Julia Dreblow BA Hons, Dip PFS 11 May 2016 For information only. - PowerPoint PPT Presentation

Julia Dreblow BA Hons, Dip PFS 11 May 2016 For information only. sriServices is not authorised to offer advice. This presentation is for use by UK financial services professionals only. Registered company - SRI Consultants Ltd, 03904843

Introduction 1. Overview of ‘SRI’ 2. market & its potential Issues, approaches & 3. ‘SRI Styles’ Suggested advice 4. process Fact finding, fund 5. research & your audit trail Next Steps 6.

Who? sriServices’ aim is to grow  ‘Sustainable, Responsible & Ethical’ Investments  25 years in Financial Services (previously Friends’, UKSIF, NPI) Awarded ‘Highly Commended ’ in the  Corporation of London ‘Sustainable City Awards’ 2015 (Sustainable Finance). Shortlisted in 2016. What? Online specialist SRI information and adviser  friendly tools - Fund EcoMarket & SRI StyleFinder Consultancy, partnerships & media 

Rapid & diverse international expansion  UNPRI ‘s 1000+ signatories, manage over $60 trillion  worldwide Eurosif ‘Engagement and Voting’ assets exceed £1.434 trillion  2015  Impact Investor(.co.uk) c £36bn Worldwide 2014 $3.4 Trillion ‘Divestment’ fossil free campaign 2016  Highest ever retail net ethical fund sales UK   1.2% of total (source: IA) 2015  c£15bn Total FUM EIRIS, 2015 Potential demand c30-50%   43% of people would like to move money away from companies involved in ‘unethical / unsustainable activities’ 34% of investors wanted to ‘ help build a sustainable UK  economy' ... (UKSIF, 2013)  SLI 2015 Millenials research is similar

The diversity of issues makes this area complex to advise on... • Ethical • Social • Environmental • Governance Tesco accounting issues (UK 2014) Rana Plaza disaster (Bangladesh 2013) BP Deepwater Horizon (Gulf of Mexico 2010) . VW governance issues (Germany 2015), Growing water scarcity

Funds approach issues in different ways...  Support  Avoid  Engage ‘Stranded Assets’ risk & the Bank of England (2015) comments. UN Global Development Goals (2015), Divest ‘go fossil free’ campaign, Tesla

 Highlights diversity of investment aims and options ESG Integration  Segments reflect ‘key features’ Responsible Ownership and differentiators Sustainability Theme Ethically Balanced  Areas of ‘crossover’ – ie not always ‘black and white’ or a Negative Ethical single solution Environmental Theme Social Theme  Simplifies identification of Faith Based ethically relevant options  Helps you match ‘what funds do’ to ‘what a client wants’

Total SRI funds – by SRI Style 348 entries Includes funds & corporate strategies Negative This includes Life, Ethical (86) Pension, OEIC, IT Ethically and selected others Balanced (84) Sustainability Total ‘Funds’ 296 Themed (62) see diagram – this Environmental excludes ‘corporate Themed (35) strategy’ listings Faith Based (4) OEICs: 66 18 Global OEIC funds Social Themed (of FEM total: 91) (1) 11 FI / income funds: (of FEM total 46

Of the 44 OEICs Fund EcoMarket has full data on:  36 have sustainability policies  35 have ethical policies  35 avoid arms manufacture  35 avoid tobacco  30 animal welfare policies  28 invest in clean energy / renewables  26 limit exposure to carbon intensive industries  27 have social policies  24 have health/wellbeing policies  24 avoid coal, oil and gas majors  19 strictly screened  14 RSMR rated  6 invest over 50% in large cap holdings  6 Faith friendly

Identify interested clients Are you interested in ethical, social, environmental or faith related issues? Identify key areas of interest eg - issues, approaches, styles Refine SRI research eg - issues, attitudes, other factors Record your findings eg - for reference, compliance & audit trail Integrate this into regular processes eg products, % portfolio, reviews

Ethical / SRI 1. information only ‘SRI StyleFinder ’ Fact 2. Find Questionnaire Fund filter options : 3. Name, Investment Type, Product, SRI Style, SRI Policies, Other SRI Features ‘ Find Adviser ’ button 4. Adviser Support area 5. & links Full report generation 6. for adviser audit trail

“… I think that your site is the missing link for many IFAs who are nervous/anxious about raising ethical investing with their clients. It gives them a process and an audit trail – and I suspect many of those advisers who don’t raise ethical investing with their clients don’t raise the issue because they have no process in place if the client was to say that they did want to invest ethically. This is what happened to me, and it was only because I wanted to offer ethical investing to my clients that I discovered your site through my own research.”

‘How can this area enhance your clients’ experience?’  eg for different groups of clients and interests (charity, pensions) ‘Can you be sure to offer ‘appropriate’ advice without discussing personal values /SRI?’  Adviser ISO, changing values ‘How can this area benefit your business?’  Younger clients, new recruits, changing opinions, trust / reputation... ‘What changes do you need to make for this to be a success for you?’  Initial & supplementary fact finding, research & audit trail, service providers, consider how to ‘mix and match’

Questions welcome! Contact: julia@sriServices.co.uk www.sriServices.co.uk www . FundEcoMarket.co.uk @JuliaDreblow