Page 23 | RPIA SUSTAINABILITY REPORT 2024
ESG INTEGRATION
OVERVIEW
SUSTAINABILITY
CULTURE & VALUES
THEMATIC PORTFOLIOS FOSSIL FUEL EXCLUSION STRATEGIES We have two thematic strategies, the RP Broad Corporate Bond (Fossil Fuel Exclusion) strategy and the RP Broad Corporate Bond (BBB, Fossil Fuel Exclusion) strategy. Both strategies employ a negative screening approach, in line with stated ESG-related investor objectives. In partnership with one of our institutional investors, we developed a first-of- its kind fossil fuel excluded corporate bond strategy in Canada for investors who take exclusionary approach to ESG. The approach is an evolution of our RP Broad Corporate Bond strategy, which has a ten-year track record of adding 174 bps of added value above the FTSE Canada All Corporate Bond Index (gross, annualized, since inception). The RP Broad Corporate Bond (Fossil Fuel Exclusion) strategy was launched in July 2022 and takes a rules-based exclusions approach to screening fossil fuel intensive issuers out of the fund and the benchmark. As its name suggests, this strategy excludes all companies with direct involvement in or significant ownership of fossil fuel products at the time of investment. We also screen and exclude tobacco and cluster munition involvements. The strategy maintains the performance target of the “original” strategy but has an additional objective of maintaining a lower WACI (Weighted Average Carbon Intensity) than the already carbon-reduced FTSE Canada All Corporate ex-Fossil Fuels Enhanced Bond Index. The strategy is an innovative solution through which our investors were able to achieve both reducing fossil fuel exposure and superior returns.
Performance as of December 31, 2024
Strategy AUM: $223 Million
1 Mo
3 Mo
YTD
1 Yr
SI
RP BCB FFE
0.00% 0.00% 0.00%
0.90% 0.90% 0.00%
7.52% 6.74% 0.78%
7.52% 6.74% 0.78%
8.15% 6.26% 1.89%
Index
Added Value
RP BCB FFE= RP Broad Corporate Bond (Fossil Fuel Exclusion). Index = FTSE Canada All Corporate Ex Fossil Fuel Enhanced Bond Index. Source: FTSE.
RP BCB FFE Weighted Average Carbon Intensity Relative to the Index
% Reduction vs. Index
WACI
50
40
30
20
10
-
Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 Sep-24 Dec-24
Reduction (RS)
Strategy
Index
As at December 31, 2024. Index = FTSE Canada All Corporate Ex Fossil Fuel Enhanced Bond Index. Source: Bloomberg.
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