In the spotlight: Artemis Positive Future
We are pleased to announce one of the latest additions to The Big Exchange stable of funds; Artemis Positive Future.
Having gone through our impact assessment process, it has been awarded a gold medal, allowing you to invest for the good of people and the planet, as well as seeking financial returns.
Below we have outlined some of the information available in our impact assessment for the fund. We have also included an example of a stock the team invest in, so you can understand more about their investment approach. For full transparency you can see every holding in the fund on The Big Exchange.
Who are Artemis Fund Managers?
Artemis operates as a partnership which means that its fund managers and other key employees own a stake in the firm and have, as they say, “skin in the game”. Although this fund was only launched in April 2021, the team of four managers previously worked together at Aegon and have over 40 years’ combined experience in sustainable investing.
What does the fund that they manage do for me?
The objective of the fund is to grow your capital (on a 5-year view) by investing in companies that meet the managers’ criteria for positive environmental and/or social impact. Their investment process is designed to find businesses that have the potential to deliver transformational, rather than incremental, change.
The managers believe that companies which have a meaningful and disruptive positive impact on society are more likely to deliver good growth prospects in the long term. There is a focus on innovative medium sized and smaller size companies which are at an earlier stage of development than better known big names.
How do the team pick the investments that go in the fund?
To get a new investment into the fund, the team undertake a rigorous assessment of new investment ideas to collect evidence of what they are looking for: intentionality (purpose), additionality (transformation) and materiality (significant impact). Companies must achieve a satisfactory score for each to be included in the portfolio. Industries with a negative impact, such as tobacco or fossil fuels, are excluded.
The managers also expect every company they hold to demonstrate positive impact that contributes to one of the Sustainable Development Goals (SDGs) and they employ a meticulous approach to SDG mapping. At the same time, the team are looking to meet the other part of the fund’s goal which is to grow your capital so, investments must also offer above market average revenue growth. Hear it from the managers themselves in this video.
A summary of The Big Exchange’s impact assessment
Our assessment notes that a substantial 33% of the fund is aligned with SDG 3 (Good Health & Well-Being), 10% with SDG 6 (Clean Water & Sanitation) and 7% with SDG 16 (Peace, Justice & Strong Institutions). The healthcare sector accounts for 29% of the portfolio, whilst 23% is invested in information technology and 16% in industrials.*
As the fund is relatively new, this restricts its scores for positive influence and impact reporting at present (it scores 1 out of 3, and 2 out of 3 respectively) but we expect these to improve significantly over the coming year as the team produce more reporting and provide evidence.* Furthermore, we are confident that the established process (employed by the managers at their previous firm), the justifications provided for holdings, and the expectation of detailed reporting on outcomes, warrants a gold medal overall.
An impact stock example: Kornit Digital
Kornit Digital, a top 10 holding, develops and manufactures digital garment and fabric printing solutions. The company has developed a one step printing technology which replaces less sophisticated manual processes and produces higher quality finishes and more complex patterns on a wider range of fabrics.
Benefits include shorter-run times which reduce environmental impacts by using less water and producing fewer toxins and waste. As digital printing requires less labour and physical space, it can be done closer to the end market, allowing manufacturing to be ‘on shored’ to areas where environmental and labour standards can be better monitored.
A Kornit machine lowers print costs per garment as the cost remains largely the same regardless of how many items are printed, making it a good investment for the purchaser.
*Fund factsheet 31/10/2021 and The Big Exchange Impact Assessment, May 2021
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