Screening

We encourage our clients to provide us with positive and negative social screens.  Almost all of the portfolios we manage are screened.  Often, clients ask us to apply RBZA’s screens which are based on the idea that the primary reason to apply screens, vote proxies or engage in dialog with companies, is to achieve meaningful improvements in the behavior of companies.

We use our best efforts to avoid purchasing securities issued by companies in industries that are intrinsically unacceptable, like tobacco, weapons of war, handguns, and nuclear power plants, because companies in these industries will not voluntarily go out of business in response to shareholder pressure.  For the rest, we try to pick the best in any industry based on business practices that show respect for an entity’s workers, suppliers, customers, community, natural environment, legal obligations and owners.

Social responsibility practices are analyzed using in house primary research. To supplement our capabilities, we employ third party social research products and services.

Human Rights

Our human rights policy attempts to exclude from our portfolios companies that contribute to genocide in a material way or where domestic or broad-based international constituencies have called for sanctions or divestment. For example, we exclude companies on the Sudan Divestment Task Force list.

ESG factors

In general, the companies we purchase make healthy, useful products and services; have positive relations with their communities; and environmentally sustainable processes. We are conscientious investors who consider environmental, social and governance (ESG) factors useful in identifying fundamentally undervalued companies and in managing risk.

Companies that lead with respect to ESG factors also have the potential to lead with respect to profitability. Our experience indicates that quality companies thrive because they are driven by innovation or have a differential advantage in terms of environmental, workplace, governance or community issues that leads to long term sustainable growth.   We are focused on a company’s attention to climate risk and other environmental factors as sources of risk and opportunity. If a company has embraced global environmental standards and disclosure it is regarded favorably by us. If a company has restructured its product lines to incorporate more healthy living or environmentally sustainable product lines we see it as a potential source of differential advantage in the marketplace. Companies that have enhanced profitability through environmental efficiency or redesign of manufacturing processes to reduce waste are also viewed favorably. If a company lobbies against necessary environmental regulation or has numerous environmental regulatory violations relative to its competitors we consider this a negative factor.

At all times, we are mindful of ESG factors but they neither guarantee nor prevent successful investments. We are first and foremost fiduciaries of the wealth entrusted to us. We have a clear commitment to deliver competitive returns  for our clients.

Shareholder Action

Where shareholder action has potential to be effective, we do not limit purchases to companies that already satisfy the objective (board diversity, CERES principals, monitoring overseas suppliers, etc.). We are reluctant to define a social screen in a way that could seriously impair investment results for the sake of the appearance of purity, although we respect and enable our clients’ ability to reject investments for moral reasons.

In addition, we vote proxies conscientiously when asked to do so. Among other things we vote against stock ownership and option plans that do not include all tenured employees. We vote against boards of directors that do not include at least one woman and one person of color. We vote in favor of most resolutions seeking to limit the compensation of top executives. We also vote for increasing and empowering outside directors, disclosing more information about equal employment.

Click Here for a complete description of our Proxy Voting Guidelines.