Speaking in Sydney yesterday, AXA IM Rosenberg Equities head of sustainable investing Kathryn Mohan McDonald pointed to research conducted by the company that showed high dividend payout did not depend on investing in major polluters.
“If I create the same quintile portfolios but without those largest 75 polluters, what would that do to my payout ratios?” Ms McDonald said.
“The fact of the matter is that it does very, very little to the payout profile.
“The carbon footprint, for example, is improved by 50 per cent, but as it turns out, it doesn’t really make much of a difference in terms of my ability to find an attractive average dividend payout.”
She said contrary to popular belief, a “green focus” would not “interrupt” investors’ search for attractive dividend yield.
“We should feel very confident that we can combine, marry, effectively, ESG concepts and more traditional investment outcome concepts that lead to extremely attractive investment outcomes,” Ms McDonald said.
She also said ‘green investing’ went further than simply low carbon companies, and that Rosenberg Equities had isolated “top green opportunity names”.
“These are about 400 names that rank highly when we think of use of green technology, or green buildings or renewable energy, and we look at their dividend payout profiles,” Ms McDonald said.
“There’s some averages that are higher than others, but the important takeaways for us is that amongst these green prospects, there are quite a few names that have a very attractive dividend payout profile.
“This is very confidence-building.”
