EQ Investors actively select funds that aim to make a positive impact on society and the environment through The Positive Impact Portfolios provided to their clients. EQ’s summer update showcases the companies their funds invest in, and the solutions provided to real world problems.
Since 2017, EQ have been using the United Nations’ Sustainable Development Goals as a way to think about impact. The 17 Goals provide a holistic framework for action around the most critical issues for society and for our planet. Underlying holdings in the portfolios are mapped to these goals, and in the summer update focuses on three examples for Goals 3. Good Health and Well-Being; 7. Affordable and Clean Energy; and 12. Responsible Consumption and Production.
Goal 3. Good Health and Well-Being
Finding the cure for rare diseases
Rare diseases present a huge challenge for medical research. While individually rare, there are around 7,000 genetic diseases which affect 350 million people globally. Individuals living with a rare disease are underserved due to the lack of resources being directed to their diagnosis, treatment and cure. Collectively, rare diseases are a large burden on patients, their families and our already overwhelmed healthcare systems.
The fund in focus to satisfy this goal is the Polar Capital Biotechnology fund. An example holding would be Shire, a global biotechnology company that focuses on rare diseases whilst providing access to rare medicines and rare disease diagnostic tests to underserved population in the US.
Goal 7. Affordable and Clean Energy
Divesting from fossil fuels
The world’s energy demand is expected to increase by another 30% by 2040. With our current global energy mix we are not on track to meet the Paris Agreement’s objective of limiting global warming to 2°C and face the prospect of runaway climate change. Generating more power from renewables is key to reaching the warming target. But it is possible that the urgency of our situation is starting to bear fruit: renewable energy accounted for 70% of new worldwide power capacity in 2017.
The fund in focus which is mapped to this goal is the Hermes Impact Opportunities fund. An example of a holding would be Ørsted, a Danish renewables company whose vision is to “create a world that runs entirely on green energy”. Ørsted have made movements to convert its thermal power plants from coal to sustainable biomass and has now reduced their own CO2emissions by 67% since 2006.
Goal 12. Responsible Consumption and Production
Protecting ecosystems from plastic waste
Each year, the world’s oceans are littered with an estimated 1.1–2.4 million tonnes of plastic waste from rivers alone. The UK alone uses 13 billion single-use plastic bottles per year, but only around half are recycled. Decoupling waste generation from economic growth is a huge challenge that requires a revolution in business models, technology and consumer mindsets.
The fund in focus to contribute to Goal 12 is the Impax Environmental Leaders fund. An example holding would be Suez a waste and water management company. It applies waste management solutions across industries and sectors. Developing integrated technologies and strategies that interfere with different pollution pathways.
To find out more about EQ Investors Positive Impact Portfolios and the three goals discussed take a look at their Summer Update.
If you want to hear more about impact investing, EQ Investors are hosting an adviser event for Good Money Week. Good Money Week is the annual campaign which this year takes place between 29thSeptember and 5thOctober and aims to grow and raise awareness of sustainable, responsible and ethical finance. Attendees will hear from Damien Lardoux, manager of EQ’s Positive Impact Portfolios and two leading fund managers who manage the Hermes Impact Opportunity and Allianz Green Bond Funds.
This article was created for the DISCUS website to share criteria used for the Positive Impact Portfolios managed by EQ Investors. You can find out more about EQ Investors and their discretionary investment services here ›