Please ensure Javascript is enabled for purposes of website accessibility Sustainable investing at Newton Investment Management
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What does Sustainable investing mean for Newton Investment Management?
 

Newton understands the investments it makes can have far-reaching influence – not just on its clients’ financial prospects, but on environmental and social factors shaping those prospects, such as:
 

  • Climate change
  • Human rights in supply chains
  • Diversity and fairness across workforces.
     

Newton believes the interests of investors, and of society more widely, can be mutually supportive. Reflecting this belief, Newton is an active and engaged owner of financial assets, investing in a manner it believes meets its responsibilities to clients and society as a whole.
 

Newton aims to look at investment prospects from all relevant angles, in search of the widest perspective possible on the investment landscape. Its multidimensional research platform has fundamental, in-house research as a key component, but also includes thematic, ESG-focused, quantitative, geopolitical, forensic accounting, credit, investigative and private-market research. It believes this approach leads to better investment decisions.

 

Newton’s sustainable strategies aim to encourage a better allocation of capital that leads to the generation of sustainable risk-adjusted returns for clients alongside improved long-term global outcomes for society and the environment.

 

 

 

Active engagement at Newton Investment Management
 

Intrinsic to the understanding of the potential of an investment is an appreciation of the quality of the company’s management, its structure, the appropriateness of its internal controls and the assurance that ESG matters are managed to the benefit of long-term investor value. Speaking directly with companies as part of the research process can play a crucial part in helping to achieve this understanding. 

 

Newton believes it is important that investors exercise the ownership rights they have been afforded, and it endeavours to exercise voting rights in all markets. 

 

As a responsible and engaged investor, Newton engages for change where it believes this to be in the best long-term economic interests of its clients. It believes that responsibly managed companies are better placed to achieve sustainable competitive advantage and provide strong long-term growth.

 

Newton's engagement in action - highlights from 2022: 

 

  • Discussed ESG considerations with 161 issuers
  • Exercised clients’ voting rights at 2,872 separate meetings

 

 

 

Newton's approach to net zero

Evidence of the direct link between the human burning of fossil fuels and climate change is all around us, yet despite the increasingly unequivocal science there is a long way to go in the fight to limit the impact of rising temperatures and increasingly frequent volatile weather events on our planet.

 

Despite 196 countries agreeing at COP21 in Paris in 2015 to limit temperature rises to well below 2 degrees Celsius above pre-industrial levels, global carbon emissions have continued to rise. What is clear is that if we are to collectively hit the net-zero target, it will require an extraordinary and global effort by governments, companies and individuals, and asset managers will have a crucial role to play.

 

Newton is a signatory to the Net Zero Asset Managers initiative, an international group of asset managers committed to supporting the goal of net-zero greenhouse-gas emissions by 2050 or sooner.

 

Newton’s approach to net zero is led by science, focusing on real-world emission reductions rather than superficial portfolio decarbonisation. This guides its priorities around focusing on the regions, sectors and companies that are the most carbon-intense.

 

 

Newton net-zero pledge
 

50%
Newton has set an interim target of having 50% of its financed emissions covered by credible transition plans by 2030, and a final target of having 100% of its financed emissions covered by 2040. While all its assets are committed in the long run, this is not a race to align assets under management with net zero, but rather a focus on aligning financed emissions with net-zero pathways

                

100%
of Newton financed emissions to be covered by credible transition plans by 2040 1, 2

 

 

 

What's Newton Investment Management's sustainable investment process?

Sustainable ‘red lines’
 

Newton’s sustainable ‘red lines’ are built on a combination of exclusions that effectively avoid investments in security issuers involved in or that generate a material proportion of revenues from areas of activity that we deem to be harmful from a social and/or environmental perspective.

 

 

WHY NEWTON INVESTMENT MANAGEMENT?

Brought to you by Newton Investment
Management

Solution Focus
Newton's sustainable strategies seek a balance between the current and future needs of stakeholders. They aim to encourage a better allocation of capital that leads to the generation of sustainable risk-adjusted returns for clients alongside improved long-term global outcomes for society and the environment.
Scale
Combined sustainable AUM for the Newton group is €4.1bn (or £3.6bn) across:
Equities
Fixed income
Multi-asset
Real Return
Credentials
Newton Investment Management Limited has been a signatory of the UN Principles for Responsible Investment (PRI) since 2007. It is also a signatory of the UK Stewardship Code, which sets high stewardship standards for asset owners and asset managers.
Commitment in practice

Via its parent company BNY Mellon, Newton has taken various steps to reduce its carbon footprint, such as reducing energy use and related greenhouse-gas emissions, procuring renewable electricity, and using carbon offsets to compensate for the remaining emissions in its footprint. Newton also places sustainability, education and diversity at the core of the projects it sponsors within the wider community.

In-house expertise Newton’s investment managers are supported by a well-resourced, global responsible investment team, comprising subject-matter experts. The responsible investment team guides Newton’s overall sustainability ecosystem and drives its internal frameworks, policies, standards, and specialised insights.

In-house expertise
Newton’s investment managers are supported by a well-resourced, global responsible investment team, comprising subject-matter experts. The responsible investment team guides Newton’s overall sustainability ecosystem and drives its internal frameworks, policies, standards, and specialised insights.
Scale
Credentials
Commitment in practice
In-house expertise
Solution Focus
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Solution Focus

Newton's sustainable strategies seek a balance between the current and future needs of stakeholders. They aim to encourage a better allocation of capital that leads to the generation of sustainable risk-adjusted returns for clients alongside improved long-term global outcomes for society and the environment.

