Morphic Ethical Equities Fund

Product Name

Morphic Ethical Equities Fund


Morphic Asset Management




Listed Investment Company (LIC)


Retail, Wholesale

Certified Since


Asset Classes

International equities


Australia, New Zealand

Investment Approaches

Negative Screening, ESG Integration

It Includes:

  • Riaa icons 10 Renewable energy and climate change solutions
  • Riaa icons 15 Social and sustainable infrastructure
  • Riaa icons 13 Sustainable transport
  • Riaa icons 31 Sustainable water
  • Investment2 More sustainable companies

It fully excludes:

  • Riaa icons 41 Alcohol
  • Riaa icons 36 Armaments
  • Riaa icons 33 Fossil fuels
  • Riaa icons 42 Gambling
  • Riaa icons 52 Human rights abuses
  • Riaa icons 38 Labour rights violations
  • Riaa icons 34 Logging
  • Riaa icons 50 Nuclear power
  • Riaa icons 99 Pornography
  • Riaa icons 35 Tobacco


Excerpt from Morphic Ethical Equities Fund Ltd (the Company) Listing Prospectus, section 3.1: The Company will seek to invest in an ethically screened global investment Portfolio to meet the investment objectives set out below. The Manager (Morphic) will apply the investment guidelines and policies detailed in the remainder of Section 3 in constructing and making changes to the Portfolio. The Manager will seek to build the Portfolio by applying a “negative screen” that prohibits direct investments in Securities that are issued by entities in the following industries: –– Armaments; –– Tobacco and alcohol; –– Gambling; –– Coal and Uranium mining; –– Oil and gas Extraction; –– Intensive animal farming and aquaculture; or –– Logging of rainforest or old growth timber. If the Company has indirect exposure to Excluded Securities by investing in Derivatives (including Exchange Traded Funds), the Company will seek to hedge this indirect exposure using Short sales. The Manager intends to apply a “positive screen” by investing a minimum of 5% of the Company’s Net Assets in Securities issued by companies which produce products or services that it considers are likely to improve the planet. Additionally, the Morphic Responsible Investment Policy (MRIP, attached to earlier responses) applies to all funds managed by Morphic Asset Management. As well as detailing the negative and positive screens, MRIP details the methodology by which consideration of Environmental, Social and Governance issues is integrated into our investment process. It also details our commitment and approach to Engagement, Proxy Voting and Transparency.


The Fund is managed in accordance with Morphic’s Ethical Charter (attached below to qu. 20A, available on our website, and labour standards, environmental, social and governance considerations. To achieve the objectives embodied by Morphic’s Ethical Charter, we construct the Portfolio by applying a “negative screen” that prohibits direct investments issued by entities (including their subsidiary entities) in various industries (detailed in answer to qu. 19 above). Additionally, we also exclude any companies that appear in the Norges Bank Investment Management Exclusion list (

In the event that a company operates in a sector which is not excluded by the negative screen but has greater than 5% of its revenues from an activity which would otherwise be excluded then investment will be prohibited.

The negative screen is enhanced by our research process which incorporates the identification and consideration of material ESG risks and opportunities for every potential and actual investment.

We also apply a “positive screen” by generally investing a minimum of 5% of the Fund in entities which produce products or services that it considers are likely to improve the planet. The criteria for investments that would fall within the scope of the "positive screen" is set out in the Manager's Ethical Charter.

Morphic is also a signatory to the Principles of Responsible Investment (PRI) which entails an explicit commitment to, and the adoption of, six principles which it believes will improve its ability to meet commitments to investors as well as better align our investment activities with the broader interests of society.

To summarise, the Fund is ethical for all the reasons below:

  • The Fund does not directly invest in companies that have significant part of their business activities in armaments, tobacco and alcohol, gambling, coal and Uranium mining, oil and gas extraction, intensive animal farming and aquaculture and logging of rainforest or old growth timber.
  • The Fund seeks to invest in businesses which:
  1. Find solutions for reducing the emission of greenhouse gases.
  2. Reduce damage to water supplies.
  3. Work to improve air quality.
  4. Provide alternatives to deforestation.
  5. Otherwise enhance the human experience without creating future problems for mankind or the environment.
  • The Fund integrates ESG analysis of all direct holdings.
  • The investment team engages with all companies the Fund is invested in (directly), seeking clarification on material ESG issues and providing feedback.
  • Finally, the Manager, donates part of its revenue to a variety of charities supporting different causes and manages funds on behalf of charities on a pro bono basis.

Other products certified by the Responsible Investment Association Australasia (RIAA)

Morphic Global Opportunities Fund

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