WealthSelect Sustainable Active 5 Responsible investment report

WealthSelect Sustainable Active 5 Responsible investment report Quarter 1 2022 This report is designed to help you review the ESG and responsible investing credentials of the portfolio and measure how the portfolio is achieving its objectives. The WealthSelect Sustainable Active 5 portfolio aims to achieve capital growth over a period of five years or more, whilst seeking to support sustainable solutions to environmental and social challenges that help to achieve the objectives of the UN Sustainable Development Goals. The Environmental, Social, and Governance (“ESG”) risks of the portfolio will be managed and exposure to unsustainable activities minimised while maintaining a smaller carbon footprint than the reference index. The portfolio will have exposure to a diversified range of investments in the UK and globally and will invest a substantial portion of its assets in funds that target a broad range of sustainable outcomes, and which are leaders in the integration and management of ESG factors, with exceptions where necessary to achieve an appropriately diversified portfolio. Please see the portfolio factsheet for the full objective. What is responsible investment and ESG? Responsible investment is defined by the UN - backed Principles for Responsible Investment (PRI) as “ a strategy or practice th at incorporates environmental, social and governance (ESG) factors into investment decisions and owners hip activity.” Environmental factors include issues such as climate change and resource scarcity, social facto rs look at people and relati onship aspects such as human rights and labour standards, and governance factors look at a firm’s posit ion on issues such as bri bery and corruption, and lobbying or political contributions. How do we measure the portfolio's responsible investment attributes? When managing and analysing the portfolios we need to have a suitable reference point for the portf olio’s carbon footprint. We use the MSCI All Country World Index as our reference index. The MSCI All Countries World Index is simil ar to the FTSE 100 Index in the UK, but it represents an average portfolio of global equities. More information on our investment ap proach and how different ESG factors are measured and calculated can be found in our ‘Guide to our responsible investment calcula tions’ at platform.quilter.com/wealthselect/guidetoRI . What is sustainable investment and is it different? Sustainable investment is more than just taking ESG factors into account in investment decisions, i t’s about looking for inv estments that are proactively doing good. For this we have used the UN Sustainable Development Goals to help guide us. The UN Sustainable Development Goals are a blueprint to achieve a better and more sustainable futur e for all. They address t he global challenges we face, including poverty, inequality, climate change, environmental degradation, peace and justice. You’l l see them referenced in places in this document. At the same time, we also try to avoid investing in things that are unsustainable. We want to activ ely avoid companies invol ved in areas such as the manufacture of controversial weapons, and tobacco production.