AXA Investment Managers (AXA IM) announces the launch of the AXA Framlington UK Sustainable Equity fund, which provides onshore investors with access to UK companies it believes demonstrate either leadership on sustainability issues through strong environmental, social and governance (ESG) practices (“leaders”), or those who have shown a clear commitment to improve their ESG practices (“companies in transition”).
The UK-domiciled fund is an official reshaping and rebrand of the AXA Framlington UK Growth fund, effective as of 13 September 2021. It forms part of AXA IM’s strategy to further develop its range of sustainable funds available to UK-based investors, signifying a growing demand for these strategies in the market. It is managed by Nigel Yates, who joined in January 2021 when he took over the management of the AXA Framlington UK Growth fund.
The strategy allocates at least 70% of its investment in shares of companies domiciled, incorporated or having significant business in the UK which the manager believes could provide positive returns. 80% of its investments in shares are in large and medium-sized companies, and up to 20% in small cap. 50% or more of the fund will be invested in ESG “leaders” and the manager will actively engage with “companies in transtion” on sustainability issues.
The strategy looks to capture secular growth through three sustainable growth themes – People, Planet and Progress:
- People – Ageing demographics and increased social awareness are creating powerful structural growth opportunities in areas such as healthcare, financial planning & leisure activities.
- Planet – The importance of limiting temperature rises is accelerating the need to dramatically cut carbon emissions, increase the amount of renewable energy and use the planet’s resources more sustainably.
- Progress – The relentless focus on digitisation provides a route towards sustainability, carbon neutrality, equality and improving skills worldwide. Companies also play a critical role in keeping us safe as more people move online.
Commenting on the launch, Nigel Yates, manager of the AXA Framlington UK Sustainable Equity fund, said: “We view ESG integration as part of expressing our conviction as long-term responsible investors, avoiding negative issues that can damage portfolio returns but also influencing management to take the right steps towards enhancing their sustainability profile and practices. We believe the UK market offers access to exciting businesses, many of which are benefiting from sustainable secular growth drivers, strong management teams and the UK’s quality corporate governance regime.”
John Stainsby, Head of Core Client Group UK, added: “The launch of the new strategy demonstrates our ongoing commitment to delivering sustainable, long-term value for clients while driving meaningful change for society and the environment. At AXA IM, we want to provide UK-based investors with access to a variety of sustainable strategies as the demand for responsible investing continues at pace. Following the launch of the UK Sustainable Equity fund, in addition to the Clean Economy fund launched back in August, we are aiming to add more funds to our sustainable fund offering for UK-based clients.”