On 1 October 2025, Martin Currie aligned under ClearBridge Investments and the distribution of all Australian Pooled Funds moved to Franklin Templeton

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Australian Ethical Income Strategy

This Strategy invests in a diversified portfolio of ethically screened ASX-listed equities, aiming to deliver a consistent and growing income stream.

 

Through active management, the Strategy targets high-quality companies, particularly those offering highly franked dividends, to meet the income needs of investors.

Why Invest in the Australian Ethical Income Strategy

Key benefits of this Strategy include:

By investing in higher-quality companies, identified through proprietary analysis, the Strategy targets businesses with the capacity to deliver sustainable and increasing dividend payments over time. This approach offers the potential for higher income compared to more defensive, yield-focused strategies.

Franking credits offer a differentiated source of return, allowing a greater portion of total return to come from a stable income stream. The portfolio is actively managed to maximise the benefits from franking credits, particularly for investors with low or zero marginal tax rates.

A diversified portfolio construction helps reduce income concentration risk, supporting a more stable and predictable income stream. This approach ensures income resilience across economic cycles and mitigates the impact of capital movements in individual stocks.

Income-focused investments typically exhibit lower overall volatility compared to broader equity markets or sector-specific strategies. This characteristic provides added stability to income-oriented portfolios, helping investors manage risk while maintaining consistent returns.

Portfolio Management Team

The Australian Ethical Income Strategy is co-managed by Reece Birtles and Will Baylis, and is supported by the broader ClearBridge Australian Equities Investment team through detailed fundamental research and quantitative analysis.

The Portfolio Management Team is employed by Franklin Templeton Australia Limited.

Reece Birtles, CFA

Reece Birtles, CFA

Managing Director, Portfolio Manager, Head of Australian Equities
Will Baylis

Will Baylis

Managing Director, Portfolio Manager

What Makes Us Different

The Australian Equity Investment team has over 40 years of experience investing in Australian equities using a disciplined and repeatable multi-lensed investment approach.

The Strategy's unique investment approach is designed to meet the income needs of retirees. It targets a high and stable franked income stream, along with income growth, capital appreciation, and diversification. Through benchmark-unaware portfolio construction, it is designed to minimise concentration risks, income shocks, and capital impairment.

The Strategy combines ethical values and ESG exclusions, tailored to client-specific requirements, with a focus on high-quality, dividend-paying companies to deliver strong income outcomes.

Active Ownership is embedded directly within the investment process, with responsibility held by the research analysts and portfolio managers who make investment decisions. This integrated approach ensures that engagement and stewardship are aligned with deep fundamental insights and long-term value creation.

Key Portfolio Information

Growth of AUD $10,000

31 August 2025

As at 31 August 2025

Performance 1 Month 3 Months 1 Year 3 Years 5 Years Inception2
ClearBridge Australian Ethical Income Strategy 1 4.2% 8.7% 19.9% 12.9% 13.7% 9.3%

As at 31 August 2025

As at 31 August 2025

Top 10 Positions Sector Portfolio
Weight %		 Forward
Yield %
BHP Group Ltd Metals & mining 5.5% 5.1%
Medibank Private Ltd Non-bank financials 5.4% 5.3%
ANZ Group Holdings Ltd Banks 4.8% 6.2%
Telstra Group Ltd Communications 4.6% 5.9%
APA Group Utilities 4.0% 6.6%
QBE Insurance Group Ltd Non-bank financials 3.6% 4.8%
Scentre Group Real estate 3.4% 4.5%
Suncorp Group Ltd Non-bank financials 3.3% 5.8%
Atlas Arteria Group Industrials 3.2% 7.5%
Rio Tinto Ltd Metals & mining 3.0% 6.6%
Objective Income
Asset Class Equities
Style Income/Quality
Investable Universe Australian listed securities
Benchmark Benchmark unaware
Market capitalisation All cap
Country limit N/A
Sector limit Absolute 25%
Security limit Absolute 6%
Number of stocks Typically 40
Portfolio turnover Typically 25% p.a.
Forecast tracking error We do not target tracking error but total risk outcome is typically 90% of the market.

Investing in the Australian Ethical Income Strategy

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Franklin Templeton Australia Limited is the Responsible Entity and distributor for all ClearBridge managed Funds in Australia. To explore and access these Funds, you will be redirected to the Franklin Templeton website.

Explore The Ethical Values With Income Fund

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Expectations vs Impact: Will earnings get rewarded or punished this season? Reece Birtles, Head of Australian Equities and Portfolio Manager, presents his key takeaways from Australia's bi-annual reporting season.

