This is one of three funds in the Kames Ethical range, which we would describe as following ‘mid-green’ ethical criteria. Kames employs EIRIS – a global provider of research into companies’ environmental, social and governance performance – to provide an ethical screening service which is supplemented by an internal corporate governance and ethical research team at Kames. This team is independent from the fund managers. The list of industries Kames excludes is outlined in its prospectus for investors, but in summary exclusions should include all companies involved in any form of animal testing, companies which have a significant negative impact on the environment, companies that produce weapons, nuclear power companies, companies that give political donations above £25,000 each year, and companies in the following industries: genetic engineering, pornography, alcohol, gambling, and tobacco. Banks are excluded if they are deemed to be corporate and/or international banks with exposure to large corporate and/or third world debt. The oil & gas sector is not completely excluded – see prospectus for full details.
The emphasis of the investment process is on bottom-up stock selection, though the top-down perspective is not ignored. Company analysis is based on a combination of fundamentals, valuation and technical (FVT), with a focus on identifying changes that drive stock prices.