Understand emerging markets opportunities and the American Century advantage.
We believe an integrated approach to ESG investing can help increase portfolio diversification and maximize the incorporation of both ESG quality and alpha-related inputs.
1. Our primary mission is to deliver superior, long-term, risk-adjusted returns for our clients.
2. We understand that ESG issues may present risks and opportunities which can affect the performance of individual securities to varying degrees over time.
3. We seek to integrate the analysis of potential risks and opportunities associated with ESG issues within our fundamental research process and we strive to mitigate related downside risks or capture upside potential as necessary, without compromising our fiduciary duty to act in the best interest of our clients.
4. In addition to conducting our business with the highest ethical standards and complying with all applicable laws and regulations, our ESG approach is regularly reviewed against industry investment stewardship and governance standards, and ESG methodologies to ensure alignment with our processes.
With responsible investing firmly rooted in our DNA, American Century’s focus on ESG factors is integral to our corporate citizenship and business model. Our ownership structure is unique in the asset management space as it enables our clients to directly support lifesaving research and contribute to the global fight against cancer.
In 1994, American Century Investments' founder, James E. Stowers Jr., and his wife Virginia—inspired by their personal experiences with cancer and a desire to use their wealth to help humanity—dedicated the vast majority of their net worth to create the Stowers Institute for Medical Research (SIMR) . SIMR is a private biomedical research institution focused on researching genetic-based diseases, including cancer. Through this distinctive ownership structure, whereby the institute is a controlling owner of American Century, we have been distributing dividends to the institute since 2000. Those payments have totalled $1.4 billion.
American Century Investments' founder, James E. Stowers Jr., and his wife Virginia dedicated the vast majority of their net worth to create the Stowers Institute for Medical Research .
Transitioned multiple portfolios to "no tobacco" (NT) versions used exclusively within the One Choice® Target Date Portfolios series.
Initiated research on ESG incorporation into investment processes.
Formally integrated ESG research within several global and non-U.S. equity strategies.
January: Transitioned existing Emerging Markets Equity SICAV to management under UN Global Compact guidelines.
July: Launched the U.S. Sustainable Large Cap Core strategy.
Established investment-led ESG and Investment Stewardship team.
January: Developed proprietary ESG scoring system; formalized ESG integration process across global and non-U.S. equity strategies and U.S. Sustainable Large Cap Core.
April: Established ESG Proxy team to integrate ESG matters in proxy guidelines.
August: UNPRI Signatory
Our ESG Platform is a cross-functional team through which ESG is embedded into the way we do business every day.
Led by Guillaume Mascotto, Head of ESG and Investment Stewardship.
Vice President, Head of ESG and Investment Stewardship
• Incorporation of ESG-related proxy proposals into voting policy
• Client relationship management
• Marketing strategy
• Business Development
• Public Relations
• Client ESG guidelines implementation
• Proprietary ESG scoring
• Portfolio monitoring and controvery analysis
• Engagement analysis
• Portfolio construction
• Idea generation
• ESG materiality analysis
• Third-part data systems integration
• ESG portfolio quantitative tool design
Oversight and accountability for American Century Investments' ESG-investing activities primarily fall under the auspices of the Office of the Global Chief Investment Officer and the Co-Chief Investment Officer of our Global Growth Equity discipline. The execution of our ESG policy and management of our ESG-investing platform falls under the purview of our Head of ESG and Investment Stewardship, who reports directly to the Co-CIO of Global Growth Equity.
American Century Investments' multi-layered ESG framework combines both macro and sector inputs with a focus on financial materiality. The framework is aligned with our fundamental analysis process, and can be applied to various investments strategies in the equity and fixed income space.
Leverage third-party research and in-house macro assessments from ESG and Investment Stewardship team.
Identify ESG issues that could potentially affect long-term, market-specific dynamics and regulatory developments.
ESG and Investment Stewardship team partners with in-house sector analysts to isolate issues that could potentially alter sector-specific competitive forces.
Level of materiality depends on company's management practices to mitigate risks.
Utilize a proprietary tool to measure and rank issuers' relative risk management performance against quantitative environmental and social indicators.
Use a complementary tool to assess relative performance on governance that applies to all sectors.
Calculate Proprietary American Century Investments' ESG Score
Consider relative ESG assessments in context of analysis/fundamental research process
Portfolio manager consider analyses when evaluating investment decisions
Investment team addresses with company management any ESG issues and controversies deemed material to an issuer's long-term financial condition
Our philosophy for ESG investing is guided by four principles. Watch the video.
With responsible investing firmly rooted in our DNA, American Century Investments' focus on ESG factors is integral to our corporate citizenship and business model.
Our ESG integration framework also extends to our active ownership initiatives.
American Century Investments' proxy voting policy and practices are guided by general fiduciary principles. We act prudently, solely in the interest of the beneficial owners of the accounts that we manage, and for the exclusive purpose of providing benefits to such persons. In short, we vote proxies in the manner that we believe will do the most to maximize shareholder value.
We subscribe to certain proxy voting services offered by Institutional Shareholder Services (ISS), which services include the ISS proxy voting platform and proxy research, including their Socially Responsible Investing (SRI) proxy research. In 2018, we created an ESG (environmental, social and governance) Proxy team which is comprised of senior legal and compliance professionals and our head of ESG and Investment Stewardship. For American Century’s entire equity complex, our ESG Proxy team reviews, on a weekly basis, each proposal affecting our positions. With various inputs, including the ISS SRI proxy recommendations, the ESG Proxy team assesses the financial materiality of the ESG issues underpinning the proposals and makes appropriate voting recommendations to portfolio managers.
With regard to disclosure, the firm’s proxy voting policies are available on the firm's website. Please note, we are in the process of updating these policies to reflect the ESG Proxy team involvement.
CEO Action for Diversity & Inclusion™
Girls Who Invest
Money Management Institute
American Century Investments® signs the UNPRI, continuing its evolution in the ESG space.
American Century Investments®' approach to ESG highlighted by Institutional Investor
American Century Investments' Head of ESG and Investment Stewardship Guillaume Mascotto discusses the growing popularity of "impact investing" and how the firm is integrating ESG considerations into its investment process.
This information is for educational purposes only and is not intended as investment advice.
The opinions expressed are those of American Century Investments (or the portfolio manager) and are no guarantee of the future performance of any American Century Investments' portfolio. This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.