We live in an increasingly connected world. In this connected world, our choices matter. Every choice we make with our money is ultimately a choice about what kind of world we want. Just as politicians respond to votes, businesses respond to the investment decisions we make.
This is why Stewart Partners is proud to offer investment options that allow our clients to invest in a way that is consistent with their personal values. We offer sustainable investment options in major asset classes and are actively looking to expand this offering set.
What sustainability means to us
Integrating, not abandoning, investment principles
Sustainability meant different things to different people, so we felt it was important to define what it meant to us when it comes to investing.
We see this type of investing best described as a spectrum. On one end you have philanthropy and the other, traditional investing. The overarching themes are two-fold; regard for creating positive impact, and regard for financial return. Sustainable investing asks, 'how can you invest to maximise financial return while considering the impact of the companies you invest in at the same time?'
The simple answer is to invest more in companies that demonstrate best practice in their industries (such as moving to renewable energy) and invest less or totally exclude those with less sustainable practices or harmful products. It's all about meeting the needs of today, without compromising future generations' ability to meet theirs.
Increasingly investors are want to align their investments with their personal values. Many make the false assumption that this cannot be achieved without lowering financial return. The best evidence we've seen suggests that there is no significant difference in investment returns, so perhaps the better question is why not invest sustainably?
More elementary approaches in the past led investors to wholly exclude any companies that don't meet certain criteria. This may achieve the desired outcome from a values point of view but those tests were arbitrary and portfolios failed to diversify properly, leading to large fluctuations in performance.
Our approach to sustainability compliments our Investment Philosophy rather than replace it.
We believe a well-constructed portfolio can reflect your personal values, whilst maintaining a low cost, evidence-based solution to help you meet your goals.
Impact investing is an emerging sector which has captured much attention and grown rapidly in Europe and the US. The idea takes sustainable investing further with a greater focus on measurable positive impact, generally in asset classes such as private equity, private debt and direct real estate.
As such, it isn't feasible to integrate into a broad strategy like it is in public markets. Any impact investment opportunity must be looked at by specialists on a case-by-case, deal-by-deal basis. Investors need to tread carefully in this new and developing area. Naturally, we are excited and curious about anything which aims to make our world better and provide a financial return. If this is of interest to you, we welcome a conversation about this growing area.