Global Emerging Markets Sustainability

Global Emerging Markets Sustainability

The Global Emerging Markets Sustainability strategy invests in between 30-75 high-quality companies that are contributing to a more sustainable future.

Our Global Emerging Markets Sustainability strategy was launched in 2009 and invests in between 30 to 75 high-quality companies that are contributing to a more sustainable future. The strategy’s bottom-up approach allows us to find only the very best businesses from an investable universe of some 65,000 companies. We are looking for companies well positioned to contribute to long-term sustainable development; businesses with high quality management teams, franchises, and financials. 

Strategy highlights: a focus on quality and sustainability

  • Companies must contribute to sustainable development. Portfolio Explorer >

  • We invest in high-quality companies with exceptional cultures, strong franchises and resilient financials. How we pick companies >

  • We avoid companies linked to harmful activities and engage and vote for positive change. Our position on harmful products >

  • Our approach is long-term, bottom-up, high conviction and benchmark agnostic

  • We focus on capital preservation as well as capital growth – we define risk as the permanent loss of client capital

Latest insights

Quarterly updates

Strategy update: Q3 2024

Global Emerging Markets Sustainability strategy update: 1 July - 30 September 2024

Most of the quarter’s activity happened in September, as is often the case. It is in such moments, like the biggest market moves since 2009 in China and Hong Kong and rising geopolitical tensions in the Middle East, that we remain grateful for our long-term philosophy. It gives us the ability to step back in moments of such volatility and reminds us to focus on the more important, bottom-up drivers for the companies we own on your behalf.

Over the course of the quarter, we have sold out of one of our Indian banks. RBL Bank (India: Financials), which we purchased in December 2023. The new management team seemed determined to move the bank towards less risky (more secured) lending which at 1x price-to-book (P/B)1 appeared attractively priced. Unfortunately, the quarter after we purchased the company, it became clear that unsecured bank loans had been growing at over 30% and the path to a more balanced loan portfolio would be a lot longer than we had expected. Added to that, we are seeing a few banks that are struggling to grow their deposit base which impacts how they can fund their loan growth. For many years, most depositors avoided the public sector banks fearing either insolvency or potential loss of deposits. They have been cleaned up and professionalised which is great for the Indian saver and borrower but tougher for the private sector banks who benefitted from weak competition in the public sector. With prospects for RBL looking riskier and with better ideas elsewhere, we decided to exit.

We exited Yifeng Pharmacy Chain (China: Consumer Staples) which was another name where we were becoming worried about increased regulatory oversight having a negative impact on profit margins. We are confident that they will continue to roll up the pharmacy sector in China – in much the same way that RaiaDrogasil (Brazil: Consumer Staples) is doing in Brazil – but we worry that Beijing could well impose price cuts on those drugs purchased through medical insurance plans.

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We also fully sold out of Clicks (South Africa: Consumer Staples), another pharmacy chain. Growth has been phenomenal at this business with new store openings continuing apace and a better mix of basket driving profitability. However, with our focus on delivering strong absolute returns, we struggled to see Clicks growing into these valuations and decided to reallocate the capital into more attractively priced ideas elsewhere. We think Clicks remains a very high-quality business, one that we would look forward to owning again at more reasonable valuations.

Finally, we sold Integrated Diagnostics (Egypt: Health Care) due to liquidity risks and to fund higher conviction ideas elsewhere.

We did not make new complete purchases in the quarter.

We continue to discuss our China holdings at length, especially in light of the recent market moves. But another area where we are doing a lot of thinking is Poland. Here we hold Allegro (Poland: Consumer Discretionary), Dino Polska (Poland: Consumer Staples) and Jerónimo Martins (Portugal: Consumer Staples), which is listed in Portugal but >50% of revenues are from its Biedronka business in Poland.2 They all experienced strong growth through 2022 and 2023 as inflation helped them increase profit margin but the opposite has now happened. Deflation in food prices and rising costs have squeezed profit margins considerably.

