Calvert Research and Management

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Facts & Figures

Inception of sustainability strategy1976
Total AUM (USD)25.965 billion
(as at 30/09/2020)
AUM Responsible Strategies (USD)24.1 billion
(as at 30/09/2020)
% screened-
% ESG integration100%
% engagement100%
% proxy voting100%
Responsible Investment team30*

*Includes individuals who conduct ESG research, quantitative analysis, engagement, proxy voting, and operations/special projects.

 

Ticking Boxes

Firm-wide ESG integration
Impact investingCalvert Green Bond Strategy
PRI Signatory2006
UN Global Compact2001
CDP Signatory2003
UNEPFI Signatory2003
IIGCC SignatoryX
SWESIFX
Funds in HållbarhetsprofilenX
Other memberships Click here to see all other memberships

IN BRIEF

Calvert is a leader in the responsible investing arena and traces its roots to Calvert Investment Management which was formed in 1976 and was a founding signatory to the UN PRI in 2006. Calvert launched their first Responsible Investment strategy in 1982 that divested from companies doing business in apartheid era South Africa. Calvert is a signatory to many ESG initiatives and notably, the Calvert Women’s Principles were also adopted as the UN Women’s Empowerment Principles.

Calvert’s philosophy is to invest in companies that demonstrate positive environmental, social and governance (ESG) performance as we address corporate responsibility and sustainability challenges. Calvert believes that there are long-term societal and financial benefits to an investment philosophy that attaches material weight to these factors.

Calvert’s in-house ESG research team are guided by the proprietary “Calvert Principles” towards the goal of earning competitive investment returns for clients while influencing progress and creating a positive impact on society. Research focuses on identifying the financially material ESG risks to which issuers are exposed, evaluating management teams’ ability to navigate those risks, and recognising opportunities for companies to improve their ESG performance. Analysts parse thousands of ever-evolving data points to differentiate issuers based on financially material ESG issues, informing both our investment decisions and our corporate engagement efforts.

Calvert has a long history of advocacy and engagement. Through this work, shareholders are able to benefit from companies improving their corporate behavior and operations to provide a net benefit to society. We believe that making these improvements on material ESG issues may not only promote positive change, but also drive shareholder value.

SRI HIGHLIGHTS

Full SRI highlights

Commitment to Sustainability
Calvert has been a leader in in responsible investing for almost 40 years and ESG investing is the sole focus of the company. Incorporating ESG considerations into our investment process is at the heart of what we do. The Calvert Research System (CRS) focuses on identifying the financially material ESG factors that impact companies and allows us to make assessments of how companies are managing the opportunities and risks associated with these ESG factors. The framework for CRS is laid out in Calvert’s Principles for Responsible Investment. Calvert’s Principles seek to ensure that all Calvert’s portfolios are comprised of companies and issuers that exhibit environmental sustainability and resource efficiency, support for equitable societies and human rights and accountable governance and transparent operations.
Engagement Resources

We believe that active engagement is an essential component of responsible investing. We have a record of successfully engaging with companies since 1986 when we became the first investment company to file a shareholder resolution on behalf of an ESG issue (it was on a Labor issue). Over the years, Calvert has achieved many milestones through our engagement work. We view engagement as partnering with companies we invest in to help them improve their operations from an ESG perspective. The purpose of engagement is to make companies better – better at what they do, better places for their employees to work and better long-term investments for our shareholders. Engagement at Calvert consists of direct dialogue with company leadership, proxy voting, filing shareholder resolutions, working with other investors in multi-stakeholder engagements, and working with legislative and regulatory authorities.

Calvert is an active engager, conducting frequent meetings with management, and boards of directors. Our engagement efforts may result in additional uncovering of information about issuers that may be incorporated into the investment process through our use of custom Key Performance Indicators. Calvert believes that long-term ownership entails a responsibility to participate in the governance of the firms that we hold in our portfolios. By engaging with corporations, which have great financial power relative to other stakeholders, Calvert can help to address critical issues that matter to clients, companies, and society.

Calvert employs five full-time dedicated ESG engagement professionals including a Director of Corporate Engagement, an Engagement Manager, a Corporate Engagement Specialist, an Engagement Analyst/Proxy Specialist and an Associate. From October 2019 through October 2020, Calvert conducted 132* company engagements via engagement during the research process, proxy voting, direct dialogue with firms, shareholder resolutions and public advocacy.

Examples of Calvert’s engagement priorities are below, although we do engage on other topics consistent with Calvert’s ESG research framework:

•Clean Energy – promote clean energy and energy productivity and reduced air pollution
•Clean Water – reduce corporate exposure to water risk and impacts to water quality
•Diversity – advance women and minorities at board and management levels
•Labor and Human Rights – strengthen performance in company operations and supply chains
•Disclosure – improve disclosure of material environmental, social and governance matters

*Source Calvert Research and Management

ESG Team
The Calvert ESG team is responsible for evaluating investments, and potential index constituents, using the Calvert Principles as a framework.

