ESG Fund Factsheet

For adviser use only

Edentree Responsible & Sustainable Multi-Asset

Classification: Sustainable
Management style: Active

Introduction

The EdenTree Responsible and Sustainable Multi-Asset range seeks to provide long-term capital growth and income over five years or more, It does so while applying Edentree’s strict ESG  criteria to the underlying assets.

Name Launch Date IA Sector Portfolio OCF Fund Size (m)
Edentree Responsible and Sustainable Multi-Asset Cautious 01/07/2021 Mixed Investment 20-60% Shares 0.90% £1.5
Edentree Responsible and Sustainable Multi-Asset Balanced 01/07/2021 Mixed Investment 40-85% Shares 0.90% £2.3
Edentree Responsible and Sustainable Multi-Asset Growth 01/07/2021 Mixed Investment 40-85% Shares 0.90% £1.2

About EdenTree

EdenTree are pioneers in responsible and sustainable investing, having launched one of the first ethical equity funds in the UK, in March 1988. They have a 33 year track record in delivering exceptional, long-term results for clients.

Based in the heart of the City of London, their investment team also have some of the longest continuous track records of any in the UK investment community. Today, they have £3.7bn* of assets under management across their range of funds.

*Source Edentree as at December 2021

Assets under management*

£5m

Total Assets under management for the listed funds

*As at 31/10/2022

Screening Process

To be considered suitable for inclusion within Edentree’s range of responsible and sustainably managed funds, an investment idea is assessed against a screening model. There are three parts to this: Ethics/Values, Responsibility/ESG and Sustainability/Thematic.

The ten exclusion criteria which make up the Ethics/ Values portion aim to avoid activities that are harmful to society. Companies that derive more than 10% of their profits or turnover from these activities are excluded from the universe of investible stocks.

They then integrate six areas of business risk (Responsibility/ESG), which are core to the way in which they consider stocks as being suitable for inclusion in the Responsible and Sustainable funds.

Finally, they look at companies from a Sustainability/ Thematic angle. As they screen stock ideas, they consider the positive sustainability case in terms of products and solutions. This is a discretionary part of stock selection, as not all companies provide sustainable solutions.

ESG Process

Edentree employ a process whereby responsible and sustainable factors are fully integrated into the investment management process, with their fund managers and responsible investment team working side by side to generate ideas, analyse opportunities, create meaningful and diversified portfolios and undertake ongoing evaluation.

Engagement

As active fund managers, engaging with investee companies is fundamental to Edentree understanding the risks and challenges they face from an environmental, social and governance (ESG) perspective. Engagement is usually prioritised according to risk factors they identify, and they actively monitor ethical and financial issues as part of their research into companies. We believe that the way they engage with businesses enables them to make sound, responsible investment decisions and to act as a force for change. Edentree form constructive long-term relationships with the companies in which they invest and continue to engage with them after they have invested as part of an active, ongoing monitoring programme. Engagement commences at the investment ideas stage and is intended to either gain information or clarification on key risks, raise concerns and/or raise business standards over time.

Cost

The average OCF over the full range is 0.90%. This above average* for an actively managed Multi-Asset ESG range.

*based on a comparison of the average cost of a range of select multi asset blended ESG funds

Investment Performance

Due to the funds being recently launched they only have a 1 year performance record. Over this period all three funds have underperformed the average of their sector peers.

Source FE Analytics, performance from 18/11/2022

Past performance is not a reliable indicator of future performance.

Platform availability

The funds are available on the following platforms:

Advance by Embark Fidelity
Quilter abrdn Elevate
Abrdn Wrap Transact
AEGON Aviva Wrap
Aegon ARC

Supporting documents

Tenet Opinion

The funds have a long track record and established history in the ethical investing space and are run by a very experienced team with access to extensive resources.

The funds list of exclusions are comprehensive and the screening document gives a good level of insight into what would and wouldn’t be acceptable to hold within the portfolio. They would potentially be suitable for clients who wish to exclude a range of different areas from their portfolios on ethical grounds. It’s important however to consult the fund literature to ensure the way the screens are applied aligns with the clients objective.

The performance of the funds over the last year, when compared to their respective sectors has been poor. However it is important to bear in mind that these are broad sectors, and these funds have specific limitations due to the ESG criteria applied within the investment strategy meaning that the performance will be strongly effected by the biases this creates when compared to their peers.

Information approved for Professional Adviser use only and should not be relied upon by private investors (this is not for Retail Clients).