Climate change – socially responsible investing

‘Socially responsible investing will be one of the key themes over the coming decade and provides tremendous opportunities’ 

Even people who don’t buy into the climate change argument can still benefit from putting their money into socially responsible investments. Things are happening you can’t ignore and political momentum will provoke increased legislation on issues such as water purification and timber planting. Companies involved in these areas are going to benefit from these changes and that will provide fantastic investment opportunities.

This was the inspiration for the WAY Green Portfolio fund which was launched in February this year as part of a suite of products that are exposed to what are likely to be the most interesting and prevailing themes of the next decade. The aim of the WAY Green Portfolio fund is to provide capital growth with the potential for income through thematic investment in a diversified portfolio of collective investment schemes, investment trusts and a variety of other instruments. Taking a fund of funds approach, it invests in businesses that show a consistent approach to sustainable operations which means buying into funds from groups that can demonstrate a commitment, experience and track record in this sector.

Although we are a socially conscious firm we are not painting ourselves out to be environmental campaigners. We approach the area of socially responsible investing more from an investment perspective rather than with an evangelical zeal.

So how is the fund managed?
We have a distinct three screen investment process. Although we are the fund management company behind the portfolio we employ the services of seasoned experts in their fields to ensure the selections are viable. For example, the actual discipline of ensuring that the constituent parts of the fund are being put together responsibly is outsourced to Ethical Screening, which undertakes research and analysis into the corporate issues that concern ethical investors. The role of Ethical Screening is to examine funds which have the potential to be considered for inclusion in the portfolio. It brings rigour and discipline to the investment processand ensures funds adhere to their objectives.

As the fund manager, WAY itself is responsible for marketing and distributing the fund, while its compliance department ensures the funds chosen are allowable from a regulatory standpoint.

We are quite keen to look at interesting offshore funds as well because it gives investors an opportunity to get into products that might otherwise be impossible for them. Up to 20 per cent of our fund can be invested in non-UK regulated portfolios but very often these have a very high minimum investment which means clients can only access them as part of a wider fund offering.

Vestra Wealth LLP were awarded the mandate to manage the portfolio for their given ‘fund of fund’ skills and experience of this area. They will decide where to invest based upon a list of funds that have already been vetted and screened. It’s clearly very important that proper due diligence is carried out and we believe our process works extremely well.

Success for the company as far as the WAY Green Portfolio Fund is concerned centres on providing positive returns for investors – despite the stigma that suggests profits don’t matter as long as the investments are environmentally sound. We want to dispel the myth that you can’t make money in climate change funds. This fund is not just for socially responsible investors – it is for anyone wanting to make money from this growing area of the market.

WAY is obviously very well known for its inheritance tax mitigation solutions and we’re keen to highlight these can be used to wrap around the Green Portfolio itself. If someone is putting money aside as a legacy for their daughter, for example, this allows them to align it with doing something positive for the world in which she will live. Her legacy will benefit both her environmental and financial future.

The overall message from WAY to financial advisers is clear: climate change investing is a theme that simply can’t be ignored by investors. The primary objective of this fund will be to make a good return for investors. There are going to be companies in this area that will do well and, irrespective of their beliefs, investors will profit whilst supporting the efforts of those who do believe and are delivering social benefit.

Log on to: WAY Green Portfolio Fund for more information

Eddie O’Gorman,
Group Sales & Marketing Director, WAY Group
11th November 2010
www.waygroup.co.uk

Posted on 10th November, 2010 | Tags: Climate Change, Green Fund, IHT Mitigation, Socially Responsible Investing |
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