In communicating what we do, we want to be as clear as possible regarding our choice of investments for Triodos investment funds and Triodos Bank Private Banking clients. To this end, we publish position papers on controversial sustainability topics. By being transparent we can assure our investors that their money is used exclusively to support socially and environmentally responsible businesses that serve as an example for others.
How we invest
A rigorous process that ensures sustainable success
So how do we ensure that the money our clients entrust to us is invested only in companies with the best sustainability performance? The short answer is we leave nothing to chance. We have strict social, environmental and governance criteria, and a rigorous research and selection process that provides a firm foundation for every investment decision.
Research and consultation
At Triodos Bank, we have our own Sustainability Research Department, responsible for keeping us up to date with the latest thinking on sustainability issues, monitoring legislative and regulatory developments, and ensuring that our selection process is based on the most relevant and reliable information available. In addition, to give us a broader perspective on what are often very complex issues, we've set up an international advisory panel which is made up of leading international experts, representing various interest and stakeholder groups.
A three stage selection process
Selecting listed companies for inclusion in the Triodos Investment Universe is a rigorous and systematic process. To ensure they meet our social and environmental requirements, companies are screened against a wide range of criteria, in a three stage process:
Step 1: Sustainable activities
We've identified certain types of products and services that contribute to the health and wellbeing of people and planet. Any company that derives over 50% of its revenues from sustainable activities of this kind qualifies for Triodos investment, provided they also pass step 3.
Step 2: Best-in-class
Companies that don't meet the step 1 criteria above can still qualify for investment if their all-round sustainability performance puts them among the best in their sector. We assess this using over 70 generic and sector-specific criteria, relating to environmental, social and governance issues. And companies whose score puts them in the top 50% within their sector qualify for Triodos investment, provided they also pass step 3.
Step 3: Minimum standards
Our minimum standards are Triodos Bank's bottom line: the absolute criteria we apply to ensure that we never fund any business engaged in any activities that are harmful to individuals, society or the environment. Companies that qualify through steps 1 or 2 must also meet these requirements before we'll consider investing in them.
Once companies have passed step 3, they are added to the sustainable universe. The actual investment decisions are made by our external asset manager. From our sustainable universe the external asset manager carefully selects the companies that are considered to have the best financial forecasts.
Position papers
As part of our transparency objective, we aim to clearly explain the criteria we use in our selection process. That is why we publish detailed descriptions of the position we take in specific sustainability issues.
Find out more
For more detailed information on our SRI process and criteria, you can download our Investment criteria .