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The fundamental philosophy underpinning the fund is that high quality companies that create economic value by providing solutions to society's needs and challenges will be market winners over the long-term. Central to our investment philosophy is our integrated and active approach to research, stock selection and engagement, based on the three inter-linked beliefs detailed below:
- Sustainability is driving new growth markets.The long-term social, demographic, environmental and resource challenges facing the world today are reshaping the economic landscape, creating new investment opportunities for those companies providing solutions to these challenges, and growing risks for those sectors that deplete human and natural capital. Our experience suggests that the selection of sustainability themes is a powerful value driver, due to the secular dynamics underlying the sustainability agenda
- Stock selection matters - Financial markets are not entirely efficient and we believe that active investment management can add value over passive approaches. We believe in conviction-led investment decisions using a pragmatic, bottom-up approach to stock selection, based on a fundamental analysis of a company's prospects and strong valuation disciplines. We take a distinctive long-term approach to investing, tending to hold a stock for an average of more than three years and seek to be flexible, avoiding the pitfalls of out-and-out value or growth investment styles.
- Fundamental stock analysis that employs a disciplined approach to company valuations and a thorough appraisal of non-financial factors, enables better stock selection. We believe in the importance of thorough fundamental company analysis. Our investment methodology combines a disciplined approach to company valuations, and analysis of a company's non-financial environmental, social and governance (ESG) practices that helps uncover hidden risks and opportunities. In this way we seek to identify stocks that offer the potential of 'Growth at a Reasonable Price' (GARP). Our in-house analysis is complemented by the insights we gain through our programme of active engagement with companies and other key stakeholders.
Our objective is to construct a portfolio of global growth companies that enable, and benefit from, the transition to sustainability. We have identified four mega-trends that are exerting a powerful influence over the development of the global economy. We have also pinpointed nine specific investment themes which we expect to benefit from these underlying trends. It is from within these themes that we select companies for inclusion in the portfolio. |
