Morley Fund Management’s socially responsible investment team, manager of Norwich Union’s Sustainable Future fund range, has published its latest Sustainability Matrix.
Morley Fund Management’s socially responsible investment (SRI) team, manager of Norwich Union’s Sustainable Future fund range, has published its latest Sustainability Matrix.
The Matrix rates companies according to social and environmental risks, liabilities and opportunities identified by Morley’s SRI analysts. A company’s product is rated from A to E, and management practices from 1 to 5.
This is the third time the team has published the matrix. As socially responsible issues have become more important to companies in Europe, this year the Morley SRI team has included the Eurotop 50 in its ratings for the first time. This allows for cross-border comparison.
This year the Matrix has highlighted that:
- Most companies disclose information on how they manage social and environmental issues and are now better at understanding how these issues can affect their business
- Generally, European companies are strong on environmental management and reporting, but UK companies have higher standards of corporate governance
- Supermarkets – There is a big difference between the best and worst performers in a sector where the environmental impacts of sourcing and transportation of products from overseas (ie: food miles*) is a key issue. Carrefour (C2), Sainsbury (C2) and Marks & Spencer (C1) do well
- Banks – There has been an improvement in levels of disclosure and reporting from banks. HSBC is the most improved company in the FTSE (up from a C4 two years ago to a C1). RBS (C2) also scores well
- Pharmaceuticals – the highest ratings go to companies developing innovative and life-saving treatments. GlaxoSmithKline is a leader, rated A2
- Oil and gas – Security of supply and the environmental impacts of CO2 emissions are key risks for this sector. BG Group (C2) is a leader with more than 70% of its product mix in natural gas and strong environmental management. Statoil (C2) has lower geopolitical risk as its production is predominantly in Norway. Shell and BP rate D2
- Chemicals – Rising energy costs favour companies with efficient processes to reduce costs and mitigate environmental impacts. Air Liquide (B2) is the leader in this regard. Johnson Matthey is rated B3 for the long-term potential of its products (automotive catalysts and fuel cells) to cut emissions of CO2 and harmful particulates.
Clare Brook, director of socially responsible investment at Morley, said: "We are proud to have published our Matrix ratings for the third time. Few fund managers engage publicly with the largest companies in Europe in this way. The rationale behind publishing the Matrix is to provide a clear and transparent analysis of companies’ social, environmental and governance policies for our clients."
Peter Michaelis, head of SRI at Morley Fund Management and manager of Norwich Union’s Sustainable Future UK Growth Fund, said: “We believe that companies operating in a socially and environmentally responsible manner will be most likely to succeed over time and we have a duty to encourage improved standards of corporate responsibility. By publishing the ratings, we stimulate debate and encourage improved social, environmental and governance practice, which is exactly what our customers are expecting of us as major shareholders.”
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http://www.morleyfm.com/uk/morley/groups/
internet/documents/webasset/pdf_001395.pdf
Norwich Union Press office contact:
David Gwyer 01904 452828 mobile 07800 699508
Morley Press Office contact:
Beth Saint 020 7809 8125
Notes to editors:
*About food miles
Food miles measure the distance a product travels to market. The further away a product is produced, the more food miles it generates. Food miles are an issue for socially responsible investors because much of the produce is transported by air, which is one of the fastest growing producers of carbon dioxide emissions.
About the Sustainability Matrix
Morley Fund Management’s socially responsible investment team produces an annual Sustainability Matrix. The Matrix ranks companies according to social and environmental risks, liabilities and provides a measure of business sustainability.
The Matrix adds another dimension to its fund management style and:
- Encourages companies to improve their social and environmental performance
- Protects and increases shareholder value by adding another analytical tool
- Provides clear analyses of companies’ social and environmental policies
- Raises awareness of corporate social responsibility
The SRI analysts use a Sustainability Matrix to rate stocks on the basis of two key elements:
- Product sustainability (rated from A to E) - assesses the extent to which a company's core business (the products or services it offers) is helpful or harmful to society or the environment.
- Management quality (rated from 1 to 5) – assesses whether a company has appropriate structures, policies and practices in place for managing their social, environmental and governance risks.
Companies that fall within those shaded boxes (green) in the matrix below are deemed appropriate for inclusion in Norwich Union’s Sustainable Future funds. For segregated institutional clients, Morley Fund Management offers the option to broaden their investment universe by lowering the screening requirements or removing them altogether. Specific details on fund exclusion criteria are outlined on the www.morleyfm.com website
Norwich Union’s Sustainable Future fund range is managed by the socially responsible team of Morley Fund Management. The team is led by Peter Michaelis and is one of the largest and most experienced in the UK.
About Norwich Union
Norwich Union is one of the UK's biggest insurers. It is a leading provider of life and pensions products and one of the largest Financial Adviser (FA) providers. FAs provide over 70% of the company's long-term savings business in the UK.
Norwich Union has strategic alliances with building societies and other leading UK brand names including CIS and The Royal Bank of Scotland Group. Norwich Union’s news releases and a selection of images are available from Aviva's internet press centre at www.aviva.com/media.
Morley Fund Management
Morley Fund Management Limited is the UK-based asset management business of Aviva plc. Firms within the Morley group of companies manage Ł147.8bn from offices around the world as at 30 September 2005.
Morley manages both institutional and retail funds under the Morley brand. It also acts as investment manager for a range of retail investment funds, marketed in the UK under the Norwich Union brand, and international funds marketed under the Aviva Funds brand.
Further information about Morley Fund Management can be found at www.morleyfm.com
Morley Fund Management is a business name of Morley Fund Management Limited, registered in England No. 1151805. Registered Office: No. 1 Poultry, London EC2R 8EJ. Authorised and regulated in the UK by the Financial Services Authority and a member of the Investment Management Association.
Morley Fund Management is also a business name of Morley Fund Management International Limited. Both are Aviva companies.
Contact us at Morley Fund Management, No. 1 Poultry, London EC2R 8EJ.
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