Small caps get help with ESG from specialist manager

As businesses are placed under increasing pressure to adopt more sustainable business practices, Chelverton Asset Management has increased its support to small cap companies, on a one-to-one basis and through targeted collaborative work.

Good governance has always been a focus, but Chelveton is now actively addressing the lack of transparency regarding environmental and social pillar management by many small cap firms.

Under Chelverton’s first responsible investing manager, Sally Clifton, the firm has built a more structured approach to ESG integration.

It wrote to investee firms during the pandemic to highlight the growing importance of the management and reporting of material ESG issues. It asked investee companies to improve their management of ESG disclosures and where possible, to set and report ESG targets and performance.

This work has continued with targeted letters to investee companies making specific reference to expectations around climate change, diversity, equity, and inclusion within the workforce and the inclusion of meaningful ESG targets in executive remuneration packages, among others.

“Our investment managers devote significant resources to engagement with the support of the ESG team,” said Clifton. “We continue to develop constructive and supportive relationships with investee firms as they strive to communicate their ESG management strengths to the market more effectively. We will offer our help and support whenever possible.”