Responsible investment

Newton believes that responsibly managed companies are best placed to achieve sustainable competitive advantage and provide strong long-term growth.

Following its analysis and engagement, Newton has decided to vote against the resolution (in favour of management) at the company's AGM.

Newton's responsible investment quarterly report covers corporate governance and SRI activity for Q1 2010. The report details Newton's comprehensive voting profile and includes rationale for resolutions where votes against were instructed during the quarter. The report also covers the quarter's engagement activity undertaken by the responsible investment team on corporate governance issues as well as the wider environmental and social matters facing the companies in which Newton invests.

Newton's energy supply investment theme recognises that the world is short of energy supply options. There is a strong likelihood that energy prices, particularly transportation fuels, will increase.

This theme is central to responsible investing and highlights the importance of the consideration of environmental, social and governance matters in Newton's investment approach.

Transport is a significant contributor to global greenhouse gas emissions. Governments and policy makers are implementing tougher regulatory measures in an effort to mitigate emissions from transport. Given increasing government intervention, companies in the transport sector will need to adapt their operations and business strategies accordingly.

A themed approach to investment - A nuclear renaissance appears likely. Increasing energy demand, concerns over climate change and a dependence on overseas supplies of fossil fuels are coinciding to make a strong case for new nuclear build. The global consensus that climate change is linked to the rise of
carbon dioxide in the atmosphere is likely to direct governments' thinking on future energy policies, in particular, in how to meet a growing energy demand through low carbon power generation.

Socially responsible investment and corporate governance are associated with many acronyms and organisations. Newton has prepared this glossary of terms to assist investors in their understanding and interpretation of responsible investment jargon.

During the past six months, the world has witnessed an unprecedented change in the financial markets. The end of cheap credit in development economies, for both consumer and company, will have far reaching consequences on future capital expenditure within the corporate world. As a result, fund managers across the world are realigning portfolios and reconsidering the future drivers of growth.