Be confident your sustainable investments are true to label

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The world of sustainable investments is evolving rapidly. Something that began as a popular trend with institutional investors, has now developed into a diverse investment characteristic with numerous strategies and objectives that advisers can incorporate into their core service offering to differentiate and add value for clients.

This growing demand from investors is being met with improving and innovative supply from investment managers, who use a variety of methods to incorporate Environmental, Social and/or Governance (ESG) factors into their investment process.

A new world of opportunity

This rapid growth around the globe is changing the expectations advisers and investors have of sustainable investment. At BT, we believe a sustainable investment approach is a key element of providing long-term value for investors, and the appropriate consideration of ESG factors in the investment process can help drive better financial outcomes and positively influence risk-adjusted returns.

But investors will have a view of what investing sustainably means to them and how important it is for their investments. Maybe they like to exclude certain stocks or industries across their portfolio. Or possibly they favour a strategic tilt to something like impact investing, where capital is used to provide solutions to some of the world’s most significant environmental and societal challenges. Perhaps they prefer a focus on how ESG factors affect investment performance and are interested in how an investment manager manages ESG risk, for example, or how they consider ESG factors in the investment process and engage with underlying companies on ESG risks.

Take the next steps

  • BT Investment Solutions (BTIS)
    BTIS delivers an institutional grade investment management capability across a range of solutions, from low-cost index portfolios to actively managed strategies.

So, how can you ensure your client’s investments align with their perception of sustainable investment?

Simple things you can do

To ensure an investment manager’s approach to sustainability and ESG complements your clients’ views, we suggest you ask yourself two questions.

  1. Is the integration of ESG factors in the investment process appropriate and relevant for the investment strategy being considered?
    Consider the manager’s beliefs on ESG and sustainability and how these are reflected in its investment process. These types of questions will help you understand how a manager approaches ESG risks and opportunities.
  2. Does the process for integrating ESG factors align with the purpose and intent of the investment strategy?

Understand what the manager is trying to achieve and how they intend to use ESG information in their investment process. Does the process align with what your client is expecting, and would it fit into their portfolio?

We also recommend reading a product’s PDS and any sustainability reporting from investment managers to understand what a product does. Some investment managers provide regular reporting that may include examples of where their investment process has considered and successfully implemented sustainability practices.

You can read more about this in our article: Making sustainable investments part of your client conversations.

Industry bodies come onboard

The industry has stepped up to help advisers and investors better understand sustainable investments and identify those that are true to label.

The Responsible Investment Association Australia (RIAA) is Australia’s recognised industry body for Responsible Investing, advocating for responsible investing and a sustainable financial system. Together with its 450 members1 (of which BT has been a member since 2000), its goal is to “promote, advocate for, and support approaches to responsible investment that align capital with achieving a healthy and sustainable society, environment and economy”.

RIAA offers tools to help investors and advisers better understand and navigate responsible investment products, including the world’s first and longest-running fund certification program and a free certified product search that yields information about where a fund fits on the spectrum of responsible investment.

The RI Certification Program

RIAA’s certification symbol distinguishes quality responsible, ethical and impact investment products. So, if a product has RIAA certification, you can be confident it’s delivering on its responsible investment promise and meeting a high standard of responsible investing.

There are eight broad requirements investment products need to achieve certification2.

  1. Responsible investment strategies are formal, disclosed, consistent, auditable and fit for purpose.
  2. Product labels are clear, honest and not misleading.
  3. Product avoids significant harm – as a minimum requirement excludes tobacco and controversial weapons producers.
  4. The investment process accounts for environmental, social and governance factors.
  5. Product discloses full holdings (including holdings by a fund of funds), performance, sustainability outcomes and engagement and voting practices.
  6. Product is managed by active stewards and managers can detail the stewardship practices, such as engagement and voting and the improved outcomes of these practices
  7. The managing organisation has a formal commitment to responsible investment.
  8. The managing organisation provides educational information to members and customers about the responsible investment strategies and investment outcomes.

BT makes sustainable investing accessible to all

BT offers sustainable investment options across all asset classes and investment styles. This allows investors to fully invest in sustainable investment options or add a strategic tilt into a portfolio instead, perhaps using a thematic, sustainability or impact investment.

As of February 2022, this is the list of RIAA certified products available on BT Panorama.

