Embark Investments, as the Authorised Corporate Director (ACD) of the Horizon fund range, is a signatory of the United Nations supported Principles for Responsible Investment (PRI), a globally recognised benchmark for the consideration of Environmental, Social and Governance (ESG) issues. Embark Investments are committed to the integration of fundamental ESG principals into the Horizon Multi Asset Fund range and continue to evolve the Horizon Funds in line with the changing investment markets to meet client needs.
The six principles of the PRI match the framework that Embark Investments employs to oversee the Horizon funds, helping us to embrace an international standard. The ACD monitors the funds through a number of ESG-related indicators on a monthly basis and proactively engages with the appointed investment manager, Columbia Threadneedle Investments.
The Horizon fund range uses an integrated approach to ESG, which is embedded within the investment process. Further insight into ESG and the management of the Horizon fund range can be found in our FAQs.
The Horizon Multi-Asset funds are actively managed by Columbia Threadneedle, who are one of the founding signatories of the United Nations supported Principles for Responsible Investment (PRI). Signatories commit themselves to the six Principles which include incorporating ESG factors into investment analysis and decision-making processes, as well as being active owners and incorporating ESG issues into ownership policies and practices.
In 2020 Columbia Threadneedle received an overall PRI assessment rating of A+, the highest rating possible which they have received for six years running. They have been a signatory to the UK Stewardship code since 2010. Columbia Threadneedle has its own dedicated Responsible Investment (RI) team, which includes experts in RI analytics, ESG research and integration, stewardship and engagement, proxy voting, sustainable outcomes and thematic RI research.
Columbia Threadneedle believe that multi-asset and asset allocation solutions may be enhanced by the integration of ESG considerations across asset classes. Their fund managers and analysts in equity, fixed income and property teams have access to ESG data to help develop investment theses. Fund managers and analysts collaborate with the dedicated Responsible Investment team to improve understanding of material ESG risk management and identify potential for sustainable opportunity.
The multi-asset experts responsible for the five Horizon funds, as well as the portfolio managers of Horizon’s underlying Columbia Threadneedle funds are therefore supported in their decision-making by the RI team.
Columbia Threadneedle includes ESG considerations their investment decision-making as they believe that well-run or improving companies are often better positioned to adapt and manage the risks and challenges inherent in business. A focus on the financial and non-financial performances of a business and its leaders helps to identify the value generated by well-run companies. Their proprietary Responsible Investment ratings tool enables portfolio managers and analysts to gain insights into a company’s leadership, governance, culture and operational standards of practice with a focus on issues that are material to its long-term performance.
Their approach includes understanding linkages between sustainability opportunities on the one hand, and growth and competitive advantage on the other. Columbia Threadneedle also seek to analyse of the quality of operating practices and potential controversies considering ESG factors, as an input to mitigate risks.
Additionally, Columbia Threadneedle actively screens companies for evidence of their corporate involvement in controversial weapons (for example anti-personnel mines or biochemical weapons). Where a company is shown to undertake such activities, it is their policy not to invest in the securities issued by that company, however it reserves the right to take short positions on such securities.
As institutional shareholders, Columbia Threadneedle believe voting rights provide the mechanism to signal to companies about shareholder preferences and expectations of good practice, as well as on perceived issues and shortcomings.