Screen prioritizes conservation of natural capital
Genus Capital Management has incorporated a new investment screen focused on biodiversity, marking a significant development in impact investing.
This initiative underscores the company's recognition of biodiversity as both an ethical imperative and a critical financial consideration, aiming to align investment portfolios with goals centered around the conservation of natural capital.
Genus Capital Management is taking decisive action to promote environmental sustainability and ethical investing by excluding companies with poor biodiversity performance from its investment portfolios. This move is a testament to the company's commitment to environmental stewardship.
Understanding the systemic risks posed by biodiversity loss, Genus Capital Management has developed an innovative biodiversity screen to address these issues.
The screening methodology is designed to identify and exclude companies that significantly contribute to biodiversity loss, focusing on criteria such as raw materials sourcing, water stress, and direct impacts on biodiversity.
To implement this rigorous approach, Genus Capital Management utilizes data from MSCI, excluding the 40 lowest-performing companies in terms of biodiversity impact.
This strategy ensures that the investment portfolios managed by Genus Capital Management are aligned with biodiversity conservation objectives and do not include companies criticized for unsustainable practices, such as Bath & Body Works, due to its palm oil sourcing.
The company underscores the recognition of biodiversity risks as systemic threats to portfolios and beneficiaries, emphasizing the economic importance of biodiversity conservation.
The biodiversity screen highlights the necessity of evaluating biodiversity risks alongside traditional financial metrics, suggesting that investments focused on biodiversity not only contribute to environmental preservation but may also enhance financial returns.
This perspective aligns with Genus Capital Management's belief in the potential link between biodiversity and financial success, demonstrating that responsible investing can serve environmental and financial goals.
The Global Biodiversity Framework stresses the significance of equity and justice outcomes in conservation efforts. Given biodiversity's substantial impact on economic activity and its influence on a significant portion of the global economy, investing in nature is seen as a strategy to improve equity and economic returns.
“We are proud to introduce the Biodiversity Screen as part of our commitment to sustainable and responsible investing,” stated Mike Thiessen, chief sustainability officer and co-chief investment officer at Genus Capital Management.
“By excluding companies with low biodiversity performance from our clients' portfolios, we aim to contribute to the preservation of our natural capital while providing investors with opportunities for both ethical and financially sound investments.”
Through the introduction of the Biodiversity Screen, Genus Capital Management invites investors, financial professionals, and the media to explore the transformative impact of this approach on responsible investing.
