Exponential Sustainability
Applied Innovation as a Catalyst for Resilience
In our view, the era of stand-alone static sustainability strategies is over. A focus on innovation-driven resilience and progress that takes global sustainability as its benchmark has begun.
At TSG, we believe resilient systems — environmental, social, economic — are the bedrock of a better future as embodied in the United Nations Sustainable Development Goals (SDGs). We also believe applied innovation is key to fostering such resilience, ensuring progress, and ultimately securing sustainability for generations to come. Innovative companies are best positioned to solve the world’s biggest challenges and to grow.
The increasing complexity, dynamism, and non-linearity of our lived reality suggests approaches to sustainability that focus on preserving the status quo are not realistic. Forces of change — geopolitical, technological, biological, climatic — will inevitably be disruptive. Achieving the aim of global sustainability therefore requires the development of societal and industrial systems as versatile as the forces around them: systems that are able to survive, adapt, and progress in the face of shocks and uncertainties — and that can successfully capitalize on opportunities to drive positive change.
This emphasis on resilience also reflects our distinct approach to risk. While many current efforts to achieve sustainability are directed at reducing unsustainability — most often measured in terms of resource consumption and waste emissions — our investments in applied innovation instead direct our attention to strengthening sustainability’s underpinnings. When communities can withstand adverse weather effects, when businesses can thrive in down cycles, when energy supply is widely accessible, when healthcare systems can meet changing patient demands — we progress, and move closer to solving some of the world’s most persistent problems. We believe exponential technologies are critical to this task.
Applied innovation for resilience and progress
Investing in applied innovation is our way of rising to this challenge. Our research and investment process is designed to align our clients’ investment exposure with those companies that use exponential technologies to learn, experiment, and progress with positive impacts on society. Resilient businesses build resilient social, economic, and environmental systems. We therefore aim to focus on public companies that are the leaders, enablers, and beneficiaries of exponential technologies. By applying clearly defined ESG exclusion criteria, we additionally make sure no company in our investment universe has a detrimental impact on society or the environment. This is a crucial first step in our wider investment approach.
We have identified twelve singularity sectors that are key to building systems able to survive, adapt, and progress over time. These sectors are likely to enable positive long-term investment opportunities and transform how the world works. From these twelve sectors we develop investment strategies that, we believe, are intrinsically fostering dynamic social, economic, and environmental systems able to cope with unexpected headwinds, transform, flourish, and grow with benefits for global sustainability. Strategies that strive for an improved tomorrow, by investing in innovation today.