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Disclaimer

This information is provided on the basis that you are a wholesale investor in Australia. Any distribution of materials or products in Australia is by Franklin Templeton Australia Limited (FTAL).

FTAL (ABN 76 004 835 849) is part of Franklin Resources, Inc., and holds an Australian Financial Services Licence (AFSL No. 240827) issued pursuant to the Corporations Act 2001 (Cth). The ClearBridge Australian Equities Investment team, a division of FTAL, is operationally integrated under the “ClearBridge Investments” global brand, alongside ClearBridge Investments, LLC (“CBI”), and other ClearBridge entities indirectly, wholly owned by Franklin Resources, Inc.

The information on this website does not constitute an offer of, or an invitation to apply for securities in any jurisdiction where such an offer or invitation is unlawful, or in which the person making such an offer is not qualified to do so.

Past performance is not a reliable indicator of future performance.

The views expressed are opinions of the portfolio managers and are subject to change based on market and other conditions and may differ from other portfolio managers or of the firm as a whole. These opinions are not intended to be a forecast of future events, research, a guarantee of future results or investment advice.

Some of the information provided has been compiled using data from a representative account. This account has been chosen on the basis it is an existing account managed by the investment team of this strategy. Representative accounts for each strategy have been chosen on the basis that they are the longest running account for the strategy. This data has been provided as an illustration only, the figures should not be relied upon as an indication of future performance. The data provided for this account may be different to other accounts following the same strategy. The information should not be considered as comprehensive and additional information and disclosure should be sought.

The information provided should not be considered a recommendation to purchase or sell any particular strategy / fund / security. It should not be assumed that any of the securities discussed here were or will prove to be profitable. It is not known whether the stocks mentioned will feature in any future portfolios managed by the investment team. Any stock examples will represent a small part of a portfolio and are used purely to demonstrate our investment style.

The analysis of Environmental, Social and Governance (ESG) factors forms an important part of the investment process and helps inform investment decisions. The strategy/ies do not necessarily target particular sustainability outcomes.

Performance
1 Data presented is the ClearBridge Australian Ethical Income composite in AUD, gross of fees. Periods over a year are annualised. The composite contains fully discretionary Australian equity accounts containing diversified portfolios of ethically screened Australian equity securities with an income investment focus. The composite adopts a benchmark unaware investment approach and therefore does not have a benchmark.
2 Composite inception date: 1 January 2016.

The Firm (defined for GIPS purposes as the ClearBridge Australian Equities Investment team, a division of FTAL) claims compliance with the Global Investment Performance Standards (GIPS®). GIPS® is a registered trademark of CFA Institute. CFA Institute does not endorse or promote this organisation, nor does it warrant the accuracy or quality of the content contained herein. To receive a complete list and description of composites and/or a presentation that adheres to the GIPS standards, please contact [email protected].

Sector Breakdown and Top 10 Stocks
Data shown for the ClearBridge Australian Ethical Income representative account.

The information provided should not be considered a recommendation to purchase or sell any particular security. It should not be assumed that any of the security transactions discussed here were, or will prove to be, profitable. References to particular industries, sectors or companies are for general information and are not necessarily indicative of the Strategy's holding at any one time.

Forward Yield is calculated for the next 12 months using the weighted average of broker consensus forecasts of each portfolio holding – because of this, the returns quoted are estimated figures and are therefore not guaranteed and may differ materially from the figures mentioned. The figures may also be affected by inaccurate assumptions or by known or unknown risks and uncertainties. In respect of the broker consensus data the number of brokers included for each individual stock will vary depending on active coverage of that stock by a broker at any point in time. A median of brokers is typically utilised. All estimates avoid stale forecasts which are removed after a certain number of days. Assumes zero percent tax rate and full franking benefits realised in tax return.

Risk Warnings – Investors should also be aware of the following risk factors which may be applicable to the Strategy:

  • Investing in foreign markets introduces a risk where adverse movements in currency exchange rates could result in a decrease in the value of your investment.
  • This Strategy may hold a limited number of investments. If one of these investments falls in value this can have a greater impact on the Strategy’s value than if it held a larger number of investments.
  • Smaller companies may be riskier and their shares may be less liquid than larger companies, meaning that their share price may be more volatile.
  • Income Strategy charges are deducted from capital. Because of this, the level of income may be higher but the growth potential of the capital value of the investment may be reduced.