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Development finance institution Investec’s Global Sustainable Equity (GSE) Fund prioritises investment into companies doing good, with the aim of helping investors do well.
Through the fund, investors are able to invest in companies that it believes “can provide attractive investment returns over the long term”, through the lens of the Sustainable Development Goals (SDGs) framework and “ensure there’s a future for the planet and its people,” the company said during a virtual presentation on August 18.
The United Nations SDGs provide a globally accepted framework through which businesses can align their strategic goals with ESG considerations. The 17 SDGs are underpinned by 169 individual targets, which have been encoded into government action plans.
They represent observable and tangible opportunities for companies to offer solutions and services to help achieve them.
Investec Wealth & Investment fund manager Barry Shamley explained that investment is, by nature, “a long-term commitment that aims to guarantee future wealth”.
He suggested that, by investing in the Investec GSE Fund, “investors combine growing wealth with helping create a positive, sustainable global environment”.
The Investec GSE Fund’s impact is calculated using the Institutional Shareholder Services (ISS) SDG Impact methodology, with the scores of individual companies assessed by ISS considering positive and negative contributions of revenue, operations and controversies towards the SDGs.
The GSE Fund’s overall score is +3.8, against the benchmark – Morgan Stanley Capital International (MSCI) World Index – of 0.5, delivering a 100% net positive impact against the SDGs.
Benchmarked against the MSCI World Index on a dollar base currency, the fund invites a minimum investment of $10 000 for Class A and $3-million for Class B.
The South African version of the fund will be an exact replica of the GSE Fund, Shamley told attendees.
However, the fund will only be available to South African investors within the next few weeks, once the related offshore accounts have been finalised, he said in response to questions posed by Engineering News.
All necessary regulatory approvals for the fund are in order, Investec confirmed.
Private, retail and institutional investors will be eligible to invest in the local fund at the rand-equivalent investment amounts. In other words, R10 000 for Class A and R3-million for Class B.
The MSCI World Index is a broad global equity index that represents large and mid-cap equity performance across all 23 developed market countries. It covers about 85% of the free float-adjusted market capitalisation in each country.
“The link between sustainability and performance is closer than many think,” said Shamley, who explained that business practices and outputs that are aligned with the SDGs “provide a net positive outcome for the planet and its people while aiming to deliver positive returns”.
Additionally, the Investec GSE Fund “proves that it is possible to simultaneously do good and do well”.
Concentrated across 30 to 50 holdings and aiming for quality growth, the Investec GSE Fund’s investment universe is listed global securities including equities, exchange-traded funds and other regulated collective investment schemes.
Alongside the establishment of the Investec GSE Fund, Investec has launched the Class of 2030 initiative.
The initiative pairs a diverse and representative mix of people from South Africa and the UK (the learners) with experts on the SDGs (the tutors) hoping to educate people about the aims of the SDGs.
“By creating a space where the learners can fully grasp the essential nature of the SDGs by learning from thought leaders in the right spaces, they’ll be educated from the point of not knowing what an SDG is, to becoming ambassadors and experts who can amplify the message and inspire the other 7.8-billion people who make up Earth’s population, to do the same,” Shamley said.