French fund house Axa Investment Managers has committed to integrate environmental, social, governance factors across its open-ended funds range in 2019.
The move will apply these factors to around €82bn in client assets, adding to the €458bn that it already classes as ESG integrated. Its total assets at the end of 2018 were €730bn.
The company announced the commitment in its 2018 full year earnings today, saying that it was able to make it after strengthening the resources within its investment platforms. It also noted net outflows for the year of €6bn.
Andrea Rossi, chief executive of Axa IM, said: “As a responsible investor, we aim to manage ESG risks and opportunities when investing on behalf of our clients in a consistent way. This is why we are committing to this integration for our clients investing in open-ended vehicles.”
The company said its ESG integration was intended to help manage tail-risks and identify long-term trends. Its policy focuses on material issues such as climate change, health and human capital, while also considering severe controversies as well as low ESG quality.
Companies with a low ESG score, according to Axa IM standards, as well as coal and tar sands producers, tobacco and defence companies along with those that carry out severe breaches of UN Global Compact principles will be excluded from open ended funds.
Rossi said: “Our ESG standards form just one dimension of our approach, and we also plan to enhance our engagement and stewardship to help influence business models of companies to anticipate future changes such as climate change. Our integration approach includes ESG corporate analysis, scoring, voting and also training for all staff.”
Axa IM has also committed to provide its clients with reporting on ESG scoring and the carbon footprint for the vast majority of its funds and will pursue further SRI labelling of some additional strategies in France.