SPONSORED STATEMENT
Investors must seize climate-change potential Climate change should not be seen as a threat, but rather an opportunity to profit from the new wave of technology firms creating solutions for the world’s ecological problems. Investors have too narrow a view on all come into play to reduce CO2 climate change. Markets overlook the emissions. Aixtron, a mid cap German real costs and opportunities in existing company, makes the machine tools business and consumer markets. used to make low energy LED lighting, Impact Funds - Climate Change, the certainly a growth area. More than half Luxembourg-domiciled fund managed its exports are to Asia. by Natixis Asset Management, offers a In energy production, rather than different perspective. It promises the ‘big oil’ or coal, we consider best ideas in stocks that the market has hydroelectric energy companies like Carlos Joly yet to re-price for environmental reasons. Tratebel Energia of Brazil or Chairman of the Scientific Advisory Committee The thematic fund is not Chesapeake in the US, for obvious benchmarked, yet still appeals to institutional carbon mitigation reasons – but, as with all our stock investors. To date, they have been mainly French selections, we look for solid financials and insurers, banks and regional banks. dependable earnings streams. Our purpose is, of Natixis Asset Management is now opening up the course, to generate the kind of returns our investors fund to other pan-European institutions. Its broad are looking for. diversification and Emerging Market growth appeal In transport, too, railways are a cleaner option, as are boosted by its performance record since launch is maritime and coastal shipping. But road traffic (5/10/09). At the end of April, the fund assets cannot be ignored. Software companies that manage amounted to $138m, and performance since traffic light systems significantly reduce petrol inception was +15% in euros (net of fees). consumption and their order books are bulging. We Although this is not an indication or guarantee of also like companies like BYD (Build Your Dream), a future performance or results for the fund, it is a Chinese $23 billion cap company that makes lithium testament to the past success of the portfolio and nickel rechargeable batteries and is branching management team. out into hybrid cars. The Luxembourg fund operates on a simple Adaptation is the fund’s second theme. Climate premise: the risks associated with climate change change is already affecting business and consumer are already upon us. Extreme weather, pollution and behaviour. Even before the volcanic ash cloud hit, stresses on energy, food and water are very real, companies were already making greater use of says Carlos Joly, head of the fund’s Scientific video-conferencing. The fund is invested in Cisco, Advisory Committee. the worldwide leader in networking, mastering the Yet investors still have too-narrow a view. They transmission of voice and video, as well as data. focus on new technologies, not making the most of Cities such as Paris and Barcelona are introducing what we have already. bicycle hire schemes. No wonder Shimano, the Joly says: ‘The impact has not been priced in by leading supplier of bike gears, is a candidate for markets, except in certain niche areas. By inclusion in the fund. concentrating on three key themes of greenhouse The natural resources theme concentrates on gas reduction, adaptation to the impacts of extreme water and soil management in an increasingly urban, weather events and better use of natural resources, developing world. Fertilizer companies for improved we widen the field, reduce concentration risk, and agricultural output, better logistics getting farm foods spread across sectors and geographies.’ to market to reduce spoilage, and sustainable The CO2 reduction theme is not just about cutting forestry all provide interesting investment oil and coal usage. ‘Many investors think too opportunities. simplistically. There are few names in the solar and A great example here is the Brazilian company All wind universe and they are chased heavily by a lot of America Latina Logistica, which runs 21,000km of investors. Pricing of those companies can easily get railways in Brazil and Argentina – 75% of their out of control,’ explains Joly. business comes from the transportation of There are more opportunities in energy efficiency agricultural products such as soy, corn and sugar. and improving existing power plants. By extension, A focus on emerging markets adds to the fund’s glazing, insulation, sensors and lighting companies unique proposition. The fund’s exposure to emerging
markets is currently 18% and might rise to 25% as new opportunities are found in countries such as China and Brazil that invest in their fragile ecosystems. Joly says: ‘In many countries, there is virtually no water metering. Consumers treat water like air. But governments know they need to take action if they want to sustain their development.’ Modernising infrastructure and simple jobs such as installing water pipes and fixing leaky ones are being boosted by emerging market government stimulus funds. ‘If you think this is action needed in 20 or 30 years, you are very much mistaken. The spending is now, and infrastructure runs to hundreds of billions of dollars,’ says Joly. The lateral thinking built into the fund’s remit produces a wide range of more than 500 eligible stocks. Managers Suzanne Sénellart and Clotilde Basselier can call on the advice of the eight scientific committee members for the latest thinking, and data on its three investment themes. Experts include Pierre Radanne, who headed France’s environment and energy agency (ADEME) and Richard Klein, a senior scientist with the Stockholm Environment Institute, co author of IPCC reports, and expert in adaptation. Expertise is diverse, as are the opinions shared. ‘Meetings are collegial and always challenging. There are lots of arguments, but all are fruitful and useful,’ admits Joly. The fund mentioned herein is a sub-fund of Impact Funds which is organised as an investment company with variable capital under the laws of the Grand Duchy of Luxembourg and is authorised by the financial regulator (the CSSF) as a UCITS. Natixis Global Associates S.A. is the management company of the fund. Natixis Asset Management, the investment manager of the fund, is a subsidiary of Natixis Global Asset Management and is a French asset manager authorised by the Autorité des Marchés Financiers (Code 1200009, Agreement No. GP90009) and licensed to provide investment management services in the EU. Natixis Global Associates is the global distribution organization of Natixis Global Asset Management, the holding company of a diverse line-up of specialised investment management and distribution entities worldwide. This article is for information purposes only and does not constitute a recommendation or an offer to buy or to sell any security, or an offer of services. Distribution of this document may be restricted in certain countries. The fund is not authorised for sale in all jurisdictions and its offering and sale may be limited by the local regulator to certain types of investors. Please ask your financial advisor if you have any questions. It is the responsibility of your financial advisor to ensure that the offering and sale of fund shares complies with the relevant national law. The fund may not be offered or sold in any country or jurisdiction where it would be unlawful to offer or sell the fund. This is not a prospectus and does not constitute an offering of shares. Please read the prospectus carefully before investing.
Pioneer in SRI with 25 years of experience, Natixis Asset Management is the european expert of Natixis Global Asset Management with around 309 billion euros of assets under management (Source: Natixis Asset Management - Data as of 31/03/2010)
July-August 2010 Issue 82
July-August 2010 Issue 82