Söderberg & Partners
Climate love
Climate love
Söderberg & Partners
144 w
•
Investing in companies to influence their sustainability work
Highlights:
- How investing in an organization can help you influence their sustainability work.
- S&P invests in 4 companies to reduce carbon emissions and accelerate the transition to a circular society.
The world is facing big challenges: resource scarcity, climate change and demographic change. As we strive toward a sustainable future, rapid decarbonization is essential and we need to implement creative ways to help companies make the right decisions for emission cuts. One way to influence the direction of a company is to invest in it.
Through the strategy Aktiv Påverkan (“Active Engagement”), Söderberg & Partners Asset Management (“S&P”) leverages the power of an active ownership profile to reach long-term sustainability goals. Investors in the strategy can vote on the sustainability topics that matter the most to them and thus determine engagement themes for the strategy.
Investments leading to reduced carbon emissions was voted as one of the most important themes in 2020. To help deliver on this, S&P partnered with the Swedish Environmental Research Institute (“IVL”) as they possess expert knowledge in the field of emissions and decarbonization. In 2021, S&P invested in Stendörren Fastigheter and Diös Fastigheter within the theme – two Swedish property companies owning, developing, and managing properties. The focus was on collecting climate-relevant data and future construction plans for the companies. The data was necessary for IVL to produce a climate calculation and materiality analysis to identify which parts of the company’s operations can be targeted for a reduction in carbon emissions. Following the climate mapping, workshops were held with project managers and key personnel to discuss the results, after which IVL compiled a final report describing the engagement. Both companies have now been provided with more of the tools necessary to improve their climate work.
Another theme the investors in the strategy Active Engagement voted for is investments in companies working against the throwaway society, i.e., investments that contribute to the transition towards a circular economy. In this theme, S&P partnered with Research Institutes of Sweden (“RISE”), an independent state-owned research institute with science-based knowledge and experience working for sustainable growth in Sweden. Earlier this year, S&P invested in Elanders and Rottneros within the theme. Elanders is a service provider specializing in Supply Chain Solutions and Print Solutions, whilst Rottneros is an independent producer of market pulp. With the support of RISE, the aim of the engagement is to help both companies develop a circular business model by mapping their circular potential from different perspectives such as materials, products, and innovation. The engagement is currently ongoing, with the project being launched in early April and the next progress update planned for August.
We’re seeing investment being used more and more as a way to influence climate action within businesses. S&P will continue to leverage this strategy as a way of using its power and influence to create positive change in the world.
If you have any questions about Active Engagement, you’d like to share an example or case study on how this has been used successfully in the past, or if you have ideas for how S&P can improve its climate action then please leave a comment.
This is a marketing communication, please refer to the prospectus of Söderberg & Partners Funds and to the KID of the relevant product before making any final investment decisions. The prospectus and information on investor rights are available in English, while the KID is available in both English and Swedish. All documents can be found on the www.soderbergpartners.lu/documents.
Marketing arrangements made for the products in Luxembourg and Sweden may be terminated in the future.
Do you agree?
35 more agrees trigger contact with the recipient
Watch our Latest Broadcasts!
We need to stop methane and #BuyMoreTime
Yes, we make a difference!
Businesses and leaders will listen and reply on We Don't Have Time
The Climate Action App
We plant a tree for every new user
Welcome, let's solve the climate crisis together
Write or agree to climate reviews to make businesses and world leaders act. It’s easy and it works.
•
144 w
@Rentzhog, I can't answer how the analysis department of the Söderberg & Partners group integrates the usage of ESG scoring in their sustainability work. I just found it very confusing that you talked about S&P, ESG score and linked to an article about the Standard & Poor's ESG index.
•
•
•
144 w
@niklas_vesterlund sorry for the confusion. I actually meant Södeberg & Parters, not Standard & Poors. I have updated my comment. I think Söderberg & Partners are doing great and I am curious how and if you use ESG score. Personally, I think the ESG score is very problematic. Here is a big area for Söderberg & Partners analysis department to improve how companies are scored for their climate actions.
•
144 w
Worth noting is that S&P in the climate love post refers to Söderberg & Partners Asset Management, a part of the Söderberg & Partners group which is a Swedish company. The S&P you are referring to, Ingmar Rentzhog, is Standard & Poor's which is an American company.
•
•
144 w
It's always great to see investors actively investing in solutions and incorporating science into what you should invest in. This should be a great way to have solutions take more room in your investment portfolio.
•
•
•
144 w
That is great! Investments in real solutions are needed. I am curious how Söderberg & Partners works with ESG ratings when you provide asset management for your clients? Are you using that? ESG doesn't work at all for the climate, unfortunately. https://theconversation.com/how-a-sustainability-index-can-keep-exxon-but-drop-tesla-and-3-ways-to-fix-esg-ratings-to-meet-investors-expectations-183705 What is your view on this?
•
•
•
144 w
Thank you for the comment and question. Firstly, please separate the sustainability analyses we do on financial products from the analyses of companies done in the process of choosing holdings within Aktiv Påverkan. In the analyses of companies as a basis for investment decisions within Aktiv påverkan, our analysts assess a company from the perspective of the chosen theme. For example, we assess the companies’ work to promote a circular economy and our subject experts, in this case RISE, always give a second opinion on the results. In the sustainability analyses of financial products, such as funds, the analysis is based on fund managers’ answers to a questionnaire we have sent to the fund company. In this questionnaire, the managers describe how they work with sustainable investments from two perspectives – how the manager selects sustainable investments into the portfolio and how the manager engages with companies to drive sustainable business practices. In addition to the information received through the questionnaire, our analysts also gather data from public information and if needed have follow-up meetings to get an in-depth understanding of the managers’ processes. We do not separate E, S and G (Environmental, Social and Governance) in the analysis and we don't assess the sustainability level of portfolio companies, i.e. the holdings within financial products. The rationale is that we want to do what we do best and let the fund managers do what they do best. That is, we are manager selectors and therefore we assess how fund managers work with sustainability, and in addition, allocation and weighting of holdings between companies may change over time. By assessing how sustainability is integrated into the management, we can have a long-term view of their sustainability work. When managers determine the sustainability of a company, it is common to use some kind of ESG rating from an external provider but we find the managers who are most proactive in their sustainability work to also have their own proprietary ESG analysis of companies. We see inhouse competence and understanding of sustainability aspects (E, S and G) as crucial to leverage value from ESG analysis and create sustainable value for clients and the world. This allows the asset managers to adapt the ESG analysis of companies to the sustainability aspects that they think are most relevant for the investment strategy. If you are interested to learn more, you can find our sustainability reports here (in Swedish): https://www.soderbergpartners.se/om-oss/analys/hallbarhetsanalys/
•
•
•
144 w
@soderberg_partners Thank you so much for your clarifying answer. I like what you do and I think players like Söderberg & Partners are needed to improve the ESG sector. keep it up!