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RLAM

Sustainable investing

Finding companies who are ESG leaders or have a positive impact on society

Overview

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An active, positive approach that aims to identify and invest in companies that ‘do good’, sustainable investing is a popular approach used by many investors.

At Royal London Asset Management we have a track record of over 20 years in this area, and whether investing across UK or globally, across equity or fixed income market, we invest in companies with the following broad characteristics:

  • Companies that provide a positive contribution to society through their products and services
  • Companies that demonstrate leading environmental, social and governance practices in the way they operate.
  • Excluding companies in certain sectors that we feel cannot meet our sustainable criteria – for example armaments or tobacco manufacturing, and fossil fuel extraction.

Investment approach

We believe that owners and managers of capital can be a catalyst for positive social and environmental change. They can do this in two ways:

  • By investing in sustainable companies that are helping to solve the world’s social and environmental challenges
  • Through active engagement to encourage continual improvement.

Sustainable screen

In our view, strong sustainable credentials are often a good leading indicator of long-term financial performance with respect to growth and profitability and we believe that sustainable investing focuses on an exploitable market inefficiency.

By embedding sustainability analysis into our investment process, we believe that we can identify investment insights that others may miss.

Portfolio

In creating portfolios that we believe can deliver attractive long-term risk-adjusted returns, we weight sustainable credentials equally with financial considerations. Within equities, we believe that value creation and long-term compounding growth are the two key drivers of shareholder return. Within fixed income, we use our established credit philosophy based on a belief that there is an overdependence on credit ratings and benchmarks, and an undervaluation of security which can be exploited.

External oversight

In an area where clients want to know that their investments really are sustainable, we use external oversight.

An independent external advisory committee of experts in areas such as charities, corporate governance, academia and sustainable investment, ensures that we meet both the criteria and spirit of our sustainable philosophy and provide independent challenge and insight.

A diverse fund range

Our range of award-winning Sustainable funds are designed to meet varying risk, capital and income requirements. Our range covers 100% equity to 100% fixed income, including a number of mixed asset funds with relatively fixed asset allocations. These funds provide investors with a choice of investments mapped against potential risk and returns.

Our team

Experience

Our Sustainable Investment team is one of the most experienced in the industry with a long-term track record. We’ve been managing the sustainable funds since 2003, through varied market, economic and social cycles.

Collaboration

The Royal London Asset Managment Sustainable team also works closely with our Responsible Investment, Equity and Fixed Income teams, and is able to draw upon their expertise and insights.

Advisory committee

The team works with an external advisory committee who provide independent challenge into the decisions we make, enhancing the decision-making process of the team. The committee is advisory only.

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Image depicts team structure which includes 7 Sustainable Equity fund managers and analysts, 4 Sustainable Credit fund managers and analysts, Responsible Investment team, External Advisory committee

Documents

Key content

Documents for end investors

Sustainable investing views

SustainAbility: What if we have no more recessions?
Read blog
SustainAbility: What’s in a name?
Read blog
SustainAbility: Reality check
Read blog
Read all our views