At Scotia Global Asset Management, we believe that successful investing is about finding the optimal balance between risk and reward. As dedicated active managers, our investment teams consider a broad range of environmental, social and governance (ESG) factors in their investment processes. The considering of ESG factors provides a fuller perspective on risks and opportunities and helps us realize our ultimate goal: delivering long-term value to investors.
Why ESG investing matters
A better understanding of risk. Integrating ESG factors into the investment process provides a deeper understanding of an investment’s risk profile and its potential value over the long term.
Poor ESG performance can be costly. Major ESG-related issues can expose a company to costly lawsuits and fines, which can negatively impact shareholder value.
Strong ESG performance helps build trust – and shareholder value. Research has shown that companies with strong ESG practices have lower risks, reduced costs and stronger share-price performance versus companies with weak ESG-related practices.
ESG factors: key considerations
How is a company’s business being impacted by increasing risks associated with climate change? Are they exposed to fines or penalties over issues, such as pollution or excessive waste? What efforts have they undertaken to reduce their carbon footprint/environmental impact?
- Climate change
- Greenhouse gas emissions
- Waste and pollution
- Renewable power
How well does a company treat its employees? Are there concerns about human rights violations, lack of diversity or health and safety issues? How well do they safeguard their customers’ data?
- Diversity and inclusion
- Labour standards
- Human rights
- Data protection and privacy
Is the company’s board of directors independent and responsive to shareholder concerns? Is executive compensation aligned with shareholder interests?
- Board independence
- Shareholder rights
- Executive compensation
- Bribery and corruption
Our commitment to ESG
Signatory to the United Nations-supported Principles for Responsible Investment and regularly submits transparency reports to the agency.
Proud member of the Canadian Coalition for Good Governance (CCGG) and serves on the group’s Environmental and Social Committee.
Sustaining member of the Responsible Investment Association, Canada’s membership association for responsible investing.
Proud member of CDP, a not-for-profit that runs a global disclosure system for investors, companies, cities, states and regions to manage their environmental impacts.