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DIGITAL PLANETBig Data, Small World

edentreeinvestment management

AMITY INSIGHT

DIGITAL DATA AND BIG DATA DEFINED

WELCOME TO THE WORLD OF BIG DATA

By Thomas Fitzgerald Investment Analyst, EdenTree Investment Management Limited

The first of this two-part Amity Insight, examined the rapid way in which digital technology has become embedded within our everyday lives, transforming the way in which we create, communicate, buy, share and search for information. The report highlighted how the proliferation of digital devices and the convergence of communication and information technologies have re-shaped existing industries and established new ones in the process. In Part II, we address the main by-product of a digitally driven world: the vast amount of digital data that is being generated by individuals and organisations.

Thanks to smartphones, the videos we stream on our tablets, the smart meters within our home and the networked sensors implemented in automobiles and industrial machinery, digital data is now universal.

This Insight explores how digital data has evolved from traditional datasets into what has become known as ‘Big Data’. We also examine the implications for companies, individuals and policymakers, as data is increasingly used commercially to analyse human behaviours. As responsible investors, we also ask, what are the emerging ethical challenges in this Brave New World?

In computing, the term data refers to information (i.e. text, images and sounds) that has been translated into a form that can be stored and processed by a digital device, for the purpose of electronic transmission, presentation and analysis.

Data

Unstructured Data

The body of an emailComments on social networks

Untagged audio, video and images

Semi-structured Data

GPS tracking information

XML (Webpages)

WHY IS DATA IMPORTANT?

Digital data has always been an amalgamation of information and communication technology, but as the digital revolution has unfolded, technological innovations have generated new forms and greater volumes of data.

This in turn has led to data being promoted from an ancillary position in business operations and market transactions, to become an economic resource and a tradable commodity in its own right. Increasingly, enterprises and government organisations are viewing data as a source of significant value in terms of providing insights and predictive capabilities.

Companies are utilising Big Data to build a competitive advantage in their business models, in order to understand the needs of consumers, more effectively target them and deliver goods and services in a more efficient manner.2 In other areas, governments and research institutions are mining vast datasets in order to solve complex behavioural, societal and public policy problems.3

Structured Data

Indexed fields (dates & times)Data within spreadsheetsEnterprise systems (CRM)

Structured Data: Organised in a highly manageable and mechanised form, residing in fixed fields such as a relational database e.g. data within an Excel spreadsheet or indexed fields within an email such as date, time, sender, recipient and subject.

Semi-structured Data: A hybrid of structured and unstructured data as it does not conform to the formal structure of data models associated with databases and other forms of data tables, but contains tags and other markers to enforce hierarchies of records and fields within the data. Examples include tracking information from GPS systems and XML (a file extension format used to create and share information over the web).

Unstructured Data: In contrast, unstructured data is raw and unorganised, meaning that it does not reside in a traditional database, which makes it more difficult for computer systems to interpret. Examples include free-form text such as the body of an email, comments on social networks and text within e-books and online articles, as well as untagged audio, images and video data.

Big Data: Refers to streams of digital data that encompass all the domains detailed above. The emergence of this key theme in recent years reflects the continually evolving nature of data management technology in capturing, aggregating, storing and analysing vast amounts of data, in conjunction with the rising demand for analytical insight.1

1. McKinsey Global Institute, Big Data: The Next Frontier for Innovation, Competition and Productivity, June 2011, p.1

2. Morgan Stanley, Monetizing Any Data, Morgan Stanley Research, September 2012

3. Klobucher, Derek, 2013, Big Data Opens Governments And Fosters Innovation, Forbes, February 2013, http://www.forbes.com/sites/sap/2013/02/13/big-data-opens-governments-and-fosters-innovation/

4. International Data Corporation

The current Big Data market size of $12.6 billion is forecast to grow to $32 billion by 2017.4

Personal Data is the new oil of the internet and the new currency of the digital world.M. KUNEVA, EUROPEAN CONSUMER COMMISSIONER

