1. Newsroom
  2. Asset TV Fund Selector: ESG & Impact Investing
Menu
UBP in the press 07.11.2018

Asset TV Fund Selector: ESG & Impact Investing

Asset TV Fund Selector: ESG & Impact Investing

Once considered a niche investment activity, sustainable investing is increasingly moving into the mainstream across all asset classes.


 

Approaches that integrate environmental, social and governance (ESG) criteria, along with strategies like impact investing, are attracting growing interest from those institutional and private investors who are willing to align their investment decisions with their values. The potential is huge, but there are challenges, such as data collection and capacity. Victoria Leggett, Head of Responsible Investment at UBP, recently took part in an Asset TV broadcast outlining the crucial trends on the market and development opportunities when it comes to ESG and impact investing products.

Sustainable investment has witnessed a sea change in recent years, with the asset management industry progressively moving from an exclusion perspective towards a much more positive approach, stated Victoria Leggett during a recent Asset TV broadcast about ESG and impact investing. Along with other industry experts, she added that there is now well-documented evidence that targeting positive social and environmental outcomes can generate competitive financial returns.

At UBP, sustainability is at the heart of investment decisions and not in a “siloed” way

explains UBP’s Head of Responsible Investment, admitting that there are still different interpretations in the financial community of what sustainable investments should be.

The concept of impact investing, however, can be easily explained: the impact universe is an umbrella for all different types of asset. Although listed equities are relatively new to impact investing, the inclusion of these liquid assets will play an essential role in the strategy’s development, as it makes it much more accessible to investors, Leggett continues.

A company has to meet key criteria in order to be considered a potential candidate for an impact fund. Its “intentionality” has to be thoroughly tested in the first instance, meaning that making a positive and a purposeful impact must be part of its business model. “Additionality” is another key characteristic, insists Victoria: firms likely to stand out as “impact companies” have strong innovation patterns and their processes tend to be unique in their fields. Last, “materiality” also has to be demonstrated. As available data is scarce and often barely comparable between one company and another, relevant KPIs have to be worked through. This can only be done over time and involves strong engagement with a company’s management at every stage of the investment process.

In conclusion, Victoria Leggett notes that the risk of style bias that would accidentally make the impact fund look like a renewable energy or healthcare fund, can be mitigated through diversification across sectors.

Impact investing

victoria-leggett-150x150.jpg

Victoria Leggett
Head of Responsible Investment for Asset Management

Newsletter

Sign up to receive UBP’s latest news & investment insights directly in your inbox

Click and enter your email address to subscribe

Expertise

Impact investing - Creating the future now

The role of impact investing is to strive to solve the world’s most pressing problems by identifying compelling long-term investments.

Read more

Most read

UBP in the press 18.10.2018

Tech sector driven by innovation

Sphere (10.2018) - Since the 2008-09 global financial crisis, the global technology sector has delivered an impressive annual return of 15.4%, easily outpacing global equities as a whole (10.2%).

UBP in the press 26.09.2018

Asset TV Fund Selector: Fixed Income

What does the end of quantitative easing mean for bond investors? What should be the right exposure to emerging bond markets and why are active managers better equipped than passive ones to handle the return of volatility? Mohammed Kazmi, Portfolio Manager & Macro-Strategist Global and Absolute Return Fixed Income at UBP, recently participated in an Asset TV broadcast outlining the risk and reward trade-offs in fixed-income markets over the next six to twelve months.

UBP in the press 28.09.2018

AI will benefit Swiss banks

Bilan (25.09.2018) - “If I had to bet on which would be the leading professions in the years to come, Swiss bankers would be on the list!” This prediction by Laurent Alexandre, the founder of the Doctissimo.fr website, may come as a surprise to some.


Further reading

UBP in the press 12.11.2018

Finance is committed to protecting the planet, there’s no turning back

Le Temps (12.11.2018) - Sustainable growth and protecting the planet are compatible.

UBP in the press 05.11.2018

Commodities outlook in a volatile market environment

Agefi Indices (23.10.2018) - With the exception of oil, the commodity complex as a whole has been struggling since the beginning of the year on concerns about the escalation of the US–China trade war and a stronger US dollar.

UBP in the press 02.11.2018

European small and mid-caps: lower valuations, attractive prospects

Agefi (29.10.2018) - Investors have been increasingly risk-averse since the start of 2018. However, there are still many opportunities in the small & mid-cap segment, where expected earnings growth remains attractive.