Environmental, Social, and Governance (ESG) considerations are ascendant priorities for consumers, policy makers, and corporations. These global ESG megatrends have pecuniary implications for corporate performance. At Causeway, our commitment and approach to ESG are informed by research. We believe that shareholder-friendly corporate governance and sustainable business practices have the potential to contribute positively to a company’s performance over a full market cycle.
Causeway has applied a deliberate approach to integrate ESG in our process. We have provided training to fundamental analysts on ESG issues, built desktop applications to facilitate ESG integration, and instituted accountability for observing integration procedures.
Since becoming a signatory to the United Nations Principles for Responsible Investment (PRI) in 2016, Causeway has conducted programmatic research aimed at identifying key ESG issues, developing a structured and evidence-based understanding of those issues, and mapping out and empirically testing their investment implications. Our research examines both traditional and big unstructured data sets, employing state-of-the-art quantitative and statistical learning techniques combined with deep fundamental knowledge of the economic drivers of investment performance. We have developed proprietary ESG scores that predicted returns in a global equity universe, and maintained out-of-sample efficacy, in back tests. To learn more about Causeway research, click on the resources below.Read our ESG policy (PDF)
Forging an Alpha-Centric Approach to ESG
A discussion of ESG's relation to alpha, incorporating ESG into an investment framework, ways to evaluate managers on ESG, and how the field is evolving.Read More