CARMIGNAC’S APPROACH
OUR ESG THEMES
Climate
We believe that climate change poses an existential threat and is a source of systemic risk for our economies and the financial markets. We expect every investee company to mitigate their impact on the environment and understand climate change impacts on their activities and operations. We encourage them to contribute to the development of a lower carbon economy in line with the goals of the Paris Agreement.Empowerment
Companies cannot successfully operate without appropriately balancing the interests of their stakeholders. We expect our investee companies to value their employees whilst providing a supportive, safe and inclusive environment at work. With regards to customers, the appropriate processes and internal controls should be put in place to ensure customer welfare, enhancing their experience and therefore, their loyalty. We also look for companies to ensure, to the best of their ability, strong human rights standards through their supply chain.Leadership
We believe that a robust leadership underpins the long-term performance and success of any corporation. Whilst there is no one formula to good governance, we expect our investee companies to put in place the appropriate governance structure which will contribute to fostering innovation as well as ensuring strong checks and balances are in place.OUR PROPRIETARY ESG RESEARCH SYSTEM: START
Effective management of ESG factors is inherently linked with long-term performance and risk management. In 2020, Carmignac invested in a significant development enabling more uniform and efficient understanding and integration of ESG factors across all the key investable asset classes: equities, corporate and sovereign bonds. START (System for Tracking and Analysis of a Responsible Trajectory) is a systemised platform aggregating multiple sources of raw ESG data for our proprietary scoring systems for companies and also our Sovereign ESG model, Controversy analysis and SDG alignment.
START provides forward-looking ESG analysis that gives our investment teams the insights they need to make appropriate investment decisions, to best serve our clients’ long-term interests.
OUR OUTCOMES FRAMEWORK
At Carmignac, we strive to identify firms generating positive change based on the Sustainable Development Goals (SDGs) defined by the United Nations. We have identified nine SDGs as ‘investable’, which means that companies in which our funds can invest are able to support progress towards these goals through their products and services.
In this sense, our funds aim to have a sustainable objective investing more than 50% of the fund’s AUM in companies with over 50% of their revenues derived from goods and services positively aligned with at least one of the nine ‘investable’ SDGs by Carmignac:
(1) No Poverty; (2) No Hunger; (3) Good Health and Well Being; (4) Quality Education; (6) Clean Water; (7) Affordable and Clean Energy; (9) Industry, Innovation and Infrastructure; (11) Sustainable Cities and Communities; and (12) Responsible Consumption and Production.
SDG alignment information at company-level is included in our proprietary ESG research system START.
United Nations Sustainable Development Goals
As part of our sustainable investment journey, Carmignac Gestion uses the United Nations Sustainable Development Goals as illustrations of the company Outcomes Framework. The SDG logos, icons, colour wheel and design rights are and remain the property of the United Nations. Carmignac Gestion is a UN PRI signatory but is in no way affiliated with the United Nations. The United Nations did not endorse the content or data behind the SDG logos, icons and colour wheel. All content and data related to each UN SDG are compiled by Carmignac.










OUR SOVEREIGN DEBT MODELS
At Carmignac, we think that it is key to integrate ESG criteria in the monitoring of sovereign bonds as these are globally dominant in asset allocation. While external solutions are slowly being developed, we have chosen to build our own proprietary models in order to ensure ESG integration and to provide material information to our investors. Two models have been developed in the last years:
- A global sovereign ESG risk model, which aims to assess ESG risks faced by developed and emerging countries
- An Emerging Markets -focused model that aims to identify positive ESG trajectories.
OUR ESG INDICATORS USED IN START
We analyse over 30 specific ESG indicators that we have defined as financially material for around 8,000 companies, to which we add controversy data. START allows our teams to add unique human insight and conduct company engagement surrounding these key indicators:
Environment
Social
GOVERNANCE
AFFILIATIONS
As an active owner, Carmignac sees value in both direct and collaborative engagement, and it is the combination of both which leads to the most influential and effective stewardship. It is by joining forces that investors can most effectively influence their investee companies on material ESG issues, including market-wide and systemic risks, and ultimately help improve the functioning of markets.
Membership to affiliations provides different levels of collaboration opportunities and involvement. We provide below an exhaustive list of the affiliations we are part of either as a signatory, supporter or participant.