Ulrik Fugmann, co-head of the Environmental Strategies Group, believes investing to benefit the environment means targeting solution providers in need of capital to start new projects or scale technologies. Index-oriented investors would not necessarily invest in such companies which may lie outside the mainstream indices. Besides contributing to the resolution of an environmental challenge, he argues a sustainable thematic approach offers attractive returns.
In this video, he states that investors should be open to the opportunities that solution providers can offer. While this could involve taking off-benchmark positions and running a sustainable thematic portfolio with a higher tracking error, it would be offset by a higher risk/reward.
To avoid any possible ambiguity, please note that any ESG/sustainability outcomes evoked by Ulrik in this video do not correspond to the definition of ‘impact’/’impact investing’ as those investments fulfilling the dual objectives of:
- Seeking a non-financial (real world) impact
- The impact being measured and monitored.
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