Amati AIM VCT | ESG

Amati recognises that managing investments on behalf of clients involves considering a wide set of responsibilities in addition to seeking to maximise financial returns for investors. Industry practice in this area has been evolving rapidly and Amati has been an active participant in seeking to define and strengthen its principles accordingly. This involves both integrating ESGH considerations, including those relating to climate change, into the investment decision-making process as a matter of course, and signing up to major external bodies who are leading influencers in the formation of industry best practice. The following is an outline of the kinds of ESGH considerations that Amati takes into account as part of its investment process:

Environmental - examining issues arising from supply chains, climate change and contamination. Amati looks for management teams who are aware of the issues and are proactive in responding to them.

Social - seeking to avoid unequivocal social negatives, such as profiting from addiction or forced labour and to support positive impacts which will more likely find support from customers and see rising demand.

Governance - examining and, where appropriate, engaging with companies on board membership, remuneration, conflicts of interest such as related party transactions, and business leadership and culture.

Human Rights - adopting and advocating a Clean Trade (http://www.cleantrade.org/) approach, which means avoiding companies that tacitly support the most oppressive regimes and engaging positively with those that uphold Article 1 of the International Covenants on Civil and Political Rights, particularly in relation to the extraction of natural resources.

In terms of external validation and support, Amati was a long-standing Tier 1 signatory to the UK Stewardship Code 2012, and subsequently met the expected standard of reporting against the revised UK Stewardship Code 2020, becoming a signatory in March 2022. Our application to remain signatories in 2023 has been successfully approved. Amati is also a signatory to the UN-supported Principles for Responsible Investment (PRI), which works to support its international network of signatories in incorporating ESG factors into their investment and ownership decisions. The PRI acts in the long-term interests of its signatories, of the financial markets and economies in which they operate, and ultimately of the environment and society as a whole. More recently, Amati became a supporter of the Task Force on Climate-related Financial Disclosures (TCFD), which was created by the Financial Stability Board (FSB) to improve and increase reporting of climate-related financial information.

To see our approach in more detail, please refer to our ESGH (Environmental, Social, Governance & Human Rights) Statement, which is split into two parts. The first part sets out our fundamental principles and investment philosophy, as well as our approach to investing in controversial sectors. The second part explains our newly enhanced approach to ESGH considerations, which involved creating our own Taxonomy in order to capture what we believe is our more nuanced approach to responsible investment. We also took the decision to appoint dedicated personnel to conduct research in this area and to support the fund managers in the integration of these considerations into the investment process.