Video Script
Hello it's Zehrid Osmani, Portfolio Manager of the Martin Currie Global Portfolio Trust.
Today we're focusing again on ESG, in a previous video we've highlighted our proprietary ESG risk assessments that we're carrying out for every company that we're researching.
These are 52 parameters that we're assessing across governance and sustainability, to ensure that we're putting our clients’ assets on companies that are well-governed and have sustainable business models and to ensure we have a good understanding of the various ESG risks that the companies might be exposed to.
Today we want to focus on the sustainability side and more specifically social risks. On the social risk side, we're assessing things like social impact that companies activities have, social improvements that they're making, but also social exploitation risks and that's the one we want to focus on today.
On the social exploitation risks, we have an additional 22 parameters that we're assessing for every company we research. We're assessing where companies operate, both in terms of activities and geographies. That gives us an assessment of whether companies operate in areas that are at higher risk of social exploitation. We're assessing companies supply chains and suppliers, we want to know whether they know their suppliers, whether they have the right reporting and monitoring processes in place and whether they're actively engaged in improving the supplier standards, in terms of social exploitation
And finally, we're assessing various type of expectations, wage is one, but age is another type of exploitation, that's where we're assessing child labor risk.
We're assessing gender exploitation risk but also racial, ethnic and religious expectation risk and a few other parameters within that.
All of which, to ensure that we are putting our clients’ assets on companies that have a low risk of social exploitation. And the importance of social exploitation is sometimes some investors might be thinking this is something that happens in emerging markets or frontier markets but actually last year we had an example of a company in the market, that was effectively found to be wage exploiting and gender exploiting.
And, this company was effectively based in the UK, so as close to home as a developed market that's nearby. So really, the importance here is that social exploitation risk is something that can happen no matter where a company operates and therefore the importance of being detailed into the analysis to ensure that we have the right assessments in place.
Thank you for listening, it's Zehrid Osmani Portfolio Manager of the Martin Currie Global Portfolio Trust.
Important Legal Information
This information is issued and approved by Franklin Templeton Investment Management Limited (FTIML). It does not constitute investment advice.
The information provided should not be considered a recommendation to purchase or sell any particular security. It should not be assumed that any of the security transactions discussed here were or will prove to be profitable. These opinions are not intended to be a forecast of future events, research, a guarantee of future results or investment advice.
Past performance is not a guide to future returns. The return may increase or decrease as a result of fluctuations in the markets, in currency and/or in the portfolio.
Market and currency movements may cause the capital value of shares, and the income from them, to fall as well as rise and you may get back less than you invested.
The analysis of Environmental, Social and Governance (ESG) factors form an important part of the investment process and helps inform investment decisions. The strategy does not necessarily target particular sustainability outcomes.
The opinions contained in this document are those of the named manager(s). They may not necessarily represent the views of other Martin Currie managers, strategies or funds.
Shares in investment trusts are traded on a stock market and the share price will fluctuate in accordance with supply and demand and may not reflect the value of underlying net asset value of the shares. The majority of charges will be deducted from the capital of the company. This will constrain capital growth of the company in order to maintain the income streams.