Invest with Confidence and make a real difference!

Qualitative screening criteria

Qualitative screening criteria are applicable to areas such as community‚ employee relations and environment‚ in which it is possible for a company to perform both positively and negatively. It is therefore possible to implement positive screening criteria – that is‚ screening criteria designed to select companies with desirable attributes – as well as negative screening criteria – that is‚ criteria designed to screen out companies with undesirable attributes. The inclusion of positive screening criteria reflects one of the goals of most social investors‚ which is to focus not only on screening out companies with poor records‚ but also on encouraging positive social performance by "screening in".

The application of qualitative criteria involves evaluating each company’s overall performance‚ both positive and negative‚ in each issue area. In the area of employee relations‚ for example‚ exceptionally strong employee benefits and programs may offset a less than perfect union relations record. The application of qualitative screening criteria may also involve balancing strengths and concerns across issue areas. For example‚ strong performance in the area of employee relations may be sufficient to offset a weak environmental record.

On the basis of such evaluation‚ the qualitative screening criteria are used to screen in companies that‚ on balance‚ have positive social and environmental records and screen out companies that‚ on balance‚ have poor records.

The Best–of–Sector Methodology

Criteria in two areas – specifically‚ occupational health and safety and environmental performance – are based on a best–of–sector approach‚ in which each company’s record is evaluated in relation to that of its industry counterparts. The standard for performance is the best practices in its industry.

As part of its performance assessment‚ Jantzi Research uses the best–of–sector approach to evaluate safety and environmental records because‚ in both of these areas‚ companies in certain sectors face challenges that are inherent to the nature of the operations of their sector. For example‚ a company within the forestry sector is not expected to eliminate all negative environmental impact‚ because it is measured against the standard of best practices in its sector.

The best–of–sector approach is consistent with one of the general goals of social investment‚ which is to effect positive social change. The best–of–sector approach facilitates engagement with companies in sectors that have a high level of exposure to certain safety or environmental issues. It sends the message to such companies that they are not expected to be "perfect" (i.e.‚ to eliminate all safety concerns or environmental impact). Instead they are expected to adhere to the best practices of their industry‚ and if they do so they will be eligible for investment. Thus the best–of–sector approach can provide an incentive for companies in industries facing safety and environmental challenges to improve their performance.

The information contained herein is for Canadian residents only and does not constitute an offer to sell or a solicitation in any jurisdiction in which Manulife Securities or its Advisors are not appropriately licensed or registered or where any Product or Service is not eligible for sale. Details are available on request.

Manulife Securities and the block design are registered service marks and trade marks of The Manufacturers Life Insurance Company and are used by it and its affiliates including Manulife Securities Incorporated.

Manulife Securities Incorporated is a Member CIPF