ESG and Sustainability

For nearly 40 years, Scharf Investments has integrated environmental, social and governance (ESG) considerations into the work we do to preserve and grow capital for institutional and individual investors. Since our founding amidst the redwood trees of the Santa Cruz Mountains, our investment process has focused on quality—specifically, sustainable earnings over an economic cycle—and risk mitigation—modeling downside risk as much as upside returns and demanding a spread between value and price. As a result, we believe this creates portfolios of sustainable businesses with compelling Carbon and ESG Risk scores. We believe buying high-quality companies at compelling valuations is foundational to long term investment success.

ESG Integration

Our framework for ESG integration is comprised of three components:




ESG integration is taken into consideration while assessing each stock in order to build a sustainable and resilient portfolio. Our integrated investment approach includes portfolio monitoring and active ownership.

Our analysts utilize the extensive database of ESG research and score ratings from Sustainalytics, findings from our ESG Stewardship Team, and other relevant sources of ESG data. ESG analysis is included in each stock report with focus on pertinent issues.

The investment team and the ESG Stewardship Team continuously monitor portfolio holdings using company filings, news flow, buy-side and sell-side research, and ESG Risk and Carbon scoring and research databases from Sustainalytics.

Companies with poor Carbon or ESG Risk scores, trends, or severe controversies are flagged and added to an ESG Watch List by the ESG Stewardship Team.

Engagement with management can produce positive ESG outcomes with special attention to minority shareholder interests, board independence, executive compensation, and management’s capital allocation track record.

>> Read Our ESG Policy Statement

>> Read Our Proxy Voting Policy

>> Read Our Engagement Policy

Meet the ESG Stewardship Team
Eric Lynch

Managing Director

Thad Heggeness

ESG Analyst

Cameron Cavalin

ESG Analyst

Ashley Yip

ESG Associate

We believe it is more effective and holistic to fundamentally integrate ESG into each step of the research and portfolio management process. Combining ESG risk factors with rigorous, fundamental investment analysis improves the chances for superior risk-adjusted returns for our clients.

Scharf Investments is proud to be aligned with and support the following organizations:
PRI Logo
The United Nations Principles for Responsible Investment (UN PRI)

What is the UN PRI?
The UN PRI is the world’s leading proponent of responsible investment. It works to understand the investment implications of environmental, social and governance (ESG) factors and to support its international network of investor signatories in incorporating these factors into their investment and ownership decisions.

What are the Principles for Responsible Investment?
The Principles for Responsible Investment are based on accepted international conventions, which are targeted corporate investors. The six Principles for Responsible Investment are a voluntary and aspirational set of investment principles that offer a menu of possible actions for incorporating ESG issues into investment practice. *

Scharf Investments became a signatory in February 2022 and fully supports the six PRI principles. Here’s how we comply with each principle.

1.  We will incorporate ESG issues into investment analysis and decision-making processes.
Our investment process focuses on quality and risk mitigation. Given our strategy, we believe it is more effective and holistic to fundamentally integrate ESG into each step of the research and portfolio management process. As a result, we believe this creates portfolios of sustainable businesses with compelling Carbon and ESG Risk scores.

2.  We will be active owners and incorporate ESG issues into our ownership policies and practices.
We have taken corporate governance seriously since our inception. We believe engagement with management can promote positive ESG outcomes.

3.  We will seek appropriate disclosure on ESG issues by the entities in which we invest.
In our engagement process, we ask companies for disclosure on material ESG issues. We also leverage a third-party data provider, Sustainalytics, to further enhance our engagement efforts toward integration of ESG issues in investee company disclosures.

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4.  We will promote acceptance and implementation of the Principles within the investment industry.
By participating in various study groups, international organizations, and through the exchange of information with industry organizations and proactive dissemination of professional opinion, we will drive the spread and promotion of ESG investment, contributing to the development of the ESG investment market.

5.  We will work together to enhance our effectiveness in implementing the Principles.
We will collaborate with industry organizations, institutional investors, and others—in the United States and around the world—by participating in key initiatives established with the goal of resolving ESG issues.

6.  We will each report on our activities and progress towards implementing the Principles.
We will proactively offer information on our ESG investment-related efforts through the filing of our annual report, client ESG updates, and disclosure of stewardship activities on individual ESG-themed investment deals.