The asset managing firm Proethos makes investments in companies that contribute to better environment, act ethically and take social responsibility. The firm’s conviction is that sustainable products and services is what will bring the best rate of return in the future.
”Imagine asset management that selects its investments strictly from an ethical and sustainable standpoint. That at the same time is understandable, transparent, affordable and accessible. That can handle both pension funds and savings, without compromising rate of return”, says Magnus Alfredsson, founder of the asset managing firm Proethos.
Making money or save the world?
Many have funds that they are looking to invest, and investments can have many purposes. Low risk and high yield are often the first priorities, but there are many other things to consider when choosing where to make investments. The investor community is large and diverse, containing individuals, institutional investors (companies and organizations) and asset managers (pension funds, investment companies, fund brokers).
In later years, sustainability has become a more important consideration to investors. More and more investment offers are catering to this interest, and sustainable development has also grown from a mere statement of responsibility to a touchstone for long-term return on investment.
What is motivating investors to consider environmental, ethical and social issues? Is there a dichotomy between making money and saving the world, or can the two be combined? We pass the question along to Magnus Alfredsson at Proethos.
Making money and saving the world?
What are the financial risks associated with climate change and human rights issues?
– To a company, lack of adaption is the greatest risk. To some, adaptation may translate to minor product changes, while other companies will be forced to reevaluate their entire business model.
How can investments contribute to sustainable development without lowering yield?
– I am convinced that the very companies that produce sustainable products and services are the ones that will provide a good return on investment in the years to come. No investor wants to be associated with a company with a poor reputation, low environmental credibility or assets that can never be extracted.
Many funds and investment vehicles offer sustainable and ethical management. What are your thoughts on the most common strategies to achieve this (norm based screening, positive selection, exclusion, various ways to influence listed companies and raise their awareness)?
– I think all strategies that put the spotlight on ethics and sustainability have their merit. And every asset manager has to find the methods and the commitment that works best for them and for their clients.
How does Proethos perform its sustainability selection?
– Proethos first finds companies with products and services that contribute to sustainable energy production or energy consumtion, sustainable transports, or a sustainable way of life in general. Then the list is scrutinized based on ethical considerations.
What makes Proethos stand out from the crowd? What will happen in the upcoming year?
– I – and many with me – are very particular about the food we eat, the electricity we use, the cars we drive and so on. Obviously, one should be able to choose asset manager with the same meticulousness. Proethos brings a new product to the market with a very strong commitment to sustainability and ethics. We are going to offer a simple, transparent and affordable investment solution. We are looking to launch in spring or summer 2017 in Sweden, and we want to expand to other currencies and launch the product in neighbouring countries within a year.
There are now more than 300 articles on Advantage Environment, showcasing companies that take sustainability seriously and want to improve the environment. Would any of these companies fit in the Proethios portfolio?
– We are keeping an eye on many of the companies mentioned on Advantage Environment.
Magnus Alfredsson believes that asset managment based on ethical, social and environmental values brings great opportunities, and benefits both the investors and the planet. Good news for everyone who believes that making money and saving the world can happen in parallel.
The article was published in April 2017.