We evaluate environmental, social and governance factors as part of our investment research process to help us effectively assess the long-term sustainability and durability of our companies and credits.
We believe that integrating ESG factors as part of our investment process helps us to better manage risk and enhance returns. In-depth, fundamental analysis is at the core of our investment process, and ESG analysis is embedded within each of our equity and fixed income strategies. We consider an ESG factor to be material if it has the potential to impact the enterprise value of a company or credit quality of a bond issuer. Our view is that well-managed, durable businesses are more likely to manage resources efficiently, create value for shareholders and protect creditors over the long-term, in addition to maintaining access to the credit markets.
ESG: embedded within our bottom-up approach
Our team of approximately 50 equity and fixed income investment professionals are responsible for incorporating key ESG criteria into our investment analysis and decision-making process. Each of our investment teams employ a tailored approach that is best suited to their specific strategy, while remaining consistent with our overall investment philosophy and process. We commit ourselves to the careful study of factors that could cause impairment of capital, understanding that if ESG risks are not adequately addressed and mitigated, they may lead us to pass on the investment.
Engagement with companies and issuers is also an important component of our bottom-up, research-driven investment approach. We engage directly with companies and issuers to gain insight into strategy, competitive positioning and durability, as well as the risks and opportunities associated with an investment, which often include ESG considerations.
In addition to integrating ESG across all strategies, for many years we have also offered the capability to customize investment solutions aligned to client-specific ESG goals or screening preferences.
To learn more about our ESG integration, please read our IM ESG Position Statement, IM Engagement Statement and Sustainable BBH report.
Investors should be able to withstand short-term fluctuations in the equity markets and fixed income markets in return for potentially higher returns over the long term. The value of portfolios changes every day and can be affected by changes in interest rates, general market conditions and other political, social and economic developments.A concentrated portfolio can increase the potential for greater price fluctuation. There is no assurance the investment objective will be achieved. Brown Brothers Harriman & Co. (“BBH”) may be used as a generic term to reference the company as a whole and/or its various subsidiaries generally. This material and any products or services may be issued or provided in multiple jurisdictions by duly authorized and regulated subsidiaries. This material is for general information and reference purposes only and does not constitute legal, tax or investment advice and is not intended as an offer to sell, or a solicitation to buy securities, services or investment products. Any reference to tax matters is not intended to be used, and may not be used, for purposes of avoiding penalties under the U.S. Internal Revenue Code, or other applicable tax regimes, or for promotion, marketing or recommendation to third parties. All information has been obtained from sources believed to be reliable, but accuracy is not guaranteed, and reliance should not be placed on the information presented. This material may not be reproduced, copied or transmitted, or any of the content disclosed to third parties, without the permission of BBH. All trademarks and service marks included are the property of BBH or their respective owners. © Brown Brothers Harriman & Co. 2020. All rights reserved.