As always, we spend the bulk of our time continuing to better understand the quality attributes of the companies we invest in and finding similarly resilient ideas to add to the portfolio.

1 Source: Bloomberg Finance L.P.

2 Source: Jerónimo Martins Annual Report 2023

Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Named new investments disclosed relate to holdings with a portfolio weight over 0.5%. It is not a recommendation or solicitation to purchase or invest in any fund. Differences between the representative account-specific constraints, currency or fees and those of a similarly managed fund or mandate would affect results.

Download a PDF copy

Select Strategy update and/or Proxy voting to produce a report. You can then download a copy of the report by clicking on the button.

You can build a bespoke report for all our strategies on the full Quarterly update report.

Stewart Investors Quarterly Client Update Q3 2024

1 July - 30 September 2024

Quarter update

Risk factors

This material is a financial promotion for the Stewart Investors strategies – Asia Pacific and Japan Sustainability, Asia Pacific Leaders Sustainability, Asia Pacific Sustainability, European Sustainability, European (ex UK) Sustainability, Global Emerging Markets Sustainability, Global Emerging Markets Leaders Sustainability, Indian Subcontinent Sustainability, Worldwide Sustainability and Worldwide Leaders Sustainability – and is intended for professional clients only in the UK, Switzerland and EEA and professional clients elsewhere where lawful.

Within the EU/EEA and Switzerland, the European (ex UK) strategy is only available to investors via a segregated mandate account.

Investing involves certain risks including:

  • The value of investments and any income from them may go down as well as up and are not guaranteed. Investors may get back significantly less than the original amount invested.
  • Emerging market risk: Emerging markets tend to be more sensitive to economic and political conditions than developed markets. Other factors include greater liquidity risk, restrictions on investment or transfer of assets, failed/delayed settlement and difficulties valuing securities.
  • Indian Subcontinent risk: although India has seen rapid economic and structural development, investing there may still involve increased risks of political and governmental intervention, potentially limitations on the allocation of the strategy’s capital, and legal, regulatory, economic and other risks including greater liquidity risk, restrictions on investment or transfer of assets, failed/delayed settlement and difficulties valuing securities.
  • Specific region risk: investing in a specific region  may be riskier than investing in a number of different countries or regions. Investing in a larger number of countries or regions helps spread risk.
  • Currency risk: the strategies invest in assets which are denominated in other currencies; changes in exchange rates will affect the value of the strategies and could create losses. Currency control decisions made by governments could affect the value of the strategies’ investments and could cause the strategies to defer or suspend redemptions of shares.
  • Concentration risk: the European Sustainability and Worldwide Leaders Sustainability strategies referred to in this material invest in a relatively small number of companies which may be riskier than a strategy that invests in a large number of companies.
  • Smaller companies risk: investments in smaller companies may be riskier and more difficult to buy and sell than investments in larger companies.

Where featured, specific securities or companies are intended as an illustration of investment strategy only, and should not be construed as investment advice or a recommendation to buy or sell any security.

If you are in any doubt as to the suitability of our strategies for your investment needs, please seek investment advice.

Investment philosophy

  • We are stewards: Our role is to allocate society’s capital to productive uses, in accordance with our Hippocratic Oath
  • We are long term: Our time horizon is measured in years, not weeks, and we value companies accordingly
  • We invest only in companies contributing to a more sustainable future: We engage constructively as owners to help companies on their sustainability journeys
  • We invest only in high-quality companies: We seek out companies with exceptional cultures, strong franchises and resilient financials
  • We believe capital preservation is important for capital growth: We define risk as the possibility of the permanent loss of client capital

Investment objective

To generate attractive long-term, risk-adjusted returns by investing in the shares of high-quality companies that are particularly well positioned to contribute to, and benefit from sustainable development.

