ENVIRONMENTAL, SOCIAL, AND GOVERNANCE
ESG at T. Rowe Price
"Environmental, social, and governance (ESG) factors can impact the sustainability and long-term success of businesses. Identifying, analyzing, and integrating information about ESG risks and opportunities help enhance our ability to make better investment decisions and pursue better outcomes for our investors. We also believe that our clients should be able to invest in a way that aligns with their values on ESG issues."
Rob Sharps, President & CEO
ESG Investing Annual Report
Latest ESG Investing Annual Report
Learn about our ESG capabilities, approach to ESG integration, company engagements, and proxy voting activities.
Net Zero
Asset Managers
initiative
We have joined the Net Zero Asset Managers initiative to support the goal of net zero greenhouse gas emissions by 2050 or sooner
INVEST IN COMPANIES THAT MAKE AN IMPACT
Impact Investing
We believe we can generate both compelling investment returns and social and environmental impacts for our investors.
Section for Title, Description and Transcript
Section for Transcript
At T. Rowe Price, integrating ESG factors - Environmental, Social and Governance - into our investment research supports one of our core beliefs that helping clients reach their financial goals demands better insights into the long-term sustainability of the companies in which we invest.
That’s why we developed our proprietary responsible investing indicator models, collectively RIIM.
We have developed RIIM across asset classes covering corporates (that is both equities and corporate bonds), sovereign bonds, municipal bonds, and securitized bonds.
For corporates, RIIM builds an environmental, social and governance profile of thousands of companies, representative of our investable corporate universe, to enhance our investment teams' fundamental research. It uses information not used in traditional investment analysis, so that we can better understand a company’s behaviour regarding environmental and social performance. These are data points like environmental fines paid, or community protests against a company.
We use RIIM to support ESG integration across a three-step process.
1) We use quantitative data to identify outliers - both positive and negative. This helps our ESG specialists determine where we should focus our deeper research and analysis.
2) Companies flagged by RIIM or our governance screens have the potential to be further analyzed by our ESG specialists, often in collaboration with our industry analysts.
3) ESG integration
Our analysts and portfolio managers have the opportunity to consider the ESG research as part of their overall recommendations and portfolio decision making - such as changing financial estimates or modifying positions.
ESG considerations form a part of our overall research process, helping us alongside other factors to identify investment opportunities and manage investment risk. This is known as ESG integration. However, we may conclude that other attributes of an investment outweigh ESG considerations when making investment decisions.
RIIM allows our portfolio managers to understand if there are concentrated environmental or social factor risks in the overall portfolio. By measuring companies’ environmental, social and governance profiles (which are often qualitative), they can more easily be used as building blocks of an investment thesis - alongside financial, economic and industry- related insights.
Compared to third-party ESG analysis, we believe RIIM has some distinct advantages.
First, there is a sharper focus on materiality, as we consider ESG factors most important to each business model.
RIIM allows for more comprehensive coverage, beyond third-party data.
And lastly, compatibility with our investment infrastructure. As proprietary models, RIIM is designed for practical application by our investment teams.
RIIM looks beyond a simple score to help us build a full ESG profile of a security allowing for the integration of ESG insights across our investment platforms.
VIDEO
Our ESG Integration Approach
Find out more about how we integrate ESG into our investment research process.
Corporate Sustainability
Making an impact beyond our walls.
At T. Rowe Price, we’re more than associates. We’re volunteers, donors, educators, grantmakers, and environmentalists. Guided by a core set of values, we’re committed to creating positive change in our communities and beyond.
Memberships & Associations
We have joined or led on various initiatives to bring investors together for purposes of advocacy and engagement.
Diversity, Equity & Inclusion
Our differences brings us together.
At T. Rowe Price, the long-term success of our clients is made possible by the diversity of backgrounds, perspectives, talents, and experiences of our associates. We believe that our culture of collaboration enables us to identify opportunities others might overlook. Our leaders are committed to diversity and inclusion. It’s an integral part of our core values as well as a long-term, strategic business priority.
Latest Insights
FROM THE FIELD
Artificial intelligence, health care, and energy transition: Three areas of focus for impact
How innovations in artificial intelligence, health care, and the energy transition can create value.
IN THE SPOTLIGHT
The power of additionality: Blue bonds could boost sustainability
Blue bonds could boost sustainability efforts in emerging markets
FROM THE FIELD
Linking corporate profits with natural capital in the Amazon rainforest
Deforestation in the Amazon is an extremely complex issue. A combination of quantitative data, fundamental research, and stewardship activities has helped us assess the potential financial risks to companies with exposure to beef production in the Amazon.
Policies, Reports & Key Information
This material is provided for general and informational purposes only and is not intended to provide legal, tax, or investment advice. This material does not provide recommendations concerning investments, investment strategies, or account types; it is not individualized to the needs of any specific investor and not intended to suggest any particular investment action is appropriate for you.
RISKS: All investments are subject to market risk, including the possible loss of principal. Impact investing strategies may not succeed in generating a positive environmental and/or social impact. The incorporation of environmental and/or social impact criteria into an investment process may cause a strategy to perform differently from a strategy that uses a different methodology to identify and/or incorporate environmental and/or social impact criteria or relies solely or primarily on financial metrics. There is no assurance that any investment objective will be achieved.
202411-4017557
