SUSTAINABLE INVESTING

Focusing on stewardship and sustainability to create long-term value for clients

The investment choices we make have a profound effect on the world around us.

At Franklin Templeton, we believe sustainable investing and a focus on environmental, social and governance (ESG) analysis can help us deliver better outcomes for our clients. What’s more, being stewards of our clients’ capital gives us the opportunity to effect real change.

Identifying the ESG indicators that provide material insights not yet captured by the market can allow us to target investments we believe are best positioned to deliver sustainable returns for our clients.

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Jenny Johnson
President and Chief Executive Officer

Creating long-term sustainable value

Sustainable investing can be a vital tool for delivering long-term value to our clients.

At Franklin Templeton, we believe integration of ESG considerations in the investment process can enable stronger investment performance and better client outcomes.

As the ESG landscape continues its rapid transformation, we have a strong firm-wide commitment to be responsible stewards of clients’ assets and aspire to be a global leader in stewardship and sustainability.

Here’s how we think about sustainability:

There is an increasing body of data that points to sustainability as a driver of long-term value creation and portfolio performance.

Part of successful investing is reinforcing sustainable social, environment and governance structures, which create the conditions for issuers to succeed.

To drive the change required for issuers to evolve, investment managers and other shareholders must provide strong engagement and demonstrate active ownership.

Diversity of thinking across our investment teams

As the ESG landscape continues to rapidly adjust, we must maintain our efforts to be ahead of this change, and where possible, help influence it.

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David Sheasby
Head of Stewardship and ESG (Martin Currie) Edinburgh

Our investment teams are incredibly diverse, as are our clients’ sustainability preferences. Our goal is to find innovative solutions that meet our clients’ needs.

We offer the best of both worlds to investors: the strength of our global organization and boutique expertise from our Specialist Investment Managers (SIMs).

Our Stewardship and Sustainability Council brings together our 19 SIMs and represents an unparalleled ability to synthesize and synchronize the breadth of insights across a range of topics.

The Council reflects the diversity and depth of our sustainable investing strategies spanning the major asset classes: equity, fixed income, alternatives and multi-asset. Our SIMs independently evaluate ESG factors from multiple angles, allowing us to provide more innovative sustainability investment solutions to our clients.

Industry collaboration

Franklin Templeton, and our Specialist Investment Managers, collaborate with organizations that promote and establish best practices for incorporating sustainability at issuer and portfolio level. Below we show some of the initiatives we are active in, some independently, and others more broadly across the wider organization.

Sustainable investing is the future of our industry. We need to look ahead to understand the real-world impacts of our investment decisions.

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David Zahn
Head of Sustainable Investment & Europe, Fixed Income London

PRI signatories at Franklin Templeton

Franklin Resources is a signatory to the Principles for Responsible Investment (PRI), the leading global investor network that champions responsible investment.

In addition, our independent specialist investment managers are PRI signatories in their own right, with ClearBridge as the longest serving signatory since 2008. In 2020, several of our specialist investment managers received high grades of A and A+ on key modules of the PRI assessment, ranking ahead of the peer median score in all categories.

Learn more about how our Specialist Investment Managers approach ESG investing here.

Diverse Range of Investment Capabilities

We offer a range of ESG focused investment solutions and vehicles to suit all client needs. We place these in 5 broad categories, reflecting the different motivations and preferences of investors.

ESG Integration

Portfolios that acknowledge the benefit of considering ESG factors

ESG tilted

Portfolios with better characteristics than the broader market

Values driven

Portfolios with social, religious, or environmental screens

Thematic

Portfolios aligned to specific environments or social trends, sectors, or industries

Impact

Portfolios that measure progress against specific environmental and social goals alongside investment returns

Insights and documents

Read about the sustainable investment approaches of our Specialist Investment Managers.

Global citizens

Global citizenship is how we behave as an organization and we are committed to operating at the highest standards of governance and transparency. Embedded in our corporate values is responsible citizenship, which includes ESG. This focus helps to both protect our clients and positively positions our firm for the future.

Read more here

ESG Resources and Policies

Please note that the policy documents shown below refer to Franklin Resources. Equivalent policies for other Specialist Investment Organizations can be found on their respective websites.

Further reading