Glossary
Active ownership
Active shareholders exercise their right to vote or actively engage the companies in which they invest in dialogue, or both. The objective is to promote the growth of a company’s value and to improve its conduct relating to the environment, social issues and corporate governance.
Best-in-class investing
Investing in those companies that perform best in terms of environmental, social and corporate-governance factors within a certain sector.
Corporate governance
The way in which a company is managed and shareholders’ interests are promoted. The remuneration policy for a company’s senior management also falls under corporate governance.
Cleantech
A collective term for investments focused on clean technologies, where the objective is to employ resources and raw materials more cleanly and efficiently.
Sustainable investing
Investing in companies that make sustainable solutions economically viable, whether their motives are financial/economic or idealistic.
Sustainable investment products
Sustainability investment products systematically integrate economic, environmental and social considerations into traditional financial analysis, offering investors a more comprehensive view of companies’ value creation. This assessment partially determines the selection.
Sustainable theme funds
The sustainable theme funds fall within the category of responsible investment products. Sustainable investment funds invest in companies that actively seek to provide solutions to global sustainability challenges. They are determined by long-term megatrends such as demographic changes, resource scarcity and climate change.
Sustainability theme investing
Investing in sustainable companies that enable sustainable and economically viable solutions for certain themes such as energy and water.
ESG
Environmental, social and corporate governance.
ESG integration
Taking corporate policy on environmental, social and governance factors into account when making investment decisions. This leads to an in-depth analysis of companies, better risk management and the ability to identify additional investment opportunities more quickly.
Ethical investing, socially ethical investing, socially responsible investments and green investing
These forms of investing stem from the idealistic motive of wanting to actively contribute towards making the world a better place. Investing in environmental projects/companies and in cultural initiatives falls into this category. These forms of investment are made fiscally more attractive.
Ethical investment products
Idealistic motives determine whether an investment is ethical. The companies concerned are exclusively those that make an active contribution towards creating a better world. Investors in such companies can sometimes benefit from tax advantages.
Tax-efficient investing
A number of green (and cultural) investments also offer tax advantages.
Codes of conduct
By becoming signatories to independent, generally accepted codes of conduct such as the UNPRI, companies have helped establish an evaluation framework for responsible investing.
Product categories
Robeco distinguishes between three groups of investment products: traditional investment products, responsible investment products and ethical investment products. The way in which Robeco categorizes its investment products is prompted by independent assessments carried out by research bureau Sustainalytics.
Risk-return ratio
This is the most important criterion when selecting a specific investment. The following usually applies: the higher the expected return, the higher the level of risk.
SAM
Swiss Robeco subsidiary and sustainable asset manager; fully specialized in integrating sustainable concepts into investment products.
Voting rights
Shareholders’ right to vote at the shareholders’ meeting of a company in which they hold shares; someone else can also vote on a shareholder’s behalf.
Sustainability insight
Insight into long-term corporate risks and opportunities obtained through research into conduct regarding environmental, social and corporate governance factors. Research into trends such as scarcity and demographic change produces social insight and outlooks. These determine which companies will be studied.
Sustainalytics
Sustainalytics is an internationally active research bureau in the field of sustainability focused on delivering research and services to the financial sector. Sustainalytics uses four elements to assess investment products for Robeco. These are ESG integration, active share ownership, exclusion policy and the extent to which the products invest in sustainable themes.
Traditional investment products
Financial/economic performance determines whether a company will be selected for a traditional investment product. The behavior of the company in terms of environmental, social and corporate governance factors has no effect on this choice.
Exclusion policy
This policy prevents investment in controversial products and countries/governments.
Responsible investing
Robeco advocates responsible investing. We believe that this will generate a more responsible risk-return profile for our clients. Robeco implements responsible investing with activities in five interrelated areas.
1. ESG integration
Promoting ESG integration when putting together and managing all investment products.
2. Active ownership
Being an active shareholder and trying to influence the companies in which you invest.
3. Transparency in terms of costs, risk and return
Being open about the risks, costs and returns of investment products. Categorizing products.
4. Investments in sustainable themes
Offering a broad range of sustainable investment products.
5. Responsible operations
Adjusting corporate operations to take into account environmental, social and good governance factors.
Responsible investment products
Apart from selection on the basis of financial economic criteria, ESG integration plays an important part in these investment products, so that environmental, social and governance criteria are structurally taken into account. Also, active ownership is an integral part of the management process.