New for 2017. Investing to benefit the environment, human welfare and sustainability
This fund aims to provide capital growth from a diverse range of asset classes, including UK and overseas equities, fixed income securities, property-related investments and cash, mainly in the UK. It invests in companies that benefit from the core themes of environment, human welfare and sustainability.
Companies leading their industries in environmental, social and governance (ESG) performance, as assessed by Royal London's ESG analysts, are also included, thereby creating a portfolio of investments that make a positive contribution to society. Mike Fox, head of sustainable investments, has managed the fund since 2014.
Fox and his team aim to integrate the consideration of ESG issues alongside financial analysis throughout the investment process. Every holding in the fund has to meet key criteria and the team actively engages with the companies it invests in to champion best practice, challenging companies on issues such as environmental policy and corporate governance standards.
On the other side of the coin, the exclusion policy is to focus on avoiding companies believed to expose investors to unacceptable financial risk resulting from poor management of ESG issues.
Fox's investment approach is characterised by several features, including a focus on long-term themes and trends such as infrastructure or changing demographics.
When selecting shares, he takes a valuation-driven approach aimed at identifying mispriced opportunities with careful analysis of company-specific factors. Fox also aims for low turnover in the portfolio, with companies typically held for three to five years.