Annual Review of Responsible Investments 2022

Fondita’s annual Responsible Investment Review for 2022 is published and it can be found here. When looking back at 2022 it sure was a multidimensional year when it comes to geopolitics, market movements and sustainability.

SFDR regulation and reporting were topical drivers of ESG workflow throughout the year. Fund prospectuses were updated, annexes added, and a lot of work was put around clarifying how a sustainable investment is defined and how Article 8 and 9 funds fulfill the requirements. We also refined our own definition of a sustainable investment as the regulators definition still leaves ample room for interpretation.

The war rightfully raised questions regarding country and governance risk which in turn initiated discussions in all investment teams around sector exclusions. Defense and nuclear to name a few. The shock on Europe’s energy system inflated the earnings of fossil fuel producers and sustainable investors (that exclude fossil fuel investments) got a thorn on performance when oil and gas was the best performing sector. We are however here for the long run and the year 2022 will also be remembered as a year when significant incentives were introduced for energy transformation and green initiatives both in the form of the US IRA (inflation reduction act) and Europe’s REPower EU.

Our aim as investors has not changed. We continue to target value adding long-term returns for our customers while also respecting sustainable development.

Our funds ESG external ratings developed positively during the year, with Fondita Healthcare and Fondita Global Megatrends both reaching MSCI AAA-ratings (A) as an example.

A few highlights from 2022 was that Fondita became a CDP investor signatory, our strategic goals and steps to have net zero funds by 2050 was approved, we renewed the Nordic Swan Ecolabel certificate for Fondita Sustainable Europe and we had valuable discussions in our ESG committee meetings during the year. Not to forget the hundreds of company meetings that our portfolio managers had throughout the year. We are constantly expanding our work in the field of responsible investing and the year 2023 will again bring many interesting new projects that we look forward to.

We firmly believe that responsible companies operating in accordance with sustainable standards will, in the long run, be better investments with a more attractive risk profile for our clients. We continue to see structural and sustainable growth opportunities in both small caps and the thematic themes that Fondita focuses on which are environmental and climate smart solutions, healthcare, and technological development. This exposure can be found in all our eight actively managed equity funds.

We thank all our customers for your trust and good co-operation. Enjoy the review and let’s keep in touch!

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