1919 Socially Responsive Balanced A (SSIAX)

overall rating:

1.5

planets

An-Binh Bui
3/27/2022
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1919 SSIAX is named in almost every “Best ESG Fund” list you can find online. The fund achieved 5 stars on Morningstar, earned the highest possible score of “A+” for “Responsible Investing Strategy and Governance” from the Principles for Responsible Investing (PRI), and was also named a Refinitiv Lipper Fund Award Winner, as the “Best Fund over 3 Years” in the Mixed-Asset Target Allocation Growth Funds category.

Further research suggests that the accumulated impact 1919 SSIAX achieved is impressive. The fund also takes great initiatives toward sustainability, notably in terms of diversity and transparency. However, like other named “Best ESG” funds, most of 1919 SSIAX listings are big tech with questionable ESG practices. 

Therefore, overall, the fund deserves a 1.5.

What it's made of:

1

1919 SSIAX performs strongly with regard to impact. Relative to the S&P 500 benchmark, 1919 SSIAX emits 4 times less CO2 and greenhouse gas annually, which is quite outstanding.

Impact aside, the fund also attempts to diversify its portfolio. Compared to other top funds, 1919 SSIAX lists not only big tech & finance players but also biotech (Thermo Fisher) and healthcare (UnitedHealth) groups. This reflects SSIAX’s commitment to diversity, yet nonetheless, tech giants like Apple, Amazon, Tesla, or Meta still seem to dominate 1919 SSIAX’s top 10 holdings. Some of these are highly controversial in terms of ESG. For instance, Meta is sued for privacy violation, Amazon filed for antitrust violation, while Thermo Fisher is accused of misusing its tech – one notorious case recently was its dealings with the Chinese authorities, who used the DNA tech to persecute the Xinjiang group.

How it's made:

1.8

1919 SSIAX boasts its socially responsive portfolio that practices both exclusion and inclusion. The fund examines undervalued securities and determines whether those issuers are conducting business in a socially responsive manner. It looks for those that contribute to the social well-being of citizens, respect human rights, or lend their economic weight to addressing social problems. And it also seeks out appropriate Sustainable Finance instruments such as green, social, and sustainability bonds. As of 12/31/2020, over 24% of the bond portion of the Fund was invested in these types of securities. This selection process though can improve much, as the profiles of SSIAX’s top holdings are not that clean. 

Yet, 1919 SSIAX supports exercising shareholder rights and ownership through informed corporate engagement and proxy voting quite actively. The fund leverages its advocacy through frequent dialogues with different company representatives, and once engaged with over 27 companies to encourage their participation in CDP Water disclosure questionnaires. Additionally, it also participates in various industry groups such as CDP, ISS ESG, and Principles of Responsible Investment.

Furthermore, I highly value 1919 SSIAX’s transparency. Whether it’s internal process or evidence of impact, I could find all information clear and robust on its websites and reports, which is something worth encouraging.

Who makes it:

1.6

1919 SSIAX Portfolio Management Team includes Ron Bates, Alison Bevilacqua, Aimee Eudy, and Robert Huesman, all having over decades of industry experience and specializing in relevant aspects of ESG investing like corporate responsibility or socially responsive investment strategies. Notably, 1919 SSIAX features Alison Bevilacqua and Aimee Eudy as two women on board, which partly demonstrates its commitment to diversity – and even positions the fund better for more sustainable ESG values, according to most workplace inclusion research.

Behind the fund and alongside the management team is the 1919 Investment Counsel, LLC (1919). 1919 has advised on investment of approximately $21.0 billion in assets as of December 31, 2021 and can help 1919 SSIAX roll out its investment cornerstone, helping it be more proprietary, risk-proof, and diverse.