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SVM to consider energy stocks for ethical engagement fund

SVM Asset Management is introducing an ethical fund that will have the ability to invest in oil and carbon-producing energy stocks.

The SRI pan-European opportunities fund, which launches on October 31, will use an engagement approach when buying into stocks typically excluded by ethical portfolios, agitating for companies to improve their environmental, social and corporate behaviour.

Co-manager Hugh Cuthbert says all meetings with company management will include SVM’s newly appointed SRI analyst Craig Jeruzal to monitor commitment to corporate responsibility. If no significant improvement is noted after 12 months,shares will be sold.

SVM says tobacco, pornography and defence stocks are ruled out from the fund.

Cuthbert, who runs SVM’s continental Europe fund, will be responsible for continental European stockpicks while UK opportunities fund manager Neil Veitch will input UK ideas.

Cuthbert says: “We want to engage and influence company management to adopt more ethical practices. If you have an oil company, why not have one that will treat its workers well?”

Gaeia Partnership IFA Olivia Bowen says: “There is definitely a place for pure engagement funds in the market. It is a kind of shareholder activism and could do a lot of good.”

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