Methodology: Funds are scored according to 1) three-year net return percentile rank (50%), and 2) weighted sustainability rating* percentile rank based on analysis of their holdings† (50%). If the fund is less than three years old, its final score is based on #2, which is grossed up to 100%. Only funds that have an ESG mandate are eligible for the ranking. Qualifying equity funds must have at least two-thirds of their holdings to be rated in Corporate Knights Research Universe; for balanced/corporate fixed income funds, the minimum threshold is 50% of the holdings to berated in the Corporate Knights Research Universe‡.
* Based on Corporate Knights’ rating methodology as deployed in the 2022 Global 100 Most Sustainable Corporations in the World ranking which consists of 24 key performance indicators as follows: Clean Revenue, Clean Investment, Paid Sick Leave; Sustainability Pay Link Energy/GHG/Water/Waste/VOC/NOx/SOx/Particulate Matter Productivity; CEO-Average Employee Pay; Board and Executive Racial and Gender Diversity; Supplier Sustainability Score; Percentage Tax Paid; Pension Fund Quality; Sanction Deductions; Injuries; Fatalities.
† Holdings that are red-flagged automatically receive a 0% CK Sustainability Rating Score. Red-flag holdings include companies that are classified in the Corporate Knights database for one or more of the following criteria: access-to nutrition laggards, access-to-medicine laggards, adult entertainment, companies blocking climate policy, cement-carbon laggards, civilian firearms, controversial and conventional weapons, deforestation and palm-oil laggards, fossil fuels (energy), farm-animal-welfare laggards, for-profit prisons, gambling, gross corruption violations, harmful pesticides, illegal activity, oil sands laggards, severe environmental damage, severe human rights violations, thermal coal and tobacco.
‡ Corporate fixed income instruments are mapped to the ultimate parent company in the Corporate Knights Research Universe.
Sources: Corporate Knights Research, Fundata, Responsible Investment Association, Refinitiv, S&P capital IQ, InfluenceMap, Norges Bank Investment Management (NBIM), Chain Reaction, NZ Super Fund, Stockholm International Peace Research Institute, American Friends Service Committee, Access to Nutrition Initiative, Access to Medicine Initiative, Motley Fool, animal welfare experts, Unearthed, Urgewald/GCEL, Deforestation Free Funds, Wespath, Sin Stocks, RedLightNetwork, Rainforest Action Network, Farm Animal Investment Risk and Return (FAIRR).