This impacts how we invest. Our Investment Philosophy is grounded in the belief that we can generate higher compound returns for investors by taking less risk. We assess sustainability and governance risk, advocate for improvement, and avoid risks we consider excessive.
Responsible Investment
Responsible investment enables our purpose: to generate compelling compound returns for our investors, measured over decades.
“Sustainable development…. meets the needs of the present without compromising the ability of future generations to meet their own needs.”
Brundtland Report, United Nations (1987)
SUSTAINABILITY & OUR INVESTMENT PHILOSOPHY
We believe that a focus on sustainability helps us identify opportunities and avoid risk.
The economy is not yet sustainable. But there are signs of change – from the commitments in the Paris Agreement and UN Sustainable Development Goals, to the spending catalysed by the US’ landmark Inflation Reduction Act.
Our Investment Philosophy checklist includes questions on climate, culture, and governance – alongside questions on the economics of the business. These factors are all part of what we think makes a durable company.
TRANSITION & ENGAGEMENT
We take a robust and engaged approach to transition – believing that our stewardship helps businesses improve.
We encourage all companies in which we invest to adopt science-based climate targets and aim that 60% of the American Fund will be covered by such targets in 2025. This is in line with our own commitment to the Net Zero Asset Managers’ Initiative.
Key Responsible Investment resources
Responsible Investment & Engagement Policy
Responsible Investment and Engagement Report – 2H 2023
Responsible Investment and Engagement Report – 1H 2023
