Changes expand on fund family’s concerns regarding climate risk
GOSHEN, Ind.– Following an intensive eight-month process, Everence and Praxis Mutual Funds have announced the expansion of their environmental screening policy.
“Over the years, attention has grown around the impact climate change has on our planet, vulnerable populations and growing businesses,” said Chad Horning, Everence Chief Investment Officer. “It’s a situation that demands attention, and the time has come to incorporate these considerations more clearly into our screening policies at Everence and Praxis Mutual Funds.”
While many investors focus solely on avoiding carbon intensive industries (such as oil, coal and utilities) to send a signal to corporate and political leaders, Everence and Praxis have chosen a different path.
“Turning our backs on every carbon intensive company accomplishes very little,” explained Mark Regier, Director of Stewardship Investing for Everence and Praxis. “We believe it is important to make a difference, not just a statement. In order to make progress, we must actively engage with companies that are both leading the way and lagging behind when it comes to climate change.”
The new environmental screen does not avoid carbon intensive industries as a whole, but comprehensively assesses the environmental impact of all companies. Everence and Praxis will examine past environmental practices, current carbon emissions and proven ability to track and manage the climate risks faced by the companies.
To help implement the new environmental screening policy, Everence and Praxis are working with the Intangible Value Assessment system built by MSCI ESG Research, the world’s largest provider of sustainable investment research.
“This system is used by hundreds of large institutional investors around the world,” said Regier. “It will help us assess a company’s prospects for meeting the range of environmental, social and governance challenges and opportunities we face.”
The revised environmental screen adds approximately 160 new companies to the international and domestic restricted lists used by Everence and Praxis in internally managed investment portfolios. Everence and Praxis regularly assess over 8,000 companies globally across the developed and emerging markets, as part of a stewardship investing philosophy that embraces a wide range of social concerns.
“In formulating this new screen, we gave careful consideration to the potential financial impact it might have,” said Horning. “While it’s far too early to draw any conclusions, we are pleased that the new screen appears to be delivering a strengthened environmental commitment with minimal impact on the management of the funds.”
“As trusted fiduciaries for a diverse pool of individual and institutional clients, we have always believed it is our responsibility to manage portfolios based on the economy we have, not the one we wish we had,” added Regier. “Transitions, particularly in core economic structures like energy, will take a long time and the active involvement of many parties. We have an important role to play as engaged investors.”
About Praxis Mutual Funds and Everence
Praxis Mutual Funds, advised by Everence Capital Management, is a leading faith-based, socially responsible family of mutual funds designed to help people and groups integrate their finances with faith values. To learn more, visit praxismutualfunds.com.
Everence helps individuals, organizations and congregations integrate finances with faith through a national team of advisors and representatives. Everence offers banking, insurance and financial services with community benefits and stewardship education. To learn more, visit everence.com or call (800) 348-7468.