The importance of sustainable investments

Investors choice of sustainable assets is a reflection of their genuine concern for the carbon footprint, environmental impact and social aspects, but is at the same time guided by the potential and good balance of the risk/return rate in the long term.

By Bruno Minoya Perez, Private banking Director

What are sustainable investments

Sustainable investment is an essential tool to ensure a balance between economic growth and business sustainability and to promote positive contributions to and impact on the community where companies operate, by upholding values and ethical principles.

THE GLOBAL PROFITABILITY OF THE ESG INVESTMENT FUNDS

At Banco Carregosa, the growing concern in the past few years with the ESG (Environmental, Social and Governance) issue has led to a commitment to sustainability beyond the selection of investments we make. While at that time sustainable investment was not always seen as critical, today it represents a USD 30 billion market overall, and accounts for 1 in 3 USD under professional management worldwide. In our business, we seek to reduce our carbon footprint every day, encouraging all stakeholders to favour socially responsible investments, circular economy, and biodiversity, helping to make this a mainstream issue today.

How we go about it

Over the years, we have developed a unique set of tools and strategies for our Private Banking clients to understand what they own and then align investments with the priorities that matter most to them.

In 1999, we launched the first online brokerage service in Portugal; in 2000, we created a technology partnership for electronic trading with Saxo Bank, the market leader in this industry. In 2007, we launched the GoBulling Pro trading platform, allowing investors to select the sectors where they wish to have exposure, being able to select and invest in companies that are strongly committed to sustainable practices, whether at a social, environmental or governance level. This is how we contribute to having a positive impact on issues such as climate change, gender diversity or other sustainability goals.

How can you invest sustainably?

The Thematic funds offer exposure to various companies that invest in Environmental Sustainability. These are 3 funds that provide access to such companies.

BlackRock Sustainable Energy

The BlackRock Sustainable Energy funds theory is simple: the cost of renewable energy is falling and there is still vast untapped potential. The funds management team invests in companies that are at the forefront of the transition to a carbon-neutral economy. Currently, the three main areas of intervention are clean energy, energy efficiency and sustainable mobility. Investments are made, for example, in companies dealing with electric vehicles, smart buildings and related companies. To learn more about the fund, click here.

THE COST OF RENEWABLE ENERGY IS FALLING

Source: Bloomberg

Schroder Global Climate Change

Climate change requires a dramatic transformation of the global economy. The implications of this are not yet fully understood, which creates opportunities for investors. With this theory in mind, the Schroder Global Climate Changefundinvests in a wide range of climate change-related areas, from water infrastructure to agricultural yield, rail transport and leading carbon-neutral industrial companies. The aim is to enable investors to access growth opportunities not yet identified by the markets. To learn more about the fund, click here.

Schroder Global Energy Transition

To achieve global environmental goals, it will be necessary to transition to a carbon-neutral world. This shift will transform the way energy is produced, distributed and consumed. Schroder, the management company of the Global Energy Transition fund,estimates that this will require USD 120 billion in investments in renewable energy by 2050. Comprising 30 to 50 companies, this global capital fund aims to take advantage of the investment opportunities enabled by an investment of this size. The management team excludes companies operating in fossil fuels and nuclear power, and invests only in organisations that are leading the clean energy sector. Diversified across geographies and sectors, the fund targets long-term sustainable capital growth in a trend that will last for decades. Find out more here.

The future of sustainable investments

Adapting to a sustainable investment environment is a current challenge that requires changes in existing culture, technology and processes. Our view is that companies and investors who have not yet done so should, in the short term, include environmental concerns in their values and operating principles.

Sustainability is nowadays an economic, political, social, environmental and regulatory imperative across all sectors of activity and investors (retail and institutional), in particular among investors and/or "Millennials" generation consumers (born between 1981-1996 and currently the generation with the largest number of individuals), which stands out in studies by the high preference and selection of products produced and/or marketed by environmentally and socially responsible companies. At Banco Carregosa, our focus is to understand the concerns of our clients and find solutions and sustainable alternatives that meet their objectives

The secret to long-term success lies in having a strong culture and talented and diverse people. To do this we rely on a team of experts with the necessary skills and tools to have meaningful discussions about sustainable investing. We are committed to making our resources available to clients to create, manage and distribute capital, while building a more sustainable future for society.

History has taught us the importance of having this view. Ensuring long-term prosperity for clients requires protecting the interests of future generations. Discover our selection of sustainable investments.

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