Small, Emerging, and Diverse
Manager Investing
We serve as a catalyst for opportunity
Guidelines for Responsible Investing
Many factors may impact the long-term performance of your investments; that’s why it’s important to responsibly approach every decision regarding your funds. Our investment programs are designed to enhance your financial resources while taking into account, where appropriate or practicable with respect to a particular investment, the potential effects of environmental, social, and governance (ESG) factors. These are at the core of the United Nations’ Principles for Responsible Investment (PRI). Mintorn is proud to be a signatory to the PRI since 2013. Additionally, Mintorn supports the Paris Agreement on climate change and the Task Force on Climate-Related Financial Disclosures (TCFD).
Responsible
Investing
Framework
To help your organization form an approach to responsible investing and determine your priorities, we’ve developed a proprietary framework that includes public and private investment programs, such as:
- Socially responsible investing (SRI) strategies
- Sustainability and real assets strategies
Our Investment Implementation Process
Given the diversified nature of our investment solutions, which vary across many asset classes, geographies and structures, we do not adhere to a singular or narrow approach to ESG, but rather, where appropriate or practicable with respect to a particular investment, incorporate such principles across investment philosophies and processes.
Mintorn Investment conducts due diligence on a particular investment opportunity for a fund it manages, whether it be an investment in a third-party investment advisor’s commingled fund or a more direct investment in the form of a secondary purchase or co-investment, ESG factors, where appropriate or practicable with respect to such investment, are reviewed alongside more traditional indicators such as the team behind the investment opportunity, the strategy that is being pursued, the investment process, past and potential future performance and investment terms. In such circumstances, they assess whether and how ESG factors:
- Impact the investment opportunity
- Impact shareholder, stakeholders and/or constituents
- Reflect in the investment process and investment exposures
- Contribute towards the risk profile of the investment opportunity
- Can be reported and integrated
Best practices in ESG integration are continuously developing. That’s why we continuously reevaluate our approach to ESG integration through insight gained as a result of conversations with peers, involvement in industry working groups, and original research in partnership with our investment managers.
We were founded with the mandate to educate institutional investors on current best practices, which we provide through the Mintorn Institute. The institute serves as the center of our resource library, providing blog articles and white papers about ESG best practices, research about ESG factors, and events. The Institute also reports on responsible investing practices among leading nonprofits through the Mintorn Benchmarks Studies.
Mintorn Investment engage with third-party investment advisors who manage commingled portfolios of securities within their respective funds. Those third-party investment advisors are generally directed to vote proxies on behalf of their clients in a way that is consistent with Mintorngroup Investment's respective proxy voting policy. Both policies note that TCF is a signatory to the PRI and that, as such, Mintorn Investment, as the case may be, believes that ESG factors and RI can materially impact investment performance. Accordingly, Mintorngroup Investment, as applicable, asks those investment advisors to consider whether ESG factors and RI are material to the investment performance of the company in question and, if so, to support proposals addressing such factors when those factors are material.
Launched in 2018, Mintorn Diversity, Equity and Inclusion Office was created with the mission to intentionally promote and foster inclusion and equity across Mintorn and its investment process, thought leadership, and professional and organizational development. As part of our commitment, the Mintorn Diverse Manager Portal is designed to broaden clients’ access to diverse investment talent through the receipt and review of due diligence materials from diverse managers across all global asset classes.
Dedication to Risk Management
Truly responsible investing is impossible without an effective risk management strategy. Learn more about our approach to risk management and the ways we strive to create a secure investment plan for your organization.
A Proven Approach to Risk Management
When it comes to your investments, managing risk is a top priority. In order to create an actionable plan that is aligned with your goals, it’s crucial to examine potential outcomes and strategize accordingly. We believe a strong risk culture should be driven by three primary actions: collective analytical insight, experienced judgment, and active collaboration across our firm—including input from our clients. With this in mind, we take a dynamic, intentional approach with comprehensive coverage to seek to mitigate risks as they arise.
Potential Risk Factors
Investment risk covers a broad range of issues facing client portfolios and investments. Through the use of proprietary risk models and third party tools, we analyze portfolio sensitivity to many different investment risk factors to understand how they drive risk and return in our portfolios. We estimate the performance of our portfolios in various scenarios, both historical periods of realized stress and hypothetical future stresses. We look at the potential impact to our clients in absolute terms and also relative to their specific investment policy objectives.
Many teams within Mintorn are involved in the monitoring and mitigation of operational risk. We think of operational risk as the potential for losses stemming from human error or the failure of processes and systems. This review of people, processes and systems takes place across all internal areas and is also performed on our managers, vendors and other third party partners.
Firms that operate in the financial markets face the risk that the market participants they do business with may not perform as promised. In mitigating this risk, Mintorn carefully monitors the creditworthiness of our counterparties, including the review of their financial condition, credit ratings, and market credit indicators such as credit default swap spreads and equity price volatility. Mintorn maintains tight control around collateral management and other methods of exposure reduction.
The ability of our clients to meet their cash needs is paramount and a daily focus at Mintorn. Understanding an institution’s ability and willingness to accept illiquidity is an essential step in building an appropriate investment policy statement. With that foundation in mind we look at liquidity at each level of the investment portfolio construction process. We evaluate how illiquidity could affect our clients at the strategy level, in client and manager portfolios, and ultimately at the individual security level.
Mintorn operates within a rapidly changing regulatory and compliance environment where news of enforcement actions appear seemingly every day. Compliance, like risk management generally, is embedded into the culture at Mintorn, led by our experienced legal and compliance teams. Outside of Mintorn we seek to ensure that all of our managers, vendors and third party partners have regulatory and compliance people, processes and procedures that are as robust as our own.
Some risks that institutions face may not result in direct financial consequences, but rather expose the institution to negative effects on their reputation. Mintorn is always cognizant of the impact our decisions may make on the reputations of our clients and our firm. Reputational harm can arise from negative press or damage to the perception of an institution among the public or within the institution’s operating community.
The true and ultimate risk our clients face is the potential inability to continue pursuing their missions. Mintorn takes all of the above risks into consideration when helping clients devise the appropriate investment policies and long-term strategies that will ensure their continued ability to execute in an uncertain future.
