Page 24 - ARUBA TODAY

Monday 6 February 2017 BUSINESS
A24

Of Mutual Interest:

Fund manager Q&A: A broader view of sustainable investing

sustainable practices in ity thesis is not a silver bullet uct or service fits this bill?
their business or offer a ser- for automatically making A: A.O. Smith. They make
vice or product that helps money or losing money. the highest efficiency wa-
other companies do the So there are three primary ter heaters on the market
same. characteristics that we re- and for really high volume
That means the fund has quire in our portfolio com- use cases, like hotels or
lots of big-name compa- panies: hospitals, you can get a
nies that one wouldn’t They must be fundamen- payback on energy sav-
immediately think of as tally strong. They must have ings alone in less than
having a green or envi- sustainable advantages. three years, and that’s re-
ronmentally friendly focus, And we also must buy them ally compelling for high-
such as Amazon.com, Unit- at attractive valuations. volume water users.
edHealth, Facebook and With these criteria, we be- So that’s an example of a
Visa. lieve we find the manage- product or service that has
The fund lagged its bench- ment teams that are mak- a compelling growth driv-
This photo shows the construction site at Energy Northwest’s Nine mark index last year, the ing the right investments er, because they improve
Canyon Wind Project near Finley, Wash. Investors are flocking to Russell 1000 Growth index, in their own long-term productivity or efficiency
sustainable mutual funds, which buy bonds to help build wind but its annualized returns sustainability, in their own for the end customers.
farms like the Nine Canyon project in Washington, among other have been nearly identical economic self-interest, so
investments. to the index since its incep- they can compete and Q: Is it more important that
(AP Photo/Jackie Johnston) tion in 2012. continue to be a part of a company is making an
ALEX VEIGA tric vehicles or household Karina Funk, co-portfolio our everyday lives for de- environmentally-friendly
AP Business Writer products sourced from sus- manager of the fund, cades to come, and that product versus, say, just
People who favor invest- tainable materials may fit weighs in on how the fund is is in line with our long-term operating in a way that
ing in a way that helps the bill, but not necessarily expanding the definition of investment approach. makes their business more
preserve the environment offer attractive returns. environmentally conscious For us, sustainability is a sustainable?
have more options than Brown Advisory Funds’ Sus- investing. Answers have means and not an end in A: We truly believe you can
strictly focusing on compa- tainable Growth Fund (BI- been edited for length and and of itself. Our end goal find sustainability drivers in
nies that offer Earth-friendly AWX) keeps this in mind. clarity: is to invest in companies just about every sector of
products or services. It focuses on companies that will outperform the the economy, but they’re
Companies that make so- that are growing even as Q: Explain what you look broad market. And one of not easy to find.
lar energy panels, elec- they use environmentally for when selecting compa- our means of doing this is to When you look at our hold-
nies for the fund. find fundamentally strong ings it looks like a large-cap
A: The way to make money companies that are using growth fund, but I can tell
on companies that have sustainability strategies to you that it’s a large-cap
sustainability characteris- add value for shareholders. growth fund where we
tics is to start with funda- avail ourselves of informa-
mentally strong compa- Q: What’s a good example tion that most money man-
nies. A green or sustainabil- of a company whose prod- agers miss.
Amazon is our top holding.
It’s companies like Amazon
that are important sustain-
ability investments in ways
that move the needle on
environmental and sus-
tainability profiles in more
significant ways than some
smaller companies.
They can leverage (their)
IT system for thousands
of customers external to
them and provide com-
putational resources in
real time that have literally
eliminated the needs of
many companies to build
up their own data servers
and storage and compu-
tational capabilities. q