Victory Capital’s Corporate Responsibility Statement
As a global investment management firm operating a next-generation, integrated multi-boutique business model, Victory Capital strongly advocates independent decision-making and investment-process autonomy for each of our investment franchises and our Solutions platform. This commitment provides our investment professionals with an environment that amplifies their unique talents and ultimately helps our clients meet unique investment objectives.
We believe that incorporating ESG considerations into a portfolio is an investment approach that is best made by each individual franchise as they frame the individual value proposition they seek to deliver to their clients. We encourage awareness of considerations around responsibility and assist our franchises in any of the following:
Evaluating best practices and operational considerations of ESG implementation;
Delivering data and screening tools that allow for implementation of social considerations across any portfolio:
Signing on to the UN-PRI and fulfilling the ongoing requirements of that commitment.
Reporting to clients on portfolios managed toward ESG objectives.
We are pleased to have partnered with our clients to build products that meet specific ESG considerations and would be pleased to discuss how any franchise might deliver an investment strategy that marries a client’s desire for social responsibility and investment success.
Our Approach & Objectives
Victory Capital is committed to sustainable growth while striving to deliver desired investment performance and outcomes for our clients by focusing on our Company’s material ESG factors. According to the Sustainability Accounting Standards Board (SASB) Materiality Map®, the key ESG factors for investment management firms include:
Social Capital issues comprising customer privacy, data security, and selling practices;
Human Capital initiatives encompassing employee engagement, diversity and inclusion;
Business Model and Innovation matters such as product design and lifecycle management; and,
Leadership and Governance subjects including business ethics and systematic risk management.
Here we address each of the ESG factors identified as being material to asset management companies and explain how we enhance our own long-term success in each of these areas.
As a socially responsible Company, we care deeply about all our constituents including our clients, employees, industry partners, shareholders, and our communities. One example is the Victory Capital Financial Literacy Program, launched in 2019. In conjunction with our management of the USAA mutual funds, ETFs and 529 College Saving Plan, the program centers on face-to-face programming for Military Bases to educate service members on investing for their futures. According to Blue Star Families Annual Military Family Lifestyle Survey (2017), financial issues and funding a dependent child’s education are two of the top five concerns of military families. To do our part, we have committed a $1 million initial investment for the program’s inaugural year.
We are proud to have a paid-time-off policy allowing employees to volunteer their time for causes uniquely important to them. This is in addition to our Victory Matching Gifts Program that encourages employees to contribute to qualifying charitable organizations. This program supports employee giving by offering a way to double – up to $250 (US) per person each calendar year – employees’ cash or securities contributions to their favorite charitable organizations and thus improve our communities.
Service to our communities is part of Victory Capital’s culture. Employees receive paid time off to perform volunteer work in their communities. We also sponsor service initiatives in many of the communities in which our employees live and work.
Victory Capital is partnering with The Children’s Hospital of San Antonio to serve children with serious medical conditions and their families. We are providing support in two specific ways:
Providing emotional care for children with serious medical conditions by creating a joyous and memorable experience at the San Antonio Spurs home games
Providing “care packages” to families with infants in the Hospital’s Neonatal Intensive Care Unit (“NICU”)
We also partner with Breakthrough Schools of Cleveland, a nationally recognized network of free, public charter schools in Ohio. The mission of Breakthrough Schools is to help students achieve success in school, their careers, and ultimately in life. Our support includes a financial commitment and service opportunities for our employees.
Investment adviser advertising is regulated primarily under Rule 206(4)-1, adopted under Section 206(4) of the Investment Advisers Act (IAA). Fund material is covered under The Financial Industry Regulatory Authority (FINRA) rules 2210-2214, and 3010, among other rules. In addition to the regulations covered by the IAA and FINRA, all materials must be reviewed and approved by a registered principal of Victory Capital Advisers (“VCA”) in accordance with VCA’s policies and procedures. It is the responsibility of the VCA principal to determine the timing and what materials to be filed with FINRA.
The Securities and Exchange Commission defines the term “advertisement” as any notice, circular, letter or other written communication addressed to more than one person, or any other published or broadcast notice, which offers analyses or reports concerning securities, any graph, chart, formula or other device to be used in determining when a security should be bought or sold, or which security to buy or sell, or which offers any other investment advisory service related to securities.
