The Biotech Growth Trust PLC (the “Company”) seeks capital appreciation through investment in the worldwide biotechnology industry. The Company and the Company’s Portfolio Manager believe that there is a high congruence between companies that seek to act responsibly and those that succeed in building long-term shareholder value.
The Board recognises that Environmental, Social and Governance (“ESG”) issues can impact the performance of investments. The Board has delegated authority to its Portfolio Manager to evaluate investee companies’ performance on material ESG issues and also to engage with the management of investee companies on ESG, and these matters and any other ESG related issues are discussed regularly with the Board.
The Company’s Portfolio Manager has incorporated a Responsible Investing Policy into its overall investment process for the Company in order to enhance investment returns.
Click here to read more.
Sector-specific ESG evaluation relies on a thorough understanding of potentially material factors (such as the results of clinical trials) as well as the availability of complete, accurate and timely quantitative and qualitative data. The internationally recognised Sustainability Accounting Standards Board (SASB) has identified subsets of environmental, social, and governance issues most relevant to financial performance in each of 77 industries, including Pharmaceuticals and Biotechnology. The Portfolio Manager’s Responsible Investing Policy integrates sector specific guidance from SASB as well as a full range of other financial and non-financial factors when making investment decisions.
In addition, the Portfolio Manager’s Responsible Investing Policy lists exclusions from potential investment, for example companies involved in production or trade in illegal products, companies providing products or services causing severe environmental damage, companies using child or forced labour and companies manufacturing or trading in tobacco and/or e-cigarettes. The Portfolio Manager has also prepared an ESG Due Diligence Questionnaire documenting its ESG approach and integration in their investment process, which is aligned to the reporting requirements of UN PRI.
The Portfolio Manager engages with investee companies through meetings with management and proxy voting. The Board has delegated authority to the Portfolio Manager to vote the shares owned by the Company that are held on its behalf by its Custodian. The Board has instructed that the Portfolio Manager submit votes for such shares wherever possible and practicable. The Portfolio Manager generally follows the guidelines and recommendations of Glass Lewis & Co LLC, a leading proxy voting services provider, and is also encouraged to refer to the Board on any matters of a contentious nature. The Portfolio Manager has used Glass Lewis, one of the two most prominent proxy advisory services provider, for over 10 years and has generally agreed with their approach to proxy voting recommendations.
ESG is a rapidly evolving field and the Board is keeping abreast of developments.
The Company complies with the AIC Code of Corporate Governance and has policies in place regarding Board diversity, integrity and business ethics.