Delivering Sustainable Investments Since 1982SM

Integration

ESG Factors Can Improve Financial Performance

Trillium believes that companies that adhere to strong positive Environmental, Social and Governance (ESG) policies can increase profitability and develop a competitive edge. We have found that integrating ESG factors into the investment process is the best way to deliver strong long-term, risk adjusted returns to our clients.

Our Approach

Trillium’s investment process is focused on finding companies with strong growth prospects that are attractively priced. Our analysts conduct bottom-up fundamental analysis on the companies they cover, simultaneously reviewing both traditional financial metrics and environmental, social, and governance (ESG) metrics that we believe can add value to the investment process. We do not believe that ESG integration can be successful simply through a process of “screening out” companies after the fact. When our analysts make recommendations to our buy list, they present a synthesized overview of a company that includes all aspects of company performance, including ESG risks and opportunities.

ESG Criteria

Like many investors focused on sustainable and responsible investing (SRI), Trillium’s environmental, social, and governance (ESG) criteria attempt to identify the companies best positioned to deliver strong long term financial performance. For this reason, Trillium’s ESG research is primarily focused on selecting companies that are meeting positive thresholds of performance for ESG issues, such as strong workplace practices, a demonstrated record of producing safe products for consumers, protecting the environment, fair compensation for employees and executives, and respecting and upholding human rights. We look to reward those companies exhibiting best practices in these areas.

In order to reflect the concerns of many SRI investors, Trillium also employs strict exclusionary screens. For example, we will not invest in companies with significant involvement in producing, marketing, or distributing firearms, alcohol, tobacco, gaming, nuclear power, pornography, or military weapons systems. For more information, please download “Trillium’s ESG Criteria”.

Financial Performance

Over time our track record has demonstrated that you do not need to give up returns to pursue Sustainable and Responsible Investing (SRI). We are able to create well-diversified portfolios designed to deliver solid risk-adjusted performance across different market cycles. Our record is backed up by academic literature that shows that positive company performance in certain environmental, social, and governance (ESG) areas, such as environmental performance and workplace practices, correlates with better financial performance. For more information on the academic literature, see: www.fsinsight.org.