Important information

This material is for general information purposes only. It does not constitute investment or financial advice and does not take into account any specific investment objectives, financial situation or needs. This is not an offer to provide asset management services, is not a recommendation or an offer or solicitation to buy, hold or sell any security or to execute any agreement for portfolio management or investment advisory services and this material has not been prepared in connection with any such offer. Before making any investment decision you should conduct your own due diligence and consider your individual investment needs, objectives and financial situation and read the relevant offering documents for details including the risk factors disclosure. Any person who acts upon, or changes their investment position in reliance on, the information contained in these materials does so entirely at their own risk.

We have taken reasonable care to ensure that this material is accurate, current, and complete and fit for its intended purpose and audience as at the date of publication but the information contained in the material may be subject to change thereafter without notice.

No assurance is given or liability accepted regarding the accuracy, validity or completeness of this material.

To the extent this material contains any expression of opinion or forward-looking statements, such opinions and statements are based on assumptions, matters and sources believed to be true and reliable at the time of publication only. This material reflects the views of the individual writers only. Those views may change, may not prove to be valid and may not reflect the views of everyone at First Sentier Investors.

Past performance is not indicative of future performance. All investment involves risks and the value of investments and the income from them may go down as well as up and you may not get back your original investment. Actual outcomes or results may differ materially from those discussed. Readers must not place undue reliance on forward-looking statements as there is no certainty that conditions current at the time of publication will continue. 

References to specific securities (if any) are included for the purpose of illustration only and should not be construed as a recommendation to buy or sell the same. Any securities referenced may or may not form part of the holdings of First Sentier Investors’ portfolios at a certain point in time, and the holdings may change over time.

References to comparative benchmarks or indices (if any) are for illustrative and comparison purposes only, may not be available for direct investment, are unmanaged, assume reinvestment of income, and have limitations when used for comparison or other purposes because they may have volatility, credit, or other material characteristics (such as number and types of securities) that are different from the funds managed by First Sentier Investors.

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or types or categories of individual where to allow such access would be unlawful or where it would require any registration, filing, application for any licence or approval or other steps to be taken by First Sentier Investors in order to  comply with local laws or regulatory requirements in such country.

About First Sentier Investors

References to ‘we’, ‘us’ or ‘our’ are references to First Sentier Investors, a global asset management business which 

is ultimately owned by Mitsubishi UFJ Financial Group (MUFG). Certain of our investment teams operate under the trading names FSSA Investment Managers, Stewart Investors and Realindex Investments, all of which are part of the First Sentier Investors Group.

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  • Other jurisdictions, where this document may lawfully be issued, by First Sentier Investors International IM Limited, authorised and regulated in the UK by the Financial Conduct Authority (reg. no. 122512; reg office 23 St. Andrew Square, Edinburgh, EH2 1BB; regcompany no. SC079063).

To the extent permitted by law, MUFG and its subsidiaries are not liable for any loss or damage as a result of reliance on any statement or information contained in this document. Neither MUFG nor any of its subsidiaries guarantee the performance of any investment products referred to in this document or the repayment of capital. Any investments referred to are not deposits or other liabilities of MUFG or its subsidiaries, and are subject to investment risk, including loss of income and capital invested.

© First Sentier Investors Group

Strategy update: Q2 2024

Global Emerging Markets Sustainability strategy update: 1 April - 30 June 2024

We have seen a continuation of geopolitical surprises throughout the quarter which have impacted investor sentiment causing near-term volatility.

