Boutique fund manager Alphinity Investment Management has unveiled a differentiated Sustainable Share Fund (SSF), which will appeal to SMSF investors who value an environmental, social and governance (ESG) approach.
SSF provides a diversified portfolio of Australian stocks with strong ESG characteristics and contributes, where possible, toward the advancement of the United Nations (UN) Sustainable Development Goals.
The fund seeks to address the 17 UN Sustainable Development Goals agenda in its investment.
It has appointed ESG investment pioneer Elaine Prior and fellow ESG veteran and Action Sustainability Asia-Pacific co-founder Mark Lyster to its compliance committee to provide an independent external review of companies in which the fund has invested.
SSF aims to outperform the S&P/ASX 300 Accumulation Index after fees, over rolling five-year periods, and will typically hold between 35 and 55 stocks and has a management fee of 0.95 per cent.
“The Alphinity Sustainable Share Fund is an ideal fund for SMSFs seeking to invest in a way that supports sustainable development while delivering strong risk-adjusted returns,” Alphinity principal and SSF portfolio manager Bruce Smith told selfmanagedsuper.
“The fund invests in companies with positive ESG characteristics and/or address the advancement of the UN’s Sustainable Development Goals.
“Alphinity has a highly experienced and skilled investment team and is supported by two eminent external sustainability experts, Mark Lyster and Elaine Prior, who oversee the constituents of the fund’s portfolio to ensure that the companies in the fund remain true to label.”
Smith said Alphinity avoids companies that are materially involved in activities the manager considers harmful to society and are inconsistent with the achievement of the goals, and/or display poor practices in their management of ESG issues.
“Society faces significant challenges to achieve sustainable development,” he said.
“[We] aim to address these challenges. We are committed to supporting companies our research shows do good and avoiding those that don’t.”
Alphinity SSF portfolio manager Stephane Andre said the fund was true to label.
“Sustainability is not just an add-on or a ‘bumper sticker’, it is at the core of this fund,” Andre said.
“For example, we will not support companies which generate more than 10 per cent of their revenues from producing or operating high-impact fuels such as uranium, thermal coal, coal seam gas, oil sands and Arctic drilling, which are considered environmentally unfriendly and for which sustainable alternatives exist.”