We understand that a company’s approach to ESG factors may result in not only downside risks or upside opportunities but may also impact the wider community and the environment.
We fully integrate responsible investment into the investment process, by considering ESG factors within the same framework that all investment risks and opportunities (operational, financial and valuational) are considered. Hence, integration of ESG factors in each investment case is best achieved by the investment team and not by a siloed ESG team.
In each prospective investment we look for acceptable standards of both corporate behaviour and disclosure, and a pathway to continual, sustainable improvement. In instances where we believe a company demonstrates wilful disregard for ESG principles and no credible plans to improve, we may choose to avoid or divest.
We combine quantitative benchmarking with a pragmatic, case by case qualitative approach to assessing individual corporate ESG performance.
In a quantitative sense, ESG inputs and ranks are fully integrated into the investment process via screens, research notes and portfolio scores. This includes company-level measurements of greenhouse gas emissions to understand and benchmark the carbon intensity of our portfolios.
Companies whose primary business comprises the manufacture, production or distribution of goods and services that are considered harmful to human health and wellbeing are excluded from portfolios, e.g. tobacco.
Defence contractors are assessed according to their involvement in controversial weapons (using the Sustainalytics definition of controversial weapons, which includes anti-personnel mines, biological and chemical weapons, cluster weapons, nuclear weapons, depleted uranium and white phosphorus), specifically the manufacture of the armaments themselves rather than any associated delivery systems. Companies involved in manufacturing such weapons will be excluded from portfolios except where divestment of these activities is either announced or likely within a reasonable timeframe.
Power utilities that may score poorly on a backwards looking carbon intensity basis that are investing in renewable capacity will be considered as part of the long-term decarbonisation solution for the economy. For power utilities, we would typically expect <35% of revenue exposure to power derived from coal and rising exposure to renewable sources as a prerequisite for inclusion.
Corporate engagement is a fundamental tool for responsible investment.
As part of Antipodes’ standard investment process we generally meet with the management of prospective investee companies before an initial investment is made. This improves transparency and opens communication between Antipodes and investee companies.
Where relevant we will constructively engage with candidate and investee companies. For example, where a company’s current performance is not reflective of its long-term potential or its strategy does not encompass appropriate risk management, we will aim to effect positive change. If our engagement proves futile, we may look to avoid or divest from the company.
We are active owners and thoroughly consider all proposed resolutions prior to voting at company AGMs and EGMs. In addition to conducting our own analysis, we also subscribe to Institutional Shareholder Services (ISS) for proxy voting guidance.
Reporting and transparency
Antipodes seeks to conduct its operations with utmost respect for the environment, to be socially minded and adhere to a robust and transparent governance framework. We aim to achieve the dual mandate of delivering investment excellence for our clients, while demonstrating the highest standards of corporate citizenship.
Each quarter we publish a review of ESG issues that have emerged throughout the year, detailing examples of both positive and negative ESG activities within our portfolio or in stocks under consideration. The ESG & Engagement Report details our active social involvement, portfolio carbon intensity and highlights our proxy voting and corporate engagement with investee companies.
Antipodes is a signatory to the UN-supported Principles for Responsible Investing (PRI). The PRI promotes the inclusion of ESG factors into investment and ownership decisions and measures progress towards this goal. We are also an investor signatory to the CDP (formerly the Carbon Disclosure Project), a global carbon, water and forestry disclosure program. Our CDP membership recognises our commitment to engaging with companies on environmental issues. Similarly, the Transition Pathway Initiative (TPI), whom we support, measures and reports on the ability of companies to address climate risks in their business models and transition towards the 2015 Paris Agreement commitments. We are also a partner of the Evergreen Responsible Investment Grading Index (ERIG Index), an independent grading system developed by Evergreen Consultants that scores managed funds across the responsible investment spectrum, and compares funds to their sector averages.
“For our investors – integrating responsible investment into our investment process will be a defining requirement for the next decade.”
Owen Scarrott, Senior Investment and ESG Analyst
As well as holding companies to account with respect to sound ESG practices, we seek to conduct our own business operations with the utmost respect for the environment, to be socially minded and adhere to a robust and transparent governance framework.
From an environmental perspective, we pay carbon credits for all business travel flights. We also purchase “green” office stationery products where possible, and support recycling initiatives. As a business, we support the ongoing training and education of employees. We also encourage wellness and participation in community and/ or charitable causes. We have a strict policy of putting client interests ahead of our own, with staff remuneration tied to client outcomes.
Pro bono activities
Antipodes is proud to be one of the founding fund managers of Future Generation Global (ASX:FGG), Australia’s first internationally focussed, charitable listed investment company. FGG seeks to provide shareholders with diversified exposure to selected global fund managers while changing the lives of young Australians who are affected by mental ill health. As a pro bono fund manager, we do not charge management or performance fees, allowing FGG to invest 1% of assets to its supported charities each year. Since inception in 2015, Antipodes have foregone an estimated $1.9m in management and performance fees, which has contributed to Future Generation in donating $14m to charities focused on youth mental health across Australia.
Together with the PNI Foundation we have forged a long-term partnership with ReachOut Australia. ReachOut is the country’s leading online, mental health organisation dedicated to offering practical support to young people and their parents. Designed by experts, ReachOut’s website helps families navigate the often-traumatic path through teenage years. The site is accessed by 132,000 Australians every month and Antipodes is enabling the charity to provide appropriate content and tools based on real-time events via a range of online support and referral services.
In the wake of the 2019-2020 Australian bushfires, Antipodes employees decided to contribute to the recovery and regeneration of wild spaces that had been impacted by the bushfires. We chose to direct our bushfire relief efforts to South Endeavour Trust, an independent, not for profit, charitable trust that owns and manages ten conservation reserves across eastern Australia. Seven out of eight of South Endeavour’s New South Wales reserves were impacted by the fires and a lot of work will need to be done to help protect the land from feral animal and weed invasion while it recovers. Our contribution has allowed South Endeavour to provide six months of feral animal and weed invasion control at their Bezzants Lease reserve.
Our Workplace Giving Program
All employees are encouraged to make donations to any charity of choice via pre-tax payroll deductions. Antipodes matches employee donations and pays all associated administration costs.
To all the people who haven’t got any help, I know it can be really challenging reaching out and getting help, and it can be scary as well, but I honestly think it can change your life, and it can save you. It can really save your life. I know for me if I didn’t reach out and if I didn’t get help, I don’t know where I would be today.”
Roxy, 24 years old
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Established in 2015 by Jacob Mitchell, Antipodes is an award-winning investment team that specialises in global and emerging markets shares.Read more >