Ruffer Investment Company | ESG

Our aim is to deliver positive returns, whatever happens in financial markets. Part of this means making an assessment of the risk in all our investments. In our view financial risks/opportunities are inextricably linked to ESG risks/opportunities. Companies that act in a responsible and sustainable manner towards all their stakeholders will make better long term investments.

As a result, in all we do we seek to be responsible investors, fully integrating environmental, social and corporate governance (ESG) considerations into our investment process. We have a dedicated team to oversee both our ESG process and how we engage with companies, and partner with other investors to try to bring about change.

Whether it’s climate change or indigenous rights, executive pay or workforce safety, we believe our considered approach helps us make better decisions. This will result in better outcomes for our shareholders, the companies we invest in and the environment and society.

More details can be found in the attached Responsible Investment policy. 

Our annual Stewardship Report highlights the depth and breadth of our stewardship activities. Our focus on engaging directly with company management has afforded us a deeper understanding of the companies in which we invest. We are able to help and challenge them in a way that would not be possible if we were to invest via exchange traded funds or other pooled vehicles. Our Stewardship Report is submitted each year to the Financial Reporting Council as part of our application to remain signatories to the UK Stewardship Code. 

More details can be found in the attached Stewardship Report. 

We vote on all shareholdings in the companies held within the Ruffer Investment Company.

We take this voting responsibility seriously. We review relevant issues and exercise our judgement, based on our in-depth knowledge of each company. The opportunity to vote enables us to encourage boards and management teams to consider and address areas that we are concerned about, along with those areas that we want to support.

Ruffer has an internal voting policy as well as access to proxy voting research to assist analysts in their assessment of resolutions and the identification of contentious issues. Although we take note of proxy advisers’ voting recommendations, we do not delegate or outsource our stewardship activities when deciding how to vote on our investors’ shares. We have also co-filed shareholder resolutions where we felt this was the most appropriate course of action.

More details can be found in the attached Voting policy. 

Engagement with the companies in which we invest not only gives us an opportunity to deepen our understanding of the business, but it is also an effective tool to achieve lasting and meaningful change. By engaging with a company to achieve specific goals, we are improving our understanding of the material ESG risks it faces, challenging its behaviour in relation to ESG considerations and in turn increasing its awareness of regulatory and societal changes. This is likely to result in superior outcomes and returns for our investors as well as broader stakeholders, the environment and society. Engagement also lets us share our philosophy and approach to investing and corporate governance with a company, and enhances its understanding of our objectives. We will engage independently or in collaboration with other investors, such as through the Climate Action 100+ initiative to which Ruffer was a founding investor signatory. 

More details can be found in the attached Engagement policy. 

Our commitment to reducing carbon emissions applies to:

1. The companies in which we invest
2. The Ruffer group
3. The Ruffer Investment Company

At Ruffer, we believe that environmental, social and governance (ESG) considerations contribute to the risk of an investment and so, to manage this effectively, we incorporate these considerations into our investment process. This is particularly important when the implica­tions of climate change are considered, given the number of companies that are likely to be affected and the variety of ways this is likely to occur. Consequently, Ruffer considers the effects of climate change, including both the risks and the opportunities this presents, for all of our investments.

As the effects of green­house gas emissions are cumulative, persistent and not localised, it is fundamental that this issue is considered in a global context. The response needs to be international, and it must be based on a shared vision of long-term goals and agreement on frameworks that will accelerate action over the next decade.

We believe that it is of utmost importance that the transition begins now. The longer this is delayed, the greater the chance of it occurring in a rushed and disorderly way, which would create additional uncertainty for markets. We agree with the comments of the former Governor of the Bank of England, Mark Carney, who has repeatedly emphasised this potential impact on financial stability.

We are engaging with management at companies that make a significant contribution to global greenhouse gas emissions to encourage them to adapt their business models to align with the transition to a low-carbon economy.

More details can be found in the attached Climate Change Framework and in our Stewardship Report.

Over the past few years, Ruffer has taken steps to ensure we continually assess and manage the impact that our own business has on the environment and society, just as we do for the companies in which we invest. Ruffer has commissioned South Pole to measure the greenhouse gas footprint of our business, with the aim of offsetting our emissions through the purchase of carbon credits. Our employees chose three carbon-offset schemes from which to purchase credits, including a forestry project in Scotland and a rainforest and biodiversity protection programme in Peru. We have purchased carbon credits to offset our greenhouse gas emissions since 2017 and secured Climate Neutral certificates for those years. We are also in the process of implementing our carbon-reduction policy.

The Enivronmental Policy of the Ruffer Investment Company is disclosed in our Annual Report.

Ruffer became a signatory to the Principles for Responsible Investment (PRI) in January 2016 to demonstrate our commitment to integrating ESG into our investment approach.

In 2020, we were delighted to maintain our A+ score for strategy and governance and our A scores in listed equity incorporation and active ownership.

Ruffer became a supporter of the Task Force on Climate-related Financial Disclosures (TCFD) in May 2019. We are developing our response to the standards and we are expecting to publish our first TCFD report in 2021.

Ruffer has been a signatory to the UK Stewardship Code since 2012.