Montanaro, a London-based asset management firm, supports businesses that help deliver on the UN Sustainable Development Goals (SDGs). Montanaro uses a disciplined investment approach focused exclusively on companies that offer solutions to global sustainability challenges. In 2018, it launched the Better World Fund, which aims to deliver attractive investment returns while making the world a better place.
We interviewed Charles Montanaro, about the importance of the SDGs in impact investing.
What was the motivation for launching the Better World Fund?
You only need to look around to see the many challenges facing the world, such as climate change. One way to solve global sustainability challenges is by mobilizing private capital to address them. As investors, we feel a responsibility to act and invest in businesses that can offer solutions to some of these major problems.
How do you assess the SDG impact of companies in the Fund’s portfolio?
We use the SDGs to guide us toward the best-managed businesses globally that proactively help implement the goals. The Fund identifies six core themes – environmental protection, low-carbon economy, innovative technologies, nutrition, healthcare and wellbeing. At least 50% of revenues must be directly aligned to the SDGs to be eligible for consideration by the Fund. We also assess the impact a company's products or services have on the environment, employees, community and governance.
How do you view Novozymes as an investment case?
We view Novozymes as an attractive long-term growth story based on a growing suite of products that can help to change the world for the better. These include new consumer products that are safer for the environment, solutions that convert plant materials and waste to bioenergy and the development of biological solutions to increase crop yields. It is therefore a member of the Better World Fund. Management has also been very approachable and keen to listen to shareholders such as ourselves. The ability to engage constructively is important to us.
How do you see the future of SDG investing?
The SDGs need to be realized by 2030. This is a call to action for all stakeholders and will become ever more important. Investors are increasingly using the SDGs in different ways to deliver positive impact. We believe that engagement between companies and their shareholders is pivotal to SDG impact investing. Ultimately, making the world a better place will be beneficial to all of us.
What does this mean for Novozymes?
The UN SDGs are increasingly being integrated into investment strategies. As Novozymes is already aligned to the SDGs, it is well placed to take advantage of this trend, to the benefit of its many stakeholders.