LifeSight believes in the importance of sustainable investing; it is one of LifeSight’s investment beliefs. We would like to explain this belief and the impact it has on our investments.

Investment policy

 

At LifeSight, investing revolves around three core concepts: return, risk and sustainability. LifeSight is convinced that investments that properly take into account environmental, social and governance aspects (sustainable investments) will generate a better return and a lower risk in the long term compared with investments that do not take this into account. LifeSight also believes that, within its capabilities, it has a responsibility towards society in limiting sustainability risks and thus make a positive contribution to society.

Sustainability risks

 

Sustainable investing is also known as ESG investing. ESG is an abbreviation for Environment, Social and Governance. There are sustainability risks when companies:

  • Insufficiently consider the impact they have on the environment;
  • Do not treat employees and society well;
  • Have not appointed an adequate (independent) board and / or management.

 

LifeSight specifically identified climate as an important issue from a risk/return perspective, the social relevance of the topic, and the available opportunities in the investment portfolio to make a difference.

 

LifeSight mitigates sustainability risks by, in both the short and long term, considering these environmental, social and governance risks – the so-called ESG criteria – in all its investment choices. At the same time, LifeSight also positively contributes to society and a more sustainable world by taking into account these sustainability criteria. The remuneration policy of LifeSight’s board members is not dependent on the integration of sustainability risks in the investment process.

 

In developing the investment policy, LifeSight has currently not explicitly taken into account the full adverse effects of the investment portfolio on sustainability factors. LifeSight has made this decision because of the current lack of internationally recognized standards to adequately assess the full adverse effects of the investment portfolio. However, LifeSight does pay extensive attention to this issue when selecting, monitoring, and evaluating its asset managers.

Stewardship

 

LifeSight expects the companies and governments in which it invests to actively pursue a sustainable society, now and in the near future.

 

As a shareholder, it is possible to encourage companies to become more sustainable. This can be realized, for example, by voting at shareholders’ meetings. Another example is to enter into a dialogue with companies with the aim of changing behavior. We refer to this as ‘engagement’.

 

It can occur that companies that do not deal well with sustainability risks or decline a dialogue and/or do not take sufficient steps to become more sustainable. In that case, the decision may be taken to no longer invest in these companies. We refer to this as ‘exclusion’.

Exclusions (negative selection)

 

LifeSight chooses to exclude investments that violate international standards and human rights of the United Nations (the UNPRI principles & UN Global Compact principles), or when exclusions are required by law (e.g. due to sanctions). Furthermore, LifeSight does not investin companies whose turnover is largely dependent on the production of controversial weapons, tobacco, or thermal coal.

 

In addition, LifeSight analyzes the investment portfolio based on a positive contribution to environmental, social and governance (ESG) aspects. Where possible, LifeSight tries to encourage companies to change if they do not properly deal with these ESG aspects or if they do not take sufficient steps to become more sustainable. However, it can happen that companies decline a dialogue or to change their policy. LifeSight therefore only selects companies that are at least capable of realizing positive change. LifeSight pays specific attention to the climate issue. LifeSight aims to reduce the CO2 emissions of its investment portfolio, as this reduces LifeSight’s exposure to the risks of climate change.

Manager selection

 

LifeSight does not invest itself, but chooses investment funds managed by external, specialized asset managers. The engagement- and voting policy of the asset manager therefore also applies to the investments of LifeSight. LifeSight therefore does not conduct its own engagement with its investments and does not vote at shareholders’ meetings itself.

 

How an asset manager implements the sustainable investment policy, including the voting and engagement policy, is part of LifeSight’s outsourcing policy and is considered in the selection and assessment of external, specialized asset managers. LifeSight ensures that the sustainable investment policy of the outsourcing partners is consistent with the sustainable investment policy of LifeSight.

 

LifeSight expects its asset managers to comply with the legal and regulatory requirements in the field of sustainable investment and periodically monitors the implementation. The asset managers of LifeSight are at least signatories to the UNPRI principles.

 

The asset managers periodically report to LifeSight on the implementation of the engagement- and voting policy. Currently, LifeSight has outsourced its stewardship policy to BlackRock, Northern Trust, Actiam, LGIM, BNY Mellon & Triodos. A description of and insight into the policy and their implementation by these asset managers can be found at:

https://www.actiam.com/en/sustainable-investments/instruments/

https://www.northerntrust.com/australia-newzealand/what-we-do/investment-management/sustainable-investing/proxy-voting-and-engagement

https://www.blackrock.com/corporate/about-us/investment-stewardship#our-responsibility

https://www.lgim.com/uk/en/capabilities/corporate-governance/  

https://www.bnymellonim.com/nl/en/institutional/funds-centre/sustainability-related-disclosures-fund/ 

https://www.triodos-im.com/governance 

Reports

 

LifeSight aims to be fully accountable and transparent on the sustainable investment policy and its implementation. LifeSight therefore monitors its investments extensively on sustainability factors. We provide insight into this in the form of a sustainability report. This report can be downloaded below.