Environmental, Social, Governance and Regulation Approach
At Vontobel Quality Growth, our goal is to generate above benchmark returns for our clients with below market risk through the economic cycle. Our philosophy of “High Quality Growth at Sensible Prices” is based on long-term investments into companies able to sustain stable rates of growth with reasonable predictability. Not many companies, relative to the global investible universe, are able to achieve this. The quality of management teams that create and execute growth strategies on behalf of investors is of core importance, along with the business opportunity they are building into.
As a result, we are highly sensitive to Environmental, Social, Governance and Regulation (“ESGR”) issues. We see the results of management choices as fundamental drivers that can support or damage long-term returns for investors and that governance is an integral part of what a company is. We feel that without strong stewardship, risk to shareholders from many different directions can be significant. To us, governance risks include, but stretch well beyond, environmental and social to fundamental aspects of managing a business such as; planning and acting for the long term, investing in future infrastructure, maintenance, labor relations, government relations, regulatory risk, communications with the franchises’ constituents (such as customers, suppliers and employees), and maintaining prudent levels of financial and fixed cost leverage.
We have broadened the ESG acronym to ESGR to include regulation. Over the years, many of our investment companies have held leading industry positions, and as a result regulation is one of the greatest risks they face. Even if regulation is not something management can control directly, we believe competent leadership can successfully steer a company around a dynamic regulatory landscape over time.
With our approach, we feel that protecting downside is more important than getting every last bit of upside and that this will reward investors over time.
We believe trust in management is key.
The information below is intended for institutions that are registered in Japan for Investment Management Business under the Financial Instruments and Exchange Act of Japan (Act no. 25 of 1948, as amended, the “FIEA”) only. It is not intended for use by any other persons including members of the general public or investors from other jurisdictions. The information provided does not constitute an offer of or solicitation for purchase or sale of securities or provision of any investment services. Persons resident or domiciled in Japan should consult with their professional advisers as to whether they require any governmental or other consent in order to enable them to invest. The information contained below has been compiled with considerable care to ensure its accuracy at the date of publication. However, no representation or warranty, express or implied, is made to its accuracy or completeness. This is informative only and the information provided should not be considered as investment or other advice or a recommendation to buy, sell or hold a particular investment.