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3 Top ESG Rated Global Equity Funds - YouTube
Channel: Morningstar Europe
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[Music]
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hello and welcome to the Morningstar
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series ask the expert I'm Emma worden
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joining me today is Morningstar fund
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analyst Fatima Kazu to talk about
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sustainable investing - hi Emma so
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kicking us off today is the news that
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fun Smith is launching a sustainable
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equity fund which will embody ESG
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considerations in its stock selection
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but it also screen out a certain sectors
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including casinos gas companies porn
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tobacco and Brewers which means some of
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the stalwart stocks in fun Smith
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equities such as Philip Morris in pure
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bronze and Diageo will not be there this
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is an institutional fund so it's not for
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our readers but it does signify the
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growing interest in sustainable
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investing doesn't it yeah it does a
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certainly we've seen a surge in some of
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the mud from an investor for the
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sustainable investment and looking at
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the assets over the last five years
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we've seen a significant increase in
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some of us are dedicated to this type of
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investments and while historically it's
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been mostly on the institutional side
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we've seen that has been a significant
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rise in term of assets that are
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dedicated to reach other side segments
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for example in terms of the overall
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assets a retail side represented in 2012
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about 10% of that and in 2016 is 25
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percent so there's been increasing
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interest from the retail side as well
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and investors want to incorporate ESG
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factors into their fund selection for
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those that do we do have a Morningstar
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sustainability rating don't we which
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will can help people pick funds that
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school above-average
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on ESG ratings yeah we do and our
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sustainability rating is a holding base
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so it will provide investor for any type
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of fund whether it's tagged as socially
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conscious or not
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how those funds how those companies that
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a fund manager are invested score while
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in term of the es Angie and so the
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investor can use the
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further metric to spot your good fun if
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he has an interest in esse consideration
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we've seen an increase interest or we've
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seen from fund manager that they're more
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and more taking into account those
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factors as well and some of them have
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been already taken into account doors
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but they've made more efforts to express
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them so their investor knows about them
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so our sustainability rating will tell
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you whether a fan scores well on those
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metrics on altar and you can actually
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support funds that actually need notes
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socially-conscious but actually because
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of the approach taken by the fan manager
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those companies score really well and
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you can sports similar characteristic of
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those funds they tend to usually to look
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for high quality companies with high
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barrier to entry so a very hard business
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model to replicate but also with cash
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flow generation high margin so most of
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those funds that score very well tend to
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have similar characteristics and what
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about a couple of funds which do score
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highly on ESG factors that also have an
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analyst rating perhaps you could
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highlight a couple for us yes sure
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actually the fans miss global equity
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fund that we rate Gold's cause quite
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well on those metrics it scores above
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average which is what you call four
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Globes as well and there's also to
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celebrate it among our universe rate
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that were rates which are the bny Milan
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long-term global equity fund scores
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above average and also the mfsl global
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equity funds which actually scores very
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high so five five globes Fatima thank
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you very much Thank You Emma this is
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Emma wall for Morningstar thank you for
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watching
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