Sustainability at Dalton

Sustainability Statement

As an investor, Dalton aims to find companies exhibiting superior Environmental, Social and Governance (ESG) standards, as it believes these companies tend to exhibit higher long-term sustainable operational performance. We also apply this lens to our own firm and aim to adopt best-in-class principles.

Alignment of Interest

A key element of Dalton’s investment philosophy is our belief that investing in companies where the firm’s decision-makers have an alignment of interests with minority shareholders may lead to superior risk-adjusted results. The main alignment of interest we find is where the key individuals at a company have material ownership in their company. We call these firms “owner-operators.”

Dalton is also an “owner-operator” firm, with the company’s equity held entirely by its employees (and their related entities). We are currently in the process of broadening this ownership across a larger number of employees to instil the “owner mindset” in more of the Dalton team. We believe that being independent allows Dalton to make long-term focused decisions, which might be challenged under external or public ownership structures.

The second way in which Dalton aligns interests with its clients is to encourage that its investment team members have a material portion of their net worth invested in the firm’s strategies alongside clients. Each year, the investment team members are requested to reinvest at least 50% of any pre-tax variable compensation in Dalton’s funds. Our team’s alignment of interest is monitored at least annually. Investment team members are also strongly discouraged from buying individual stocks in their personal accounts. We believe that this concept of “eating your own home cooking” aligns the interests of Dalton’s investment team with those of its clients.

Diversity, Equity, and Inclusion

Dalton believes strongly that diversity leads to better decision-making, both in the management of our client portfolios and in the management of our business. We also believe that diversity should be considered in multiple dimensions: age, gender, sexuality, race, ethnicity, socio-economic background, education, work experience, religious views and more. Dalton has a highly diverse workforce, with 17 nationalities represented and 17 languages spoken. The composition of the firm’s senior executives (including minority and female representation in the Chairman, CEO, CCO and CFO/COO roles) also reflects our commitment to diversity. However, we are conscious that we can always do more and are focused on sourcing diverse talent and challenging our internal biases.

Dalton’s Management Committee monitors the ethnic and gender composition of its staff using voluntary and anonymous surveys. It also takes steps to source diverse candidates for roles by taking steps such as considering broader educational and professional qualifications, using blind CVs, offering job flexibility and leaving job openings open for longer (hopefully leading to higher participation by under-represented groups).

Dalton is also aware that diversity alone is insufficient, so we take active steps to improve inclusion. We believe that a welcoming work environment, which encourages diverse individuals to prosper, is an invaluable contributor to Dalton’s long-term success. As such, we undertake training around the topics of racism, inclusion and unconscious biases. We also have taken steps to align our firm policies with fostering the career growth of diverse individuals – for example, allowing for flexible working practices, providing for parental leave and supporting continuing education. Finally, we have implemented a mentoring program for new employees, with a specific focus on underrepresented groups. Our diverse executives also aim to participate in organizations such as 100 Women in Finance, to hopefully encourage the diverse talent of the future.

On an annual basis, as one measure of progress, Dalton considers the potential gender and ethnicity pay gap at its firm.


Dalton takes the well-being of its employees seriously, as it believes a healthy working environment is more productive for both the firm and our clients. We encourage our employees to take regular breaks (including in our communal areas, which have a wide range of complimentary healthy-eating options provided) and are also supportive of our employees taking time off to recharge on vacation. Finally, we provide a healthcare allowance (to be used on a gym membership or home fitness equipment) to support the physical well-being of our employees.


Given Dalton’s focus on in-depth due diligence of Asian and emerging market companies, as well as our global client base, we view travel as a necessary part of our business for investment and client service purposes. We, however, encourage our employees to evaluate their travel arrangements and, where possible, develop efficient travel itineraries and/or use alternative forms of communication, such as video and teleconference technologies. In addition, we purchase Carbon offsets from Cool Effect (more information here) to compensate for the emissions resulting from our team’s air travel. Cool Effect is a non-profit dedicated to helping individuals, organizations and businesses of all sizes reduce their carbon emissions then offset what remains with the highest quality carbon offsets on the planet. 

Environmental Policy

Dalton takes active steps to minimize its environmental footprint in its Santa Monica office. The office building is currently LEED Gold certified and holds an excellence rating by Energy Star. The facilities provide access to recycling, including e-waste, and provide highly efficient air filtering to ensure a healthy working environment. Within our own office space, we take a range of steps to ensure employees recycle where possible and encourage staff to reduce the use of resources, such as paper and single use plastic products, unless absolutely required.

Managing Risk at Dalton 

Dalton’s Management Committee is responsible for the firm’s major day-to-day tasks and projects, including ultimate oversight of the risk management function via the Risk Management Committee. The Management Committee is made up of Senior Executives, including the Chief Executive Officer/President, Chief Research & Sustainability Officer, Chief Marketing Officer, Chief Compliance Officer/Counsel) and Chief Financial Officer/Chief Operating Officer.

Dalton’s Risk Management Committee (the “Risk Committee”) supervises all Firm risk functions and consists of the CEO/President, COO/CFO, CCO/Counsel, Co-Founder, Chairman and CRO/CSO. The Risk Committee generally meets on a quarterly basis to review risk-related reports produced by members of the Compliance, Operations and Accounting teams. 

Dalton’s compliance team monitors and elevates exceptions, issues on client portfolios, and various internal Firm controls directly to the Risk Committee. The CRO/CSO generally monitors and reports market, liquidity, credit and counterparty risk to the Risk Committee.  Summaries of the Risk Management Committee’s sessions are reported to Dalton’s Management Committee. Any material changes to the Firm’s risk policies are reviewed and approved by the Management Committee.

As well as internal oversight from the Risk Committee, Dalton uses external parties to assess and control firm-level risk. An independent controls audit is undertaken on Dalton annually by Grant Thornton, which seeks to record and assess the efficacy of Dalton’s stated control processes and publishes a SOC-1 report (available upon request). Dalton also uses an external party to test internet security controls (ACA Aponix) and to implement a mock SEC audit and an email surveillance program on an annual basis (ACA Compliance Consultants). Finally, Dalton welcomes the operational due diligence assessments of its large institutional clients and their consultants, viewing these assessments and feedback as an opportunity to make improvements and minimize risk.

Net Zero and Alignment to the Paris Agreement

Dalton is committed to an investment approach that aligns with the central goal of the Paris Agreement. This landmark agreement aims to “hold the global average temperature to well below 2°C above pre-industrial levels” and pursue efforts “to limit the temperature increase to 1.5°C above pre-industrial levels.” To limit global warming to 1.5°C, greenhouse gas emissions must peak before 2025 and decline by at least 43% by 2030.

Dalton will align with the agreement by seeking to implement investment portfolios that will achieve a reduction in emissions of 43% by 2030 against the base year of 2025. At this stage, we monitor emissions within the portfolios and will track year-on-year emissions changes. Where no tangible emissions goals or targets exist, we will actively engage companies to implement sufficient policies and targets to align with the Paris Agreement. By 2050, we aim to transition our portfolios towards net zero emissions.

Carbon Reporting