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Policies

Scope

This Responsible Investing Policy outlines how we approach ESG issues for the investment strategies and portfolios managed by IMCO.

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Key Principles

Policy supports IMCO's mission to provide clients with strategic portfolio construction advice, investment opportunities and products, risk management and client services. This approach is also aligned with IMCO's core values of integrity, public purpose, respect, innovation and continuous improvement and collaboration.

As such, IMCO is a signatory and is committed to the United Nations-backed Principles for Responsible Investment (PRI). The six Principles are:

  • We will incorporate ESG issues into investment analysis and decision-making processes.
  • We will be active owners and incorporate ESG issues into our ownership policies and practices.
  • We will seek appropriate disclosure on ESG issues by the entities in which we invest.
  • We will promote acceptance and implementation of the Principles within the investment industry.
  • We will work together to enhance our effectiveness in implementing the Principles.
  • We will each report on our activities and progress towards implementing the Principles.

IMCO's focus is on delivering the risk-adjusted investment returns that can help clients meet their long-term financial objectives. We consider ESG issues as a part of our management of risk and investment opportunities in a manner that is consistent with our fiduciary duty obligations to our Clients.

ESG Beliefs

The following are IMCO's Investment beliefs on ESG which underpin this policy:

  • ESG issues impact investment returns and risk, and therefore should be integrated within our investment process.
  • Climate change presents both a systemic investment risk and opportunity, and we should consider the potential impacts of the transition to a low-carbon economy and the physical impacts of different climate scenarios.
  • Governance matters and will continue to be central to our investment decision-making and the assessment of companies into which we invest.
  • Diversity and inclusion contribute to long-term sustainable performance and we will integrate diversity and inclusion into our investment process, where possible, and take steps to encourage better practices.
  • The four pillars of IMCO's ESG strategy – Integration, Stewardship, Sustainable Investing and Screening – are designed to improve risk-adjusted investment outcomes for our clients.

IMCO has decided to implement a focused approach to ESG issues and has therefore identified climate change, diversity and inclusion, and governance matters as priority areas to focus on in our investment process.

ESG Considerations Within The Responsible Investing Framework

IMCO defines Responsible Investing as an approach that incorporates ESG considerations into the investment process, to better manage risk and generate sustainable, long-term returns.

IMCO recognizes that there is a broad set of ESG issues that are increasingly material and important (please see the table for examples).

Environmental (E)

Issues relating to the quality and functioning of the natural environment and natural systems.

  • Climate change
  • Energy
  • Water
  • Waste and pollution
  • Biodiversity

Social (S)

Issues relating to the rights, well-being and interests of people and communities.

  • Diversity and inclusion
  • Health and safety
  • Human rights
  • Human capital
  • Supply chain management

Governance (G)

Issues relating to the governance of companies and other investee entities.

  • Board structure, diversity, and independence
  • Business ethics
  • Cybersecurity
  • Executive compensation
  • Accounting and audit quality
  • Risk management

ESG Pillars

IMCO has decided to implement a focused approach to ESG issues and has therefore identified climate change, diversity and inclusion, and governance matters as priority areas to focus on in our investment process.

Integration
Diversity and inclusion (D&I) can contribute to better idea generation and outcomes.
ESG issues can impact investment returns and risk and therefore are integrated into our investment considerations. The degree of relevance, or materiality varies, as does the current state of integration across asset classes. ESG practices and performance are considered in the evaluation, selection and ongoing monitoring of external investment managers. IMCO will continuously review, evolve, and improve our ESG practices.
IMCO will take steps to identify and manage climate change risks and opportunities with the aim of managing risk and enhancing long-term risk-adjusted returns. This includes improving processes around governance and strategy to manage climate-related risks and opportunities in line with the Task Force on Climate-Related Financial Disclosures (TCFD)i recommendations.
Good governance enhances corporate performance and IMCO will consistently assess governance considerations across the investment value chain and encourage best practices.
Diversity and inclusion (D&I) can contribute to better idea generation and outcomes. We will ensure our investment decisions include D&I considerations and encourage best D&I practices among our managers and investee companies.
Stewardship
We will monitor and engage on material ESG issues with entities in which we invest.
IMCO believes that stewardship helps us better manage risk and contributes to long-term sustainable value. We aim to use our influence to promote strong ESG practices, whether through direct engagement with portfolio companies and external managers, proxy voting or collaborative engagement with our peers.

Please view our Stewardship Guideline here.
Sustainable Investing
IMCO believes that navigating longer‐term sustainable trends is likely to lead to improved risk management
IMCO believes that navigating longer-term sustainable trends and investing in companies delivering solutions to environmental and social challenges is likely to lead to improved risk management and new investment opportunities. As such, IMCO will research and consider sustainable investing opportunities that benefit from powerful trends and have a positive impact on society. Additionally, IMCO recognizes potential investment opportunities available in a transition to a low-carbon economy and supports the UN Sustainable Development Goalsii and will therefore give consideration to them, where applicable, in our investment process.
Screening
We will implement a robust screening framework that strives for results.
IMCO recognizes the importance of considering ESG related risks in the investment management process, including the requirement to screen companies for misalignment with IMCO's and our clients' core missions, values and risk and return criteria. We will implement a robust screening framework that strives for research- based, repeatable, and defensible results.

Please view our expanded Screening Guideline here.

Transparency and Reporting

We are committed to reporting on our responsible investing activities.

Consistent with IMCO's expectation of disclosure on ESG practices and performance from the entities in which we invest, we are committed to reporting on our responsible investing activities to our clients and providing information publicly on our approach.

Responsible Investing

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