Sustainability is at the heart of our investment decisions and the way we look after the pension savings of our clients’ pension schemes.
We believe that aside from being the right thing to do for our planet, sustainable investing can lead to better long-term financial and social outcomes for employers, members and stakeholders.
We use the term ‘sustainable investing’ to encompass Environmental, Social and Governance (ESG) issues and related topics.
Back in 2003, we launched our Principles of Ownership, which explain what we expect from the companies we invest in - and what they can expect from us. And since then, we’ve been regularly updating our ESG policies and commitments.
Our net zero plan
Our approach to climate change is driven by our objective to cut real-world emissions.
We have set targets to help us achieve this:
- Halve the carbon footprint of our investment portfolio by 2030, from a 2020 baseline, reaching net zero across portfolios by 2050; and
- Achieve net zero across Fidelity’s own operations by 2030.
Understanding climate change
Our physical and financial futures depend on how quickly we cut real-world carbon emissions. As investors, the biggest impact we can have is through our investment and active ownership.
Jenn-Hui Tan, Global Head of Stewardship and Sustainable Investing, outlines Fidelity’s climate goals and how we plan to get there.
We can’t do it alone, but together we can make a real-world impact.
Sustainability and FutureWise
Our default investment strategy for workplace investing pension schemes, FutureWise, has sustainability built in. The funds it invests in are currently managed by Fidelity and BlackRock, who both received four stars in the Principles for Responsible Investing (PRI) assessment scores 2021 for Investment and Stewardship Policy.
We carefully monitor the funds we offer your employees through our Workplace pensions, and we expect all the fund managers we work with to outline how they engage with companies on ESG issues. As well as this, we require them to measure the effectiveness of their strategy for engaging with companies in terms of how it benefits members of pension schemes and other investors. We also encourage fund management companies to become signatories of the Principles for Responsible Investing (PRI) and the UK Stewardship Code.
How we invest sustainably
We believe that assessing sustainability is part of fundamental investing, and by integrating it into our investment processes, we can gain a complete view of the companies and markets that we monitor.
Through our corporate access, due diligence processes and industry expertise, our investment analysts deliver independent sustainability analysis that is summarised by our proprietary ESG ratings.
These ratings, combined with input from our specialist ESG team, and external analysis and ratings, help ensure we have more knowledge about a company’s ESG performance, and the potential risks and opportunities this poses for investors.
Our active ownership approach
Active ownership is at the core of Fidelity’s approach to sustainable investing. As an active investment manager, we believe that engagement is a much better way for us to drive change, rather than exclusion.
We engage with companies to gain a deeper understanding of their ESG approach and to help improve their management and awareness of sustainability issues. We believe working closely with companies will result in better investment decisions and returns for our clients.
We engaged with over 1,500 companies across the world in 2022
We voted against over 1,100 directors during 2022
Active ownership to drive outcomes, reduce the negative - and improve the positive
Voted at over 3,500 company meetings in 2022
We participate in key industry initiatives and work closely with policymakers and industry groups
Practicing what we preach - our approach to corporate sustainability
We apply the same lens used to evaluate investee companies to our own operations, with sustainability fully incorporated into our business. We are committed to reducing our environmental footprint, adhering to the highest standards of governance, encouraging a positive workplace culture and embracing diversity and inclusion at all levels.
You can find out more in our Sustainable Investing report