Approach

The Man RI Global Sustainable Future Strategy is an actively managed, long-only equity strategy that invests in global companies across market capitalisations and has the sustainable investment objective to support the financing of companies that contribute to the UN Sustainable Development Goals (the “SDGs”), while providing a long-term capital appreciation to investors.

The investment team takes a highly selective bottom-up approach to identify and invest in the world’s strongest companies, and is uncompromising in its search for quality companies that are able to demonstrate sustainable competitive advantages over the next 5 years and beyond.

The team’s investment philosophy relies upon detailed, fundamental analysis which concentrates upon carefully researching all the attributes of strength, as defined by the investment team, which must exist for candidates to qualify for portfolio inclusion. The philosophy, which has evolved over more than 30 years, is a natural extension of the one the team successfully applies to its European funds.

Portfolio construction

The team’s investment universe of around 3,200 companies is typically made up of companies with a market capitalisation of USD 3 billion and above, however, only around 150 companies pass the team’s fundamental strength analysis and are candidates for the 25-35 stock portfolio. The stock selection process starts with a bottom-up approach identifying companies that demonstrate consistent long-term outperformance through value creation.

The team considers sustainability to be a prerequisite for long-term strength, success and outperformance, and the Fund seeks to align with UN Sustainable Development Goals and to maintain a lower WACI than the MSCI World benchmark index. The Investment team also applies a proprietary exclusion list of controversial stocks or industries related to banned weapons, nuclear weapons, tobacco and fossil fuels.

In particular, the team looks to invest in companies that demonstrate sustainable behaviours such as activities related to the circular economy including waste reduction, re-use and recycling and the sustainable disposal of waste (in line with SDG 12); companies whose operations and/or activities are aligned with climate change mitigation and climate change adaptation (in line with SDG 13), and companies that consider the interests of all-stakeholders, in particular female representation and empowerment (in line with SDG 5). The Investment Manager will favour companies where material ESG behaviours, such as the furthering of inclusive and sustainable industrialisation and innovation, lead to long-term competitive leadership (SDG 9) and growth potential.