First Sentier Investors launches Responsible Listed Infrastructure Fund in Australia
Monday 9 August 2021: Leading global investment manager, First Sentier Investors, today announced the launch of its Responsible Listed Infrastructure Fund (the Fund) to Australian institutional and wholesale investors.
The Fund invests in listed infrastructure assets across the globe, with a focus on companies that are contributing to or benefiting from sustainable development within a framework of good corporate governance. Having attracted support from European and UK investors since launching in 2017, the strategy will now be open to Australian-based clients seeking inflation-protected income and sustainable growth from utilities, toll roads, airports, mobile towers and data centres.
Portfolio Manager, Rebecca Myatt, said the Fund aims to invest in infrastructure companies that are delivering upon the UN Sustainable Development Goals. Infrastructure assets have a central role to play in the delivery of Affordable and Clean Energy; Clean Water and Sanitation; Sustainable Cities and Communities; and Climate Action to name but a few.
“Alignment with the UN Sustainable Development Goals is a key pillar of our stock selection process."
Given infrastructure assets have large environmental footprints, investment in this space is key to accelerating decarbonisation. The Fund’s portfolio consists of companies that First Sentier Investors considers to be at the frontier of this global trend.
“We see sustainability as being much broader than climate change, but we also recognise it’s the largest single issue today. Clean energy and decarbonisation are no longer just vague aims – they are real goals with timelines and government support. Our strategy aligns with investors’ expectations that asset managers need to play a more active role to support this shift.”
US President Joe Biden’s infrastructure plan, the UK’s 2050 Net Zero target, and the European Union’s trillion-Euro ‘Green Deal’ provide policy frameworks to accelerate investment towards decarbonisation, Ms Myatt said.
“Net zero emissions cannot be reached without substantial infrastructure investment, so as investors, we have an important role to play in addressing climate change. This includes more investment in clean energy generation, the electrification of the transport sector, and support for emerging technologies such as hydrogen and renewable natural gas. As investors, we have the opportunity of a lifetime to finance innovation that supports these major changes.”
The Fund is managed using an active, bottom-up process of stock selection which focuses on valuation, asset quality and sustainability-related criteria. As part of this, shareholder engagement is a key focus, Ms Myatt said.
Ms Myatt said, “Engaging with company management enables us to understand a company better, and, where we believe it is necessary, to lobby for change. Through this engagement, we seek to highlight areas for potential improvement, encourage disclosure on ESG issues, and commend companies that are making progress in this area. We view this approach as being an important element of our fiduciary responsibilities.”
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