Sustainable investing

What do you believe in?

We at Vontobel Asset Management want to help you make informed and active choices when it comes to ESG investing. But before you make a decision, you need to know what exactly your needs and beliefs are, and what investment approaches are available.

We start the discussion with a question: What do you believe in?

Environmental, social, and governance (ESG) standards can serve multiple purposes. Do you look for ESG to improve financial performance? Does ESG stand for investments in line with your values and convictions? Or both of the above?

 

infograph-esg-approaches_en

Whatever your goals are, the ESG approach you choose will affect your portfolio. We have defined six categories which we use to describe ESG investments: impact investing, thematic, best-in-class, integration, engagement, and exclusion, categorizing them according to the motivation and the resulting effect.

The six approaches can be explained as follows:

Impact Investing

Investing in activities with a positive impact on the environment or society. The main focus here is “doing good”, rather than investment performance.

Thematic

Investment focused on opportunities related to a single theme or megatrend. Results in a concentrated portfolio that should perform if the trend develops as expected.

Best in class

Only invests in companies with excellent ESG performance relative to others in their sector, often based on external database information. The focus is not on companies with moderate ESG scores with other attractive characteristics.

Integration

Includes ESG as a fully integrated element of the investment process, with ESG scorings combined with other factors to support investment decisions. The aim is a portfolio blending ESG and other characteristics. It requires a purpose-built investment process and portfolio management staff able to conduct ESG alongside other types of investment analysis.

Engagement

Investors aim to influence company management to improve business practices. A wide range of engagement levels exist, ranging from proxy voting through to public engagement as practiced by prominent activist funds.

Exclusion

Filtering out undesirable companies or sectors, either based on convictions or on international norms e.g. regarding weapons. Typically applied at the start of the investment process. While the companies in the portfolio meet ESG minimum standards, other factors are more important for the shares.

How ESG adds value

One of the old myths about investing is that ESG and performance don’t go together. Actually, they do, according to a review of more than 2,000 academic studies (“ESG and financial performance: aggregated evidence from more than 2,000 empirical studies,” Friede, Busch and Bassen, December 2015). There are three core ways in which ESG can improve investment results.

infograph-esg-navigating_en

There is no “one size fits all”

We believe there is no “one size fits all” ESG approach. There are simply too many investment styles, investor objectives, geographies, and asset classes. Being an active asset manager, we develop specialized ESG strategies covering a wide range of client needs in a targeted manner. We are convinced this leads to better results than standardized products, such as passive ESG exchange traded funds (ETFs).

Looking for the “right” ESG approach already puts you on the path towards active investing. If you are ready to invest independently of a benchmark, we can help you start your journey. Here is an overview of our ESG product range and our processes.

ESG at Vontobel Asset Management is managed on two levels:

  • The Vontobel Sustainability Committee works at Group level, chaired by the CEO and sets specific sustainability targets
  • Within Vontobel AM, the ESG Investment Governance Committee is responsible for coordinating ESG investment approaches across investment teams

We classify our offering into two product categories: "Integrated ESG" and "Sustainable". More information about these two product categories can be found in our Sustainability Report and here.

ESG Integration and Stewardship Report

Find more information about our ESG processes, resources, and governance in our ESG Integration and Stewardship Report 2020.

Our commitment to active ownership

We exercise voting rights at the annual meetings of companies whose shares we hold in our sustainable and thematic portfolios, and engage in active dialogue with them. To be able to do this efficiently, we work with leading service providers in the field of voting rights and corporate dialogue. Read our engagement policy. Read our voting policy.

Examples of how we exercise our voting rights and how we engage with companies can be found here. Vontobel Asset Management - Voting & Engagement Report

Key facts

Vontobel's heritage and strategic focus on sustainability help make us one of the leading asset managers for sustainable investing in Europe and Switzerland.

29.5 34% 21.8% 27 34  2001

Vontobel has a long tradition of corporate responsibility and sustainability. We are a founding member of Swiss Sustainable Finance, and have received numerous awards for our sustainable investment funds.

The sustainability rating agency ISS-oekom awarded Vontobel the rare "prime" status, and we received an above-average score “A+” for the implementation of the U.N. Principles for Responsible Investment (PRI).

logo-iss-oekom
Vontobel
  • PRI signatory since 2010
  • Founding member of SSF, established in 2014
  • Climate-neutral since 2009
  • Participant of the United Nations Global Compact charter
Vontobel Asset Management

We launched our first equity fund with an ESG focus in 2001. Ever since, our sustainable equity offering has grown significantly in volume and importance. On the multi asset side, we gained substantial ESG expertise through the acquisition of Vescore in 2017. The transaction enabled us to harness the skills of some of the industry’s original pioneers and advocates. The year of 2018 saw the launch of a bond fund with a sustainability angle, an offering we plan to expand soon with similar fixed income products.

ESG options available in most asset classes

ESG approaches are now possible in most asset classes. However, there are limitations. For instance, if US issuers of high-yield bonds are mostly energy companies, it is impractical to build a well-diversified ESG portfolio in this segment. To include ESG in your portfolio, you need to consider your objective, asset class and geography.

 

Our approaches and to which asset classes they apply

 

Equities Multi asset Fixed income
Best-in-class Global
European
Switzerland
Global Global
Emerging markets
Switzerland
Integration Global
Emerging markets
Asian
Solutions available on request
Thematic
Clean technology
 

ESG library

Learn more about your regional ESG market.

 

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