Letter from our CEO

While 2023 saw record-breaking heatwaves and extreme weather events, it also saw an 8% rise in publicly listed companies setting decarbonisation targets.¹ Nearly half of global public companies now have decarbonisation targets, including many top emitters. This progress is driven by collective initiatives and campaigns pushing for change, many of which we support.² Our portfolios have increasingly robust carbon measurement capabilities, covering listed equities, fixed income, sovereign bonds, private equity, and real estate. For our absolute return portfolios which hold alternative investments, we follow the latest guidance from the Standards Board for Alternative Investments (SBAI) and Carbon Disclosure Project (CDP) to drive progress in this complex space.

Measurement is crucial for understanding how to influence positive change within our portfolios and as a firm. In 2023, our fixed-income team replaced a significant allocation in the high-yield bond portfolios with less carbon-intensive investments. This resulted in a sizeable drop in emissions intensity for our portfolios. Our equities team’s sustained efforts have lowered the carbon intensity of our portfolios too – by approximately 13 tons of emissions for every € million invested since 2019. In 2023, the real estate portfolio made meaningful progress on its climate and nature-related initiatives with managers reducing their funds’ life-cycle emissions footprint, increasing the proportion of buildings meeting green building certifications, reducing water consumption, and increasing the proportion of waste diverted from landfill.³

We further developed tools to look through portfolios at the underlying holdings to better assess sustainability risks and opportunities. For example, knowing which companies align with the United Nations’ Sustainable Development Goals (SDGs) (positively or negatively), or assessing which companies we are exposed to on our exclusions list. This empowers us to engage meaningfully with our managers in alignment with our values. These are significant steps toward our net zero ambition and overarching commitment to sustainability, and we are learning and growing all the time.

On Human Rights Day in 2023, we published our first Human Rights Policy and conducted workshops throughout the year to educate and inspire our investment team. For Anthos, we concluded that our most salient issues are: just transition and adaptation; living wage; and DEI⁴. These efforts are part of our broader commitment to ensuring that our investments support a fair and inclusive transition to sustainable economies.

Good corporate citizenship means embracing our own corporate environmental and social impact, being a responsible investor, and aligning our investment process with our purpose and values. We partner only with responsible investors who share our values.

I am proud to report that we achieved 4 stars in the 2022-2023 United Nations Principles for Responsible Investment (PRI) assessment in all investment categories⁵. Our mission is to provide holistic, valuesbased asset management solutions to like-minded investors, outperform benchmarks, and contribute to the common good. Our responsible investment strategy is designed to make this mission tangible, helping our investors align their portfolios with their values. Opening ourselves up to judgment and being validated by the PRI shows that we are doing what we promise.

In a world undergoing challenging transitions, the collective desire for positive change is driving real progress, albeit slower than we’d like. I believe the destination will be a greener, more inclusive, and more sustainable world. Through calm, determined steps and steadfast hope, investors can do their part to accelerate the journey toward this goal. As a mid-sized asset management firm, we recognise the importance of our role in enabling faster change by transitioning our clients’ portfolios to investments that do not harm the environment or society while also achieving solid financial returns. We are driven by ambition and innovation, acting quickly and decisively, and working with our clients and partners to ensure their investments align with our shared values and principles.

In our Annual Responsible Investment Report 2023, we hope to show steadfast steps on our journey to investing more responsibly in a world undergoing challenging transitions. We are not perfect, but we hope to be transparent so that others may learn from our experiences. Responsible investing has always been about being a force for good in line with our core values of sustainability, human dignity, and good corporate citizenship. If that resonates with you, join us in conversation to see how, together, we can tackle the responsible investment challenges and opportunities that a world in transition presents.

Sincerely,