Responsible Investing (RI)

Futuregrowth views responsible investing as a fiduciary duty. Non-Financial analysis through the assessment of environmental, social and governance factors is a crucial risk management tool and is therefore embedded into our fundamental investment processes. We believe that the consideration of the short-, medium- and long-term impacts of non-financial factors in a particular investment supports long-term value creation. Futuregrowth’s non-financial analysis is guided by both local and international best practice.

Futuregrowth is a signatory of the UN Principles for Responsible Investment (PRI), and also endorses the Code for Responsible Investment in South Africa (CRISA).  

Futuregrowth’s non-financial analysis framework entails the assessment of environmental, social and governance factors in the investment process. This is carried out alongside the financial analysis. The intended outcome is to mitigate overall portfolio risk.

The non-financial analysis seeks to achieve the following outcomes:

• Investments are screened using non-financial factors as part of the due diligence process

• Non-financial risks are evaluated

• The non-financial activities of investee companies are monitored

• Improvements are measured over time

• Active engagement with companies takes place when risks are identified

• Reports are provided to stakeholders on non-financial issues in a transparent and accountable manner

South Africa is one of the largest contributors towards Greenhouse Gas (GHG) emissions in the world, and the highest emitter of GHGs in Africa. The South African government has evidenced a commitment to mitigating climate change by signing the Paris Agreement which is an international treaty to support a net-zero world by 2050.  In support of this commitment, the South African president recently signed into law the Climate Change Bill of 2024. which provides a national framework for responding to climate change.

Futuregrowth recognises the importance of these commitments and has taken the position that global warming is a material factor that affects an investments’ risks and returns, as well as the sustainability of the country and the world. We have taken a position to proactively manage our exposure to carbon-intensive investments through our investment process.

Futuregrowth utilises a number of stewardship approaches and tools to protect the long-term value of our investments and related economic, social and environmental interest.

These include:

• Engagement

• Proxy voting at shareholder meetings

• Filing of shareholder resolutions

• Nomination of directors to Board and/ or Board sub-committees

• Leveraging roles on the Board and/ or Board mandated committees

• Taking roles on investee Boards

• Working directly with investee companies

These approaches towards stewardship, encourage transparency and accountability in our investee companies.