Amity Insight July 2015 3

THE EXPLOSION IN DATA GENERATION

THE DRIVERS OF DIGITAL DATA GROWTH

The growth of structured and unstructured data is rapidly accelerating, with the International Data Corporation (IDC) estimating that annual digital data generation will reach 44,000 exabytes (or 44 trillion gigabytes) by 2020. If we were to store this data on iPads and stack these face down on top of one another, the queue would stretch from the Earth’s surface to the Moon 6.6 times.1

This surge in data generation is predominantly derived from the rapid increase in semi-structured and unstructured data that is being created. At present, an estimated 90% of all data is either semi-structured or unstructured.2

This driver refers to the dramatic expansion of new technologies, sensors and physical objects with digital processing and transmission capabilities. The growth of digital devices that are connected to the internet, capable of collecting and transmitting greater amounts of data, is forecast to grow at a compounded annual rate of 11% from 2013 through to the end of 2018.3 One of the fastest-growing elements of the digital world is machine-to-machine connectivity (or the Internet of Things – see our January 2015 SRI Expert Brief), which refers to the rapid expansion of physical objects that have been digitised, with internet connection capabilities that enable these objects to feed additional data into the system. In the case of smartphones, tablets and laptops, these digital technologies have the propensity to connect to online networks and services where the data generated is predominantly unstructured.

ANNUAL DIGITAL DATA CREATION, REPLICATION AND CONSUMPTION

1. INCREASING DIGITALISATION

GLOBAL CONNECTED DEVICES BY TYPE

Three key drivers are at the centre of the massive growth in digital data being generated and stored:

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Source: Cisco Visual Networking Index

Source: International Data Corporation

4 Amity Insight July 2015

There is not only a greater number of avenues in which an individual or an object can create digital data, but through technologies such as wi-fi, Bluetooth and GPS as well as upgrades and greater penetration in mobile and broadband networks, the velocity in which this data is generated has dramatically increased. Enhanced and continuous connectivity through these innovations has fuelled a rapid increase in data traffic, with a large proportion of digital technologies now capable of transmitting data in real-time. As a result, annual data traffic over both fixed and mobile network connections increased fivefold between 2009 and 2013, and Cisco estimates that over the next five years, data traffic will grow at a compound annual growth rate of 21% and this is heavily skewed in favour of the consumer..4

2. UBIQUITOUS CONNECTIVITY

3. LOWER DATA STORAGE COSTS AND COMPUTING ADVANCEMENTS

GLOBAL INTERNET PROTOCOL TRAFFIC

AVERAGE SELLING PRICE DECLINES, CAGR (%) 2006-2012

There has been a stark divergence in trends between data storage costs and computing capabilities over the course of the digital era. In the past 50 years, the cost of digital data storage has been reduced by approximately half every two years, while storage density (the quantity of information that can be stored in a given space) has increased 50 million fold.5. The declining cost of data management and storage infrastructure is a result of the commoditisation of hardware and technological innovations such as cloud-based infrastructure, which removes the immediate requirement for physical hardware. Simultaneously we have seen dramatic advancements in compression technologies and analytical software, which enable companies to manage the rapid growth in data volume more efficiently, without increasing spend on storage at the same rate, while using analytical tools that are more suited to their aims.