Claudia Sheinbaum was elected the first female President of Mexico with such a resounding victory that her party now holds a two-thirds majority in both congressional houses, which means it could make constitutional changes such as the proposal that Supreme Court judges would be directly elected by popular vote. India completed the largest democratic election in the world with a surprise vote removing Narendra Modi and the Bharatiya Janata Party’s absolute majority in the Lok Sabha (also known as the House of the People and the lower house in the Indian Parliament). The Nifty 50 (top 50 stocks by market capitalisation listed on the National Stock Exchange of India) rose the day before the election on the expectation that Modi would get over 400 seats. It then fell 7% when the news broke that he had lost his absolute majority before rising again in the days afterwards as the market decided Modi staying in power with a reduced majority was a positive for Indian democracy1. It is at times like this that we are thankful for our philosophy and bottom-up stock picking process with a focus on quality and a 10-year time horizon on growth, allowing us to take advantage of irrational price movements.

We sold out of seven companies and only added one through the second quarter which is higher turnover than previous quarters. We sold Amoy Diagnostics (China: Health Care) after a period of better performance. Whilst we still like the way the business is managed, the high operating margins (c.27%) generated in the healthcare sector means we have become worried about the regulatory environment potentially aiming to reduce those margins. We sold Kingmed Diagnostics (China: Health Care) for the same reason and both Amoy and Kingmed are good examples of where top-down or macro views on a country and sector can break an investment case.

We also sold Tech Mahindra (India: Information Technology) and Dabur (India: Consumer Staples) having bought into both in 2009. Tech Mahindra (known then as Satyam) and Dabur have delivered mid-teen annual performance since first bought. Whilst we still believe that they are good companies, valuations are becoming problematic. Tech Mahindra has been a great investment over the last ten years but we believe we have a better option for the next ten years in Tata Consultancy Services (India: Information Technology). Tech Mahindra has seen margins reduce and it is also expensive. Dabur is a soaps and detergents producer in India which has delivered high earnings but we expect growth to be lower in the future. Valuations in India remain one of our biggest concerns and we have been trimming back our positions there including Marico (India: Consumer Staples) and Mahindra & Mahindra (India: Consumer Discretionary) due to valuations. We also sold Pigeon (Japan: Consumer Staples) as we lost conviction in the speed and extent of the evolution of the franchise which is facing rising headwinds such as declining birth rates.

Finally we sold out of Banco Bradesco (Brazil: Financials) and Infineon Technologies (Germany: Information Technology). Infineon is a semiconductor designer and manufacturer mainly serving the automotive sector (c.45% of revenues2) and it is moving into software solutions, but we feel there are better ideas elsewhere. Banco Bradesco was a mistake which we are rectifying by exiting the position. We underestimated the impact of Nubank (a financial technology bank, known as a neobank) on the country’s banking sector and Banco Bradesco is clearly late in providing fintech and more advanced digital banking services. To compete, the company is going to have to undertake a massive amount of organisational and cultural change at a time when Brazil’s economy is looking precarious with inflation potentially beginning to reappear.

The only new company we have purchased is MediaTek (Taiwan: Information Technology), a leading fabless (outsources production) design house in Asia. It has followed TSMC in its relentless focus on quality though it has arguably been more focused on the affordability of technology, helping to provide innovative solutions to many global development challenges and democratising technology. Barriers to entry are getting higher with faster product cycles and longer lead times in terms of design but they have access to great designers in Taiwan. The company has sound financials and good management and we aim to hold this company for the long term.

We have been selectively adding to some positions in technology companies where we took advantage of price movements to continue building a long-term position. We added to Samsung Electronics (South Korea: Information Technology) as we believe it is in the early stages of a memory cycle recovery. We also added to Globant (Argentina: Information Technology) which suffered as IT capital expenditure (capex) was postponed by several customers, but growth has held up better than we expected and we don’t see it as too expensive.

1 Source: Bloomberg

2 Source: Stewart Investors investment team and company data

Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Named new investments disclosed relate to holdings with a portfolio weight over 0.5%. It is not a recommendation or solicitation to purchase or invest in any fund. Differences between the representative account-specific constraints, currency or fees and those of a similarly managed fund or mandate would affect results.

Strategy update: Q1 2024

Global Emerging Markets Sustainability strategy update: 1 January - 31 March 2024

Over the course of this quarter, we exited our positions in three holdings and initiated in one new company.

