Assessing Company Leadership during COVID-19 with Active ESG Engagement

Neuberger Berman’s global credit platform considers Environmental, Social and Governance (ESG) factors to be an essential component of its credit analysis discipline when making portfolio investment decisions. We believe it improves the risk profile of portfolios over time and through our active engagement with management teams on ESG issues, we are able to identify those companies who are successfully incorporating socially responsible principles into their core operations. While being sound investments, these companies are also leaders in regards to ESG as evidenced by their actions during the COVID-19 health crisis. Throughout the global COVID-19 health crisis and the resulting market disruption, there are examples of companies that are working to find a solution to the crisis and are working to address the needs of their constituents both internally and externally.

While news reports may highlight large investment grade companies with dedicated ESG resource teams as being actively involved in addressing the crisis or adapting their operations to the benefit of their employees, customers and communities, there are also numerous companies in the non-investment grade market which are leading by example. High yield companies are not traditionally known to be at the forefront of ESG which highlights the increased importance that our Non-Investment Grade credit research team places on using active engagement with companies to identify the leaders as well as utilizing our position in the capital markets as an agent of change for others. Leveraging our access to high yield management teams provides us the opportunity to set specific issuer ESG objectives and then systematically track the company’s progress against these objectives.

To showcase the various initiatives of issuers across our fixed income platform, we would like to recognize companies that we have identified during our engagement efforts as having addressed the COVID-19 crisis head-on by driving innovative solutions, implementing customer support and employee programs, and providing community assistance.