QEP Global ESG

Investment Objective

QEP Global ESG aims to outperform the MSCI AC World Index (NDR) by 3% p.a. gross of fees over a full market cycle.1 In addition, the strategy aims to build portfolios that are positively exposed to stocks that perform well on ESG2 measures and avoid those that do not meet our minimum acceptable standards. Through engagement we also aim to encourage good practice from companies in terms of their environmental and social impact, as well as strong corporate governance.

1There can be no guarantee that any investment objectives or outcomes will be achieved. 
2Environmental, Social and Governance is referred to as ESG throughout the website.

Description

The strategy is active in all areas of ESG.  We incorporate environmental, social and governance considerations into the investment process in four principal ways:

  1. Exclusions.  We implement both industry-specific and revenue-based exclusions of ‘sin’ stocks defined as tobacco, alcohol, armaments and gambling stocks.
  2. Integration.  ESG considerations are incorporated into our fundamental analysis of companies; we allocate more capital to stocks with good ESG characteristics and penalize those which are poor.
  3. Ongoing research.  We analyze key ESG themes to look for opportunities to integrate these insights into our process.
  4. Engagement.  Working in partnership with Schroders’ Sustainable Investment team, we carry out an active program of company engagement.

Again, in addition to the ESG aspects of the strategy, stock selection is grounded in the analysis of company fundamentals indicating Value and Quality.  The advantage of investing in both Value and Quality is that, while both tend to outperform over time, they deliver their returns at different stages of the economic cycle, creating the potential for outperformance across a broad range of market environments.

We believe that intelligent portfolio construction can greatly enhance the ability to generate repeatable long-run returns. We reduce stock specific risk by building a highly diversified portfolio, but with conviction in every single stock. Recognizing the limitations of market cap-weighted indices, we take an index-unconstrained approach which enables us to invest wherever we find the best opportunities and to capitalize upon those which may be missed by other managers.

Management Team

Investment Philosophy

Investment Process

Key Features

Literature

Investment Options*