The Next 10 Years: Mirova’s Flagship Equity Fund
Marketing communication for professional investors only
It’s been 10 years since the launch of the Global Sustainable Equity fund. What was the rationale back then?
Jens Peers: The reason why we launched an active, sustainable and multi-thematic fund is because we are convinced that over the long run this will give investors the best portfolio from a risk-return point of view.
Equally, we also believe that every company, including ourselves, have a role to play in how the world is going to look in the future. We want to make a positive impact overall, and we saw this as a natural combination looking to marry performance with impact.
That may sound simple enough. But, when we started over a decade ago, this was a relatively novel concept: most investors were looking at single themes, like water or climate, and sustainable funds were in their infancy. We thought this could be a product that would work for big and small investors alike. But to do that, we would have to have a more diversified, multi-thematic approach.
How would you describe your investment style? Has it evolved at all?
Hua Cheng: I joined in March 2014, just a few months after the strategy launched, but the overall investment philosophy remained much the same: We are biased to quality growth companies that are well exposed to the big transitions reshaping our economy over the long term: demographics, technology, environment and governance. And we only add new positions if we see attractive upside potential in the stock.
As a result, we have been structurally overweight the healthcare sector with strong exposure to technology, because we believe in the strong secular tailwinds coming from the technology and demographics transitions, and we are still in the early stages of some of these themes. For example, we like specific areas like AI, digital payments, and parts of the healthcare sector offering solutions for an aging population. Over time, how we play individual themes can shift and we may see themes strengthen.
That sounds like a very wide opportunity set?
Hua Cheng: Of course, we are not only thematic investors, we implement a sustainable approach as well, looking for those companies best positioned within those four major transitions to create value over the long term. A key difference between Mirova's sustainability approach from many other asset managers that do sustainable investing is that we value the contribution of a company to the sustainable development goals, not only through its products and services, but also through their practices.
This means that we don’t simply invest in renewable energy, but also many other companies, either healthcare, information technologies, utilities etc., and we look for opportunities across these value chains. That makes us unique, and offers a global equity portfolio that can play a role in investors’ core equity allocations.
How are you looking at the next 10 years?
Hua Cheng: A lot can change in 10 years. We all wish we had a crystal ball, but it is important to keep the long-term approach that we take in mind. We have a great team that works well together, but we still need to tap into those long-term winning themes if we’re to outperform the benchmark.
Soliane Varlet: I think it's really about people. If you look at the three portfolio managers, we all have different backgrounds. I think it enables us to have a deeper understanding of the companies that are both in Europe and in the U.S., and we are able to meet them on a regular basis due to our proximity. We better understand the regulatory environment, the economics and the politics.
Lastly, sticking to our long-term vision and continuous improvement. Always questioning what we can improve, both as a team and as individuals.
Jens Peers: Looking back on what we've achieved, I think we should be very, very proud. We’ve grown quite significantly. And within global equities in general, we're scoring very well in the peer group over since inception, so we’ve achieved what we set out to do.
But, more importantly, we’ve built a very good foundation to continue to outperform and to continue to grow from here. We must do that. So, there's always things we can fine tune and do a bit better, and that's what I’m really focused on.
Marketing Communication. For professional investors only. Past performance is not indicative of future results. All investments involve risk, including the risk of capital loss. The provision of this material and/or reference to specific securities, sectors, or markets within this material does not constitute investment advice, or a recommendation or an offer to buy or to sell any security, or an offer of services. Investors should consider the investment objectives, risks and expenses of any investment carefully before investing. The analyses, opinions, and certain of the investment themes and processes referenced herein represent the views of the portfolio manager(s) as of the date indicated. These, as well as the portfolio holdings and characteristics shown, are subject to change. There can be no assurance that developments will transpire as may be forecasted in this material. In Switzerland: This material is provided by Natixis Investment Managers, Switzerland Sàrl, Rue du Vieux Collège 10, 1204 Geneva, Switzerland or its representative office in Zurich, Schweizergasse 6, 8001 Zürich.
NATIXIS INVESTMENT MANAGERS Paris 453 952 681 Capital : 178 251 690 € 43, avenue Pierre Mendès-France, 75013 Paris www.im.natixis.com
MIROVA - Affiliate of Natixis Investment Managers. French Public Limited Liability Company. Share Capital: €8 813 860 Regulated by the Autorité des Marchés Financiers (AMF) under n° GP 02014. RCS Paris n° 394 648 216. 59 avenue Pierre Mendès France 75013