As at 30 September 2020, Calvert’s ESG Team is composed of a Director of ESG Research, 10 ESG research analysts and two associates, three quantitative product portfolio managers, two quantitative product analysts and two associates, five shareholder engagement professionals and five operations and special projects professionals. Each ESG analyst specializes by sector and has significant experience in ESG analysis and advocacy to determine company eligibility for inclusion in Calvert Funds’ portfolios. The ESG team also undertakes shareholder advocacy and policy initiatives to seek to improve the performance of individual companies and lift standards across entire industries.

Broader Calvert investment teams work in close collaboration with the ESG analysts in evaluating the ESG profile and relative attractiveness of potential investments. The Calvert ESG research team represents the “front line” in evaluating ESG factors. Our ESG staff spends the majority of their time working on ESG research and engagement and advocacy with companies. In addition, some analysts allocate a small portion of their time to certain areas that relate to education on ESG issues and servicing clients with regard to ESG reviews and updates.

Offering Across SRI Spectrum
As at 30 September 2020, Calvert manages approximately US$26 billion in firm-wide assets across 28 specific investment strategies that cover all areas of the global capital markets. Calvert offers a wide range of strategies across asset classes, investment styles and geography to cover the full responsible investment spectrum. Highlights of Calvert’s offering includes active equity, indexed equity, fixed income, alternatives, multi-asset and thematic strategies
Proxy Voting
 Calvert actively exercises proxy voting seeking to advance the environmental, social, and governance practices of companies held in our investment portfolios. We take this responsibility very seriously and are transparent about how and what we vote. Shareholders of a corporation not only have the right to participate in the financial growth and success of their corporation, they also have the right to vote on important matters concerning the company’s policies, practices and governance. Calvert believes that proxy voting is the most direct means by which investors can influence corporate behavior. Calvert casts votes on a company’s shareholder resolutions based on its proxy voting guidelines. We believe all of our clients have a right to know how we are voting company proxies on their behalf; therefore, recent proxy voting decisions for each of the funds we manage are disclosed. Calvert contracts with Institutional Shareholder Services (ISS) for the implementation of its proxy voting guidelines. Calvert reviews its guidelines annually and monitors the implementation of its guidelines by ISS. Certain proxy issues are referred back to Calvert and reviewed by Calvert’s Proxy Administrator and, where appropriate, Calvert’s Proxy Group.

Over the last past proxy season, which ran from 1 July 2019 to 30 June 2020, we voted on 48,685 proposals at 4,524 meetings*. All votes are posted to our website within 72 hours of being cast, and where possible, in advance of the meeting so our clients and the general public can easily see how we voted. You can view our voting record by visiting www.calvert.com/proxy-voting.php.

*Source: Calvert Research and Management and Institutional Shareholder Services as at 30 June 2020.

Exclusions

Calvert does not set thresholds or screen. Instead, we take a holistic view of a company, and examine business involvement in controversial industries on a company-by-company basis. All issuers represented in our portfolios must meet ESG minimum criteria guided by the Calvert Principles for Responsible Investment (“Calvert Principles”).

The Calvert Principles provide a framework for Calvert’s evaluation of investments and guide Calvert’s stewardship on behalf of clients through active engagement with companies and other issuers. The Calvert Principles seek to identify companies and other issuers that operate in a manner that is consistent with or promote:

Environmental sustainability and resource efficiency
Equitable Societies and respect for human rights
Accountable Governance and transparent operations

Through the application of the Calvert Principles, Calvert could have no or limited exposure to issuers that:

•Demonstrate poor management of environmental risks or contribute significantly to local or global environmental problems.
•Demonstrate a pattern of employing forced, compulsory or child labor.
•Exhibit a pattern and practice directly or through the company’s supply chain of human rights violations or are complicit in human rights violations committed by governments or security forces, including those that are under U.S. or international sanction for human rights abuses.
•Exhibit a pattern and practice of violating the rights and protections of Indigenous Peoples.
•Demonstrate poor governance or engage in harmful or unethical business practices.
•Manufacture tobacco products.
•Have significant and direct involvement in the manufacture of alcoholic beverages without taking significant steps to reduce the harmful impact of these products.
•Have significant and direct involvement in gambling or gaming operations without taking significant steps to reduce the harmful impact of these businesses.
•Have significant and direct involvement in the manufacture of civilian handguns and/or automatic weapons marketed to civilians.
•Have significant and direct involvement in the manufacture of military weapons that violate international humanitarian law, including cluster bombs, landmines, biochemical weapons, nuclear weapons, blinding laser weapons, or incendiary weapons.
•Use animals in product testing without countervailing social benefits such as the development of medical treatments to ease human suffering and disease.

Awards & Recognitions
 Calvert won two Pensions for Purpose Content Awards 2020
– Best COVID Thought Leadership – Pandemic Bonds Issue Brief
– Best Social Impact Thought Leadership – The COVID-19 pandemic and the demand for racial justice

John Streur, President and CEO Calvert Research and Management, won the Personality of the Year at the 2020 Environmental Finance IMPACT Awards

2020 Lipper Awards: Calvert was the overall winner in the small investment company category. 

Sustainable Products & Strategies

Core / Impact

Active SRI

Screened

Source & Resources