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Timothy Plan Fixed Income C TFICX Sustainability

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Sustainability Analysis

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Sustainability Summary

Timothy Plan Fixed Income Fund may not appeal to sustainability-conscious investors.

Timothy Plan Fixed Income Fund's holdings are exposed to average levels of ESG risk relative to those of its peers in the US Fixed Income category, thus earning it an average Morningstar Sustainability Rating of 3 globes. Competing funds in the category with ratings of 4 or 5 globes have less ESG risk in their holdings. Unlike impact, which measures positive environmental and societal outcomes attributable to an investment, ESG risk reflects the degree to which investments could be affected by material ESG issues, including climate change, biodiversity, product safety, community relations, data privacy and security, bribery and corruption, and corporate governance.

Timothy Plan Fixed Income Fund has an asset-weighted Carbon Risk Score of 7.6, indicating that its companies have low exposure to carbon-related risks. These are risks associated with the transition to a low-carbon economy such as increased regulation, changing consumer preferences, technological advancements, and stranded assets. By prospectus, the fund aims to avoid, or limit its exposure to, companies associated with tobacco, and, as expected, the fund is not currently invested in such companies.

One potential issue for a sustainability-focused investor is that Timothy Plan Fixed Income Fund doesn’t have an ESG-focused mandate. Funds with an ESG-focused mandate would have a higher probability to drive positive ESG outcomes. Currently, the fund has 24.3% involvement in fossil fuels, surpassing 6.6% for the average peer in its category. Companies are considered involved in fossil fuels if they derive some revenue from thermal coal, oil, and gas. The fund has significant exposure (12.27%) to companies with high or severe controversies. Companies with controversies may be involved in incidents such as corruption, employee abuses, environmental incidents, and corporate scandals that pose some degree of business risks to the company. Severe and high controversies can have significant financial repercussions, ranging from legal penalties to consumer boycotts. Such controversies can also damage the reputation of both companies themselves and their shareholders.

ESG Commitment Level Asset Manager