High conviction stock-picking utilizing the full opportunity set
Diversification, incorporation of material ESG factors, and growth from Asia with tightly controlled style exposure
A diverse & experienced team – Bottom-up stock picking based on holistic, long-term understanding of industries across Asia, not just a single country.
Repeatable process - consistent culture and common philosophy that emphasizes teamwork, ESG integration and risk management.
- Businesses that are best in class or show strong improvement trajectory as evidenced by its return on capital levels against history and peers
- Companies that have strong balance sheets and consistent cash flow generation that can outpace market expectations over the long run
Investment style
- Long-term perspective based on industry focus across the region
- Short-term market shocks can create opportunities to buy at significant discount to what we assess is the fair value of the underlying business
Investment process
- High conviction stock selection based on fundamental research
- Disciplined and unconstrained view of the benchmark to build differentiated returns over time
Integration of ESG
- We see direct engagement and in-house research as core to what we do as long-term focused, fundamental, active investment managers
- We believe our ESG assessments help us identify companies with good governance practices and appropriate management and oversight of material environmental and social characteristics
- We build conviction as a team – each member contributes to our collective understanding of material ESG risks with different views and industry focus
- Our ESG assessments are primarily driven by our proprietary due diligence checklist which allows us to be holistic, thorough, and consistent
Portfolio construction
Company meeting notes
- All investment ideas will have meetings notes, an investment checklist and research note shared in the team library
Investment check list
- Ideas are regularly reviewed and discussed at the team level from various perspectives
Research note
- Investment ideas are regularly presented to the team and team members are encouraged to speak up and ask questions about ideas in other sectors
Material ESG factors can be incorporated at multiple points in our investment process. We access and analyze information from a broad array of sources, including external data providers and, more importantly, on-the-ground channel checks. The data gathered from these sources can be both quantitative and qualitative. We believe that incorporating material ESG factors will allow for more robust risk assessments on a stock and portfolio level.
ESG integration is an important part of our fundamental, active investment management
Quantitative
- Proprietary quant process/tools
- Accounting quality screens
- In-house audit/quant specialists
- 3rd party research (GMT, MSCI ESG, HOLT Risk, Sustainalytics)
- Aggressive accounting
- Sustainability of cash flows
Qualitative
- In-house research notes and robust checklist with explicit commentary on ESG
- 3rd party data specializing in ESG (e.g. past several years of company’s litigations or media coverage)
- Holistic, thorough, consistent process
- Long-term view
Beyond
- Company meetings/calls
- On-the-ground channel checks
- Sector specialist team structure/discussions
- Interviews (e.g. industry experts, regulators, competitors, local investors)
- Industry/company specific ESG perspective
Entire investment process. Each and every investment team member
Source Impact Global Assets