Features & Benefits
With over 25 years of experience managing socially responsible portfolios and an ever increasing client base in diverse socially-screened strategies, Northern Trust offers a breadth of capabilities to build a complete portfolio solution incorporating environmental, social and governance (ESG) factors:
Multiple approaches to incorporating ESG factors into portfolios, such as negative and positive screens, shareholder advocacy, and best-of-sector stock selection.
Passive, active, and tax-efficient investment strategies to maximize investment and social return.
Unique solutions for today's most pressing issues, such as our Sudan Free Portfolio Solutions.
Exposure to global equity and fixed income asset classes and SRI-based universes, such as the Domini 400 Social Index.
Commingled funds and separate accounts for scale, efficiency and customization.
Social Investment Capabilities
We believe socially responsible investing (SRI) can be executed using a variety of approaches to incorporating ESG research within portfolios. Our relationships with leading ESG research providers, such as MSCI ESG, gives us the tools to develop an optimal strategy based on your requirements.
Negative screens exclude companies with involvement in any of the following industries or activities that clients choose to restrict:
|Adult entertainment||Military weapons|
|Animal testing||Poor diversity|
|Environmental destruction||Stem Cell|
Positive screening includes companies with strong performance in any of the following ESG factors that clients choose to emphasize:
|Board Diversity||Firm Diversity|
|Clean Energy||Human rights|
|Charitable Giving||Product Innovation|
|Community Relations||Product Quality|
|Corporate Governance||Product Safety|
|Employee Relations||Product Safety|
|Environmental Policy||Work/Life Benefits|
Best-of-Sector Stock Selection
This approach selects companies with the highest ESG record relative to sector peers. As a result, companies in industries traditionally screened out of SRI portfolios, such as oil and mining, are included in these portfolios. This reduces the sector-bias common in screened portfolios. Best-of-sector stock selection also creates an incentive for other companies within the industry to improve their social and environmental impacts.
Shareholder Advocacy describes investor efforts to submit and vote corporate proxy resolutions as a means of influencing company behavior. This strategy was successful in pressuring corporations to pull out of South Africa. It has also been instrumental in reporting minority hiring practices and improving environmental practices through adoption of the CERES principles (an environmental code of conduct).