Liontrust on how all assets can be sustainable investments


Ethical and sustainable investing is an investment strategy that can apply to all asset classes: you just have to find the right product for your client's risk appetite, according to Peter Michaelis, head of sustainable investment at Liontrust.

Speaking to Eleanor Duncan, features editor of Financial Adviser and FTAdviser, Mr Michaelis made the point that ethical does not necessarily mean 'exclusion'. 

In fact, he invests in financials across the funds, a sector of the market that some investors might not have automatically considered as 'sustainable' or 'ethical'. 

He said: "Having a strong resilient financial system is incredibly important in delivering a more sustainable economy."

One stock in which the team invests is Prudential, in the insurance sector. 

"Insurance spreads risks between people and through time and this is important in binding society together and making sure that one individual accident does not destroy a life.

"So insurance is an incredibly positive financial product that we invest behind."

The team also invests in Visa, which he said was an example of a company benefiting from the shift from "cash to cashless".

As this move can reduce corruption, bribery and fraud, he said this made Visa an example of a stock that is capitalising on sustainable trends. 

He also commented on the positive messages around Good Money Week, which was held this year from September 29 to October 5 in the UK. 

Mr Michaelis said: "Good Money Week is a great way of focusing attention on sustainable investing. It is raising awareness and showing the different flavours of sustainable investment that are available, as well as showing the different asset classes you can invest in."

"I have been working in sustainable investment for nearly 20 years and over the past two or three years we are seeing a step-change in demand. 

"It is coming for a couple of reasons. People seem to care more about how they invest. They obviously care about how much money they make, but now they care more about how they invest."

He pointed to a recent survey by Natixis, which surveyed more than 20,000 investors. More than 70 per cent of these investors said their personal values were incredibly important when investing.

"The second reason is more interesting from an investment point of view", he said.

"Sustainable investment strategies have been running for well over two decades and they have shown strong returns. Put these two reasons together and you have a compelling investment proposition."