Henderson believed the audit would demonstrate that an active approach to SRI not only delivers financial returns, but can also bring environmental benefits for investors. The detailed company-by-company analysis of the fund’s holdings also helps to show how investment choices between alternative stock ideas can affect the fund’s carbon performance. Finally, the audit also contributes to Henderson’s goal of constantly improving the transparency of their SRI funds, both in financial and environmental terms.
Trucost found that the Global Care Income fund was 32% less carbon intensive than its benchmark. Underweight positions in Mining and Oil & Gas made the largest positive impact on the fund’s carbon intensity, while an over-weight position in Utilities had the biggest negative impact. This analysis only addresses the operational emissions generated by the companies in the portfolio; it does not calculate the emissions associated with a company’s goods and services. Substantial emissions are generated from the consumption of oil, gas and coal sold by British companies, which is not included in this analysis. The fund’s significant under-weight position in these sectors means that the fund has limited exposure to regulatory measures being taken to reduce consumption of these carbon intensive fuels.