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1. EMC, The Digital Universe of Opportunities, April 2014. Comparison based on iPad Air 128 GB model

2. Cisco, 2013, Big Data: Not Just Big, But Different – Part 2, Cisco IT In-sights Series, April 2014 http://www.cisco.com/web/about/ciscoitatwork/enterprise-networks/docs/i-bd-04212014-not-just-big-different.pdf

3. Cisco Visual Networking Index, 2014, Cisco VNI Forecast: It’s not just about big numbers, Cisco, June 2014, https://blogs.cisco.com/news/cisco-visual-networkingindex-vni-global-ip-traffic-and-service-adoption-forecast-update-2013-2018/

4. Cisco, Cisco Visual Networking Index: Forecast and Methodology, 2013-2018, 10 June 2014 http://www.cisco.com/c/en/us/solutions/collateral/serviceprovider/ip-ngn-ip-next-generation-network/white_pa-per_c11-481360.html

5. Mayer-Schönberger, Viktor, Delete: The Virtue of Forgetting in the Digital Age, Princeton University Press, July 2005, p.63


on the US equity market

Trade

Every day we create 2.5 quintillion bytes of data.1 The result is increasingly large datasets…

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Big Data example: Visa and MasterCard

Credit card companies are harnessing Big Data analytics to combat fraud and create new revenue opportunities.

• Fraud detection: Traditional databases and analytical models studied as little as 2% of transaction data, while Big Data in conjunction with powerful algorithms and underlying hardware and software analyses all data, with systems now studying more than 500 aspects of a single transaction at once versus 40 in 20054 – Visa estimates new analytical platforms have identified $2 billion in potential annual fraud detection and mitigation activities

• Revenue opportunities: MasterCard and Visa along with other credit card companies are mining data for marketers, retailers and banks, selling anonymous transaction data to aid with targeted advertising – MasterCard revenue from ‘other’, the area

that includes the sale of data, grew 37% in Q3 2014 to $460 million

BIG DATA IN PRACTICEA variety of technologies and analytical techniques are being deployed by organisations in every sector in order to capture value from these vast new datasets.

This has resulted in a rapidly expanding market for Big Data technology and services – a market which the International Data Corporation forecasts to grow from its current level of $12.6 billion to $32.4 billion by 2017.2 To demonstrate how Big Data practices are already creating value across the global economy, we highlight industries that have already experienced a material impact.

Big Data example: Suez Environnement

Suez Environnement is a French-based utility company which operates in the water treatment and waste management sectors.

• The company has made ‘smart water’ one of its priorities for its long-term strategy

• The company has installed 1.8 million smart meters and is aiming for 2 million by the end of 2014

• Generated €350 million in revenues from ‘smart water’ services in 2013

• Targeting 10% annual growth in ‘smart water’ per year through to 2016

FINANCEAs global financial infrastructures become more complex and illegal activities such as money laundering grow more sophisticated, Big Data has become a strategic imperative for financial institutions in detecting criminal activities and complying with an increasingly rigorous regulatory environment.

Real-time geo-location technology, paired with historic consumer transactions, allows a bank to detect anomalies in financial activity which may point to credit card theft. Big Data can also be a source of incremental revenue opportunities for these firms, as insurance providers have already shown, by using data on consumer behaviour to suitably price and target insurance products at specific consumers.

1. IBM, Mayer-Schönberger, Racicati, Google; Apple; Netflix2. IDC, New IDC Worldwide Big Data Technology and Services Forecast

Shows Market Expected to Grow to $32.4 Billion in 2017, December 2013, http://www.idc.com/ getdoc.jsp?containerId=prUS24542113

3. http://www.greentechmedia.com/research/report/the-soft-grid-20134. Rosenbush, Steve, 2013, Visa Says Big Data Identifies Billions of Dollars

in Fraud, The Wall Street Journal, 11 March 2013, http://blogs.wsj.com/cio/2013/03/11/ visa-says-big-data-identifies-billions-of-dollars-in-fraud

UTILITIESThe use of Big Data analytics is predicted to have a dramatic shift within the utilities sector, with companies being able to track, visualise and predict both supply and demand. GTM Research estimates that the annual expenditure on data analytics by global utility companies will grow from $700 million in 2012 to $3.8 billion in 2020.3


