AXA IM launches biodiversity listed equity strategy investing for ecosystem preservation and restoration
- 27 April 2022
- AXA IM adds new fund to impact strategy range. The fund aims to prevent biodiversity loss and restore ecosystems, focusing on four UN Social Development Goals (UN SDGs)
- The fund will have input from AXA IM’s partner Iceberg Data Lab to assess the environmental impact of companies
- It is ESG integrated, and will be categorised as Article 9 according to the EU Sustainable Finance Disclosure Regulation (SFDR)
AXA Investment Managers (AXA IM) today announces the launch of the AXA WF ACT Biodiversity fund that aims to generate a positive and measurable impact on the environment and deliver long-term financial returns.
This fund forms part of AXA IM’s ACT range1 , and will be managed by Amanda O’Toole. It aims to mitigate biodiversity loss by investing in best-in-class companies offering innovative solutions to address issues such as pollution on land and water, land degradation, fauna and flora protection, and overconsumption.
AXA IM has identified four key investment areas which contribute to the preservation or restoration of biodiversity:
- Sustainable Materials
- Land and Animal Preservation
- Water Ecosystems
- Recycling and Recirculation
The AXA WF ACT Biodiversity fund follows AXA IM’s listed active equity investment process through fundamental, bottom-up stock selection. The fund applies ESG exclusions2 (white phosphorus, weapons producers, tobacco, defence, UNGC principles, low ESG quality, severe controversies and human rights violations) and sectoral exclusions (controversial weapons, ecosystem protection and deforestation, soft commodities and climate risks). The team uses AXA IM’s proprietary ‘Impact Framework’3 to analyse companies, focusing principally on their products and services.
The strategy has been specifically designed to have a direct and positive impact on the following United Nations Sustainable Development Goals (UN SDGs): Clean water & sanitation (SDG 6), responsible consumption & production (SDG 12), life below water (SDG 14), and life on land (SDG 15).
Commenting on the launch, Amanda O’Toole, manager of the AXA WF ACT Biodiversity fund, said:
“Our planet’s biodiversity is being lost at an alarming rate, threatening the planet’s future, and human economic activity is the main driver. There is growing recognition that there are economic and human costs associated with biodiversity loss – over time these negative externalities will crystalise as economic costs for companies. AXA IM’s biodiversity strategy identifies and invests in companies that contribute to ecosystem preservation and restoration through their products and services”.
Hans Stoter, Global Head of AXA IM Core, added:
“We believe companies who address their impact on the planet and contribute to preserving and restoring biodiversity will achieve stronger earnings growth and superior shareholder returns over the long term. The companies we invest in and engage with are ultimately helping to drive the transition to a nature positive economy.”
AXA IM’s partnership with Iceberg Data Lab4 , to develop a biodiversity measurement tool, is utilised by the new strategy. Iceberg Data Lab delivers science based metrics that identify the most harmful and material impacts of companies on a bottom-up basis. Its models calculate the environmental impact of companies throughout their value chain and supply chain to end use. This tool allows the investment team to measure how the portfolio impacts biodiversity, and will use the Corporate Biodiversity Footprint, a metric which quantifies the impact of a company across all of their activities.
The fund is classified as an Article 95 product according to the EU Sustainable Finance Disclosure Regulation (SFDR), highlighting its robust investment process to deliver a positive environmental impact. As part of the impact fund range, 5% of the management fees paid to the fund will be donated to organisations aimed at developing solutions with a tangible societal impact. AXA IM’s focus is to act in areas in which we can drive systemic change, across our priority topics of climate change and biodiversity, education and health. The ACT range accounts for €29 billion of AXA IM’s assets under management as at end of December 2021.
The fund is registered and available to institutional, professional and retail investors in Austria, Belgium, Denmark, Finland, France, Germany, Italy, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom.
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Biography
Amanda O’Toole
Amanda is the lead portfolio manager of the AXA ACT Biodiversity Strategy and the AXA ACT Clean Economy Strategy. Amanda is also the CleanTech thematic specialist within our internal global research team and Impact Research Pods Leader for the Smart Energy and Agriculture themes within our impact research team. Amanda was previously a member of the Emerging Markets team focussing on energy, utilities, consumer and healthcare. Prior to joining AXA IM in 2011, Amanda was an Investment Analyst at Nevsky Capital, covering Europe and then Emerging Markets across a range of sectors with emphasis on energy, utilities and consumer. Amanda began her career at PricewaterhouseCoopers, initially in Corporate Recovery and latterly in Corporate Finance. She holds a BA (Hons) in Economics from the University of Newcastle Upon Tyne and is an Associate Chartered Accountant.
Risks
Risks
Counterparty Risk: Risk of bankruptcy, insolvency, or payment or delivery failure of any of the Sub-Fund's counterparties, leading to a payment or delivery default.
Geopolitical Risk: investments in securities issued or listed in different countries may imply the application of different standards and regulations. Investments may be affected by movements of foreign exchange rates, changes in laws or restrictions applicable to such investments, changes in exchange control regulations or price volatility.
Sustainability Risk: Given the Sub-Fund’s Investment Strategy and risk profile, the likely impact of the Sustainability Risks on the Sub-Fund’s returns is expected to be low.
Impact of any techniques such as derivatives: Certain management strategies involve specific risks, such as liquidity risk, credit risk, counterparty risk, legal risk, valuation risk, operational risk and risks related to the underlying assets. The use of such strategies may also involve leverage, which may increase the effect of market movements on the Sub-Fund and may result in significant risk of losses.
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AXA WF ACT Biodiversity is a sub-fund of AXA World Funds. AXA WORLD FUNDS ‘s registered office is 49, avenue J.F Kennedy L-1885 Luxembourg. The Company is registered under the number B. 63.116 at the “Registre de Commerce et des Sociétés” The Company is a Luxembourg SICAV UCITS IV approved by the CSSF and managed by AXA Funds Management, a société anonyme organized under the laws of Luxembourg with the Luxembourg Register Number B 32 223RC, and whose registered office is located at 49, Avenue J.F. Kennedy L-1885 Luxembourg.
The product categorisation is provided based on the basis of the European Directive (EU) 2019/2088 on the sustainability-related disclosures in the financial services sector (“SFDR Regulation”) and state of knowledge at the time of creation of this document. As of today the SFDR related regulatory technical standards are not yet finalised and enforced and while we monitor closely regulatory developments, the product categorisation shall be re-assessed once such regulatory technical standards are published and may evolve.
Issued in the UK by AXA Investment Managers UK Limited, which is authorised and regulated by the Financial Conduct Authority in the UK. Registered in England and Wales No: 01431068. Registered Office: 22 Bishopsgate London EC2N 4BQ
In other jurisdictions, this document is issued by AXA Investment Managers SA’s affiliates in those countries.