Understanding impact is a critical part of investment analysis, alongside risk and return. The process combines two proprietary tools to assess both what a company does and how it operates.

The Impact Engine evaluates the intensity of the positive impact generated by a company's products and services, producing an overall impact intensity score for each company assessed.

Fundamental Quality Analysis examines the overall quality of the business: how it manages environmental, social and governance (ESG) factors, the strength of its business model and the quality of its financial management.

Together these two tools determine whether a company qualifies for the portfolio and, if so, how it is weighted relative to others.

Identifying positive impact companies requires an equally rigorous assessment of negative ones. The funds do not invest in companies where more than 5% of revenues derive from alcoholic beverages, cosmetics involving animal testing, gambling, fossil fuel exploration or production, intensive farming, nuclear power generation, pornographic materials, unsustainable timber or weapons.

A zero-revenue threshold applies to a further set of activities. The funds have no exposure to companies involved in the production of tobacco or tobacco alternatives, the development or production of nuclear weapons, or the development or production of biological and chemical weapons, depleted uranium ammunition, anti-personnel mines or cluster munitions.

Only around 15% of listed companies meet the positive impact threshold and qualify as candidates for investment.

Download our Ethical Outcomes document detailing our approach to negative impacts >