There is no set definition, there is no blueprint and there is no universal method when it comes to Socially Responsible Investing (SRI). The plethora of different approaches can make the SRI market seem hard to navigate; however, we believe that our approach and framework are well placed to achieve our clients’ objectives.

Evolution through evaluation

Many investors considering an SRI approach have what we call a ‘dual objective’: achieving their desired target investment return and creating a positive societal impact through their investments. Our approach is designed with this dual objective in mind. When developing our proposition, we focused on listening to our clients about their investment experiences and evaluated their feedback: we took on board what was important to them. Through this, we developed an investment framework that aims to reflect the personal values and sustainability views of our clients.

However, reflecting these values does not mean compromising on performance. Our SRI proposition encompasses the same DNA as our existing and established investment proposition, and has been developed through evolution, and not revolution. It is crucial to us that our SRI framework works in harmony with our core investment principles: growing the real value of our clients’ assets and protecting them in extreme market conditions.

So, how does our framework work?

It encompasses the four pillars detailed in the graphic below:

Psigma SRI framework
Psigma SRI framework

An important feature of our SRI framework is the flexibility and pragmatism provided by the four pillars of our approach. The combination of these four strategies gives us freedom to select the best-in-breed fund managers who, within their specialist field, can achieve our clients’ desired outcomes. We align ourselves with fund managers who are experienced, share a similar philosophy with us and incorporate elements of our framework into their investment process. Once we make our investment selection and allocate to these funds, we undertake regular due diligence to ensure that their underlying holdings continue to correspond with our framework and help us to achieve our clients’ dual objective.

Positive inclusion, not negative exclusion.

We have embedded positive inclusion at the heart of how we construct our SRI portfolios. Although we recognise the importance of minimising financial support for damaging companies and practices, our more active approach requires the underlying investments within our strategies to display the potential for a positive investment contribution, whilst also promoting a positive impact to society. As a result, our positive inclusion approach naturally excludes and limits exposure to undesirable industries and companies by natural deselection.

To find the right solution for a client, understanding the investment process and philosophy is paramount. Different approaches and a raft of terminology make it even more important to dig a little deeper and ensure that a client’s objectives are being met by the investments they hold.

Mike Myers
Investment Manager, Head of Socially Responsible Investing (SRI)


Investment Risks:

If you are in any doubt whether any of the investments contained in this communication are suitable, you should speak to your Investment Director, or take appropriate advice from a professional adviser, such as an accountant, lawyer or Financial Adviser authorised and regulated by the Financial Conduct Authority.

  • The value of investments and the income from them can fall as well as rise. An investor may not get back the amount of money that he/she invests. Past performance is not a guide to future performance.
  • Foreign currency denominated investments are subject to fluctuations in exchange rates that could have a positive or adverse effect on the value of, and income from, the investment.
  • Investors should consult their professional advisers on the possible tax and other consequences of their holding any of the investments contained in this publication.

©2020 Psigma Investment Management. This communication has been approved and issued by Psigma Investment Management. Psigma Investment Management is a trading name of Punter Southall Wealth Limited, which is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales No. 5374633. FCA Registration No. 478840. Registered office: 11 Strand, London WC2N 5HR. A Punter Southall company.

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