Philosophy: ESG factors to enhance alpha and mitigate risk
The Global Quantitative Equity team’s philosophy is rooted in a disciplined, data-driven approach to investing. This also applies to the team’s Environmental, Social and Governance (ESG) integration approach. Mission critical for the team is to identify ESG-related factors that they believe enhance alpha and address risks across the market.
The investment team systematically incorporates ESG factors in its stock selection model with the belief that it enables exposure to companies with stronger ESG characteristics and an additional factor to add alpha for the portfolio, as companies that are focused on sustainability typically possess favourable quality characteristics.
How the Mackenzie Global Quantitative Equity Team integrates ESG
The Mackenzie Global Quantitative Equity team follows a 3-step process for integrating ESG into its highly disciplined stock selection process.
Importantly, the team has a capacity to manage the overall portfolio sustainability characteristics subject to the mandate’s ESG guidelines. Depending on the fund, this may include managing the portfolio according to a carbon budget, excluding controversial industries, avoiding companies involved in controversies, etc. The investment team collaborates with Mackenzie Sustainability Centre of Excellence to stay abreast of the growing ESG data landscape and to comply with sustainability requirements from clients.
The Mackenzie Global Quantitative Equity Team’s ESG approach in action
Learn more about the Mackenzie Global Quantitative Equity team’s funds here.
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