Newton Investment Management has broadened its range of sustainable investment funds with the launch of a global equity strategy.
The Newton Sustainable Global Equity fund will be managed by Terry Coles and be run as concentrated strategy of 50 or less stocks.
The investment process is designed to identify companies with a strong balance sheet and competitive position, which actively manage the impact their business has on both the environment and society.
An ESG screen will be used to whittle down the MSCI World index universe, which will omit companies with material and unsolvable ESG risks which are a threat to their businesses.
Firms earning more than 10% of their income from tobacco are also ruled out and the team can veto potential investments, if, for example, they breach the UN’s Global Compact Principles.
Newton said the team will also take an active role in engaging with companies and exercising their voting rights.
The fund will aim to outperform the MSCI AC World index over rolling five year periods. It will carry a 0.75% annual management charge and have an ongoing charge of 0.83%. The fund has a minimum investment of £10 million for its institutional share class, but a retail share class is available upon request.
It will sit alongside the company’s existing sustainable fund range, which includes both the Newton Sustainable Real Return and Sustainable Sterling Bond strategies.
Newton chief commercial officer Julian Lyne said: ‘This fund has been launched in response to increased client demand for sustainable investment products. Our latest annual charity survey, for example, revealed that over half of charities identify as ethical investors, and that ESG factors are considered by even more, and we see this as a growing trend for institutional clients around the world too.
‘Investors are increasingly recognising the importance of sustainable investing, not just for the positive impact it has on the environment and society, but also as a necessary consideration for positive long-term returns.'
He added: 'Responsible investment has been core to our approach at Newton for 40 years, being grounded in our belief that responsibly managed companies are best placed to achieve a sustainable competitive advantage and strong long-term investment opportunities.’