The product distribution teams at Victory Capital are staffed with individuals who, in addition to being licensed through FINRA, undergo extensive background checks to ensure the Company maintains an educated, competent and ethical sales force.
As an asset management firm, we are in the human capital business. As such, we value and appreciate our most important asset—our people. We employ “owners”, not employees. We all take pride in the deep expertise that we bring to the table. Every “owner” is held accountable for their individual actions as we work hard to generate positive outcomes for both our clients and shareholders. This culture is consistently supported and deliberately reinforced to drive sustainable financial performance and enhance value for our shareholders.
We strive to provide a healthy work environment including a new fitness facility at our San Antonio headquarters that is free for employees and other healthy lifestyle amenities such as treadmill work stations in other offices and reimbursement for external fitness memberships.
Employee Engagement, Diversity and Inclusion
We have formal Health and Safety, Anti-Discrimination, Diversity, and Human Rights policies in place at every level of our Company. It is our belief that people with diverse backgrounds and experience enhance our collective perspective and thereby produce better results.
All employees must complete mandatory sexual harassment and compliance training and are encouraged to voice concerns and obligated to report any policy violations, without fear of retaliation.
Compensation practices are not influenced by gender, rather by role and achievement.
Benefits, Training & Development
We offer an array of benefits to attract, retain and assist our employees. These benefits include health and wellness benefits, as well as other programs to help our employees’ financial wellbeing. All new employees are welcomed into Victory Capital through onboarding, a process in which we integrate new employees into the Company. Access to training and development are provided which allows our employees to further develop their talents.
Business Model and Innovation
Product Design and Lifecycle Management
As the asset management business matures, the industry is rapidly undergoing dramatic transformations. We knowingly developed a unique business model that specifically addresses ongoing trends in the capital markets and investment industry. Our distinctive business model addresses the epic shift of assets from active to passive management and embraces these changes with our growing exchange traded funds and solutions offerings. Moreover, the compression of average industry fee rates for active management plays perfectly into our integrated multi-franchise platform, which can produce industry-leading profit margins despite the lower fee-rate environment.
Our platform is also structured to make accretive acquisitions and add value for asset managers seeking the innovation, technology and distribution afforded by ever increasing economies of scale. With approximately two-thirds of our cost structure made up of variable expenses, this model allows us to scale and flex quickly in response to changing business and market conditions. In short, our Company has been built to exploit current industry trends and rapidly adapt to future developments.
Leadership and Governance
Please click here for more information on our leadership team and click here for more information on our Board of Directors.
The Victory Capital ethics hotline is available 24 hours a day, seven days a week. Employees may report an anonymous complaint by calling 1-800-584-9055. Victory Capital also has a Victory Funds ethics hotline and a USAA Mutual Funds ethic hotline.
Victory Funds ethics hotline: 1-866-855-3863
USAA Mutual Funds ethics hotline: 1-877-711-3336
Trust and integrity are core to our DNA. Trust is a sacred attribute that forms the foundation of our culture. We understand that great relationships are built on trust. Every day we earn trust through reliability, discipline, transparency and strength. Our culture is one of mutual respect for each other and our business partners.
It is our policy to maintain the highest ethical standards and comply with all applicable laws, rules, and regulations that affect our business. Because we conduct business internationally, we also abide by the applicable national and local laws of all countries in which we operate. Victory Capital believes that adherence to our Code helps to ensure our continued success, as well as earn and maintain the confidence of our clients, shareholders, and the communities in which we live.
Systematic Risk Management
Victory Capital’s risk governance structure includes a committee led by a diverse set of business managers that assist the firm in identifying and evaluating risks associated with the firm’s profile. We stress and note that risk management is the responsibility of every employee and is a core responsibility for each senior executive. Senior management plays an active and visible role in all risk management functions. We employ a risk management evaluation methodology and have established a framework that defines major risk categories and the responsible parties for managing those risks.
This methodology assesses the impact and likelihood of events or threats, the residual risk based on the control design and effectiveness, and the risk outlook based on trends, industry knowledge and external analysis.
The framework’s major risk categories include financial, legal, compliance, investment, operational and reputational.
Evaluation of risks and the adequacy and execution of controls are critical to our enterprise risk management therefore, open communication is encouraged at Victory Capital.
We endeavor to advance continuous improvements in every aspect of our business and welcome comments and/or suggestions regarding our Corporate Responsibility Initiatives.