CT Responsible Global Emerging Markets Equity Strategy – ESG Profile and Impact Report 2022

Emerging Markets

In an ever-changing and complex world, it is important to hold ourselves accountable and regularly report to our clients, as stewards of their capital, how our investment decisions are impacting key stakeholders across various emerging markets.

In our seventh impact report, we continue to showcase the influence our investments are having within society, through their products and services as well as operations. Our core belief to adopt leading standards means we don’t just share our successes, but also highlight the challenges and report on our engagements to drive change.

To create this report, we delved into a collaborative process with our Responsible Investment team to refine our Sustainable Development Goals (SDG) mapping tool, debating various business models and their genuine linkage to SDGs. The result is a significant increase in positive alignment, as we have demonstrated how various business models within emerging markets help address these goals. It is imperative we understand how our investee companies can benefit from the sustainable structural trends we see shaping our world, ensure they continue to drive change, and are at the forefront of the transition to a better world. We have listed a group of anecdotes of some of that impact on page 5 of the report.

We believe capital can and should drive positive change. This is particularly poignant in our universe, as capital scarcity amplifies the importance of market participants. We utilise the soft power to drive change through engagement and voting, but more importantly we first select companies that are creating positive impacts on the populations within the regions we invest. Our research intensity results in an enhanced focus on maximising both financial and non-financial benefits, through identifying stewards of capital, i.e. companies that are good stewards of shareholder capital who use the capital to build successful sustainable businesses.

Each of our investee companies’ current and future revenue is inherently linked to satisfying various stakeholder needs and wants:

 

  • Their employees, who manufacture and provide services that are needed by the wider society;
  • Resilient supply chains made up of hundreds of SMEs that provide the necessary inputs to manufacturing;
  • Thriving local communities, which provide a healthy and productive workforce that reside in desirable living conditions;
  • Customers that receive sustainable, long-lasting value from the final product or the service that is provided;
  • And of course the environment, by ensuring each company maintains the biological balance and, if possible, improves it directly as well as indirectly

We do not solely think in economic terms to assess development. Rather, we think more holistically around the human development taking place in emerging markets. Development is not purely measured by GDP per capita. It is measured alongside quality of life and the creation of new and improved business models which enable growth, maximise social and environmental capital, and enrich lives.

We hope this report will provide examples on how companies can act as a force for good, as well as help deepen your understanding of our Strategy. As ever, we welcome all feedback, and we thank you for the trust that you place in our Strategy and our team.

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