Sarasin & Partners is an investment management firm based in London. It manages assets for institutional and private clients, and is known for its sustainable and responsible investment strategies. Recently, the firm has made some bold claims about its investment approach. In this article, we will explore these claims and assess their validity.
## Claim 1: Sarasin & Partners is a pioneer in sustainable investing
Sustainable investing, also known as impact investing or socially responsible investing (SRI), is an investment approach that takes into account environmental, social, and governance (ESG) factors. Sarasin & Partners claims to have been a pioneer in this field, and to have integrated ESG criteria into its investment process since the 1990s.
There is some truth to this claim. Sarasin & Partners has been a signatory of the United Nations Principles for Responsible Investment (UNPRI) since 2007, and has won several awards for its sustainable investment strategies. However, it is worth noting that many other asset managers have also been active in this field for decades, and that sustainable investing has become more mainstream in recent years.
## Claim 2: Sarasin & Partners generates alpha through sustainability
Alpha is a term used in finance to describe the excess return of a portfolio compared to its benchmark. Many investors aim to generate alpha through their investment decisions, as it can lead to higher returns and outperformance. Sarasin & Partners claims to be able to generate alpha through its sustainability approach.
This claim is more controversial. While there is some evidence that ESG criteria can have a positive impact on investment performance, it is not clear whether this is consistently true or whether it applies to all asset classes. Some studies have found that sustainable investing can lead to underperformance, and that the effect of ESG criteria on alpha varies depending on the investment strategy and market conditions.
## Claim 3: Sarasin & Partners integrates sustainability into its investment process
Integrating sustainability into the investment process means taking ESG factors into account in all stages of the investment decision-making process, from the initial screening of potential investments to the ongoing monitoring of portfolio companies.
Sarasin & Partners claims to have a rigorous approach to integrating sustainability into its investment process. The firm uses a proprietary sustainability framework that considers a range of ESG factors, and incorporates sustainability into its risk management and portfolio construction processes.
This claim seems to be supported by the firm’s public statements and reports. However, it is difficult to assess the impact of this approach on investment performance, as it is not possible to isolate the effect of sustainability from other factors that may affect returns.
## Claim 4: Sarasin & Partners is committed to stewardship and engagement
Stewardship and engagement are terms used in the context of responsible investing to describe the active ownership and engagement with companies in which an investor holds shares. Stewardship can involve voting on shareholder resolutions, engaging with management on ESG issues, and advocating for change in the companies in which an investor holds shares.
Sarasin & Partners claims to be committed to stewardship and engagement, and to use these tools to promote sustainable business practices and improve the environmental and social impact of companies. The firm has signed several international stewardship codes and guidelines, and has a dedicated team of engagement professionals.
This claim is plausible, as many responsible investors use stewardship and engagement as a way to promote change and impact in the companies in which they invest. However, it is again difficult to assess the impact of these activities on investment performance, as they are long-term and indirect in nature.
## Conclusion
Overall, Sarasin & Partners is a reputable investment management firm that has been active in sustainable investing for many years. Its claims about its investment approach are generally well-supported by public information and industry standards, but some of the claims about generating alpha through sustainability may be more controversial.
Investors who are interested in sustainable investing may wish to consider Sarasin & Partners as a potential investment manager, but should also be aware of the limitations and uncertainties of this approach. As with any investment decision, it is important to do your own due diligence and consult with professional advisors.