Investing in the social transition

The ‘S’ in ESG is multifaceted but can fundamentally be drawn back to the unequal distribution of human rights and resources – the right to a decent job and income, education, and access to healthcare. The socio-economic implications of inequality could impede growth and increase the risk of financial crises and poor public policy decisions, as well as fuel social unrest. 

We believe investors can play a positive and influential role and capture a significant investment opportunity as markets increasingly price in the risks and opportunities of social inequality.

Our Social Transition Global Equity strategy targets opportunities aligned to the principles of the United Nations’ Sustainable Development Goals (see below specific SDGs) that support and benefit from the transition to a more socially equitable economy. We invest with an active, high-conviction approach to address the needs of investors seeking two objectives:

Long-term capital growth

To support the transition to a socially equitable economy

Our approach

We go beyond a simple approach of only investing in companies providing solutions to tackle inequality, to also invest in companies transitioning their business models towards a more socially equitable economy. Moreover, we seek to drive further positive change by engaging with investee companies on specific social issues.

Transition focus

Our proprietary transition risk framework helps identify winners from the social transition across all sectors. Our approach aims to deliver more resilient performance over the long term, uncover more alpha opportunities, and more effectively support the social transition than by investing in solutions-focused companies alone.

Bespoke engagement

We engage with all portfolio companies on specific social issues. Our three-year structured engagement programme systematically tracks all companies with an escalation pathway that could ultimately lead to divestment if we are not satisfied with their progress.

Investment opportunities in the strategy are linked to the following investment themes and aligned with the principles of the following United Nations Sustainable Development Goals:

Sustainable Development Goals

Transition themes

Respect human rights

Promote decent work

Responsible corporate behaviour

Solution themes

Access to education

Access to health

Access to finance

Social Transition Global Equity strategy

Aviva Investors Social Transition Global Equity Fund

This strategy aims to deliver long-term capital growth by investing in companies globally that either provide solutions to social inequality or transitioning their business models to manage their social impact, while avoiding those that do not meet minimum social criteria.

Evidencing how we are progressing against our sustainable outcomes objective

This report looks at the progress the fund has made in 2022, in delivering tangible sustainable outcomes for clients, across the companies invested in as well as through company engagement and macro stewardship.

Read more

Key risks

Full information on the risks applicable to the Fund is detailed in the KIID and Prospectus.

Investment risk and currency risk

The value of an investment and any income from it can go down as well as up and can fluctuate in response to changes in currency and exchange rates. Investors may not get back the original amount invested.

Equities risk

Equities can lose value rapidly, can remain at low prices indefinitely, and generally involve higher risks — especially market risk — than bonds or money market instruments. Bankruptcy or other financial restructuring can cause the issuer's equities to lose most or all of their value.

Counterparty risk

The Fund could lose money if an entity with which it does business becomes unwilling or is unable to meet its obligations to the Fund. 

Illiquid securities risk

Certain assets held in the Fund could, by nature, be hard to value or to sell at a desired time or at a price considered to be fair (especially in large quantities), and as a result their prices could be very volatile.

Derivatives risk

Derivatives are instruments that can be complex and highly volatile, have some degree of unpredictability (especially in unusual market conditions), and can create losses significantly greater than the cost of the derivative itself.

Sustainability risk

The level of sustainability risk to which the fund is exposed, and therefore the value of its investments, may fluctuate depending on the investment opportunities identified by the investment manager.

Strategies in focus

Sustainable transition

A range of strategies investing in opportunities to accelerate change for Climate, People and Earth.

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