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Sustainability Methodology

Grandeur Peak is committed to world-class standards across everything we do. This means we are continuously strengthening the frameworks that govern all aspects of our work. Sustainability issues, which include environmental and social justice, along with management oversight and transparency, are financially material and, therefore, central to the quality ratings our research team assigns to all companies held in our funds. In order to continuously strengthen our work on these issues, our Sustainability Committee is on a perpetual fact-finding mission with scholars and practitioners around the world. We invite all of our stakeholders to help us build a world-class sustainability framework.

Stakeholder Justice

Sustainability is a fiduciary issue for Grandeur Peak. Our sustainability framework focuses on analyzing and influencing the extent to which our companies exercise stakeholder justice. We believe that the stakeholder justice profiles of our companies are financially material. Stakeholder justice work is, therefore, a fiduciary matter, requiring our best efforts, which we divide into standards of independent research, company engagement and universal treatment.

We Believe Sustainable Companies Exercise Stakeholder Justice

  • Companies have stakeholders beyond large shareholders (small shareholders and non-shareholders)
  • These (non-large shareholder) groups have historically been marginalized and exploited
  • In our view, practices that marginalize and exploit stakeholders are unsustainable

Therefore, we believe companies with weak stakeholder justice profiles are unsustainable

Stakeholder Justice Profiles Are Material to Our Investment Strategy

  • The fiduciary objective of all Grandeur Peak Funds is long-term capital growth
  • We seek long-term capital growth by buying and holding what we believe to be best-in-class companies
  • Unsustainable companies are, in our opinion, not best-in-class companies that we can hold long term

Therefore, companies’ stakeholder justice profiles are material to our investment strategy

Stakeholder Justice Work Requires Our Highest Standard of Care

A fiduciary duty represents the highest standard of care, which we divide into three specific standards

  • Independence: Our investment team does 100% of our stakeholder justice work
  • Engagement: Deep dives, including impact work, with 100% of our companies
  • Universality: Our stakeholder justice work applies to 100% of our funds

We approach sustainability in a spirt of sincerity. We believe that continuously strengthening the sustainability profiles of our funds is in our common interest as shareholders, as well as the right thing to do. And doing this in the right way requires hard work, consistent with our painstaking framework. Our pledge to you, fellow shareholders, is to continue engaging our sustainability framework on your behalf with earnestness and thoughtfulness.

The Grandeur Peak Team

Engagement Methodology

We rate the stakeholder justice profiles of every company held in our funds. The analytical construct through which we execute this work is called our stakeholder justice chain.

Specifically, through the sequence of actions that a company performs, we ask company leaders how each action:

INFLUENCES CLIMATE CHANGE AND BIOLOGICAL DIVERSITY

TOUCHES VOLUNTARY AND INVOLUNTARY COUNTERPARTIES

IS EXPOSED TO OVERSIGHT AND TRANSPARENCY

Our objective is twofold: rating accuracy and rating improvement.

Our high-touch engagement methodology represents our best efforts towards those ends. Based on our materiality opinions on company disclosures, which directly influence the strength or weakness of a company’s candidacy for weight in our funds, we assign ratings and identify potential sources of both upward and downward rating migration. As active owners, we share our observations with company leaders. An effectively perpetual feedback loop is set in motion, creating opportunities for us to strengthen the accuracy of our ratings and for company leaders to strengthen their respective stakeholder justice profiles.

Advisory Board

The analysis of stakeholder justice profiles in the course of our sustainability work frequently leads to conceptual complexity or conflicting considerations. We engage an independent board of scholars in these fields for this reason. These experts advise us on challenging cases and help us to progress through categorically resolving specific recurring complexities or conflicts.

Catherine Wolfram
Catherine Wolfram
Professor
UC Berkeley

Energy Policy, Environmental Economics, Energy in the Developing World

Maximillian Auffhammer
Maximillian Auffhammer
Professor
UC Berkeley

Environmental Economics, Climate Change, Energy Economics

Magali Delmas
Magali Delmas
Professor
UCLA

Business Strategy, Corporate Sustainability, Information Strategies to Promote Conservation Behavior

Stephen Gardiner
Stephen Gardiner
Professor
University of Washington

Ethical Theory, Political Philosophy and Environmental Ethics

Global Coalition

Collaborating with best-in-class asset managers around the world is an important part of our culture and process. One of the mechanisms through which that collaboration happens is common affiliation with progressive sustainable investment organizations. We are proud members of the following organizations, in the interest of strengthening shareholder justice.

Environmental & Social Impact

Grandeur Peak offers financial support to all employees taking steps to decarbonize. The firm offers employees an electric (EV) or hybrid electric vehicle (HEV) subsidy, as well as a comprehensive public transportation benefit, the Hive Pass. The firm also subsidizes solar panels for employees’ residences.

We work to expand opportunities for women and minorities historically underrepresented in the financial services industry. Our outreach initiatives include scholarships at local universities, on-campus engagement and sponsoring networking opportunities for the local financial services industry.