* Source: Newton Investment Management as at 31.03.23. Sustainable AUM is for strategies managed by Newton Investment Management Ltd and is derived using the BNY Mellon Investment Management framework and the definition of 'Sustainable and/or Impact AUM’.

 

 

Associations and Partnerships

Newton Investment Management Ltd signed the UN Principles for Responsible Investment in February 2007, less than a year after they were drafted.

Newton was an early adopter of the Task Force on Climate-related Financial Disclosures (TCFD) recommendations, providing voluntary disclosures in line with these since 2019, prior to them becoming a regulatory requirement.

Newton is a founding supporter of the charity The Centre for Financial Capability, and is a founding member of its ground-breaking collaborative project KickStart Money, which aims to take financial education to almost 20,000 UK primary school children, catalysing a movement to build a savings culture for the future.

Newton is a founding supporter of the charity The Centre for Financial Capability, and is a founding member of its ground-breaking collaborative project KickStart Money, which aims to take financial education to almost 20,000 UK primary school children, catalysing a movement to build a savings culture for the future.

Part of the 100 Black Interns programme, which offers a range of investment internships to black students and recent graduates.

 

In March 2021, Newton joined the Net Zero Asset Managers initiative, demonstrating its commitment to work with clients to help fulfil their net-zero ambitions and to navigate portfolios through the complex energy transitions that are unfolding.

 

 

Newton's Sustainable Fund range

The value of investments can fall. Investors may not get back the amount invested.

 

BNY Mellon Sustainable Global Real Return Fund (EUR)

Fund Managers: Philip Shucksmith, Matthew Brown

BNY Mellon Sustainable Global Dynamic Bond Fund

Fund Managers: Team approach

BNY Mellon Sustainable Global Equity Fund

Fund Managers: Nick Pope, Julianne McHugh, Paul Markham

Meet the team

 

Newton’s dedicated responsible investment team is fully integrated across its investment process, working alongside the group’s conventional financial analysts to help inform investment decisions.

 

 

Resources


 

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For a full list of risks applicable to this fund, please refer to the Prospectus or other offering documents. Please refer to the prospectus, and the KIID before making any investment decisions. Documents are available in English and an official language of the jurisdictions in which the Fund is registered for public sale. Go to fund-centre.

 

BNY Mellon Sustainable Global Dynamic Bond Fund's Benchmark: The Fund will measure its performance against 1 month EURIBOR + 2% per annum (the ""Cash Benchmark""). The Cash Benchmark is used as a target against which to measure the performance of the Fund over 5 years before fees.

EURIBOR is the Euro Interbank Offer Rate and is a reference rate that is constructed from the average interest rate at which Eurozone banks offer unsecured short-term lending on the inter-bank market. The Fund is actively managed, which means the Investment Manager has discretion over the selection of investments, subject to the investment objective and policies disclosed in the Prospectus.
 

BNY Mellon Sustainable Global Real Return Fund's Benchmark:The Fund will measure its performance against 1 month EURIBOR + 4% per annum (the ""Cash Benchmark""). The Cash Benchmark is used as a target against which to measure the performance of the Fund over 5 years before fees.

EURIBOR is the Euro Interbank Offer Rate and is a reference rate that is constructed from the average interest rate at which Eurozone banks offer unsecured short-term lending on the inter-bank market. The Fund is actively managed, which means the Investment Manager has discretion over the selection of investments, subject to the investment objective and policies disclosed in the Prospectus.

 

BNY Mellon Future Earth Fund's benchmark: The Fund will measure its performance against the MSCI AC World NR Index (the ""Benchmark"").

The Fund is actively managed, which means the Investment Manager has absolute discretion to invest outside the Benchmark subject to

the investment objective and policies disclosed in the Prospectus. While the Fund's holdings may include constituents of the Benchmark, the selection of investments and their weightings in the portfolio are not influenced by the Benchmark. The investment strategy does not restrict the extent to which the Investment Manager may deviate from the Benchmark.

 

BNY Mellon Future Food Fund's benchmark: The Fund will measure its performance against the MSCI AC World NR Index (the ""Benchmark"").

The Fund is actively managed, which means the Investment Manager has absolute discretion to invest outside the Benchmark subject to

the investment objective and policies disclosed in the Prospectus. While the Fund's holdings may include constituents of the Benchmark, the selection of investments and their weightings in the portfolio are not influenced by the Benchmark. The investment strategy does not restrict the extent to which the Investment Manager may deviate from the Benchmark.

 

Investment Managers are appointed by BNY Mellon Investment Management EMEA Limited (BNYMIM EMEA), BNY Mellon Fund Managers Limited (BNYMFM), BNY Mellon Fund Management (Luxembourg) S.A. (BNY MFML) or affiliated fund operating companies to undertake portfolio management activities in relation to contracts for products and services entered into by clients with BNYMIM EMEA, BNY MFML or the BNY Mellon funds.

 

Important information

Newton will make investment decisions that are not based solely on ESG considerations. Other attributes of an investment may outweigh ESG considerations when making investment decisions. The way that ESG and sustainability considerations are assessed and the assessment of their suitability for Newton's sustainable strategies may vary depending on the asset class and strategy involved. For Newton’s sustainable strategies, ESG reviews are performed prior to investment for corporate investments (single name equity and fixed income securities). The analysis will then also follow the Newton sustainable investment process to ensure it fits with the wider Newton sustainable investment philosophy.

 

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