Fund name APIR code Investment strategy Fund manager
Aberdeen Std Focused Sustainable Australian Equity Fund MGL0114AU Australian shares Aberdeen Standard Investments Australia Limited
Acadian Wholesale Australian Equity Fund FSF0787AU Australian shares Acadian Asset Management
Acadian Wholesale Global Equity Fund FSF0710AU International shares Acadian Asset Management
Affirmative Global Bond Fund - Class A FSF7298AU International fixed interest Colonial First State Investments Ltd
Alphinity Sustainable Share Fund HOW0121AU Australian shares Alphinity Investment Management Pty Ltd
Altius Sustainable Bond Fund AUS0071AU Australian fixed interest Australian Unity Funds Management
AMP Capital Ethical Leaders International Share Fund AMP0455AU International shares IPAC Asset Management Limited
AMP Capital Global Property Securities Fund AMP0974AU International property AMP Capital Investors Limited
Ausbil Active Sustainable Equity Fund AAP3940AU Australian shares Ausbil Investment Management Limited
Ausbil Investment Trust - Candriam Sustainable Global Equity Fund AAP0001AU International shares Ausbil Investment Management Limited
Australian Ethical Australian Shares Fund AUG0018AU Australian shares Australian Ethical Investment Ltd
Australian Ethical Balanced Fund (Wholesale) AUG0017AU Diversified Australian Ethical Investment Ltd
Australian Ethical Diversified Shares Fund AUG0019AU Diversified Australian Ethical Investment Ltd
Australian Ethical Emerging Companies Fund (Wholesale) AUG0027AU Australian shares Australian Ethical Investment Ltd
AXA IM Sustainable Equity Fund ETL0171AU International shares AXA Investment Managers Asia (Singapore) Limited
Baillie Gifford Global Stewardship Fund - Class A FSF4018AU International shares Baillie Gifford Overseas Limited
Bell Global Emerging Companies Fund BPF0029AU International shares Bell Asset Management Limited
Nanuk New World Fund SLT2171AU International shares Nanuk Asset Management Pty Ltd
Pendal Horizon Fund RFA0025AU Australian shares Pendal Institutional Limited
Pendal Sustainable Australian Fixed Interest Fund BTA0507AU Australian fixed interest Pendal Institutional Limited
Pendal Sustainable Australian Share Fund WFS0285AU Australian shares Pendal Institutional Limited
Pendal Sustainable Conservative Fund RFA0811AU Diversified Pendal Institutional Limited
Pengana Axiom International Ethical Fund HOW0002AU International shares Pengana Capital Ltd
Pengana Axiom International Ethical Fund (Hedged) HHA0002AU International shares Pengana Capital Ltd
Pengana WHEB Sustainable Impact Fund HHA0007AU International shares WHEB Asset Management LLP
Perennial Better Future Trust WPC5600AU Australian shares Perennial Investment Management Limited
Perpetual Ethical SRI Credit Fund PER1744AU International fixed interest Perpetual Investment Management Limited
Perpetual Wholesale Ethical SRI Fund PER0116AU Australian shares Perpetual Investment Management Limited
Regnan Global Equity Impact Solutions Fund - Class R PDL4608AU International shares Pendal Institutional Limited
Stewart Investors Wholesale Worldwide Leaders Sustainability Fund FSF0047AU International shares Colonial First State Investments Ltd
Stewart Investors Worldwide Sustainability Fund FSF1675AU International shares Colonial First State Investments Ltd
Vanguard Ethically Conscious Global Aggregate Bond Index Fund (Hedged) VAN2989AU International fixed interest Vanguard Investments Australia Limited
Vanguard Ethically Conscious International Shares Index Fund VAN8175AU International shares Vanguard Investments Australia Limited
Vanguard Ethically Conscious International Shares Index Fund AUD Hedged VAN0848AU International shares Vanguard Investments Australia Limited

While the above funds meet RIAA’s strict certification criteria and this is a great way to identify available sustainable investments, it’s important to know that not all sustainable investments have RIAA certification, so this list is not exhaustive. You should look deeper into the investment objectives and process of the manager for any sustainable investments you’re considering for your client, regardless of whether they’re certified by an industry body.

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1 https://responsibleinvestment.org/about-us
2 https://responsibleinvestment.org/wp-content/uploads/2021/02/RIAA-Certification-Program-Overview.pdf


To find out more about BT Panorama, visit bt.com.au. The product disclosure statements for products available on BT Panorama and their target market determinations are available on bt.com.au.

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