The Australian boutique fund manager’s new strategy aims to invest in global companies that are supporting the transition to a more sustainable future.
The fund is taking the same approach as the 2015-launched Alphinity Global Equity Fund, but “also applies the same rigorous sustainable and ESG methodology” used by the Alphinity Australian Sustainable Share Fund launched in 2010.
Portfolio manager Jeff Thomson said the Alphinity Global team is focusing on companies that “do good” and “do it well”.
“We have a zero revenue tolerance for producers of tobacco and controversial weapons,” he said.
“We also don’t support companies generating more than 5 per cent of their revenues from the production of fossil fuels, controversial fuels such as uranium, gold mining where gold is the primary purpose of the mine, factory farming, live exports, predatory lending, alcohol and gambling, and old growth forestry logging, for example.”
Mr Thomson added that the fund will steer clear of companies who have demonstrated poor management of ESG issues, including breaching human rights principles and unnecessary pollution.
“When we come across a grey area related to ESG issues or alignment with the SDGs, the Sustainable Compliance Committee assesses the matter and determines whether Alphinity can support the company’s activities,” he said.
“The committee includes Elaine Prior, an award-winning ESG pioneer and former managing director at Citi Research in Sydney, and lawyer Melissa Stewart, a Canadian modern slavery and human rights expert.
“Only those companies that meet these stringent sustainability conditions are then assessed against Alphinity’s investment philosophy and process to ensure they are quality undervalued companies in or entering an earnings upgrade cycle and are therefore candidates for our portfolio.”
