What is impact investing?
An investment approach that aims to make a positive contribution to society or the environment alongside an attractive financial return.
Socially responsible investing is not a recent phenomenon, it can actually be traced back several centuries. Early initiatives were all based on the exclusion of controversial sectors such as tobacco or armaments:
Impact investing is the next level up: our Positive Impact Portfolios are based on years of research that have enabled us to create a unique approach to ‘positive screening’, or actively selecting investments with the power to do good.
Impact investing should deliver strong financial returns
Positive Impact investing leads to selecting companies that are bringing solutions to very real social and environmental problems to market, and actively trying to run their businesses in a sustainable manner. Such companies tend to avoid fines and other penalties, and have stronger relationships with their customers, suppliers and staff. They also tend to operate in sectors with high growth potential.
Research by fund manager WHEB shows that growth is higher in their universe of 1,000 investable companies than in the stockmarket generally.
About the author: Damien Lardoux
Damien has an MSc in Management from Reims Management School and an MSc in Wealth and Asset Management from ESCP-EAP Paris Business School. He is also a CFA charter holder, being a regular member of the CFA Institute and CFA UK society.
Before joining EQ Investors, Damien worked for Bank of America Merrill Lynch being responsible for asset allocation, security selection and portfolio construction. Damien now acts as the portfolio manager for the EQ Investors Balanced, Positive Impact and Multi Index portfolios. He also co-chairs our Fund Selection Committee. Damien is a devoted sportsman, playing judo and squash on a regular basis. He also enjoys hiking, to very far places such as the Himalayas and Kilimanjaro.