Insight's responsible horizons capabilities | Insight Investment

The Responsible Horizons strategies bring together Insight’s fixed-income expertise and responsible-investment capabilities. The range is designed for investors seeking portfolios that align with both financial objectives and defined sustainability goals, rather than treating responsible investment as a separate consideration from credit analysis and portfolio construction.

The range includes corporate bond, multi-sector credit, buy-and-maintain and impact bond strategies. This allows investors to pursue different investment objectives while applying explicit responsible-investment criteria appropriate to the relevant market and strategy.

Insight considers sustainability and governance factors where it believes they are financially material. Where relevant, we will also seek to reflect clients’ sustainability preferences. These factors are assessed alongside conventional credit risks rather than through a separate process.

The analysis is supported by Insight’s proprietary Prime ratings, covering corporate sustainability, physical and transition climate risks, and alignment with net-zero pathways. The Prime frameworks cover a wide range of corporate and sovereign issuers, and look to help analysts and portfolio managers in their approach to security selection and portfolio construction, where appropriate and relevant for the specific strategy.

Responsible Horizons strategies apply defined criteria rather than relying only on broad responsible-investment principles. Depending on the strategy, these may include minimum sustainability standards, exclusions, allocations to issuers committed to net zero, carbon-intensity limits and a preference for issuers with stronger sustainability profiles.

Several strategies in the range incorporate net-zero-related characteristics, including minimum allocations to companies at least committed to net zero and carbon-intensity thresholds that decline over time. The exact criteria vary, so investors should refer to the relevant strategy documents when assessing whether a portfolio meets their requirements.

Insight has developed proprietary Prime ratings to address the limitations and inconsistencies that can arise in third-party sustainability data. The frameworks cover thousands of corporate and sovereign issuers and assess different dimensions, including ESG performance, climate exposure and progress towards net zero.

This research gives portfolio managers an analytical framework across fixed-income markets. The ratings aim to complement investment judgement, and to help our teams to identify risks, compare issuers and apply the Responsible Horizons criteria more consistently.

Where appropriate, Insight may engage with issuers to understand and manage sustainability risks and hold management teams to account. Engagement may take place directly, through group meetings and collaborative initiatives, or via market counterparties.

Restrictions and engagement can therefore perform complementary roles. A strategy may avoid issuers that fail to meet its minimum requirements while using engagement where continued dialogue could help manage risk. Engagement does not guarantee that an issuer will change, and any response to a lack of progress will depend on the relevant strategy’s criteria.