HEALTHCAREData in the healthcare sector is complex and highly fragmented. By digitally storing more patient information, opening data systems and increasing the use of connected ‘smart’ medical devices, which wirelessly transmit health information on a real-time basis, the healthcare sector stands to benefit through increased operational efficiencies, more timely emergency care and greater informational resource for research and development. McKinsey estimates that Big Data can help to unlock over $300 billion per annum in additional value for the US healthcare system.1

$300bnin the potential annual

value to healthcare

$165bnClinical

Transparency in clinical data and clinical decision support

$108bnR&D

Personalised medicine, clinical trial design

$5bnBusiness Model

Aggregation of patient records, online platforms

and shared datasets

$47bnAccounts

Advanced fraud detection and performance-based

drug pricing

$9bnPublic Health

Public health surveillance and response systems

Big Data example: Horizon Discovery

Established in 2007 and a publicly traded company since March 2014, the Cambridge-based firm is engaged in genomics research and the development of personalised medicines.2

• Most diseases carry certain genetic variations, which pre-dispose individuals to the onset and progression of certain diseases as well as the clinical response to therapy. Rapid declines in the cost of DNA sequencing driven by innovations in technology, and more cost-efficient methods of information storage, have led to the generation of vast amounts of data on the genetic drivers of disease

• Horizon’s proprietary gene-editing platform GENESIS™, has enabled the company to develop an extensive inventory of genetically defined cell-lines, which model anomalies found in human DNA that can cause disease

• These can be used to predict the clinical outcomes of medicines targeted at patient populations with a specific genetic profile, allowing drug developers to implement shorter, less costly and more targeted clinical trials

• Personalised medicine offers the promise of early detection and diagnosis, more effective therapies and minimised side effects

Big Data example: Tesco

Tesco is the world’s third largest supermarket group by revenue behind Wal-Mart and Carrefour and has long been recognised as a pioneer of using Big Data, introducing its own loyalty scheme (Clubcard) in 1995.

• The Clubcard loyalty scheme has enabled Tesco to amass a huge amount of data on shoppers

– Tesco Clubcard has more than 16.5 million registered users4

– Enables the company to target promotions such as money-off coupons at relevant customers

– Offers those it deems less risky based on shopping habits, discounts of up to 40% on insurance products

• Energy management system connects all 2,700+ UK stores to data analysis facility in India

– Analyst team tracks real-time data, monitoring categories such as lighting, refrigeration, heating and cooling

– Half-hourly reports on energy consumption allow team to identify irregularities in consumption

– Helped the group save £3.9 million on its energy bill in 2012

• Predictive analytics driving reductions in wasted stock

– Combining data from weather records with sales data, broken down by store and products

– Uses data to predict future demand for product lines on a per store basis according to weather forecasts

– Saving £100 million per year in supply chain costs since analytical programme was deployed

RETAILBig Data and related analytical processes could increase sector-wide productivity and drive profitability higher, with the McKinsey Global Institute estimating that US retailers could increase operating margins by more than 60% by 2020.3

The integration of information technology and vast data resources presents the opportunity for retailers to create value via more effective product promotion and greater leverage of the supply chain.

1. McKinsey Global Institute, Big Data: The Next Frontier for Innovation, Competition and Productivity, June 2011, p.432. Horizon Discovery, 2014, Corporate Overview, http://www.horizondis-covery.com/media/item/206

3. McKinsey Global Institute, Big Data: The Next Frontier for Innovation, Competition and Productivity, June 2011, p.644. Tesco, 2014, Annual Report and Financial Statements 2014, Tesco PLC, May 2014


In Digital Planet we highlighted what we see as a suite of emerging ethical challenges faced by companies participating in the digital economy including:

• Digital poverty

• Environmental impacts (emissions, conflict minerals, water, electronic waste)

