Zenith rolls out RI classifications
Zenith Investments Partners has completed the rollout of its responsible investment (RI) classifications across 878 funds across its approved product list (APL) which will help advisers select funds best suited for clients’ portfolios seeking to align with environmental, social, governance (ESG) criteria.
Additionally, Zenith’s research team said it used qualitative analysis, rather than relying on manager self-assessment questionnaires which would allow the consultant to examine the robustness of each funds process and test managers to ensure that activity would match any policy guidelines.
Dugald Higgins, head of real assets and listed strategies and chair of Zenith’s Responsible Investment Committee, said: “Each category has varying levels of ESG factor consideration within its investment process.
“Importantly, the classifications go beyond simply identifying which ESG strategies a fund uses, which is essential given many funds combine more than one approach. Instead, the classifications have been applied across all asset classes which allows advisers to identify the level to which any fund incorporates ESG, and not just those funds branded as pursuing responsible, ethical or sustainability aims.”
According to him, Zenith process also showed which sectors tend to prioritise RI and ESG over others.
“Among Zenith-rated funds, listed property and infrastructure as well as unlisted real assets have the largest proportion of funds classed as ‘Integrated’, meaning they expressly take into consideration RI and ESG factors,” he said.
“While Australian and international shares funds did have a large number of funds incorporating RI and ESG factors, just over half of the universe incorporated ESG.
“We feel that is a logical outcome of the process given real estate and infrastructure assets have a long history of incorporating ESG issues, particularly around sustainability.”
Zenith has been chosen by fund managers, according to the Money Management’s “Rate the Raters” part one survey, as the preferred research house, winning the highest ratings for its research methodology, personnel quality, feedback and the most accurate selection of the peer group and sectors, among others.
AUTHOR
Oksana Patron
Recommended for you
Lonsec and SQM Research have highlighted manager selection as a crucial risk for financial advisers when it comes to private market investments, particularly due to the clear performance dispersion.
Macquarie Asset Management has indicated its desire to commit the fast-growing wealth business in Australia by divesting part of its public investment business to Japanese investment bank Nomura.
Australia’s “sophisticated” financial services industry is a magnet for offshore fund managers, according to a global firm.
The latest Morningstar asset manager survey believes ETF providers are likely to retain the market share they have gained from active managers.
