• Trust characteristics


    Overview of Stewart Investors' Investment philosophy

    Stewart Investors, which has been the Company’s Investment Manager since 1 July 2010, adopts a sustainable investment strategy in selecting the investments that make up the Company’s investment portfolio.

    Definition of Sustainable Investment

    By sustainable investment, Stewart Investors is not referring to ‘green’, ‘clean tech’ or ‘ethical’ investing. Their emphasis is on sustainable development. They are simply setting out to invest in those companies they believe are particularly well-positioned to deliver long-term returns in the face of the huge development challenges facing all countries today.

    The root causes of these development challenges are numerous and complex. They include population pressure, land and water scarcity and degradation, resource constraints, income inequality, ethnic and gender inequalities and extreme levels of poverty. It is becoming increasingly clear that in order to tackle these development challenges, both developed and developing countries will be required to reinvent their development trajectories and shift away from the current resource intensive, consumption intensive, overly debt-dependent development models towards a more genuinely sustainable path of economic development.

    Sustainable investment has always been an integral part of the Stewart Investors team’s investment philosophy and stock-picking process. At the heart of this philosophy is the principle of stewardship. They believe their job is to invest their clients’ capital in good quality companies with strong management teams and sound long-term growth prospects. Each investment is a decision to purchase, not a piece of paper or an electronic Bloomberg ticker, but part of a real business with all the rights and responsibilities that go with this ‘share’ of the ownership of the company.

    They take these rights and responsibilities seriously. They also believe the way they behave as investment professionals and the role they play in the broader industry are important for their own sustainability All the Stewart Investors investment strategies strive to integrate environmental, social and governance (ESG) considerations into every investment decision. Their sustainability strategies take this one step further by focusing on long-term sustainability themes as a key driver of the investment process.

    Please click here for the latest Sustainability strategy document.

     

    Sustainable Investment aim

    To generate attractive long-term, risk-adjusted returns by investing in the shares of those companies which are particularly well-positioned to benefit from, and contribute to, the sustainable development of the countries in which they operate.

     

    Investment Philosophy

    Stewart Investors seeks to invest only in good quality companies. Quality is measured through the lenses of management’s financial and franchise quality. By analysing the sustainability performance and positioning of companies they can better measure less-tangible elements of quality and identify hidden risks.

    Stewart Investors are long-term investors. They strive to make investment decisions with a five-year time horizon.

    They have an absolute return mindset. That is, they define risk as losing money for their clients, rather than in terms of deviation from any benchmark index. They focus as much on the potential downside of their investment decisions as on the anticipated upside. The identification of long-term sustainability risks thus becomes an extremely important way of managing risk. In addition, their willingness to differ substantially from index weightings, both country and company, means they are not obliged to be invested anywhere where they have particular sustainability concerns.

    They also recognise there is no such thing as a perfect company. They are active owners and stewards of the companies they own.

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