A focus on delivering sustainable and growing dividends by integrating multi-thematic and ESG approaches
A focus on multiple global themes lies at the centre of the strategy’s investment approach, which provides sustainable growth drivers for the companies in which we invest.
Our disciplined approach leads us to access both cyclical and defensive yields, which maintains a balanced portfolio. We select companies with a high sustainable current income as well as future income growth.
A focus on fundamentally based, active stock selection, paying close attention to the risks that each company faces, leading to better informed decision-making around the sustainability of growth and dividends. At the portfolio level, the combination of stocks across multiple sectors with different growth and defensive characteristics mitigate unwanted factor risks, which is also augmented by leveraging multiple themes.
Employs a consistent approach to the integration of Environmental, Social and Governance (ESG) considerations when selecting companies. We don’t own any of the vice areas exposed to potential regulatory change, such as tobacco, and we only look to invest with ESG leaders.
The Portfolio Managers have been running sustainable Global Equity portfolios since 2013, screening out the vice sectors which are at risk of regulatory change, and low ESG scoring companies. We look for Leaders in the ESG space within their industries. To help do this, we leverage Sustainalytics, a leading independent information source on ESG criteria. Mirabaud Asset Management also has a dedicated team of Socially Responsible Investing specialists that work jointly with the investment team to strengthen ESG engagement and capture the non-financial risks of the companies selected for the strategy.
We select companies with a combination of stable high free cash flow yields and strong balance sheets. This means they can deliver a solid yield today, with the underlying growth and stability in cash flows to grow future dividends. We also believe that companies positioned to benefit from global themes enjoy additional growth factors, providing more stability in longer term dividend generation across all market environments.
We’ve been employing thematic investing in this strategy since its inception. We have identified eight global themes, and multiple sub-themes underneath them, which share common attributes – innovation and structural growth drivers as a result long-term sustainable demand from consumers or industries. When we consider a company, it’s always in the context of how it fits within one of our themes, which provide companies with additional growth drivers.
We have reclassified our “Renewables” theme to “Decarbonisation”. Renewables are a key piece of the puzzle in the transition to carbon neutrality, but alongside this there are other key areas of the transition, which will represent a significant tailwind for those companies exposed to them. As ever, we continue to look for global leaders in these areas.Discover more about this theme
In the US, the number of people aged 26-41 has exceeded 72 million, surpassing ‘baby boomers’ as the largest cohort of the population. Millennials will account for 75% of the global workforce by 2025 and their combined income will hit $8.3 trillion by 2025Discover more about this theme
Automation also has an important role to play in bringing customers previously reliant on e-commerce back into stores. Customers who had a positive experience with in-store automation said they would be willing to shift.
The Health and Wellbeing market has had to change during the global pandemic as consumers under lockdowns or partial lockdowns have had to adapt with limited or no access to gyms, fitness studios and other high-touch wellness-related activities.
What will emerge from this pandemic are more resilient, inclusive and sustainable cities, which could focus on large scale investment in public housing, to help alleviate some of the inequalities seen across urban centres today.
Covid Impact: The Covid-19 pandemic has created significant challenges for the world’s ageing population.
The service economy was one of our themes that was hit hardest during Covid, and we now expect this theme to bounce back hard in 2021.
The Explosion of Data remains an important theme for us and growth continues to be driven by the move towards a digital economy and changing preferences in the way individuals access information.
Our core belief is that companies paying dividends are highly disciplined in managing their cash flow, apply rigorous standards to capital expenditure decisions and are careful stewards of their cash.
Head of UK Wholesale