• Cyber security and crime

• Human rights and freedom on the Net

These are all visible challenges arising from the Big Data information revolution – with one overriding proviso: we are now entering an ethical void. Kord Davis in his pioneering research ‘Ethics of Big Data: Balancing Risk and Innovation’1 makes the point that “there isn’t yet an ethical framework or common vocabulary for having productive discussions around the ethical use of Big Data”. Whilst the received wisdom is that Big Data will put power in the hands of consumers in a transformative way, undoubtedly its use – or misuse – will skew outcomes for some consumers and as personal data becomes increasingly public, companies will face critical ‘ethical crunch points’. Regulation has not yet begun to contend with this; many corporate-taken decisions will rely on in-house ethical Codes of Conduct. The Financial Times predicts that 25% of organisations will face corporate reputational challenges by as early as 2016.2

COMPANIES WILL NEED TO CONFRONT SOME FUNDAMENTAL BEHAVIOURAL QUESTIONS:• Is offline existence now deemed to be identical

to online?

• Who should control access to data?

• Who owns data, can its rights be transferred (and sold) and what are the obligations of users?

• What is the impact for reputation when it (inevitably) goes wrong?

At the heart of this ethical debate is the consumer. A lack of regulation and possibly unscrupulous use weigh heavily in the context of poor consumer awareness and low value placed on personal data. For instance, most users of social media are careless of their own privacy – and yet companies such as Facebook have encountered reputational challenges when consumers withdraw consent over arbitrary changes to privacy settings. Big Data profiling may also lead to discrimination, victimisation or ‘minority reporting’. Examples (that may attract public consent – or not) include data mining to detect benefit fraud, insurance pricing based on health and lifestyle profiling, security services using data to detect behavioural abnormalities in a controlled sample, or the targeting of consumers with highly personalised offers, effecting a skewing of consumer behaviour. At one extreme, social media analytics could be used to ‘identify’ mass shootings profiling based on ‘crunching’ social media posts, background profiling, and age, gender and location data.3

Without Kord’s ‘ethical framework’ customer segmentation may lead to discriminatory outcomes based on age, gender and lifestyle. Organisations will need to evaluate the value of knowing something given the potential ethical pitfalls arising from a consequential course of action. Intent therefore becomes the precursor to data analytics – why do we need to know NOT what do we want to know? The jury is out as to whether commercial imperatives will outweigh ethical due diligence.

BIG DATA: ENTERING THE ETHICAL VOID

1. Ethics of Big Data: Balancing Risk and Innovation (2012), Kord Davis, O’Reilly Media ISBN 978-1449311797

2. Financial Times: Confronting the privacy and ethical risks of Big Data 24 September 2013 www.ft.com

3. Various sources, but see ‘Mass murder, shooting sprees and rampage violence: research roundup September 2013 www.journalistsresource.org

4. Financial Times: How much is your personal data worth? June 2013


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GovernmentInsurance Company

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Principles

Code

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Analyses Social Media

for Fraud

Customer Profiling

Dieting, Smoking,

Health, Social Media

Big Data Code of Conduct

Principles of Appropriateness

Ethical Checks and Balances

Legal Implications

Reputational Risk

Intended Use Vs. Actual Use

Assesses & Writes Risk

VALUING DATAThe key to the future use of Big Data is appropriately valuing it.

This is still at a relatively early stage. We have shown several examples of how data is being amassed and analysed by companies – monetising this, against a backdrop of significant ethical challenge, will be a key ongoing test. The surveillance of consumers via profiling of social media and purchasing habits is now routinely carried out in a largely unregulated way. Companies, using highly sophisticated algorithms, can predict and influence consumer behaviour, and so data has a value in building brand

and market share – Amazon’s ‘you may also like these’ is a good example. However, the competition for data and its sheer volume are driving down the market price for personal information. Basic datasets (age, gender and location) sell for as little as $0.0005 per person, whilst income and buying habits are more valuable – but only marginally – at about $0.001. The more detailed and intimate the dataset, the greater the market value. For $0.26 per person, subscribers to leadsplease.com can access specific health data including medical conditions. However, for most individuals, the value of all data is seldom worth more than $1 per person.4

BIG DATA: EMERGING ETHICAL CHALLENGES


The digitalisation of the physical world and the growing importance of Big Data practices across numerous end-markets create a number of opportunities and challenges for investors. With the proliferation of digital data, it is important that investors focus on which companies hold the potential to create significant value from the data, rather than simply the generation of data itself.

