Strategies that follow the Newton Sustainable Investment process are subject to a set of minimum exclusion criteria referred to as the ‘red lines’*. These red lines include companies that are deemed to be harmful from an environmental or social perspective. Specifically, these are:
Corporate issuers that generate any revenues (>0%) from the manufacture of tobacco products.
Tobacco retail and supporting products
Corporate issuers that generate more than 10% of revenue from products that support the tobacco industry and/or retail or wholesale tobacco products manufactured by other companies.
Breaches of the UN Global Compact
Corporate issuers deemed to have violated one or more principles of the UN Global Compact (UNGC).
Corporate issuers that generate any revenue (>0%) from the manufacture of any of the following weapons: anti-personnel mines, cluster munitions, chemical weapons, biological weapons, nuclear weapons, incendiary weapons, non-detectable fragments, blinding laser weapons, white phosphorous weapons, depleted uranium weapons.
Corporate issuers that generate 10% or more of revenues from the manufacture of alcoholic beverages.
Corporate issuers that generate 10% or more of revenues from the owning and/or operation of a gambling venue.
Adult entertainment production
Corporate issuers that generate 10% or more of revenues from the production of adult content or the owning and/or operation of adult entertainment venues.
Thermal coal extraction
Corporate issuers that generate 10% or more of revenues from the extraction of thermal coal.
* Some strategies following the Newton Sustainable Investment process may choose to add to these exclusions – but may never subtract.
Source: Newton, 10 May 2023