US-based asset manager AllianceBernstein (AB) has launched the AB Global ESG Improvers Portfolio, a new investment strategy focused on transition and engagement for companies to become more sustainable. The portfolio employs a bottom-up investment process, integrating AB’s equity research, and seeks to purchase stocks that are fundamentally attractive and have strong ESG credentials. The portfolio invests in two key areas: neglected enablers and unrecognised improvers, which traditional ESG approaches have tended to bypass, according to the firm. The portfolio will be made up of 30-40 stocks with the “highest conviction” and improving ESG potential. Its shortlist will be perpetually reviewed by the portfolio managers and analysts to assess stocks’ return potential and progress on ESG improvement. The fund is domiciled in Luxembourg and registered in several countries. Portfolio Manager Jeremy Taylor believes that investing in underappreciated companies that are driving material ESG improvement can deliver notable investment returns. “Currently we find that sectors such as materials, utilities and industrials contain a significant number of stocks where market perceptions are yet to catch up with significant ESG improvements,” said Taylor. “Progress in these industries will be key to the world meeting substantial ESG challenges such as decarbonisation.”
