ESG Criteria: Positive Integration
Some of the positive ESG qualities Trillium seeks in a company include:*
Environmental
- Limits harmful pollutants and chemicals
- Responsible raw material management
- Actively lowers greenhouse gas emissions
- Utilizes renewable energy sources
Social
- Pays employees fair wage
- Deploys a robust human capital management strategy
- Encourages diversity and inclusion
- Supports LGBTQ rights
- Operates an ethical supply chain
Governance
- Strives to have a diverse board
- Values separation of CEO role from board chair
- Pays executives reasonable wages
- Dedicated to corporate transparency
* This is not an extensive list of the positive criteria analyzed during the research process
Exclusionary Screening

While much of Trillium’s ESG integration focuses on attributes we positively seek in investee companies, exclusionary screening remains an important tool to aid in managing exposure to risk and adherence to our investing principles, as well as part of our efforts to align with clients’ values and investing preferences. We periodically review our exclusionary screen coverage and methodology in effort to ensure the screens account for current societal, regulatory, scientific, or other norms.

Agricultural Biotechnology
Trillium excludes companies which earn 5% or more of revenues from genetic engineering business activities related to agriculture. The screen specifically applies to agricultural companies directly involved in the production of genetically modified organisms, and does not include food retailers, food producers or manufacturers of food ingredients.
Casinos and Gaming
Trillium excludes companies which earn 5% or more of revenues from gambling related business activities including operation, support, licensing or ownership. Support specifically relates to companies that provide key products or services fundamental to gambling operations including slot machines, roulette wheels, or lottery terminals, gambling technology and services such as IT maintenance, software design, security or surveillance systems, lottery ticket printing, credit lines, and casino management and consultation.
Coal Mining
Trillium excludes companies that earn 5% or more of revenues directly from coal mining. The screen does not include service companies or equipment manufacturers.
Hard Rock Mining
Trillium excludes companies that earn 5% or more of revenues directly from mining or quarrying hard rock. The screen does not include service companies or equipment manufacturers.
Pornography
Trillium excludes companies that earn 5% or more of revenues from adult entertainment, including producers, distributors, and retailers.
Private Prisons
Trillium excludes companies that earn 5% or more of revenues from companies that operate private prisons, jails, detention centers or correctional facilities. The screen does not include companies that service or equip these facilities.
Tar Sands & Arctic Drilling
Trillium excludes companies that earn 5% or more of revenues directly from the extraction of tar sands, sometimes known as oil sands. Additionally, Trillium excludes companies that earn 5% or more of revenues directly from Arctic drilling for oil or gas. The screen does not include service companies or equipment manufacturers.
Tobacco
Trillium excludes companies which earn 5% or more of revenues from the production, distribution, licensing, or retailing of tobacco products, such as cigars, cigarettes, e-cigarettes, inhalers, smokeless tobacco, snuff, chewing tobacco, etc. Companies that grow or process raw tobacco leaves are included in the definition. Additionally, Trillium excludes companies that earn 5% or more of revenues from the manufacture and supply of key products necessary for the production of tobacco products.

Weapons and Firearms
Trillium excludes companies which earn 5% or more of revenues from the production of conventional weapons; weapons related support systems and services; weapons systems, components and support systems and services; manufacture of landmines whole systems or components; or the manufacture and retail of civilian firearms and ammunition. Additionally, Trillium has a zero tolerance for companies that earn any revenues from the production of nuclear, biological, or chemical weapons and related systems or components.

Ongoing Screening
In addition to the above screens, we periodically review and restrict companies with major recent or ongoing controversies in areas such as:
- Animal Welfare
- Environment
- Governance
- Human Rights
- Product Safety
Note on fossil fuels:
It is clear the world’s climate is changing at a rapid pace, as human activities pump more greenhouse gas emissions (GHGs) into the atmosphere every year. Trillium acknowledges that no genuine effort to slow or combat climate change can ignore the Energy and Utilities sectors. Investing in companies that do not proactively manage these climate-related risks and opportunities exposes portfolios to unnecessary, material risks. As long-term oriented, sustainability-focused investors, Trillium seeks to invest in companies that seize transition opportunities to move towards a net zero greenhouse gas emission economy, while avoiding those companies not likely to successfully minimize their climate risks.
We look to invest in companies with a business model designed to succeed in a low-carbon economy. At the same time, we avoid investing in companies with the greatest transition risks, namely fossil fuel companies without a transition plan we find credible. We apply this framework to companies in the Energy and Utilities sectors (excluding Utilities companies without power generation), as well as any company deriving 50% or more of revenue from sales to Energy or Utilities companies (excluding Utilities companies without power generation). At a minimum, to be considered for investment, these companies must derive at least 10% current revenue from renewable energy or enabling technology, and no commitments to invest in new fossil fuel exploration, production, storage, transport (excluding distribution), trading, or refining capacity; or new fossil fuel-based power generation without emissions capture.
This approach is in line with our commitment to align our portfolios with a net zero economy, as members of the NetZero Asset Managers Initiative.
Important Information: There is no assurance that impact or investment objectives will be achieved. This is not a recommendation to buy or sell any of the securities mentioned. It should not be assumed that investments in such securities have been or will be profitable. The specific securities were selected on an objective basis and do not represent all of the securities purchased, sold or recommended for advisory clients.

Approach to Investing in Power and Energy
We look to invest in companies with a business model designed to succeed in a low-carbon economy. At the same time, we avoid investing in companies with the greatest transition risks, namely fossil fuel companies without a transition plan we find credible. We apply this framework to companies in the Energy and Utilities sectors (excluding Utilities companies without power generation), as well as any company deriving 50% or more of revenue from sales to Energy or Utilities companies (excluding Utilities companies without power generation). At a minimum, to be considered for investment, these companies must derive at least 10% current revenue from renewable energy or enabling technology and have no commitments to invest in new fossil fuel exploration, production, storage, transport (excluding distribution), trading, or refining capacity, or new fossil fuel-based power generation without emissions capture.
Further characteristics of a credible transition plan could include:
- A higher projected or historical revenue growth rate from renewable energy or enabling technology, as compared to fossil fuel-based revenue;
- Capex plan showing spending on renewable energy or enabling technology;
- Regulatory permit approval for new renewable energy or related projects; or
- Approved Science Based Targets for greenhouse gas emission reduction or time-bound commitment to set Science Based Targets.
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