Impact Investors Tag: Asset Management 1
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United States of America
Green Alpha s investment philosophy is straight forward don t invest in companies that cause global systemic risks instead invest in the solutions. That s the Next Economy.We have been redefining asset management since 2007 by investing in the Next Economy one in which solutions to our greatest systemic risks drive economic growth. Our economic thesis predicates that the global economy is moving to minimize the global primary systemic risks that have the power to undermine the economy s ecological and social underpinnings and therefore economic growth. These myriad threats can largely be placed within three major risk groups climate change resource scarcity and widening inequality. To arrive at a zero risk economy that allows the global economy to thrive indefinitely without succumbing to these threats it is necessary to both address systemic risks directly and increase economic efficiencies. As British environmental economist Nicholas Stern has said Strong investment in sustainable infrastructurethat s the growth story of the future. This will set off innovation discovery much more creative ways of doing things. This is the story of growth which is the only one available because any attempt at high carbon growth would self destruct. Carefully selected sustainable investments will benefit from these trends. In order to positively impact the economy institutions families and individuals can invest in public companies that are driving these trends. This does not mean companies that are publishing glossy sustainability reports or only marginally reducing the carbon footprint of their operations but firms that have made it their purpose to enable a thriving world with an indefinitely sustainable economy.Overall we believe that long term success as an asset manager requires that one cannot hold the causes of systemic risk since they will continue to fall out of favor over the long term. Fossil fuels and fossil powered generation provide prime examples. We see fossil fuel generation owners as poor long term holdings for two reasons. First they contribute to long term systemic risks such as climate change and resource (water soil oceans property values etc.) degradation and as such are very unlikely to persist as popularly supported economic assets over the medium and especially long term. Second we don't own them because they are decreasingly economically competitive. Within energy we only hold pure play renewables holdings that are carefully selected based on solid fundamentals and good growth for price.In addition we believe that innovation (often technology leveraged) provides more efficient and sustainable means of effecting legacy economic functions. This in turn paves the clearest path to long term competitive portfolio performance. As streamlined economically productive and risk mitigating approaches within each sector advance these companies will exhibit faster growth as they continue to gain market share from their legacy predecessors.Green Alpha s strategies offer allocations that decisively move assets away from major downside risks toward innovative economic solutions to these environmental social and economic risks. This shift is a forward looking strategy that simultaneously avoids these risks and enables exposure to the most exciting growth areas of the global economy.
|Type: Investment Fund Manager||Geography: Global||Impact: Access to Information|