How ESG integration adds value in the investment process

Portfolio Manager Amber Fairbanks discusses ESG integration, impact investing and Mirova’s global sustainable equity investment strategy.

  • Mirova Portfolio Manager Amber Fairbanks examines the relationship between impact investing and performance.
  • She explains how ESG integration may be a source of alpha.
  • She also discusses the differences between investing in large and small company stocks, and provides examples of cases when ESG added value to the investment process.
Alpha is a measure of the difference between a portfolio's actual returns and its expected performance, given its level of systematic market risk. A positive alpha indicates outperformance and negative alpha indicates underperformance relative to the portfolio's level of systematic risk.

Investing involves risk, including the risk of loss. Sustainable investing focuses on investments in companies that relate to certain sustainable development themes and demonstrate adherence to environmental, social and governance (ESG) practices; therefore the universe of investments may be limited and investors may not be able to take advantage of the same opportunities or market trends as investors that do not use such criteria. This could have a negative impact on an investor's overall performance depending on whether such investments are in or out of favor.

Mirova is operated in the US through Mirova US LLC.