasingly complicated. The need to manage volatility and pursue portfolio growth remains, but it can be balanced with the need to follow an environmental, social and governance mandate,” said Andrew Kitchen, managing director, Russell Investments Canada institutional. “We are seeing this balance more acutely among organizations considering an outsourced CIO provider. Their interest continues to grow in a more holistic solution that offers the benefits of an outsourcing arrangement, while also providing a managed approach to prominent ESG issues, including exposure to carbon risk.”
Russell Investments has incorporated an ESG ranking system into its manager research process, which reflects how effectively managers incorporate ESG considerations into their investment process. Each asset class team has an ESG knowledge specialist who is responsible for taking steps to ensure that this ranking process is consistently applied across asset classes. The firm also employs specialists within its capital markets research team who are tasked with staying abreast of the trends in ESG and how their impacts may affect the overall market.
“As a global equity strategy, the Russell Investments ESG Global Equity Fund goes beyond reducing a carbon footprint,” explained Chief Investment Officer for Equities James Barber, who also serves as a portfolio manager for Russell Investments Implementation Services, LLC, a sub-advisor to Russell Investments Canada. “The solution tilts a portfolio away from those companies with greatest exposure to carbon-related risk and the reputational risks associated with alcohol, tobacco and firearms production. We tilt towards those companies expected to contribute to, and benefit from, the energy transition. In designing this solution, our research has focused on meeting ESG principles in a way that is still consistent with our goal of delivering on performance.”
Barber added that Russell Investments has been a signatory to the United Nations-supported Principles for Responsible Investment (PRI) since 2009, which includes organizations managing a combined total of more than $70 trillion in assets as of August 2017. The goal of the PRI is to support its international network of investor signatories in incorporating ESG factors into their investment and ownership decisions.
In 2017, Russell Investments received the highest-possible grade of “A+” in an annual assessment by PRI1 for eight separate categories. In the Strategy & Governance category, the A+ was given to the top 20% of 935 organizations which self-report details in this category. The firm also received the highest possible grade for ESG-related efforts involving direct active management, manager selection, manager appointment and manager monitoring. The full report and details on the scoring methodology are available in the Responsible Investing section of russellinvestments.com.
Regarding Russell Investments Canada specifically, it is member of the Responsible Investment Association (RIA) Canada, which is Canada’s membership association for Responsible Investment. RIA members believe that the integration of ESG factors into the selection and management of investments can provide risk adjusted returns, while contributing to positive societal change.
Russell Investments Canada also has been a signatory of the Carbon Disclosure Project since 2010 and is a member of the Institutional Investors Group on Climate Change and the Investor Group on Climate Change.
1The PRI’s Principles for Responsible Investment are a voluntary and aspirational set of investment principles that offer a menu of possible actions for incorporating ESG issues into investment practice. They have more than 1,750 signatories, from over 50 countries. Signatories have committed to invest in a manner that demonstrate their implementation of the six principles. To facilitate this, PRI generates reports based on signatory responses to the reporting framework to help them demonstrate how signatories are meeting these commitments. Annually, PRI signatories are required to share information about their responsible investment process to the PRI through a detailed reporting framework, which is then reviewed and rated by the PRI. The ratings for each category involve a subset of signatories who submit data for the particular category.
About Russell Investments Canada Limited
Russell Investments Canada Limited is a wholly owned subsidiary of Russell Investments Group, Ltd. Established in 1985, Russell Investments Canada Limited has its head office in Toronto.
About Russell Investments
Russell Investments, a global asset manager, offers multi-asset portfolios and services which include advice, investments and implementation. Russell Investments stands with institutional investors, financial advisors and individuals working with their advisors—using the firm’s core capabilities that extend across capital market insights, manager research, asset allocation, portfolio implementation and factor exposures—to help each achieve their desired investment outcomes. The firm has more than CAD$360 billion in assets under management (as of 6/30/2017).
Headquartered in Seattle, Washington, Russell Investments operates globally with 21 offices, providing investment services in the world’s major financial centers such as London, Paris, Amsterdam, Sydney, Tokyo, Shanghai, Toronto and New York. For more information about how Russell Investments helps to improve financial security for people, visit russellinvestments.com/ca or follow @Russell_Invest.
Kate Bauman, 206-505-1858, or firstname.lastname@example.org