The first of the three exits was Vinda International (China: Consumer Staples), a Hong Kong listed tissues maker that was steadily offering higher-quality hygiene products with higher pricing power. The company was stewarded by the combination of the Li family as owner-managers and Essity, the Swedish multinational. We exited our holding in the company after a bid to acquire the company was accepted by the majority shareholders.

We also exited Komerční banka (Czech Republic: Financials) and Infosys (India: Information Technology). Both companies remain high-quality, well-run franchises but were getting closer to fairly valued rather than cheap. As such, we decided to use the proceeds to invest in ideas where we saw the potential for better returns.

One such example is Allegro (Poland: Consumer Staples), a dominant e-commerce platform in Poland with c.40% market share, nine times larger than their nearest competitor. Allegro has been able to steadily defend this market share against new entrants, even through a period of mismanagement. With a new CEO in place, Allegro is focused on improving their international operations and re-focusing on profitable growth.

We also took the opportunity as valuations have come off across a number of our high-quality Chinese holdings to continue to build position sizes. A few of these include Glodon (China, Information Technology), Milkyway Intelligent Supply Chain Service (China: Industrials), and Yifeng Pharmacy Chain (China: Consumer Staples) – all well placed to be the leaders in their respective industries, aligned with the broader sustainable development of the economy, and remain on reasonable valuations for steady earnings growth.

Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Named new investments disclosed relate to holdings with a portfolio weight over 0.5%. It is not a recommendation or solicitation to purchase or invest in any fund. Differences between the representative account-specific constraints, currency or fees and those of a similarly managed fund or mandate would affect results.

Strategy update: Q4 2023

Global Emerging Markets Sustainability strategy update: 1 October - 31 December 2023

Over the course of this quarter, we initiated four new positions in the portfolio. Two of these new positions are in China: Centre Testing International (China: Industrials) and Midea (China: Consumer Discretionary). 

Centre Testing International provides inspection and certification services for industrial and consumer products across China, ensuring product quality and safety standards. The franchise benefits from being one of the first movers in the country, and continues to take share in a fragmented market as scrutiny rises on health, environmental and product standards. The balance between long-term family stewards and a professional manager who spent decades at one of the world’s leading inspection and certification services firms helped us build conviction in the quality of people here as well.

We also initiated a position in Midea, China’s dominant domestic home appliances manufacturer. Midea is taking the cash flows from this business, and reinvesting behind expanding into attractive growth areas like digital building automation, integrated energy management and industrial robots.

The third new position was a re-initiation in Samsung Electronics (South Korea: Information Technology). We have long admired the strength of the Samsung Electronics franchise, along with the ability they have shown to evolve. We believe current valuations do not reflect a recovery in the memory market, or the investments that Samsung Electronics continues to make behind long-term growth. The business continues to have an impressive ability to generate cash, and a solid balance sheet.

Finally we initiated a new position RBL Bank (India: Financials), a private bank in the midst of a turnaround. The bank lost its way through aggressive growth leading to high non-performing loans (NPLs). As a measure of abundant caution India’s central bank stepped in to change management and solidify the foundations of the bank. We believe new management is putting in place the right systems to build a quality credit culture with a focus on lower risk assets funded mostly by deposits. A successful turnaround could yield attractive returns for shareholders.

We have also continued adding to some of our high-quality holdings where valuations have become more attractive. One such example is WEG (Brazil: Industrials), a manufacturer of electric motors, which are sold into areas like electric vehicles (EVs) and renewable energy with structural growth opportunities. WEG has been consistently investing behind expanding outside of Brazil and is focused on Mexico, China, and India as their next large regions of growth. Alongside, they have recently completed their largest acquisition with the balance sheet remaining in sound health.