Typically, these industries are very competitive and rife with technological disruption; therefore, we believe those companies with substantial scale will be best positioned to monetise opportunities. This will allow for greater integration into the business models of end-users.

THE BIG DATA VALUE CHAIN

SEMICONDUCTORS• Computing• Connectivity• Memory

NETWORKING• 3G/4G spectrum• Wi-fi• GPS• Data centres

HARDWARE• PCs• Tablets• Smartphones• Servers

DATA CAPTURE• Search engines

• Social media

• Cloud systems

END-USERS• Healthcare

• Retail

• Insurance

• Utilities

SOFTWARE/SERVICES• Structuring data

• Organising data

• Cloud software


AMITY CASE STUDY: CISCO SYSTEMSFounded in 1984 by two members of Stanford University’s computer support staff, Cisco Systems has become

one of the world’s largest technology companies, with a market capitalisation of over $132 billion and annual revenues of more than $47 billion, sourced from a well-diversified customer base on both a geographical and end-market basis.

The company has a long-established leadership in Internet Protocol-based networking equipment for data, voice and video, and also provides related networking services. However, in recent years the company has faced a number of considerable challenges, having lost 25% of its market value since 2007, in the face of an increasingly competitive threat from Asian peers with lower cost structures, as well as the emergence of disruptive technologies that could put pressure on future revenue growth and profitability.

Nevertheless, with substantial scale and a commanding market position in core product areas, we believe the company stands to be a key beneficiary of the rising network infrastructure investment that is required to support future growth in data and connectivity. This is augmented by a series of investments the company has made in recent years, providing new product and service categories which help it defend its position against disruptive technologies and broaden its portfolio offering to customers, from infrastructure through to analytics.

A STRONG SUSTAINABILITY CHAMPIONCisco Systems has been reporting its material sustainability challenges for a decade. Its key focus has been access to education and connected healthcare – both strong Amity pillars for positive screening. Harnessing the power of network technology via its pioneering schools partnerships, Cisco Systems has actively closed the skills gap in some of the most disadvantaged areas of the world, thereby improving career chances and changing the cycle of poverty and low achievement. Similarly, its collaborative approach to healthcare has seen the innovative pioneering of healthcare outreach into rural regions and those devastated by natural disasters. Cisco too, has strong environmental management systems, achieving a 30% absolute reduction in Scope I and II GHG (greenhouse gas) emissions worldwide from a 2007 base line.

The company has invested heavily in energy efficiency ($9.6 million in 2014) and renewable energy as part of its pioneering Energy Ops Program, which is investing a total of $50 million over four years in order to meet very challenging GHG reduction goals. The company is rolling out state-of-the-art low-energy data centres that economise water and energy use, employ LED exterior lighting and Low-E-glass windows. Solar technology is helping deliver an estate that is at the cutting edge of low-energy building design.

VIEW FROM THE TOP Over two successive Insights we have outlined how our world is changing from analogue to digital. We observed that at the heart of the digital economy there will be corporate winners and losers – our job as responsible investors is to understand where opportunity lies, whilst being ever cognisant of the evolving ethical landscape.

Data is at the heart of the digital economy – its amassing, analysis, sale and use. We have shown how the pace of technological innovation and the speed of data generation are transforming our ability to understand – as never before – predictive human behaviours. Much of this will be genuinely useful – examples we have seen in healthcare and access to education will transform the life chances of some of the world’s most vulnerable people.

But much of this is taking place in an ethical void, where regulation and legislation struggle to keep up. This places huge responsibility on companies to make moral choices about the use and sale of data – choices which, as the FT suggests, will lead to more and more reputational issues.

