Analysis of material sustainability and governance issues, alongside other considerations, helps us identify investment risks and opportunities. They can be, but are not necessarily, determinative to an investment decision.
Our approach
OUR APPROACH
We analyse material sustainability and governance issues as a part of our investment research to better understand long-term risks and opportunities as we strive to maximise returns for our investors.
Deciding what issues matter most
Evaluating material sustainability and governance risks and opportunities is embedded into our investment approach,
The Capital System™. Our three-part process enhances our invesment research and emphasises materiality at the
individual-issuer level.
PRO
Research & Investment Frameworks
Reflect material sustainability and governance considerations in 25+ sectors.
PRO
Monitoring Process
Uses available third-party data to flag a subset of investments in certain asset classes* for further research and review.
PRO
Engagement & Proxy Voting
Involves engaging with issuers on material sustainability and governance risks and opportunities and voting proxies solely in the financial interests of our clients.
WHY CAPITAL GROUP?
Our integrated approach
We identify investment opportunities with deep research and analysis, with partnership between investment professionals and the Sustainability & Governance team. Analysing material risks and opportunities (including those that relate to sustainability and governance topics) is a crucial aspect of how we assess an issuer's long-term potential to generate value.
LONG TERM
Taking the long view is crucial. We’ve been long-term investors for 90+ years.
DEDICATED TEAM
Our 40+ sustainability and governance professionals focus on proprietary research and analysis.
INTEGRATED
Our portfolio managers and investment analysts work to integrate material sustainability and governance considerations in their investment decision making.
INSIGHTS AND REPORTS
Must-read insights and much more
Reports, analyses, studies & policies
DISCLOSURES
Key term glossary
Corporate bond: A type of debt security issued by a corporation in order to raise financing for a variety of reasons, such as ongoing operations, expansions or mergers and acquisitions.
Engagement: The process whereby companies connect with their shareholders. The process typically includes participating in quarterly investor calls or in-person meetings. From an asset manager’s perspective, engagements are conducted to exchange views on material issues and gain a better understanding of the company, all with a view to protecting and growing the value of investments for the benefit of fund shareholders.
Sustainability and governance: A set of considerations related to (ESG) issues that could have a material impact on the value of an investment over time.
Governance: The system of rules, practices and processes by which a company or issuer is directed and controlled, typically through a board of directors and company management.
Issuer: A legal entity that develops, registers and sells securities to finance its operations. Issuers may be corporations, investment trusts, or governments.
Material: An issue is "material" if it could reasonably be considered to affect the value of an investment over time.
Proxy voting: A proxy vote authorizes a person or firm to cast a vote on behalf of the issuing company’s shareholder. Proxies typically are used by shareholders to elect a company’s board of directors, select independent auditors, approve executive compensation, and vote on other management- or shareholder-sponsored proposals.
Sovereign bond: A debt security issued by a national government.
Third-party data: Data provided by external vendors or data aggregators. Sources of data include company reports and proxy statements. Other sources include government databases, NGO reports, financial news, social media and company reviews.
*As at September 30, 2026, monitoring applies to holdings of corporate (equity and fixed income) and sovereign bonds.
All data as at 31 December 2025 unless otherwise stated. Source: Capital Group