Tracing our history to 1928, Wellington Management is one of the world’s largest independent investment management firms. With over USD 1 trillion in client assets under management as of 31 March 2019, we serve as a trusted adviser to clients in over 60 countries. Our fiduciary duty includes understanding material risks or opportunities that may affect our clients’ investments, and we include sustainability in that realm.

 Partner, invest, engage

 Our philosophy regarding sustainability is a holistic “partner, invest, engage” framework. We partner with industry leaders, climate scientists, and academics to understand the structural forces shaping economies and capital markets, provide leadership on asset management, and learn from experts in fields other than our own. We then use those insights to inform our research and investment decisions, in pursuit of better outcomes for our clients. Across our investment platform, we incorporate the principles of stewardship and environmental, social, and corporate governance (ESG). We also offer a dedicated suite of sustainable investment strategies for our clients who are seeking to express their investment intent more directly. These include impact investing, ESG integration and engagement, and thematic approaches focused on climate change or sustainable economic development in emerging markets.

 Finally, ongoing engagement helps us assess ESG risks and opportunities and allows us to positively influence corporate behavior. Because we see material ESG issues as strategic business issues that can affect financial performance, the goal of our stewardship activities — engaging with companies and voting proxies on our clients’ behalf — is to support decisions that we believe will maximize the long-term value of securities we hold in client portfolios.

 Climate science initiative

 One of our key collaborative initiatives is with Woods Hole Research Center (WHRC), the world’s leading independent climate research institute. With the climate scientists at WHRC, we are studying the physical effects of climate change on capital markets. Variables like heat, drought, wildfires, flooding, hurricanes, and water access will affect the value of assets around the world and move prices accordingly. Here again, we believe it our fiduciary duty to understand the physical as well as the transition risks of climate change, and, with that knowledge, be prepared to make investment decisions that are in our clients’ best long-term interests. Through this partnership, we will also be able to raise awareness with company managements about what the science is telling us, and inform and encourage them about investing in resiliency efforts, armed with data that helps support those investments.

 Advancing the UN SDGs

We support the United Nations Sustainable Development Goals (SDGs) through our partnership, investment, and engagement activities, because we believe publicly traded companies can deliver effective, market-based solutions to the problems identified. For a company in our flagship impact strategy, for example, we tag the goal or goals the business aligns with, as well as any of the 169 underlying targets the UN has identified. And while development of our 11 impact themes preceded the UN SDGs, there is a great deal of overlap, as the companies we invest in offer solutions to these social and environmental challenges. We see the UN SDGs as an instructive blueprint that identifies the world’s most pressing problems and continues to inform our research and investment activities.