
Specialist in Asia Pacific, Japan, China, India and South East Asia and Global Emerging Market equities.
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Specialists in equity portfolios in Asia Pacific, emerging markets, global and sustainable investment strategies
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Our philosophy is very simple. We are constantly searching for high quality businesses and when we acquire them, we will work relentlessly with them to create long-term sustainable value through innovation, ESG-led and proactive asset management.
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- Global Fixed Income
- Global Fixed Income - Responsible Investment
Approach to Responsible Investment
Stewardship and ESG integration
The Global Fixed Income team defines Responsible Investment as an investment process that considers environmental, social and governance indicators alongside traditional indicators of financial performance. Importantly, our process does not implement ethical screens. We consider ESG factors relative to their potential impact on financial performance.
At First Sentier Investors, we maintain that comprehensive credit evaluation extends beyond traditional financial analysis and is the result of a confluence of factors and drivers. We integrate ESG factors into our bottom-up credit analysis process in an effort to better evaluate downside risk and relative value to the market and peer group, and assign an ESG Risk Assessment to all names within our coverage. Using industry-leading quantitative tools such as Sustainlytics, MSCI, and Reprisk, we are able to deeply analyse important sector and idiosyncratic dynamics and risks, to augment our own expertise.
In our process, we view the comparison of ESG policies and the practices of bond issuers as a risk management exercise, making the ESG risk-assessment an integral part of our security selection process. Provided that the ESG analysis is skilful and focused on the potential for events to affect bond prices, we believe the benefits to investors will show up over time.
Because ESG risk-assessment is incorporated into our idea generation stage, all client portfolios benefit from our consideration of these factors. Because product design is done independently from idea generation, clients have the option to further shape their portfolios using ESG factors. These options include negative or positive ESG screens. We can work with clients to incorporate other ESG ideas into their product designs based on their views and requirements.
Assessment and monitoring
Analysts identify ESG risks during their bottom-up credit research. We analyse ESG risks through our own risk framework that results in a proprietary ESG ranking. Analysts consider these risks alongside their own research with reference to a variety of other drivers that frame an assessment of price-focused risk.
The analysis and assessment of ESG issues within a company helps identify sources of risk which may not be fully captured by its financial statements. These factors, along with our other relative-value focused drivers, allows us to further articulate our view of default risk than the balance sheet might otherwise imply. The result is a more articulated view of RV-return in identifying mispriced risk spreads in the market.

Engagement
We attempt to engage with issuers’ senior management teams to better understand ESG factors and how they will manifest in the company’s position within the market, with a focus on identifying additional tail risk not readily identifiable by conventional ESG tools. While this is not always possible, we make every effort to engage with companies regarding ESG issues to better understand the risks from their perspective; in doing so, we are able to formulate the most comprehensive and informed overlay of the ESG risks in our relative value credit framework. This information not only affects our ultimate assignment of the internal credit rating, but ultimately feeds into our assessment of drivers that affect risk positioning in any credit we cover.
Case studies
We believe that a strong commitment to stewardship is an essential component of a strong approach to responsible investment (RI), and that embedding RI into the core of our investment activities is in the best long-term interests of our clients. For more than a decade we have systematically and progressively improved our practices and processes across our investment capabilities globally.
More information
View First Sentier Investors proxy voting record and statistics
Responsible Investment
For over a decade, responsible investment has been integrated into every investment process.
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First Sentier Investors became a Certified B Corporation in November 2022 with a score = 107.2, noting that the passing score is 80. Please visit the B Corp Directory here to view our report and for additional information regarding the assessment process.
Copyright © First Sentier Investors (Australia) Services Pty Ltd 2023, (part of First Sentier Investors, a global asset management business. First Sentier Investors is ultimately owned by Mitsubishi UFJ Financial Group, Inc MUFG.)
In the EU: This is a marketing communication. The fund(s) mentioned here may or may not be registered for marketing to investors in your location. If registered, marketing may cease or be terminated in accordance with the terms of the EU Cross Border Distribution Framework. Copies of the prospectus (in English and German) and key investor information documents in English, German, French, Danish, Spanish, Swedish, Italian, Dutch, Norwegian and Swedish, along with a summary of investors' rights are available free of charge at firstsentierinvestors.com
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