Responsible Investing News

Sustainability preferences

Investing isn’t just about making money – it’s also about what you care about. That’s where sustainability preferences come in. Basically, it’s about whether you want to invest in companies that are considering the environment, how people are treated and are seeking to be responsible in the way they are run. You might hear this called ESG investing (Environmental, Social, and Governance), or just ‘responsible investing’.

Let’s say a company is trying to cut pollution or treat its workers well – that could be seen as a good sign for long-term success. On the other hand, ignoring things like climate change might lead to risks like higher costs or damage to their reputation, especially as international regulation in this area increases.

What do you want your money to support?

You get to choose how much you care about these issues when you invest. Here’s how you might think about it:

You want to support changemakers – You want your money to go to companies actively trying to create positive change in the world, like providing solutions to help with climate change.

You’re all in for ESG – You believe companies should be open and responsible, and you want your investments to reflect that.

You’re not that bothered – You’d rather focus on the financial, with no ESG considerations.

UK Government initiatives to support investing for positive change

The UK Government has launched some plans to drive more investment into the UK and areas which will help move towards a sustainable low-carbon economy:

• Pension Schemes Bill (2025) – Encouraging more investment in local infrastructure, private businesses and green tech.
• Modern Industrial Strategy (2025) – a ten-year plan to grow industries of the future like clean energy and artificial intelligence.
• Nature and Development Bill (2025) – overhauling planning while safeguarding nature and boosting investment in nature-based projects.

This is likely to increase sustainable investments seeking to achieve positive change either for people or the planet alongside financial returns. This is way of investing which can align investing with people’s values and help to address global challenges such as nature loss and the need to decarbonise the economy.

Our Climate Change fund’s sustainability characteristics mean it invests both for a long-term return and with the aim to invest in companies seeking to provide solutions to address climate or environmental issues. Learn more about our Climate Change Fund.

Voting season 2025

An important part of responsible investing is being an active owner, which includes using voting rights. Shareholders have the right to vote in companies’ Annual General Meetings (AGMs). Aberdeen Investments, our investment adviser, votes on our funds which directly own shares, such as the UK Index Tracking Trust and Climate Change Fund. For our Fund of Funds which own shares this is carried out by the fund’s investment manager.

We’re now well into this year’s voting season, with the second quarter of the year being a busy time. We thought it a good time to reflect on key themes and provide a couple of voting examples for our funds.

Key themes

• Climate risk and planning – encouraging better information and targets
• Political spending and lobbying – more information or raising concerns
• Environmental management – more action on key issues
• Human rights and supply chains – concerns over labour and indigenous rights
• AI governance and data ethics – more disclosure on governance and risks

A few recent votes:

• Virgin UK Index Tracking Trust – vote against BP’s Chair of the Board of Directors in response to moving away from its climate commitments. 24% of shareholders voted against which is a significant opposition and a clear signal of discontent.
• Climate Change Fund – vote against Novo Nordisk’s shareholder vote about working conditions due to a lack of evidence. The vote received limited backing from investors with less than 5% support.
• Growth Funds – Aberdeen Investments voted for META’s shareholder vote requesting reporting on hate targeting marginalised communities. Aberdeen has concerns over oversight and transparency in addressing harmful content on its platforms. 46.8% of independent shareholders voted ‘for’ in the meeting, however due to META’s ownership structure (over 50% of votes are held by founder Mark Zuckerberg) this represents only 14.6% of overall votes.

Even if some votes don’t pass, they send a message – and sometimes investors escalate by voting against board members to send a signal and hold them to account.

For more details on significant votes from 2024, as well as our policy on voting, see our Investor Engagement Policy.

Responsible investing funds’ performance

Good news – our responsible investing funds are meeting key measures that go beyond just financial returns. Our responsible investing approach has now been implemented across all investment funds (except the Virgin UK Index Tracking Trust, this is under review). This quarter our funds performed well with:

• Higher Environmental, Social and Governance (ESG) scores – We check that our funds are shifting towards investing in companies with better ESG scores.
• Lower carbon emissions – We check that our funds are lowering their exposure to the most carbon-intense companies.
• Clear exclusions – We check whether businesses are involved in in specific harmful companies or business practices.

We also added a new fund to our fund of fund range this quarter: abrdn Evolve Asia Pacific Fund, which focuses on companies with higher ESG scores, lower carbon footprints and investing in clean technology solutions.. So far, it’s helping us reduce carbon exposure.

Our Climate Change Fund also added Linde PLC, a company helping others reduce carbon emissions through tech like hydrogen and carbon capture. This company has increased the fund’s overall emissions, however it does have a plan to reduce its own emissions and the bigger picture is that it helps others cut theirs.

Learn more about our approach to responsible investing.