Schroder ISF* Global Sustainable Value
Seeking ESG leaders offering better value for responsible investorsOur approach
Global equity investors are increasing their exposure to sustainable strategies, but there are currently far more growth and core funds available in the sustainable sector than value funds. The growth style has enjoyed an unusually long period of dominance for more than a decade, but history suggests that value strategies have an important role to pay in portfolios. We believe that the combination of value and sustainability offers an attractive way to meet clients’ need for style diversification.
*Schroder International Selection Fund is referred to as Schroder ISF.
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Why invest in a global sustainable value strategy?
Exploiting attractive valuations
Active value investing seeks to unearth opportunities of many kinds, including temporarily “unloved” stocks and early-stage turnaround stories. Identifying pricing anomalies, together with the catalysts that will cause the market to re-rate an undervalued company, makes Value a true stock-picker’s market. As the sustainable investment market is biased towards growth, this strategy offers clear style diversification.
Focus on ESG leaders
By our definition, environmental, social and governance leaders are those that score highly on both absolute and relative measures. They have a net positive social impact on society and the environment, and are also best-in-class versus peers in their industry.
What makes a successful value investing process?
The Global Sustainable Value strategy offers the Schroder Global Value team’s tried and tested value approach with investment in companies that have a positive impact on society and have an industry leading sustainability profile. We explicitly only invest in undervalued ESG leaders. Our “triple lens” assessment applies in-house models, data from external providers and fundamental analysis to a proprietary universe of global stocks that meet our criteria.
Systematic active engagement
We engage with every company in the portfolio to improve ESG outcomes over time, focusing on three main areas: their business practices; their operations (for example audit of supply chains); and the social and environmental impact of their products and services.
Meet the team
Schroder ISF Global Sustainable Value
"Our unique approach proves that you can invest in true ESG Leaders without sacrificing valuation. Sustainability and Value are a compelling combination and investors really can have the best of both worlds. We also benefit from first mover advantage. There are very few competitors and if clients want sustainability and value - Schroders is in a position to deliver.”
Head of Value ESG and Fund Manager, Equity Value
Risk considerations
*Schroder International Selection Fund is referred to as Schroder ISF.
- Currency risk: The portfolio may lose value as a result of movements in foreign exchange rates.
- Derivatives risk: Derivatives may be used to manage the portfolio efficiently. A derivative may not perform as expected, may create losses greater than the cost of the derivative and may result in losses to the portfolio.
- Emerging Markets & Frontier risk: Emerging markets, and especially frontier markets, generally carry greater political, legal, counterparty, operational and liquidity risk than developed markets.
- IBOR: The transition of the financial markets away from the use of interbank offered rates (IBORs) to alternative reference rates may impact the valuation of certain holdings and disrupt liquidity in certain instruments. This may impact the investment performance of the portfolio.
- Liquidity risk: In difficult market conditions, the portfolio may not be able to sell a security for full value or at all. This could affect performance and could cause the portfolio to defer or suspend redemptions of its shares.
- Market risk: The value of investments can go up and down and an investor may not get back the amount initially invested.
- Operational risk: Operational processes, including those related to the safekeeping of assets, may fail. This may result in losses to the portfolio.
- Performance risk: Investment objectives express an intended result but there is no guarantee that such a result will be achieved. Depending on market conditions and the macro economic environment, investment objectives may become more difficult to achieve.
- Sustainability risk: The portfolio has environmental and/or social characteristics. This means it may have limited exposure to some companies, industries or sectors and may forego certain investment opportunities, or dispose of certain holdings, that do not align with its sustainability criteria. Therefore, the portfolio may underperform other portfolios that do not apply similar criteria. The portfolio may invest in companies that do not reflect the beliefs and values of any particular investor.
Important information:
For professional investors and advisers only. The material is not suitable for retail clients. We define "Professional Investors" as those who have the appropriate expertise and knowledge e.g. asset managers, distributors and financial intermediaries
This information is a marketing communication. This information is not an offer, solicitation or recommendation to buy or sell any financial instrument or to adopt any investment strategy. Information herein is believed to be reliable but we do not warrant its completeness or accuracy. Schroders has expressed its own views and opinions in this document and these may change. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Exchange rate changes may cause the value of any overseas investments to rise or fall. Past Performance is not a guide to future performance and may not be repeated. This document does not constitute an offer to anyone, or a solicitation by anyone, to subscribe for shares of Schroder International Selection Fund (the “Company”). Nothing in this document should be construed as advice and is therefore not a recommendation to buy or sell shares.
Subscriptions for shares of the Company can only be made on the basis of its latest Key Investor Information Document and prospectus, together with the latest audited annual report (and subsequent unaudited semi-annual report, if published), copies of which can be obtained, free of charge, from Schroder Investment Management (Europe) S.A.
Issued in March 2023 by Schroders Investment Management Ltd registration number: 01893220 (Incorporated in England and Wales) is authorised and regulated in the UK by the Financial Conduct Authority and an authorised financial services provider in South Africa FSP No: 48998.