Whilst our own view is fundamentally positive, we will, as responsible investors, continue to ask companies demanding questions about the control, ownership and use of data, pointing out the rising risk to reputation and loss of consumer consent.

Neville White Head of SRI Policy & Research


WHY EDENTREE?• The backing of an award-winning team

• Over 20 years of experience of socially responsible investing (SRI)

• Funds that are both positively and negatively screened

• A stable investment team with a wealth of experience spanning many years

• A comprehensive in-house SRI research function

• An independent panel that reviews investment decisions

• A robust socially responsible investment process

• A pride in our independent analysis. We’re not afraid to adopt contrarian positions and are in favour of long-term investment horizons

• A consideration of the preservation of capital as our primary responsibility, preferring absolute returns over relative performance

• Fund Managers at EdenTree are unconstrained by rigid stock lists, permitting more flexibility to take advantage of good-value opportunities as they present themselves

• Decision-making for the long term, as frequent trading increases costs and decreases returns

• Avoidance of companies materially involved in alcohol production, gambling operations, pornographic and violent material, tobacco production, testing animals for cosmetic or household products, supporting oppressive regimes or strategic weapon production

• Actively seeking out companies with a record of involvement and good performance in terms of business practices, community relations, corporate governance, education, environmental management, healthcare, human rights, labour relations and urban regeneration

ABOUT EDENTREE INVESTMENT MANAGEMENT

1. As at 31 December 2014

EdenTree is an investment management firm with a strong heritage of delivering profit with principles. We provide an award-winning fund range managed responsibly by some of the UK’s most highly rated Fund Managers. Our formidable investment team has some of the longest permanent track records of any in the City. We believe that consistent, long-term returns are more likely to be achieved by investing responsibly in sustainable businesses. That’s why we adhere to our ‘Profit with Principles’ approach. We firmly believe that the companies still returning results tomorrow will be the ones acting responsibly today, both internally and within their communities.

Our charitable ownership, along with our history, is what drives our values and we’re proud to re-invest our profits into the community. We currently offer eight funds; six of which are both positively and negatively screened – and we now have over £2.4 billion1 of institutional and retail funds under management.

AMITY INSIGHTSWe know it’s important for you to get all the information you need when you’re making an investment decision. That’s why we provide a wide range of factsheets, brochures and reports outlining the different Amity investment options and their aims.

Our document library also includes other interesting information that relates to our socially responsible investment (SRI) activities. This includes a wide range of Amity Insights on a variety of topics. Amity Insights allow us to share the results of our independent and informed SRI research with you. The Insights are available for you to download at www.edentreeim.com. The range is constantly growing, so please check back for updates.

THE AMITY RANGE OF FUNDSAmity is an award-winning range of responsible investment funds that truly stands out. Amity funds consistently deliver for investors over the long term. They achieve this in a principled way under the stewardship of some of the UK’s most highly-rated Fund Managers.

We know there is a link between well-managed companies with a clear understanding of their social and environmental impacts, and strong financial returns. We’re proud to have repeatedly proved that investors can have both.

OUR INVESTMENT PROCESS• ‘Profit with Principles’ – a socially responsible

investment (SRI) process – is at the core of everything we do.

• Our approach includes a comprehensive in-house SRI research function.

• Our funds are both positively and negatively screened:

– We actively seek out companies with a record of involvement and good performance in terms of business practices, community relations, corporate governance, education, environmental management, healthcare, human rights, labour relations and urban regeneration.

– We avoid companies materially involved in alcohol production, gambling operations, pornographic and violent material, tobacco production, testing animals for cosmetic or household products, supporting oppressive regimes or strategic weapon production.

OUR INVESTMENT PHILOSOPHY• We take pride in our independent analysis. We’re

not afraid to adopt contrarian positions and are in favour of long-term investment horizons.

• Our decision-making is designed for the long term, as frequent trading increases costs and decreases returns.

