Philosophy Learn about how SEDCO Capital’s Philosophy encompasses ethical principles, diversity and partnership

overview

SEDCO Capital’s investment philosophy is based on the three principles of ethical investing, diversity and partnership.

We have pioneered a Prudent Ethical Investment (PEI) approach ensures we invest in companies that have strong governance, are well structured, have reasonable leverage and add value to the economies they work in. In short, we ensure that our investments benefit society, comply with Shariah and ESG investment principles, and refuse to create returns at the expense of others.

In 2014, we became the first Shariah compliant asset manager in the world, and the very first Saudi Arabian company, to become a signatory to the United Nations Principles for Responsible Investment (UNPRI). This principle-based framework ensures we incorporate Environmental, Social and Governance (ESG) variables when analysing risk for any investment.

SEDCO Capital’s careful due diligence and selection ensures every investment, irrespective of asset class, generates maximum value for our investors. We have created a broad and innovative spectrum of products that match the risk-return appetite for both Shariah-compliant and conventional investors.

Our diversity is our core strength. It enables an investment portfolio accessing many asset classes, spanning the entire risk spectrum, and covering all key global markets. Our investment strategy is as diversified as our asset classes, helping us match investor preferences with high-performing products time after time.

Finally, our partnership concept is instrumental in creating investor value. We are proud to emphasise lasting relationships built on mutual trust and shared success. In fact, we are committed to funding 20% of all investments - regardless of asset class – to cement our principles of collaboration, and demonstrate our confidence in our investment processes and reams. Our partnership model – where we back investments with our own resources – aligns our interests with those of our clients, and guarantees that our teams are constantly sourcing the best investment opportunities worldwide. Our global partnerships also create scale, reduce costs of doing business, increase negotiating power and help us access investment opportunities worldwide.

UNPRI

Bearys Global Research Triangle, Bangalore/ India –LEED Platinum Certified Green Building

SEDCO Capital CEO, Hasan AlJabri Signing The UNRPI

SEDCO Capital (SC) is the first Shariah-compliant signatory of the United Nations Principles for Responsible Investment (UNPRI) - the principle-based framework designed to incorporate Environmental, Social and Governance (ESG) characteristics in the context of analysing investment risk.

We recognise the synergy and similarities between Shariah compliance and responsible investment principles. Both aim to improve global living conditions and societal well being while establishing social equity and preventing injustice in trade relations. We believe that Shariah compliance is a viable next step for investors prioritising ethical investments.  Our research shows that adding Shariah compliance to ethical investments has the potential to increase returns while reducing downside risks.

Responsible investing and environmental, social and (corporate) governance aspects are an integral part of SEDCO Capital’s investment activities. We avoid undue risks and seek sustainable investments with strong governance that are in compliance with relevant regulation.

Ethical investment isn’t just a corporate principle for us. Our research also indicates that paying attention to ESG leads to long-term rewards for investors by reducing risk and generating potentially higher returns. Our holistic ESG framework incorporates non-financial factors to gain a truer understanding of investment risk during our analyses.

SEDCO Capital UNPRI Report

PRI 2017 Assessment Report For SEDCO Capital

2017 UNPRI Responsible Investment PEI Transparency Report - SEDCO Capital

https://www.unpri.org/report/reporting-for-asset-owners-and-investment-managers

How Can Responsible Investors Benefit from Islamic Criteria?

Sharia Compliance

SEDCO Capital prides itself on its ethical and Shariah-complaint investment framework. The company has pioneered its PEI (Prudent Ethical Approach) that combines the best of Shariah and responsible investing under a unified umbrella.

SEDCO Capital’s Shariah Compliance arm is the gatekeeper of our investment approach. It creates and implements thorough screening processes to ensure all investment activities are fully Shariah-compliant. Our Shariah Compliance team comprises renowned Shariah scholars that liaise with an internationally recognized Shariah audit firm based in the UK to oversee all transactions and investment implementation.

Our Compliance team has mandated strict rules for investing in the Shariah universe. For instance, we rule out companies with interest-bearing debt of over 33% of market capitalization when making our investment choices. For companies still under formation to qualify for potential investment, we insist on a debt to equity ratio equalling zero.

None of our portfolios invest in companies engaged in certain prohibited activities. Nor do we consider certain financial instruments and their derivatives - such as futures, options, swaps, short sales, and other trades that involve the payment or receipt of interest, either in cash or in kind.