Monday, May 11, 2009

TD Asset Management adopts across-the-board sustainable investment policy

TD Asset Management has opted to apply a Sustainable Investing Policy across all its operations in Canada and the United States.

The move, announced recently in a press release by TD, builds on the company’s Global Sustainability Strategy, “a global equity approach that invests in companies that contribute to the world's future sustainability," said Barbara Palk, President, TD Asset Management.

"Where environmental, social and corporate governance (ESG) factors are key drivers of financial value for that Global Sustainability Strategy, they should be part of our analysis for all our investment mandates,” Palk added.

The policy notes that the financial effect of ESG factors on a company can be positive, if new opportunities open up for the company, and negative, if the company fails to properly manage the reputational and other risks arising from ESG factors.

“For us, sustainable investing means helping our clients who have a shorter time horizon achieve their financial objective in a way that does not compromise our ability to help clients who have a longer time horizon achieve their financial objective too,” the policy states. “This approach is based on the most common definition of sustainability.”

TD’s sustainable investing process consists of four parts: 1) developing a proprietary sustainability matrix to ensure TD’s analysis of a company includes a thorough analysis of ESG factors; 2) paying close attention to risk management; 3) ensuring proper disclosure to make more informed investment decisions; and 4) evaluating the total mix of information. “Under our approach, there is no single ESG factor that automatically trumps all others. We continually need to weigh the importance of competing factors and apply our professional judgement. "

The policy also includes active ownership of companies through engagement, proxy voting, and, as last resorts, litigation and divestment.

TD Asset Management, which also operates as TDAM USA Inc., managed over $169 billion in assets under management as of March 31, 2009, for pension, insurance, foundation and corporate and HNW clients, as well as retail mutual funds.

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