Download - Angela de Wolff
Building a sustainable portfolio in line with clients' values
Angela de Wolff
Partner conser invest
Former President sustainable finance geneva
TBLI November 2013
• 17% of European pension funds are signatories of the Principles for Responsible Investment (UN PRI)
• UN PRI gather 1000 signatories representing 30 trillion of AUM
• in 2010, nearly 50% of equity mandate RfPs, made explicit reference to ESG
“sustainable investing” striking figures...
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• in 2010, nearly 50% of equity mandate RfPs, made explicit reference to ESG (Environmental, Social and Governance)
• large fortunes (HNWIs) allocate 14% of their wealth to sustainable solutions (Eurosif 2012)
• 60% of UK Foundations have defined an ethical investment policy
“sustainability investing” - different motivations for each investor
regulatory requirements
• « comply or explain »
• international standards - UN-PRI, CDP, Equator Principles etc.
long term investing
• quality check
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• quality check
• transparency
• risk assessment
value alignment
• consistency with values, principles or mission
• global challenges mitigation
• impact objective
RI market : multiple approaches pursuing various sustainability goals
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invest wisely; select sustainable solutions rigorously
• set objectives in terms of financial return and sustainable impacts (personal values)
• identify existing investment solutions1.0
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3.0
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Sustainability investing
AdvocacyImpact investing
Value mapping
Portfolio
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• assess the quality/consistency of SRI investment process
• require transparency
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Ethical sensitivity
Environmental sensitivity
Social sensitivity
Portfolio
sustainable funds - a heterogeneous universe requiring thorough selection
• a strong risk / return dispersion
• specific risk - very important 0%2%4%6%8%
10%
Act
ive
Ret
urn
(an
nu
alis
ed)
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universe of 244 SRI equity funds from 2007 to 2012sources: Bloomberg, conser
• specific risk - very important when the selection is limited to one or two funds
• statistically comparable to the traditional market
-12%-10%-8%-6%-4%-2%0%
0% 5% 10% 15% 20% 25%
Act
ive
Ret
urn
(an
nu
alis
ed)
Active Risk (annualised)
our sustainable funds database (1000 screened solutions)
• inventory of existing solutions: • inventory of existing solutions: 1000 sustainable funds
• analysis and assignment to different investment styles: proprietary database
experience
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databasedatabase
• own methodology to assess and • own methodology to assess and classify funds
• proprietary rating based on a qualitative /quantitative analysis
know how
our value added: sustainability rating vs performance
• qualitative assessment of sustainable funds . A proprietary rating ranging from good (1) to low (4)
3.0
3.5
4.0
4.5
5.0
Rat
ing
(0-4
)
Rating Conser vs Active Return
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• positive statistical relationship between the quality of the funds and their active performance 0.5
1.0
1.5
2.0
2.5
3.0
-20% -15% -10% -5% 0% 5% 10%
Rat
ing
(0
Active Return (annualised)
universe of 244 equity SRI funds from 2007 to 2012sources: Bloomberg, conser
illustration: balanced sustainable portfolioPhilosophie Pondération
Classe d'actifs d'investissement G érant Fonds Qualité moyenne
CASH 10%
ACTIONSLarge cap suis ses B est in class B - 1 5%S & M suis ses B est in class B + 1 5%S & M européennes B est in class B - 2 5%Large cap internationales Intégration A 2 5%Large cap émergents Intégration B - 2 5%Large cap US S creening positif A 1 5%All cap internationales Thème social A 2 5%
OBL IG ATIONS
Qualité
portefeuille univers
4 1
Médiocre Bon
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OBL IG ATIONSInternationales CHF B est in class B + 2 5%Internationales EUR B est in class B + 2 5%Emergents S creening négatif C 2 7%High Yield S creening négatif C 2 8%
MICROC RE DIT
Mictrof inance Thème social A 2 5,0%
IMMOBIL IER
Immobilier européen Thème env. B + 2 10,0%
HEDGE FUNDMutli-fonds Non durable 7,5%Long/short Non durable 7,5%
the « value mapping » defines the portfolio
construction
• founded in 2007, conser is 100% dedicated to sustainable finance and responsible investment. We co-manage CHF 100 mn and advise institutional investors with AuM up to 16 bn
• our proprietary tools unable us to advise investors throughout different stages, from understanding and defining objectives, to selecting investment solutions and
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from understanding and defining objectives, to selecting investment solutions and to constructing performing sustainable portfolios
• our company relies on a range of experts with extensive experience in sustainable and investment management, strategic advise and shareholder engagement and benefits from an strong board
• as an advisor and asset manager, we are supervised by the Swiss Association of Asset Managers (SAAM)
Disclaimer• This document is produced for information purposes and does not constitute investment advice,
nor does it constitute a recommendation or solicitation to buy shares. Any research or analysisused in the preparation of this document is based upon sources believed to be reliable, but norepresentation or warranty is given as to the accuracy or completeness of those sources. Anyopinions, estimates or forecasts may be changed at any time without prior warning.
• This document is not intended for distribution to private investors and is not directed to, orintended for distribution to or use by, any person or entity, who is a citizen or resident of orlocated in any locality, state, country or other jurisdiction where such distribution, publication,availability or use would be contrary to law or regulation.
• The value of an investment and the income received from it can go down as well as up and, onsale; investors may not get back the full amount invested. Past performance is no guarantee of
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sale; investors may not get back the full amount invested. Past performance is no guarantee offuture performance. Changes in the rates of exchange may have an adverse effect on the value ofan investment. The prices of small cap stocks tend to be more volatile than the prices of otherstocks and are sometimes less liquid and harder to value than securities of large cap stocks.Emerging markets tend to be less liquid and more volatile than developed markets.Furthermore, these markets face a certain number of specific risks (dramatic changes incurrency rates and modifications of exchange control regulations)
• This document has been issued by CONSER INVEST SA This document may not be reproducedor distributed, either in part or in full, without prior authorisation being obtained fromCONSER INVEST SA.
