Sustainable

We believe investors can promote better societal outcomes without compromising on returns. 

Our proprietary relative value software, Observatory, enables us to offer ESG screening specifically designed for investors who wish to focus on sustainability and promoting better social outcomes, while still benefiting from TwentyFour’s specialist, active approach to fixed income.

Our sustainable strategy is a simple way for investors to help ensure their capital is being invested sustainably and responsibly, while still benefiting from TwentyFour’s specialist and active approach to fixed income.

What is Sustainable Investing?

ESG issues can be a risk to fixed income returns like any other. At TwentyFour we have built the assessment of these risks into our regular investment process, with an integrated ESG model used daily by portfolio managers for all strategies across the firm.

However, in recent years many investors have begun to consider sustainability a key element of their own investment objectives, and have sought products that specifically avoid investing in companies perceived to operate in an unsustainable way, either for their own business or the society and environment in which they operate.

Unfortunately, especially within fixed income where ESG data availability can be poor compared to publically quoted equities, managers have developed a range of approaches to sustainable investing, and it is clear to us that many of these may not work for investors in the way they should.

Why invest?

  • Promoting better outcomes: We believe the objective of sustainable investing should be to at least maintain investor returns while playing a part in promoting better environmental, social and governance outcomes
  • ESG and performance: Our research has shown that with the right combination of positive and negative screening, stated sustainability criteria do not have to detract from risk-adjusted returns
  • Higher return potential: A focus on more nuanced factors such as controversies, engagement and momentum in ESG analysis can potentially deliver higher returns and better ESG outcomes
  • ESG Framework: TwentyFour’s ESG framework puts the onus on the team’s ongoing credit work, rather than relying solely on third party analysts or data providers
  • Meets regulation: Regulatory initiatives are increasingly pushing asset owners into more sustainable strategies, and we expect companies seen as running sustainable businesses to benefit from increased capital flows in the coming years

 

Meet the team

 

Insights

TwentyFour Asset Management
TwentyFour Blog

How ESG Will Change the Face of Asset Management

As regular readers of this blog will know, TwentyFour has adopted ESG integration throughout its investment process for all strategies, and launched its first sustainable fund offering in January 2020. In doing so, we have engaged in some fascinating debates with clients and peers about the growing impact of ESG objectives on the fund management industry, and on fixed income markets in particular. Here are a few of our predictions for the years ahead.

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