Fund Style Name: Sustainability Themed funds

Style USP: Encouraging more sustainable business practices through investment

Brief description of Style

Funds that focus on longer term, sustainability related themes as part of their investment strategy.

SRI approach applied

Fund managers invest in companies with good investment prospects which are likely to benefit from the shift towards more sustainable business practices and lifestyles.

Fund managers select companies that fit within their published investment themes which aim to favour, support and encourage more forward looking, sustainable businesses.

SRI Issues

Fund managers look for companies that have a positive impact on society as well as the environment.

Relevant issues include sound management of sustainability related themes such as the responsible use of resources, good employement practices, good stakeholder relations – and addressing long term environmental challenges. Funds may also be subject to engagement activity.

Variation across Style segment

Fund aims, approaches, investment strategies and resources vary. Different fund managers have different views on what constitutes progress towards ‘sustainability’.  Some fund managers demand more advanced company policies and practices than others. Some funds build in a limited number of values based exclusions such as avoidance of armaments and tobacco companies.

Impact on investment strategy

Sustainability Themed funds often offer a diverse portfolio by investing in sustainability leaders across most business sectors – often on a ‘best of sector’ basis.

Fund managers invest in companies that are expected to succeed as a result of the way they approach environmental and social challenges. They will aim to hold companies that are expected to benefit from the raising of standards across a range of environmental, social and governance (ESG) related issues – without necessarily avoiding a significant number of business sectors.

Who is this Style most likely to appeal to?

Ideal for investors who are looking to benefit from, support or encourage companies with more sustainable policies, practices and products.

Associated Styles

These funds may include a responsible engagement strategy to encourage more sustainable business practices. These funds may be similar to some Balanced Ethical and Environmental funds.

Associated jargon

Sustainability, environmental – fund names often indicate taking a responsible view on the future.

Providers

Fund providers include established and newer market entrants.

 

 

Sustainability:

‘…meeting the needs of the present without compromising the ability of future generations to meet their own needs.’

Source: The Brundtland Report 1987

 

 

 

 

 

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