To fund these additions we trimmed a few positions where valuations had become less attractive including MercadoLibre (United States: Consumer Discretionary), Hoya (Japan: Health Care), and Infosys (India: Information Technology). In each of these cases, we continue to have conviction in the quality of people and the franchises, but believe increasingly stretched valuations suggest we might have better opportunities elsewhere.

Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Named new investments disclosed relate to holdings with a portfolio weight over 0.5%. It is not a recommendation or solicitation to purchase or invest in any fund. Differences between the representative account-specific constraints, currency or fees and those of a similarly managed fund or mandate would affect results.

Download a PDF copy

Select Strategy update and/or Proxy voting to produce a report. You can then download a copy of the report by clicking on the button.

You can build a bespoke report for all our strategies on the full Quarterly update report.

Stewart Investors Quarterly Client Update Q3 2024

1 July - 30 September 2024

Quarter update

Investment philosophy

  • We are stewards: Our role is to allocate society’s capital to productive uses, in accordance with our Hippocratic Oath
  • We are long term: Our time horizon is measured in years, not weeks, and we value companies accordingly
  • We invest only in companies contributing to a more sustainable future: We engage constructively as owners to help companies on their sustainability journeys
  • We invest only in high-quality companies: We seek out companies with exceptional cultures, strong franchises and resilient financials
  • We believe capital preservation is important for capital growth: We define risk as the possibility of the permanent loss of client capital

Investment objective

To generate attractive long-term, risk-adjusted returns by investing in the shares of high-quality companies that are particularly well positioned to contribute to, and benefit from sustainable development.

Important information

Reference to specific securities (if any) is included for the purpose of illustration only and should not be construed as a recommendation to buy or sell the same. All securities mentioned herein may or may not form part of the holdings of Stewart Investors’ portfolios at a certain point in time, and the holdings may change over time. 

Important information

The information contained within this material has been obtained from sources that First Sentier Investors (“FSI”) believes to be reliable and accurate at the time of issue but no representation or warranty, expressed or implied, is made as to the fairness, accuracy, completeness or correctness of the information. To the extent permitted by law, neither FSI, nor any of its associates, nor any director, officer or employee accepts any liability whatsoever for any loss arising directly or indirectly from any use of this. This material is intended solely for distribution to professional/institutional investors as may be defined in the relevant jurisdiction and is not intended for distribution to the public. The information herein is for information purposes only; it does not constitute investment advice and/or recommendation, and should not be used as the basis of any investment decision. Some of the funds mentioned herein are not authorised for offer/sale to the public in certain jurisdiction.

The value of investments and the income from them may go down as well as up and you may not get back your original investment. Past performance is not necessarily a guide to future performance. Please refer to the offering documents for details, including the risk factors.

Reference to specific securities (if any) is included for the purpose of illustration only and should not be construed as a recommendation to buy or sell the same. All securities mentioned herein may or may not form part of the holdings of Stewart Investors’ portfolios at a certain point in time, and the holdings may change over time.

Some of the information in this document has been compiled using data from a representative strategy accounts. This information relates to existing Stewart Investors strategies and has been provided to illustrate Stewart Investors’ expertise in the strategies This material is provided for information purposes only and does not constitute a recommendation, a solicitation, an offer, an advice or an invitation to purchase or sell any fund and should in no case be interpreted as such. The distribution or purchase of shares in any funds, or entering into an investment agreement with First Sentier Investors or Stewart Investors may be restricted in certain jurisdictions.

This material and the information contained herein may not be reproduced in whole or in part without the prior consent of FSI. This material shall only be used and/or received in accordance with the applicable laws in the relevant jurisdiction.

In Hong Kong, this material is issued by First Sentier Investors (Hong Kong) Limited and has not been reviewed by the Securities & Futures Commission in Hong Kong. In Singapore, this material is issued by First Sentier Investors (Singapore) whose company registration number is 196900420D. This advertisement or material has not been reviewed by the Monetary Authority of Singapore. First Sentier Investors and Stewart Investors are business names of First Sentier Investors (Hong Kong) Limited. First Sentier Investors (registration number 53236800B) and Stewart Investors (registration number 53310114W) are business divisions of First Sentier Investors (Singapore).

