Ausbil wins Responsible Investments award in Zenith Fund Awards 2020

From

Paul Xiradis

Ausbil has been named the winner of the Responsible Investments award category in the Zenith Fund Awards 2020 for the Ausbil Active Sustainable Equity Fund (Fund).

“We are delighted to be recognised by Zenith with this award,” says Paul Xiradis, Executive Chairman, Chief Investment Officer and Head of Equities at Ausbil. “We feel so strongly about   the benefits of investing responsibly that we have for many years integrated ESG across all of our investment strategies, with ESG consideration built into our investment process.”

The Ausbil Active Sustainable Equity Fund is a true-to-label sustainable and responsible investment fund that actively engages companies, within its universe, to improve on all measures of ESG, and actively exercises its voting rights accordingly.

Ausbil was early in seeing that the only way forward in active investment was to integrate ESG in the firm’s culture, approach and decision making. Excellence in corporate governance (G) has always been a critical consideration in Ausbil’s process, from the very beginning in 1997. Over 10-years ago, Ausbil added environment (E) and social (S) considerations to the investment process, bringing together the full ESG approach across all funds.

“What gives our Active Sustainable Equity Fund its edge is our top-down bottom-up investment approach, our reach into the boards and management of Australia’s leading listed companies, and the depth and quality of our ESG research team,” says Nicholas Condoleon, Portfolio Manager  of the Ausbil Active Sustainable Equity Fund and Head of Research at Ausbil. “We believe our active engagement with these companies helps us achieve better risk-adjusted outcomes,” says Condoleon.

What has become apparent is that investing for sustainable returns with an ESG approach does not sacrifice returns, or cost the investor more, and may indeed enhance both the risk and return sides of the investment coin. “We believe, and we have seen this play out in our sustainable investment portfolio, that a sustainable approach reduces investment risks in a material way,” says Condoleon. “It also improves outcomes, especially in downside markets where sustainable companies are rewarded for their lower overall risk profiles.”

Ausbil’s ESG Research Team is led by Måns Carlsson, Head of ESG Research. “In our engagements we frequently encourage companies to adopt best practice in ESG risk management, which can in turn, help them become more sustainable businesses. That also helps increase the universe of companies in which we are willing to invest, and contributes to a better society.”

Genuine engagement means maintaining an ongoing conversation with a large number of companies in the potential investment universe, even when they currently have un-investable ESG scores. “We engage with companies for four key reasons,” says Carlsson. “Firstly, we want to protect invested capital. Secondly, we believe we can have a more positive impact on companies that are in dialogue with us than if we simply exclude them as pariahs. Thirdly, we want all companies to become more sustainable in their journey, and increase the universe in which we can invest. And finally, we need to understand the full distribution of ESG outcomes and behaviours to get a full picture of both ends of the curve, those we would never invest in, and those we believe are exemplary on an ESG basis.”

Ausbil is a PRI signatory and a member of the Plastic Solutions Investor Alliance. Ausbil also holds memberships with the Investor Group on Climate Change (IGCC) and the RIAA Human Rights working group. Ausbil is currently assisting the Australian government on the Modern Slavery Act. Ausbil’s ESG Research Team is actively engaged in deep collaboration across a wide range of ESG and responsible investing groups. Ausbil reports on all active collaboration in ESG and responsible investing regularly, summarising our engagement, advocacy and voting action in an extensive annual report, the most recent which can be found here.

The Ausbil Active Sustainable Equity Fund provides exposure to an actively managed portfolio predominantly made up of listed Australian equities which meet Ausbil’s sustainability approach to investing. The PDS can be obtained from our website at www.ausbil.com.au.

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