Joanna Davison, regional managing director Australia and New Zealand for Colonial First State Global Asset Management, says the company’s 160 Australian institutional clients want one thing.
“Everybody wants alpha,” she says. “We deliver it through research of the companies we invest in and an important part of that research is ESG,” referring to environmental, social and governance principals.
Colonial is a signatory to the United Nations Principals for Responsible Investing and the biggest fund manager in Australia managing $150 billion. Alpha is return in excess of the benchmark, according to Davison.
“PRI is integrated into each team’s research to ensure we make the best investment decisions,” says Davison.
She says these protocols helped it steer clear of BP shares before the Gulf of Mexico oil spill.
“Adhering to ESG does give a better investment outcome,” says Davison.
She says Colonial is also conscious of the integrity of its products and says many of its new investment products may be classified as niche.
Davison has simple advice for investors.
“Think long-term, think diversified,” she says.