Henderson High Income Trust | ESG

The Board believes that integrating environmental, social and governance or (‘ESG’) factors into the investment decision making and ownership practices is an important element in delivering the Company’s investment objective. ESG considerations are a fully integrated component of the investment processes employed by the Fund Manager and the wider investment teams at Janus Henderson. These teams, spanning different geographic markets, operate and are structured in ways that are suited to their respective regions. This means that ESG considerations are embedded in ways that are appropriate to the markets in which the teams invest. They apply their differentiated perspectives, insight and experience to identify sustainable business practices that can generate long-term value.

When employing fundamental security analysis, the Fund Manager takes a long-term view, seeking to identify companies differentiated by their sustainable competitive advantage, strong earnings potential and stakeholder-friendly management teams. As he strives to understand all drivers of company performance, he also strives to understand the risks. An evaluation of environmental, social and governance factors is integral to this.

Governance is a key part of fundamental analysis with good corporate governance supportive of long-term decision-making and investment returns. The interpretation of environmental and social factors can vary in importance depending on the sector and geographic region in which a company operates. Nonetheless, each ESG factor, in addition to the quantitative and qualitative assessments, are important considerations when calculating the opportunity in an investment.

Stewardship is an integral and natural part of Janus Henderson’s long-term, active approach to investment management. Strong ownership practices, such as management engagement and proxy voting, can help protect and enhance long-term shareholder value. Janus Henderson entities support a number of stewardship codes and broader initiatives around the world including being a founder signatory of the UN Principles for Responsible Investment.

The intensive research of the portfolio managers and analysts involves conducting on an annual basis thousands of interviews with senior executives and chairmen of companies throughout the world. These teams naturally develop long-term relationships with the management of firms in which they invest. Should concerns arise over a firm’s practices or performance, they seek to leverage these constructive relationships by engaging with company management or expressing their views through voting on management or shareholder proposals. Escalation of the engagement activities depends upon a company’s individual circumstances.

The Board believes that voting at general meetings is an important aspect of corporate stewardship and a means of signalling shareholder views on board policy, practices and performance. The Board has chosen to delegate responsibility to Janus Henderson for voting the rights attached to the shares held in the Company’s portfolio and the Manager actively votes at shareholder meetings and engages with companies as part of the voting process.

Extensive additional information on the Company’s approach to ESG can be found in the latest annual report

The Manager’s ESG Principles are available on the Janus Henderson website.   

The Company’s appointed investment manager:

• supports the Stewardship Code.
• is a signatory of the Principles for Responsible Investment.