Pendal Horizon Fund (formerly Ethical Share Fund)

Product Name

Pendal Horizon Fund (formerly Ethical Share Fund)

Issuer

Pendal Group

Category

Investment

Type

Fund or Trust

Target

Retail, Wholesale, Institutional

Certified Since

2005

Asset Classes

Australian only equities

Markets

Australia

Investment Approaches

Negative Screening, Positive Screening

It Includes:

  • Riaa icons 14 Education
  • Riaa icons 32 Green property
  • Riaa icons 12 Healthcare and medical products
  • Riaa icons 10 Renewable energy and energy efficiency
  • Riaa icons 15 Social and sustainable infrastructure
  • Tree green background Sustainable land and agricultural management
  • Riaa icons 13 Sustainable transport
  • Riaa icons 31 Sustainable water

It has some level of screening for:

  • Riaa icons 56 Animal cruelty
  • 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

It fully excludes:

  • Riaa icons 41 Alcohol
  • Riaa icons 36 Armaments
  • Riaa icons 33 Fossil fuels
  • Riaa icons 42 Gambling
  • Riaa icons 35 Tobacco

Overview

The Fund is designed for investors who want the potential for long term capital growth from a high conviction, values-oriented, concentrated portfolio of typically 15-35 stocks that invests in businesses that in our view, in aggregate, provide a net benefit to Australia’s future economy and society.


Description


We adopt a principles-based approach in identifying the Fund’s investments which aims to: 
  • Avoid companies whose industries, business models and products or services are not sustainable or cause significant harm, having regard to what we believe most investors would want to avoid in a values-based investment portfolio. 
  • Invest in companies that demonstrate, or offer or enable more sustainable practices, business models or products and services. 
  • Invest in companies that advance or participate in the transition of the Australian economy to one that is more sustainable. 
  • Engage with management of companies in which we invest to manage risk, effect change and realise potential value over the long term.
Exclusionary screens
In managing the Fund, we avoid investing in companies which:
Fossil Fuels
  • directly undertake fossil fuel exploration or extraction (specifically, coal, oil and gas); or 
  • earn more than 10% of their revenue from fossil fuel-based power generation, or from fossil fuel refinement or distribution (coal, oil and gas); or 
  • earn more than 10% of their revenue from the provision of supplies or services which relate specifically to the fossil fuel exploration or production industries 
    (coal, oil and gas) 
Uranium 
  • directly undertake uranium mining for weapons or power generation; or 
  • earn more than 10% of their revenue from nuclear energy-based power generation 
Logging
  • earn more than 10% of their revenue from unsustainable forestry or forest products, including non-Forest Stewardship Council certified forest products or non-Roundtable on Sustainable Palm Oil certified palm oil production 
Gambling
  • directly manufacture, own or operate gambling facilities, gaming services or other forms of wagering; or 
  • earn more than 10% of their revenue from the indirect provision of gambling (for example, through telecommunications platforms) 
Pornography
  • produce pornography; or 
  • earn more than 10% of their revenue from the distribution or retailing of pornography
Weapons
  • produce or distribute controversial weapons (such as cluster munitions, landmines, biological and chemical weapons), or supply goods or services specifically relating to controversial weapons; or 
  • produce or distribute non-controversial weapons or military equipment; or 
  • produce or distribute civilian firearms, or supply goods or services specifically related to firearms to firearm manufacturers 
Alcohol
  • produce alcoholic beverages; or 
  • earn more than 10% of their revenue from the distribution or retailing of alcoholic beverages 
Tobacco
  • produce tobacco (including e-cigarettes and inhalers); or 
  • earn more than 10% of their revenue from the distribution of tobacco (including e-cigarettes and inhalers) or supply of goods or services specifically related to the tobacco industry (for example, packaging or promotion) 
Animal Testing
  • directly undertake animal testing for cosmetic products 
Predatory Lending Practices 
  • directly provide products or services with lending practices that are unfair or deceptive to ordinary borrowers, including small amount short term loans at higher than commercial rates of interest (for example, payday loans, pawn loans or the use of aggressive sales tactics) 
Breaches/ misconduct 
  • we consider to have been found to have significant breaches of social or environmental norms or regulations, or are subject to serious and substantiated allegations of unethical conduct, which we consider have not been remedied or adequately addressed.
Sustainable industries and companies
Alongside core investments, we seek to invest in companies that demonstrate, or offer or enable more sustainable practices, business models or products and services, as well as companies that advance or participate in the transition of the Australian economy to one that is more sustainable. 

To that end, we seek to allocate capital to companies which directly contribute to, or enable others to contribute to, areas such as: 

  • Innovation and technological advances
  • More sustainable resource consumption and production, including decarbonisation 
  • Supply chain resilience 
  • Sustainable and resilient infrastructure 
  • Quality education 
  • Provision of decent work 
  • Health and wellbeing 
  • Social inclusion and diversity 
  • Meeting basic needs 
  • Low carbon transportation 

Please note, this Fund changed its name from the Pendal Ethical Share Fund to the Pendal Horizon Fund on 15 March 2021.

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

Pendal Global Select Fund

Pendal Multi-Asset Target Return Fund

Pendal Sustainable Australian Fixed Interest Fund

Pendal Sustainable Australian Share Fund

Pendal Sustainable Balanced Fund

Pendal Sustainable Conservative Fund

Pendal Sustainable Future Australian Share Portfolio

Pendal Sustainable International Fixed Interest Fund

Pendal Sustainable International Share Fund

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