What We Do

At Merganser Capital, we believe in the traditional role of fixed income and the importance of safeguarding principal. We recognize that fulfilling our fiduciary responsibility to clients and positively contributing to the investment management industry involves incorporating Environment, Social and Governance (ESG) issues into our investment risk assessment.

ESG research and analysis is not conducted by a separate team; instead, ESG factors are integrated and carried out by our analysts and Portfolio Managers. Every member of the investment team is tasked with understanding how ESG issues can impact individual securities, entire sectors of the fixed income markets and different geographic regions of the world. This effort is overseen and supported by our internal ESG committee which consists of senior professionals from the investment and relationship management teams.

Merganser views ESG factors to be vital components in evaluating the overall risk profile of fixed income securities. The Merganser investment team uses fundamental issuer analysis across corporate credit and securitized products to manage risk and identify key ESG drivers that could materially impact investment returns. This fundamental analysis is informed by issuer filings/disclosures, third party research, and management interviews. ESG analysis is an integrated facet of our underwriting process rather than a separated function, this provides for a holistic analysis of the entire mosaic of risks. We have taken this approach to avoid the potential for ESG risks being reduced to a singular number or rating.

For over three decades, Merganser has been managing SRI portfolios on behalf of clients. Many of our clients utilize our capabilities in applying value-based screens which eliminate companies or industries that do not align with the mission and core beliefs of the organization. Building customized separate accounts has long been a core competency of our firm and this is supported by a robust technology infrastructure.

We can and do engage with company management teams on ESG issues that we feel could materially impact our position as lenders. Conversations with management and issuers are a regular part of our underwriting and ongoing surveillance process. We systematically track and review the team’s engagement efforts on a regular basis to help inform future attempts.