Overview
- Fundamental Input
- Environment
- Social
- Governance
Research is the source of our investment ideas. In conducting research for equity and credit opportunities, Jennison’s investment professionals analyze, as an intrinsic element of our process, the potential risks and opportunities of various factors. These include sustainability factors which are directly linked to investment risks or opportunities and evaluated for their potential to materially affect an investment candidate’s financial prospects or business model.
By integrating sustainability considerations into our investment processes, we are better positioned to identify and address relevant issues early on, paving the way to take timely action.
Sustainability: Investment Implications
Our research leads us to a broad spectrum of companies across different sectors and countries. Each investment idea has a unique set of considerations and the role of environmental, social, and governance factors can vary markedly from one situation to another. There are times when these considerations will be material to a buy or sell decision as well as in calibrating a portfolio weight. There will also be instances when these factors are practically negligible in an investment decision. We utilize our fundamental, bottom-up research to identify the relevance and level of materiality of these issues.
We believe that environmental risk, including climate risk, may be a material consideration for companies. Key issues include:
- Carbon emissions
- Deforestation
- Water risks
- Energy efficiency
Sustainability: Investment Implications
Our research leads us to a broad spectrum of companies across different sectors and countries. Each investment idea has a unique set of considerations and the role of environmental, social, and governance factors can vary markedly from one situation to another. There are times when these considerations will be material to a buy or sell decision as well as in calibrating a portfolio weight. There will also be instances when these factors are practically negligible in an investment decision. We utilize our fundamental, bottom-up research to identify the relevance and level of materiality of these issues.
As employers and providers of products and services, companies perform an essential social function. We believe a company’s ability to maintain trust and strong relationships with its employees and customers is essential to its longevity and ability to create value. Social considerations include:
- Product safety and governance
- Human capital
- Cybersecurity
- Supply chain management
- Labor practices
- Workplace health and safety
Sustainability: Investment Implications
Our research leads us to a broad spectrum of companies across different sectors and countries. Each investment idea has a unique set of considerations and the role of environmental, social, and governance factors can vary markedly from one situation to another. There are times when these considerations will be material to a buy or sell decision as well as in calibrating a portfolio weight. There will also be instances when these factors are practically negligible in an investment decision. We utilize our fundamental, bottom-up research to identify the relevance and level of materiality of these issues.
We believe that good corporate governance is an important driver of the long-term success of a company. With proper oversight, environmental and social concerns should be minimal and dealt with quickly and effectively. Governance issues that we often encounter include:
- Management compensation
- Board structure and composition
- Differential voting rights
- Shareholder rights
Sustainability: Investment Implications
Our research leads us to a broad spectrum of companies across different sectors and countries. Each investment idea has a unique set of considerations and the role of environmental, social, and governance factors can vary markedly from one situation to another. There are times when these considerations will be material to a buy or sell decision as well as in calibrating a portfolio weight. There will also be instances when these factors are practically negligible in an investment decision. We utilize our fundamental, bottom-up research to identify the relevance and level of materiality of these issues.