Ethical Hub : Ethical Reviews - Ethical Investment Review March 2023

Climate Action 100+

As has been previously reported, The CFB/Epworth are co-leads for Climate Action 100+’s {CA100+) engagement with the multinational mining company Anglo American. The efforts undertaken by the CFB/Epworth, the other co-leads, and supporting investors has moved Anglo American to set a goal to reduce net emissions to zero in the long-term, publish a detailed pathway of actions, publish a scope 3 inventory, conduct scenario analysis, and improve governance and transparency on indirect lobbying. Most recently, again in line with CA100+ requests, the company included in its latest climate report a 1.5 degree scenario analysis, actions to support a just transition and a quantitative Scope 3 ambition.

The collaborative group is now focussing its attention on Anglo’s methane emissions from the mining of coking coal. The mining of coking coal is a major source of methane emissions globally. The IEA calculates that more methane is released by coking coal mining than from the world’s gas pipelines and LNG facilities combined. In addition, methane has a much greater global warming potential than carbon dioxide, increasing the urgency of managing these emissions.

Methane emissions represent the largest component of Anglo American’s Scope 1 emissions. The current Scope 1 and 2 emissions targets cover methane emissions, however, given the significance of methane to Anglo American’s operational emissions, it is important for investors to be able to evaluate progress towards mitigating methane emissions. As such, the CFB/Epworth and the CA100+ co-lead, Robeco. have asked Anglo to set methane-specific reduction targets.

Brooks Macdonald

The Epworth UK Equity Fund has held exposure to Brooks Macdonald for over 5 years, a relatively small Wealth Management business with operations in the UK and the Channel Islands.

The business has made significant progress improving its financial position and growth opportunity in recent years, but has provided more limited tangible progress that it is improving its ethical profile. Examples of success have included voting consistently against the remuneration report, which has yielded productive conversations and improvements in the remuneration approach adopted by the company.

However, the company has made much slower progress on its broader sustainability approach and impact, partly because of changes at senior leadership level in recent years, which has frustrated us in our objective of seeking our investments to be clear leaders in the sectors and industries. As a result, we have communicated our concerns at the slow progress to the CEO directly in more recent meetings, highlighting that Brooks should really be an accredited Living Wage employer by now as an example, and asking why there is not clear representation for sustainability issues at board level.

The company has promised us that it will release a much more comprehensive sustainability report later this year. which it hopes will coincide with it achieving B Corp certification status, and it will also look to achieve the Living Wage accreditation. We look forward to continuing this engagement and seeing the business deliver more substantial progress in these important non-financial areas.


In the wake of HSBC’s announcement to cease new fossil fuel project funding, we co-signed letters organised by ShareAction to Barclays and BNP Paribas, encouraging these banks to do the same and cease direct financing of new oil and gas fields. The goal is to create a snowball effect in the European banking industry following HSBC’s announcement, whereby banks stop funding new fossil fuel projects.

MJ Gleeson

Since our last meeting, and arguably as a direct result of our regular shareholder questions at meetings over the last 5 years, Gleeson has set the following targets/achieved the following:

  • Concrete bricks have half the embodied carbon of traditional bricks (saving around 1.8tonnes per home). These bricks are currently used to build about 6% of Gleeson homes, but the company is targeting raising this to 27% by FY 2024.
  • Currently 8% of Gleeson homes include an EV charging point, the company is targeting raising this to 14% in FY 2024
  • Having successfully trialled Air Source Heat Pumps instead of gas boilers on new homes, the company is targeting this being the standard method of heating all of its new homes within 2 years, and hopefully sooner.
  • The company recruited a senior ecologist to lead a team to drive the company’s biodiversity strategy on its sites, seeking ways to minimise the impact of its developments on the local environment and promote it where possible – this is an area we have raised a few times with the company and are delighted to see progress being made. It appears to already be helping result in tangible improvements in the company’s engagement with local communities, which is often a challenge for new developments.
  • Signed up to the UN Global Compact
  • Retained the Fair Tax Mark for the 3rd successive year, still the only housebuilder to have this accreditation after we introduced it to them.
  • Gleeson encourages its staff and contractors to take part in the BBC’s DIV SOS programme whenever they are working in an area local to a Gleeson site
  • Gleeson believes this progress is evidence that it is moving faster on these issues than any of its peers.

In addition, despite the increase in inflation & interest rates over the last year and the pressure on Gleeson’s cost base, it is still the case that a couple on the Government’s National Living Wage can afford to buy a Gleeson home on any of Gleeson’s developments (and not just the basic 2 bed house either). This is partly because Gleeson’s homes are already very well insulated, so much cheaper to heat than comparable legacy housing stock (use almost 50% less energy).

The company is trialling adding solar panels and/or battery storage, but there is a delicate balance to strike to ensure the home remains very affordable, and the size & position of roof space is not always conducive to this being worthwhile. Overall, these changes take time because they need to be planned in from an early stage on each site, ensuring practical aspects like affordability, local infrastructure, energy supply etc are not stressed (the conflict between its environmental and social responsibilities), and this all means there is quite a lag before it filters through into all completed homes.

Future engagement will seek to push for further ambitious targets being set and met to ensure Gleeson is accelerating towards being a net­zero housebuilder.


We corresponded with Unilever in 2019 regarding conditions of employment on Assam tea estates and were encouraged to read about the work that Unilever was doing to improve the lives of people working in tea production.

We were alarmed, however, to read the February 2023 BBC article regarding allegations of sexual abuse on Kenyan tea farms at a time when Unilever retained an economic interest in the country, which turned our attention to the risk of sexual abuse across the Assam tea estates in India.

In February 2023 we began an engagement programme with Unilever to learn more about what role the company is playing in trying to put an end to this abuse.

Carbon Footprint

The Epworth funds listed below report on their carbon footprint using independently verified data provided by Clarity AI.

  • As at the 31 March 2023, the Epworth UK fund had a carbon footprint 19% below its benchmark of the All-Share Index.
  • The Epworth Climate Stewardship fund has a mandate to have a carbon footprint substantially below (at least 15%) that of the FTSE All Share Index. As at the end of March 2023, the footprint of the fund was 70% less intensive than its benchmark.
  • The Epworth Global Equity fund at the end of March 2023 was 70% less intensive than its benchmark of the FTSE All-World index.
  • The Epworth Corporate Bond Fund as at the end of March 2023 is 60% less carbon intensive than its benchmark.