OUR INVESTMENT OBJECTIVES• We consider the preservation of capital as our

primary responsibility, preferring absolute returns over relative performance.

• We believe that consistent long-term returns are more likely to be delivered through investing in responsible and sustainable businesses.

• Our ‘Profit with Principles’ approach consistently proves that investors can have both.


OUR PEOPLE• Our Fund Managers have some of the longest permanent track records in the City. Together, they share

a wealth of top industry ratings and provide a unique breadth of expertise.

• Building on their impressive track record, our investment team are constantly looking for new ways and new opportunities to provide investors with strong financial returns.

• We have an independent panel that reviews all investment decisions.

• Fund Managers at EdenTree are unconstrained by rigid stock lists, permitting more flexibility to take advantage of good-value opportunities as they present themselves.

MEET THE TEAM

Sue Round Director of Group Investments and Senior Fund Manager

Sue is the UK’s longest serving retail SRI Fund Manager. She launched the Amity UK Fund 27 years ago – pioneering our Profit with Principles investment approach. She is also A rated by Citywire as of May 2015.

Neville White Head of SRI Policy and Research

Neville is in charge of our Socially Responsible Investing team. His extensive experience includes being responsible for managing global corporate government proxy voting for specialist CCLA Investment Management. He is also a Chairman of Amnesty International.

Ketan Patel CFA Senior Investment Analyst

Ketan began his career on the equity derivatives trading desk at JP Morgan, before moving to Insight Investment as a Global Healthcare Analyst. Ketan leads the team’s company research, supporting the Fund Managers’ investment decision making. He has been a CFA Charterholder since 2009.

Thomas Fitzgerald Investment Research Analyst

Having graduated from Oxford Brookes University with a degree in Economics and Business Management, Tom now supports the Fund Managers by providing detailed company research and analysis. Tom is currently studying for the CFA.

Rob Hepworth Chief Investment Officer and Senior Fund Manager

Rob has previously been voted Investment Week’s Fund Manager of the Year and has been recognised as one of Citywire’s top 10 Fund Managers of the past decade. This places him in the top 10% of all UK Unit Trust and OEIC Managers.

Chris Hiorns CFA Fund Manager

Chris has worked at EdenTree since 1996. He started as a Graduate Trainee and worked as an Investment Analyst before being appointed as the Fund Manager for the Amity European Fund in 2007 and the Amity Sterling Bond Fund in 2008.

Peter Cameron CFA Assistant Fund Manager

Peter is an experienced Equity Analyst having worked both in the Quant solutions and SRI performance and portfolio risk teams at Aviva. He holds a Masters degree and the CFA.


NOTES


Please note that past performance is not a reliable indicator of future results and that the value of investments can fall as well as rise and you may get back less than the amount invested. For more information, factsheets or details of how to invest, please speak to your financial adviser. EdenTree Investment Management (EIM) Reg. No. 2519319. This company is registered in England at Beaufort House, Brunswick Road, Gloucester, GL1 1JZ, UK. EIM is authorised and regulated by the Financial Conduct Authority and is a member of the Financial Ombudsman Service and the Investment Association.

How to contact us

We hope you have found this Amity Insight interesting and useful. If you have any questions, or would like to know more about our responsible investment, in-house research and analysis, please get in touch.

Call 0800 011 3821Fax 020 7528 7365Go to www.edentreeim.comEmail [email protected] to us or visit 24 Monument Street London EC3R 8AJ

Please note that past performance is not a reliable indicator of future results and that the value of investments can fall as well as rise and you may get back less than the amount invested. For more information, factsheets or details of how to invest, please speak to your financial adviser. EdenTree Investment Management (EIM) Reg. No. 2519319. This company is registered in England at Beaufort House, Brunswick Road, Gloucester, GL1 1JZ, UK. EIM is authorised and regulated by the Financial Conduct Authority and is a member of the Financial Ombudsman Service and the Investment Association.

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