First Sentier Investors (Hong Kong) Limited and First Sentier Investors (Singapore) are part of the investment management business of First Sentier Investors, which is ultimately owned by Mitsubishi UFJ Financial Group, Inc. (“MUFG”), a global financial group. First Sentier Investors includes a number of entities in different jurisdictions.

MUFG and its subsidiaries are not responsible for any statement or information contained in this material. Neither MUFG nor any of its subsidiaries guarantee the performance of any investment or entity referred to in this material or the repayment of capital. Any investments referred to are not deposits or other liabilities of MUFG or its subsidiaries, and are subject to investment risk, including loss of income and capital invested.

© First Sentier Investors 

Proxy voting

Proxy voting: Q3 2024

Global Emerging Markets Sustainability proxy voting: 1 July - 30 September 2024

Proxy voting by country of origin

Proxy voting by proposal category

During the quarter there were 153 resolutions from 17 companies to vote on. On behalf of clients, we voted against three resolutions.

We voted against the appointment of the auditor at Philippine Seven as they have been in place for over ten years. The company has given no information on intended rotation which we believe is important for ensuring a fresh perspective on the accounts. We also voted against proposals on transaction of business, as the company did not provide enough information about the proposals. We wanted to avoid giving them unrestricted decision-making power without sufficient clarity. (two resolutions)

We voted against the appointment of the auditor at Vitasoy as they have been in place for over ten years. The company has given no information on intended rotation which we believe is important for ensuring a fresh perspective on the accounts. (one resolution)

Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Proxy voting chart numbers may not add to 100 due to rounding. SHP means: Shareholder Proposal.

Proxy voting: Q2 2024

Global Emerging Markets Sustainability proxy voting: 1 April - 30 June 2024

Proxy voting by country of origin

Proxy voting by proposal category

During the quarter there were 412 resolutions from 38 companies to vote on. On behalf of clients, we voted against 14 resolutions.

We abstained from voting on amendments to work systems for independent directors and board meeting procedures at Amoy Diagnostics as the company did not provide sufficient data on the proposed amendments. (two resolutions)

We voted against the appointment of the auditor at EPAM Systems, Glodon, Yifeng Pharmacy Chain and Zhejiang Supor as they have been in place for over 10 years and the companies’ have given no information on intended rotation. We believe rotating an auditor on a relatively frequent basis (e.g. every 5-10 years) helps to ensure a fresh pair of eyes are examining the accounts, and follows best practice. (four resolutions)

We voted against the proposed employee stock ownership plan at Midea as we believe non-executive director involvement could lead to conflict of interest and would not be in shareholders' interest. (three resolutions)

We abstained from voting on amendments to articles at Quálitas as the company did not provide sufficient information on the amendments. (one resolution)

We voted against the recasting of votes for the supervisory council at RaiaDrogasil as we believe the principle of recasting votes for an amended slate is poor practice and would prefer the slate to be resubmitted for voting. (one resolution)

We abstained from voting on a series of proposals regarding capital and shares allocation and board elections and reports at Regional as the company provided insufficient information. (12 resolutions)

We voted against the establishment of a supervisory council and cumulative voting at TOTVS as no detail on the candidates was provided. (two resolutions)

We voted against recasting and cumulative voting at WEG as this would allow the board to make changes without shareholder assessment or knowledge of candidates. (three resolutions)

We abstained from voting on requests for a separate board election and the election of a Supervisory Council position at WEG due to insufficient information and our preference for the current family stewards to remain in place. (two resolutions)

We voted against a shareholder proposal regarding board declassification at EPAM Systems as we do not deem it necessary for all directors to stand for election annually and believe this could destabilise the board by allowing excessive turnover. (one resolution)

Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Proxy voting chart numbers may not add to 100 due to rounding. SHP means: Shareholder Proposal.

