Fidelity International has revised its sustainable investing framework to adjust to an “evolving” landscape, in line with client requirements and environmental, social and governance (ESG) regulations.
Fidelity said sustainability is an important component of its active investment approach.
It incorporates sustainability as part of its “fundamental investment research”.
The framework has been designed to complement the firm’s overall investment approach and enhance clarity and transparency for its clients.
It includes the addition of three new categories:
- ESG Unconstrained, which includes products that aim to generate financial returns and may, or may not, integrate ESG risks and opportunities into the investment process.
- ESG Tilt, which includes products that aim to generate financial returns and promote environmental and social characteristics through a tilt towards issuers with stronger ESG performance than the product’s benchmark or investment universe.
- ESG Target, which includes products that aim to generate financial returns and have ESG or sustainability as a key investment focus or objective, such as investing in ESG leaders (issuers with higher ESG ratings), sustainable investments, a sustainable theme (such as climate or transition investment) or meeting impact investing standards.
Fidelity International chief sustainability officer Jenn-Hui Tan said: “We have long been committed to sustainable investing and have continued to evolve our approach and capabilities in line with client requirements and ESG regulations.
“The integration of sustainability into investment research and portfolio construction is part of our fundamental process to identify the drivers of long-term value creation.
“Our revised framework aims to facilitate the creation and maintenance of a consistent, transparent and practical range of investment capabilities that meet evolving client and regulatory needs.
“We believe this framework balances a robust approach to sustainability with a flexible approach that can accommodate different investment styles, asset classes and client preferences.”
