It’s little surprise that there has been plenty of confusion about Responsible Banking (RB). Much of the terminology around the concept can be jargon heavy. We have created a series of insights to help investors better understand the opportunities presented by RI.
With around 600 people operating in over 20 countries and based in 13 offices around the world, the team combines in-depth, in-country knowledge with longstanding experience, strong convictions and a thorough understanding of capital structure.
This combination allows us to build strategies for our clients across the spectrum of Real Assets through a wide range of investment solutions which aim to deliver targeted returns commensurate with their risk profile. We are the number one portfolio and asset manager in Europe² in direct property and a global leader in Real Asset investment.
From little acorns do mighty oaks grow
After starting out with the fundamental idea of investing in ‘good’ companies and avoiding ‘bad’ ones, RI has since evolved into a powerful way to make effective investment decisions. It can deliver sustainable, long term value for clients and create a positive impact on society using insights gleaned from environmental, social and governance (ESG) data.
This approach has built significant credibility in an age when some firms can become winners almost overnight as a result of prominent trends like technological disruption. A striking example is the rapid rise of electric car manufacturer Tesla1, which although launched a century later than Ford, has in its few short years of existence already temporarily outstripped it in terms of market capitalisation2.
The shift may seem sudden but illustrates the momentum that is building for products that are deemed more responsible and less harmful to the environment. This wave of enthusiasm is quickly moving into the financial world. Investors increasingly want to understand how a company is creating value, demanding details of how an organisation’s activities are impacting the wider world.
The RB revolution
In the past, investors concerned about aspects of a company or sector, such as tobacco, arms or gambling had limited investment options. The focus was almost exclusively on public equity-oriented strategies, generally described as negative screening or ethical funds. This also created the perception that financial returns were limited.
But RB strategies have grown both in number and sophistication. Through integrated and innovative fund management techniques, RB is opening up a new world of opportunities. These will continue to improve as tools and measurement criteria evolve further, helping asset managers to more effectively mitigate risk and therefore potentially enhance financial returns.
To find out why we believe RB provides a compelling investment opportunity and the different approaches available to investors, click on the insights below.