Sustainable and Impact Equities

We exclude companies that generate income from sensitive industries, We exclude companies that generate income from sensitive industries, ranging from tobacco or gambling to arms, thermal coal production or oil and gas extraction. Companies identified as UN Global Compact violators or considered worst-in-class are also excluded from the investment universe. Additional exclusions can be applied for mandate solutions.

Using our proprietary LGT Capital Partners ESG Cockpit, we score all stocks in the investment universe according to ESG criteria and their impact on the UN SDGs. When doing so, we examine each company’s ESG performance across operations, products and services, and we consider any ESG controversies.

We screen all stocks in the investment universe based on fundamental criteria. We aim to identify companies with stable business models and a long-term focus that demonstrate the ability to generate attractive returns, coupled with strong pricing power, low debt levels and a strong growth outlook.

We seek to identify companies with strong market positions that can participate in the structural trends driving long-term growth and benefit from a compelling combination of ESG or impact and traditional financial returns drivers.

The final stock selection stage is based on a bottom-up approach focusing on our highest convictions across sectors as well as stock interaction in a portfolio context. The responsible portfolio manager collaborates closely with sector specialists.

We engage with portfolio companies on ESG and impact, both bilaterally and in collaboration with other investors. Additionally, we exercise our shareholder rights in the form of proxy voting to strengthen corporate governance and support strategic ESG and impact initiatives.

For our impact strategies, we evaluate the impact investment opportunity using our proprietary impact framework. The framework allows for a thorough assessment of impact across four key categories: alignment, reach, inclusiveness and risk. This impact score card evaluation is used to assess whether investments considered for the portfolio are strongly aligned with one of our impact themes and with one or more of the UN SDGs. It also allows us to determine whether  the products and services provided are affordable and inclusive, that the business model is scalable and replicable to continually drive impact and that any adverse effects or risks of not achieving the intended impact are well understood and manageable. Further, we use the “Theory of Change” and Impact Frontier’s “Five Dimension of Impact” to analyze the impact of the companies. We work with an external impact provider, Net Purpose, to conduct a third-party impact assessment at the investment screening stage and to monitor impact over time. 

Our commitment to sustainable equity investing goes beyond the integration of ESG factors. Manyof our sustainable equity funds have received the “Towards Sustainability” label administered by Febelfin, the Belgian financial sector federation, based on their sustainability criteria defined under the label framework. This recognition underscores our dedication to investing in companies that drive positive environmental and social impact alongside financial returns. The label is reassessed every year and is a quality standard supervised by Belgium’s Central Labelling Agency (CLA). Please refer to the  “Towards Sustainability” website for information about how such labels are awarded.