EQ Investors (EQ), the B Corp wealth manager, has announced the launch of the EQ Climate Action portfolios. The new range will provide investors with the opportunity to tackle climate change and support the transition to a green economy.
To accommodate the varying risk and return profiles of investors, eight options are available, ranging from defensive to all-equity. The suite of portfolios will be managed by Damien Lardoux, Head of Impact Investing, alongside Assistant Portfolio Manager, Tertius Bonnin.
At launch, EQ’s multi-asset Climate Action portfolios will follow a three-pronged approach, investing in both equity and fixed-income funds that aim to reduce climate risk, benefit from climate opportunities, and drive the transition to a net-zero emissions global economy.
To achieve this, the EQ Climate Action portfolios will focus on companies that have best-in-class climate risk management policies, provide exposure to green projects, and use climate-focused engagement practices to create change in climate laggards. The EQ Climate Action portfolios will not invest in the worst offending companies such as fossil fuel extractors.
The portfolios will target companies:
- Whose products and services are providing solutions as well as financing solutions.
- On a credible, science-based path to decarbonising their business models.
- That are leaders in carbon efficiency, with emissions at least 33% lower than their industry peers.
EQ will also focus on adding value through its own engagement process, using the Science Based Targets initiative (SBTi) to judge whether a business is serious about climate change and has set science-based emission reduction targets.
Sophie Kennedy, Joint CEO & Head of Investing commented:
“Transforming the fundamental workings of our globalised economy, away from its reliance on fossil fuels, will require significant innovation and investment.
“Climate change has become an investment consideration impossible to ignore, as related disasters and economic losses grow, and regulators increasingly recognise it as a systemic financial risk.
“Using our in-house expertise across sustainable investing, we have developed this globally diversified portfolio range. As one of the early pioneers in this field, we are extremely excited by this new strategy as we add to our suite of sustainable portfolios.”
As with EQ’s existing MPS range, the Climate Action portfolios are rebalanced quarterly, and use a blended active and passive mix to keep costs low.