Stratton Street Capital LLP (Stratton Street) today announces that it has signed the United Nations-supported Principles for Responsible Investment (PRI).
Stratton Street is a London based fund management and advisory company founded in August 2000, specialising in fixed income markets and is an organisation that aims to achieve alignment with clients, long-term stability and maintaining a high level of professionalism. We seek to use our extensive experience gained within the investment management industry to ensure best practice is applied across all areas of our business.
Whilst return on investment remains of prime importance to investors, there is a growing recognition of the importance of considering environmental, social and governance (ESG) issues in making investment decisions. Some investors have long understood that neglecting these considerations can raise risks of financial loss in their portfolios. Unethical or neglectful behaviour can harm both investors as well as the wider environment or society.
We have been integrating ESG considerations at several levels within our organisation led by our ESG Working Group. The ESG Working Group is chaired by Andy Seaman, Stratton Street’s CIO, and was tasked with increasing awareness of ESG matters across the business; keeping abreast of ESG regulations; and assisting investment teams to incorporate ESG into their respective investment processes and to produce ESG summaries of their policies.
Approach to Integrating ESG Considerations into Investment Processes
We are mindful of the fact that different asset classes, portfolio strategies and investment universes require different approaches to incorporate ESG considerations into the decision-making process most effectively. Our approach has therefore been to formulate our ESG policy to take account of this diversity and to empower each investment management team to be responsible for incorporating ESG considerations into their respective investment processes (whether identifying trends, analysing securities (for example, by reference to ESG scores / factor analysis) or in constructing portfolios). As such, the approach to incorporation of ESG considerations adopted by each investment team may differ accordingly, but we believe this is the best way to ensure meaningful and genuine integration of ESG aspects into each investment process for the ultimate benefit of the funds we manage.
In addition to its firm-wide policy, each investment team’s process documentation describes their approach to incorporating ESG considerations into their investment process and investment approach.
We consider our own conduct and culture as an integral and critical part of our commitment to a broader issue of responsibility. By the very nature of its business, Stratton Street must maintain high ethical standards in the conduct of its business and every member of staff is responsible for ensuring that they do just that. We as an organisation are committed to develop our capabilities to support our investment teams in incorporating ESG aspects into their decision-making processes.
We also believe that Stratton Street should strive to offer a stimulating and attractive place to work. Our focus on building a sustainable long-term business that is aligned with its main stakeholders – clients, employees and members – is a good foundation for these efforts. Stratton Street values the differences that a diverse workforce brings and recognises the contribution that such diversity makes to our business. We are part of a group that has a history of providing internships and work experience placements and encourage members of staff to support former interns as they complete their studies and move into the workplace. We encourage and support participation of our employees and members in fund-raising events.
We believe in transparency and reporting as the basis of the trusted relationship between our investment professionals and our clients. Stratton Street is committed to providing infrastructure and reporting which allow our investment teams to strengthen their consideration of ESG aspects over time.
Becoming a signatory of PRI
Andy Seaman, Stratton Street’s CIO, said: “As long-term investors and in line with our long-established culture, we have been mindful of PRI for some time and, having formally implemented an Environmental, Social and Governance Policy, it was a natural next step to become a signatory of PRI to reinforce our commitment to our responsibilities.”
"We are delighted that Stratton Street Capital has joined the PRI and we welcome their recognition of the need to balance returns with sustainability considerations," said PRI CEO Fiona Reynolds, "especially across fixed income, where investors are increasingly recognising the importance of looking at ESG factors."