T. Rowe Price has launched the global impact equity fund to allow Australian investors to simultaneously focus on financial goals and impacts on global environment and social equity issues.
The fund will provide a high-conviction, global equity portfolio that seeks to invest in companies that create sustainable and measurable impact and identify the added return potential this could bring.
It will employ an all-capitalisation, active management approach typically owning between 55 and 85 securities, find companies that the firm believes is on the right side of societal and environmental change and focus on three impact pillars including climate and resources, social equity and quality of life, and sustainable innovation and productivity, guided by the United Nations Sustainable Development Goals (UN SDGs).
It excludes certain industries and companies that the manager believes do not conform to the fund’s impact mandate, such as fossil fuel, tobacco, gambling and casinos, and for-profit prison companies.
The fund is certified by the Responsible Investment Association Australasia’s (RIAA) responsible investment certification program, which distinguishes responsible, ethical and impact investment products and services in Australia and New Zealand, while its investment process is endorsed by the RIAA, and will provide transparency on the impact targets of its portfolio holdings.
The fund is available to wholesale and institutional investors in Australia and New Zealand, and retail and advised investors on various distribution platforms, including Hub24, Netwealth and Wealth O2 (it will be added to more platforms).
T. Rowe Price head of distribution for Australia and New Zealand, Darren Hall said: “Over the last decade, T. Rowe Price has invested significantly to integrate ESG factors into our investment research platform, recognising that the long-term sustainability of our portfolio companies is critical to their financial success and to our mission of helping clients reach their financial goals.
“As an active manager, we want to make a difference with our dollars by directing capital towards desired impact outcomes as well as to influence positive environmental and social progress.”
The fund’s portfolio manager Hari Balkrishna said the investment industry has reached a point where it can contribute to “positive societal and environmental change”, while focusing on financial performance over a long-term horizon.
“Being able to marry these goals together in a single strategy is an exciting step forward for us as investors, and we look forward to partnering with clients in our pursuit of positive impact at scale, on a truly global basis,” he said.
RIAA CEO Simon O’Connor said, “it is pleasing to see the growing number of fund managers offering quality impact investment options in the Australian marketplace in response to the demand from investors who want to achieve a positive impact on the environment and society alongside strong financial returns”.
To hear more about the increasing demand for ESG investing and how advisers can tailor their advice to suit client demand, click here attend the 2022 ESG Summit.
