Simplicity Green Impact – a fund for you that seek high risk-adjusted return and who want to invest in companies that contribute with a sustainable development.

Sustainable companies have experienced substantial growth in recent years. The focus on climate change and environmental issues continue to increase, which presents several interesting investment opportunities and indicates further strong growth in the area. The green transition will be driven by rising demand for sustainable products and services, and by even more investors seeking to finance future solutions for global challenges. We believe that sustainable companies are building the future, and that the future winners are companies that are at the forefront in terms of climate change, environmental impact, and resource efficiency.

The fund invests in companies that are assessed to have environmentally sustainable economic activities in line with the EU taxonomy and in companies that are assessed to contribute to the UN’s sustainable development goals. Particular attention is placed on sustainable energy, consumption, and production, on combating climate change, climate adaptation, and preservation and utilization of our environment in a sustainable way. The goal is to invest in several different industries around the world, which provides increased diversification.

Investors in the fund get access to the fund managers’ long experience of equity investing. The sustainability analysis is supplemented with a structured and disciplined investment process to identify stocks that are expected to have a high risk-adjusted return. The goal of our investment strategy is to identify quality companies at attractive valuations with emphasis on risk analysis. Investment decisions are based on analysis of the underlying company performance as well as fundamental and qualitative factors. In accordance with our investment strategy, the investment decisions consider neither weight nor size of stocks in the index. The fund is actively managed, which means that the profiles of the companies in the fund may vary over time based on the market situation and the performance of the stocks.

Risk management is a central part of Simplicity’s management process, and it is therefore important that sustainability risks are considered and monitored just like other types of risks. Besides having sustainable investments as an objective, Simplicity Green Impact also promotes social characteristics and good governance. The fund does not invest in companies that produce or distribute weapons, alcohol, tobacco, gambling, pornography, fossil fuels, coal, uranium, and GMO. The fund also does not invest in companies that systematically violate international standards.

To measure and monitor the environmental and social impact, Simplicity has access to several different methods, services, and data sources. The fund has documented investment and sustainability processes that the managers follow. The managers have access to several different data sources, including Bloomberg and MSCI. The fund’s holdings are regularly screened with the help of MSCI. The person responsible for Simplicity’s risk function audits, independently of the managers, that the fund complies with established criteria.

Fund facts

  • 2022.05.23
  • 1,25%
  • 100 SEK
  • 08:00 CET

Risk information

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  • Moderate level (4)
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Sustainability-related information

If a company in which any of Simplicity’s funds has invested has breached any international norms and conventions, actions will be taken by the fund company. Actions may include initiating an engagement dialogue to understand the company’s perspective on the incident and what actions the company has taken to address the issue. The dialogue and other information collected by Simplicity form the basis for the actions taken, such as divesting holdings if the actions taken by the company are deemed insufficient. Simplicity does not invest in companies that systematically violates international norms and conventions, without showing any progress or will to improve.

The proportion of sustainable investments in the fund should be at least 90 %. The portion classified as “Not sustainable” is only cash held for liquidity management. According to the fund terms, Simplicity Green Impact can hold a maximum of 10% in cash for liquidity management. Various sustainability indicators are used to measure the attainment of the fund’s sustainable investment objectives. Indicators are considered in investment decisions and regularly monitored.

The fund managers regularly evaluate the range of sustainability data providers to ensure data quality. Data are used to identify companies that are assessed to meet the fund’s sustainable investment goals. Data are also used to consider principal adverse impacts on sustainability factors to ensure that the sustainable investments do not cause significant harm to any other environmental or social investment objectives. Data is both based on reported and estimated data.

The fund company has concluded that eventual limitations in data or method do not affect the attainment of the sustainable investment objective, as the fund only invests in companies with existing reported or estimated data that proves fulfilment of the fund sustainability requirements.

The binding elements of the fund are to 1) only make sustainable investments, 2) adhere to Simplicity’s responsible investment policy, including the exclusion criteria as well as the inclusion, norm-based screening, and engagement strategies, and 3) adhere to the fund’s sustainability indicators. Due diligences are carried out regularly by internal controls.

The fund is actively managed, and no index has been designated as a benchmark to determine whether the fund is aligned to its sustainable investment objective.

Statement on principal adverse impacts of investment decisions on sustainability factors (PAI) – Simplicity AB.

This text contains sustainability-related information for Simplicity Green Impact, which is a dark green fund according to EU Sustainable Finance Disclosure Regulation (SFDR Article 9). This means that the fund has sustainable investments as its objective.

Simplicity Green Impact is a global equity fund that invests in companies that are assessed to contribute to a sustainable development. The fund’s financial objective is to achieve long-term positive value growth and a higher risk-adjusted return than its benchmark index. The fund is actively managed, which means that the profiles of the companies the fund invests in may vary over time based on the market situation and the performance of the stocks.

Sustainability is a central part of the investment process. The fund follows the company’s policy for responsible investments but has also certain fund specific sustainability criteria. All holdings in the fund are sustainable investments linked to an environmental sustainability objective. The fund invests in companies that are assessed to have environmentally sustainable economic activities in line with the EU taxonomy and in companies that are assessed to contribute to the UN Sustainable Development Goals (SDGs) relating to the climate and the environment. The objectives include SDG 6 (clean water and sanitation for), SDG 7 (affordable and clean energy), SDG 9 (industry, innovation, and infrastructure) SDG 11 (sustainable cities and communities), SDG 12 (sustainable consumption and production), SDG 13 (climate action), SDG 14 (life below water) and SDG 15 (life on land).

For a holding to be defined as a sustainable investment according to Article 2 (17) of SFDR, the fund’s established thresholds must be met. This means that at least 10 % of the company’s revenue must either 1) come from environmentally sustainable activities according to the EU taxonomy or 2) contribute to one or more of the SDGs.

As Simplicity Green Impact invests in companies that are assessed to have environmentally sustainable according to the EU taxonomy and in companies contributing to the climate and environmental related SDGs, the fund thereby contributes to fulfilling the taxonomy’s environmental goals or the SDGs. The fund does not invest in stocks that do not meet the fund’s requirements regarding the EU taxonomy or the SDGs.

The fund considers principal adverse impacts on sustainability factors to ensure that the sustainable investments do not cause significant harm to any other environmental or social investment objectives through two main methods: exclusion and norm-based screening. Norm-based screening and exclusion are carried out in accordance with Simplicity’s responsible investment policy.

The fund excludes investments in the following sectors: tobacco, cannabis, alcohol, pornography, gambling, weapons, fossil fuels, and GICS sector 10. Additionally, there are specific requirements for energy production based on fossil fuels and nuclear power. Norm-based exclusions are also applied to companies subject to applicable EU or UN sanctions. Thresholds are used to determine whether a company is related to any of the mentioned sectors or activities.

To manage sustainability risks, it is crucial that the companies Simplicity invests in through its funds conduct their business responsibly. The company uses norm-based screening to ensure compliance with good governance practices. Simplicity expects, at a minimum, that companies follow laws and international norms and conventions, such as the UN Global Compact, the UN Guiding Principles on Business and Human Rights, and the OECD Guidelines for Multinational Enterprises, as well as a certain level regarding other types of environmental, social, and governance-related incidents. All holdings in Simplicity’s funds are regularly screened to check for any violations. The norm-based screening is performed by a third party.

Copyright Simplicity AB 2023