ESG Policy
Richmond Capital is committed to ESG principles. We place significant emphasis on human capital development. We have low to no employee turnover. All employees are paid well above a living wage and all non-owners are paid a bonus. RCM offers healthcare to all employees and covers the annual premium for a high deductible Health Saving Account as well as a significant portion of the deductible. The company also covers the cost of dental insurance and provides short-term and long-term disability for all employees. We provide outstanding retirement benefits through a Simplified Employee Benefit plan which currently pays employees 20% of annual compensation up to the IRS maximum. Our policies and procedures manual outlines our policy on Equal Opportunity Employment, harassment, drug-free workplace as well as our benefits. Tuition reimbursement is available to all employees. We offer an attractive vacation policy to all employees and eight paid sick days as well as three personal days.
Richmond Capital Management believes strongly in employee ownership as a way to retain and attract incredibly talented personnel. We are 100% employee owned and 13 of 19 total employees are owners. Additionally, we seek diversity in our hiring practices. Of our 19 employees, 8 are female. Our board of four employee representatives has one female. Five of our thirteen shareholders are women and have a 24% ownership stake in the company.
We encourage and support all employees in their own philanthropic endeavors. Many employees volunteer at non-profit organizations and serve on various philanthropic boards. We do business with a number of small business suppliers and minority owned businesses. The environment is important to us as well. For example, we recycle our paper and plastic products in designated recycle bins.
Richmond Capital became a PRI (Principals of Responsible Investing) signatory in April 2017.
Investment Process
Our ESG investing initiative begins at Richmond Capital Management at the top. Our president heads up our ESG research group which is directly integrated into our credit research. ESG evaluation of each of our credits using MSCI, a third party vendor, provides a more complete analysis of our credit holdings. This analysis allows our investment team to better value fixed income securities over longer periods. In the end, ESG compliments and supplements our extensive fundamental credit research.
We believe that credit analysis is most effective when integrating fundamental quantitative and qualitative credit research with Environmental, Social and Governance analysis. As a value manager in the investment grade fixed income sector, in-depth research allows our talented investment team to make successful long term investment decisions. We start by screening for “best in class” corporations as measured by MSCI, a third party ESG research firm. Once a company clears this initial hurdle, our fundamental research team then reviews it to see if it passes our rigorous qualitative and quantitative analysis. At this point, we have a list of credits which we believe are excellent long term investments. We then select those securities that offer the most value in a diversified portfolio.
Historically, fixed income asset managers have not sought to influence corporate issuers. Unlike equity investors who have a history of engaging with corporations through proxy voting, bond managers have been less likely to engage these same issuers. Of course, fixed income managers do not vote on corporate proxies and often believe that they have no particular leverage to institute changes within these companies. However, with the increased need for capital in R&D and/or merger activity, fixed income managers like Richmond Capital are recognizing that they can engage corporate bond issuers to improve important disclosures related to ESG issues. This is an important step in encouraging better corporate behavior. Richmond Capital Management actively engages with each of our approved credits, encouraging better disclosures related to ESG issues and supporting companies to include ESG principles in their day to day operations.
