Environment, Social, and Governance Policy

Strategic Overview
At Oberweis Asset Management, we employ fundamental analysis in making our investment decisions. As part of our fiduciary duty to clients, we seek to enhance returns and reduce risk. Our process is designed to analyze businesses from several angles, providing us a well-rounded understanding of a company’s risks and opportunities. Ultimately, we aim to assess whether the business is durable and capable of sustaining high returns on capital over time. In this regard, we believe that responsible investment (RI) and environmental, social, and governance (ESG) issues can potentially affect the risk and return profiles of our investments and, therefore, we consider ESG issues in our fundamental analysis. As a firm, we believe in the following guiding principles for the process of ESG assessment:

    • Effective corporate governance is essential to long-term value creation
    • Business operations and planning should consider the risks and impacts to all stakeholders
    • Effective policies and procedures help to mitigate ESG risk
    • Transparency drives process improvement over time

Oberweis believes that governance, environmental and social issues should generally be considered as part of the overall evaluation of a potential investment. The relevance and materiality vary by company, industry, and country. Accordingly, the implementation of ESG factors into each strategy will vary based on the portfolio manager’s judgment on the materiality and availability of information.

Governance: Pertains to equitable distribution of value creation to stakeholders through transparency, accounting practices, and appropriate oversight

    • Adoption of best-practices with respect to accounting policies, board structure, and internal control
    • Adoption of a corporate culture and best-practices to promote prevention of bribery and corruption

Environmental: Pertains to operational sustainability, off-balance sheet risk from environmental externalities, and potential risk associated with climate change

    • Compliance with local regulations and best practices for resource management
    • Assessment and understanding of potential environmental risks

Social: Pertains to human rights, fair labor practices, and privacy

    • Corporate culture that fosters ethical work environments and fair treatment of employees
    • A “safety first” production culture for employees and stakeholders

ESG Integration
Oberweis believes there are multiple dimensions to ESG integration. We consider a company’s exposure to and management of ESG risks and opportunities, rather than focusing on only the risks. For example, banks could mitigate risk by limiting their financing of companies facing scrutiny over their impact on the environment. However, they could also increase their opportunity by improving access to their products in under-penetrated segments and markets. By evaluating both the ESG risks and opportunities, Oberweis develops a deep understanding of a company’s ability to create long-term shareholder value. Oberweis uses external ESG research from MSCI and Bloomberg. We believe that ESG considerations should not limit the investable universe, but rather help us hone our assessment of a company’s sustainable competitive advantage.

Company Engagement
As active investors with strategies that generally have a smaller capitalization bias, we believe that engagement and dialogue with potential and current holdings is important in evaluating companies’ ESG profiles. ESG-related disclosure is often not robust in the small-cap universe, especially within the emerging markets. As such, when relevant, we interview management to assess the materiality of ESG issues to their businesses and, where feasible, discuss the adoption of improved ESG practices

Proxy Voting
Oberweis has retained the services of an industry-leading proxy voting provider, who casts votes taking into consideration a range of factors material to share and stakeholder stewardship.

Policy Scope
ESG integration is overseen by an ESG Committee comprised of senior staff. Oberweis is a signatory to the UN Principles of Responsible Investing, a broad international network of ESG-conscious investors.

Oberweis publicly supports The Paris Agreement, an international treaty on climate change adopted by 196 parties. Its goal is to limit global warming.


Oberweis publicly supports the Task Force on Climate-Related Financial Disclosures (TCFD), which seeks to improve and increase reporting of climate-related financial information.


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