our approach to sustainable investing.

Sustainable investing means different things to different people. At Lombard Odier, we focus on two areas:

 

1. Dedicated sustainability strategies 

For our range of dedicated sustainability strategies, sustainability is the main driver of alpha. In these strategies we establish a universe of companies that provide solutions to sustainability-related challenges (such as zero-emissions), as well as those that are leading the sustainability transition within their sector or industry. Our high-conviction managers then use this universe as the starting point for further analysis and security selection.

 

2. Sustainability integration

For strategies where sustainability is not the primary alpha driver, our sustainability and ESG tools and techniques can be integrated within portfolios to enhance returns and mitigate risk as the transition unfolds. This is designed to identify 'best in class' companies (for example, those displaying superior management of significant risks and opportunities both in their business model and in their business practices).

 

These strategies are underpinned by our sustainable investment framework. Investment teams can also benefit from the expertise of our dedicated Sustainable Investment Research, Strategy & Stewardship (SIRSS) team, which monitors and informs investment teams on top-down global issues associated with sustainability challenges and their potential impact on sectors/industries. This interdisciplinary support ensures that our investment teams can make forward-looking investment decisions with the highest level of information and, therefore, conviction. Our investment teams have access to common tools that analyze the ESG factors and short-term controversies that could affect performance. Our ESG solutions team has developed a materiality-weighted approach to curating data that is bespoke to 160 industries.

Our proprietary technology platform is used to aggregate and monitor sustainability-related information and ensure it is readily available to all of our in-house portfolio management teams at all times.  As a result, sustainability is tightly coupled to our portfolio management and construction process for our dedicated sustainability strategies, and those that integrate sustainability.

Each investment team maintains the discretion to decide how best to utilise these sustainability tools and resources in the manner that best suits their investment process and asset class.

 

The landscape for sustainable investing 

3. Landscape-for-sustainable-investing_EN.jpg

 

Source: LOIM (adapted from Global Sustainable Investment Review 2018); Note that owing to overlap between the various approaches listed, the totals do not sum to the USD 31 trillion in total sustainable investments; includes screening solely based on negative exclusions as well as best-in class screening; Approaches featuring full ESG integration assumed to include corporate engament. 
 

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find out more about our sustainable investment strategies. Gérant de portefeuilles clients

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