Proxy voting: Q1 2024

Global Emerging Markets Sustainability proxy voting: 1 January - 31 March 2024

Proxy voting by country of origin

Proxy voting by proposal category

During the quarter there were 190 resolutions from 20 companies to vote on. On behalf of clients, we voted against 8 resolutions.

We voted against a Board appointment at Banco Bradesco as we would encourage the appointment of more external independent Directors. We also voted against an increase in Authorised Capital as we found the proposed dilution to be overly high, and voted against requests for cumulative voting and to recast votes for an amendment on the day of voting. (five resolutions)

We voted against excessive executive remuneration at Bank Central Asia. (one resolution)

We voted against an adjustment of the Guarantee for Controlled Subsidiaries Assets Pool Business at Midea as we found the guarantee amount to be excessive and not in shareholders' best interests. (one resolution)

We voted against a Board appointment at Samsung Electronics as we would prefer to see more independent, non-family associated Directors. (one resolution)

Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Proxy voting chart numbers may not add to 100 due to rounding. SHP means: Shareholder Proposal.

Proxy voting: Q4 2023

Global Emerging Markets Sustainability proxy voting: 1 October - 31 December 2023

Proxy voting by country of origin

Proxy voting by proposal category

During the quarter there were 48 resolutions from 11 companies to vote on. On behalf of clients, we did not vote against any resolutions.

Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Proxy voting chart numbers may not add to 100 due to rounding. SHP means: Shareholder Proposal.

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For illustrative purposes only. Reference to the names of example company names mentioned in this communication is merely for explaining the investment strategy and should not be construed as investment advice or investment recommendation of those companies. Companies mentioned herein may or may not form part of the holdings of Stewart Investors. Holdings are subject to change.

Certain statements, estimates, and projections in this document may be forward-looking statements. These forward-looking statements are based upon Stewart Investors’ current assumptions and beliefs, in light of currently available information, but involve known and unknown risks and uncertainties. Actual actions or results may differ materially from those discussed. Readers are cautioned not to place undue reliance on these forward-looking statements. There is no certainty that current conditions will last, and Stewart Investors undertakes no obligation to correct, revise or update information herein, whether as a result of new information, future events or otherwise.

Source: Stewart Investors investment team and company data. Securities mentioned are all investee companies* from representative Asia Pacific Sustainability Strategy, Asia Pacific & Japan Sustainability Strategy, Asia Pacific Leaders Sustainability Strategy, European Sustainability Strategy, European (ex UK) Sustainability Strategy, Global Emerging Markets (ex China) Leaders Sustainability Strategy, Global Emerging Markets Leaders Sustainability Strategy, Global Emerging Markets Sustainability Strategy, Indian Subcontinent Sustainability Strategy, Worldwide Sustainability Strategy and Worldwide Leaders Sustainability Strategy accounts as at 30 September 2024. *Assets that the strategies may hold which an active decision has not been made, and sustainability assessment does not apply, include cash, cash equivalents, short-term holdings for the purpose of efficient portfolio management and holdings received as a result of mandatory corporate actions. Holdings of such assets will not appear on Portfolio Explorer.

The Stewart Investors supports the Sustainable Development Goals (SDGs). The full list of SDGs can be found on the United Nations website.

Source for Climate Solutions and impact figures: © 2014–2024 Project Drawdown (drawdown.org). Source for Human Development Pillars: Stewart Investors investment team.

Source for climate solutions and human development analysis and mapping: Stewart Investors investment team. Contributions are defined by the team as demonstrable contributions to any solution, either direct (directly attributable to products, services or practices provided by that company), or enabling (supported or made possible by products or technologies provided by that company).

Investment terms

View our list of investment terms to help you understand the terminology within this document.