Acadian ESG

ESG at Acadian

Spotlight

 
Acadian Responsible Investing ESG

PHILOSOPHY

We believe that environmental, social, and governance (ESG) issues are highly relevant to successful investing. To this end, we have implemented responsible investing concepts in our core process since the 1990s. We were the first quantitative investment firm to sign the PRI (Principles for Responsible Investment) in 2009.
Acadian’s philosophy is that the stocks likely to generate the best risk-adjusted returns are characterized by strong financial health, solid business prospects and favorable management quality. Our investment process develops a fundamental view of a company that combines traditional investment factors with non-financial signals, including those related to ESG.
ESG PRI Scores 2020 Acadian

PRI Scores: A+ in Strategy & Governance; Incorporation

In 2020, Acadian was awarded “A+” ratings on Strategy & Governance and Incorporation by the PRI. Additionally, we received an “A” rating on Active Ownership, underscoring our leadership and innovation in shareholder advocacy, which we believe is the next frontier of sustainable quantitative asset management.
Windmill ESG 01

PROCESS

Acadian wholly incorporates ESG investing throughout our investment process across several frameworks.

Data:
We gather data through third-party ESG data sources, but the majority of our ESG signals are sourced throughout internal and proprietary data. Acadian utilizes data science practices to develop coverage across our 42,500-stock universe, and we employ modern tools such as textual analysis, imputation techniques, machine learning, data scraping, and direct engagement to develop proprietary coverage. This enables us to augment coverage where disclosure is missing and to develop a holistic view of both bottom-up and top-down opportunities.

Integration:
We integrate ESG factors into our core investment process along each dimension (E, S, and G), and we hold our ESG factors to strict standards to ensure they are material in an investment context.

Active ownership:
We are an active steward of the capital we invest and believe that this is a key pillar of the future of asset management and that advocacy, when done properly, not only enables a better class of investable securities, but also improves data for better insights and alpha generation. We demonstrate our active ownership through both proxy voting and engagement.

Governance & Reporting:
We provide extensive ESG reporting to our clients, including regular updates on portfolio characteristics, proxy voting, and engagement practices.
SUSTAINABLE PORTFOLIOS

SUSTAINABLE PORTFOLIOS

Acadian has a long history of integrating sustainable considerations throughout our investment process. We use our quantitative tools and expertise to assist in defining, implementing, and assessing the impact of these considerations on financial performance. Our sophisticated and flexible quantitative portfolio construction process, combined with a large investment universe and proprietarily enhanced data coverage, allows for implementation of a wide range of sustainable considerations while managing the consequences for risk and return.
We manage various dedicated sustainable portfolios. We can incorporate ESG issues into our portfolio construction through client-driven ESG screening, restriction lists, active portfolio tilts, and ESG-sensitive proxy voting.

Responsible Investing Overview

Acadian has a long history of integrating sustainable considerations throughout our investment process. We use our quantitative tools and expertise to assist in defining, implementing, and assessing the impact of these considerations on financial performance.

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ESG Acadian Docks

Acadian Australia’s Matt Picone, portfolio manager for our ESG strategies, recently appeared on financial news platform Ausbiz to discuss ESG investing through a quant lens.

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Quick Takes

Brief observations on ESG investing.

Environmental Themes in Commodities Investing: Systematic Macro Perspective on ESG

Acadian’s Director of Client Advisory, Seth Weingram sat down with our lead commodities PM, Mike Ponikiewicz, to discuss environmental and other ESG themes in the context of systematic macro investing.
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U.S. climate policy – anticipation but uncertainty

We highlight potential environmental policy changes in the U.S. under a Biden administration. Given the uncertainty that remains, particularly with yet-to-be-resolved Congressional leadership, we also discuss the importance of a nuanced and dynamic approach to incorporating the impact of environmental policy change when it occurs.
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ESG Investing during the COVID Crisis

We discuss how the crisis has brought attention to many ESG themes and how poor ESG practices have been associated with weaker performance.
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Can Quants Be Engaged Investors?

We believe that as stewards of capital, asset managers have a responsibility to be active owners, and we see engaged ownership as an important worldwide trend.
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Is Carbon Relevant to Your Investments?

While there is no global price on carbon today, we observe that market participants are implicitly applying a carbon tax on high-emitting companies across the globe, albeit at varying rates.
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ESG: Beyond ‘Green-Wishing’

We believe that certain ESG considerations influence corporate success and investment performance, but amid relentless hype and pressure to participate, many approaches have been brought to market that are based on imprecise foundations and rudimentary implementations.

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