Economic and Environmental Opportunities Fueled by Sustainable Investing
July 16, 2021
Jenna Dagenhart: Joining us to discuss the launch of VanEck's new Environmental Sustainability Fund is Portfolio Manager Shawn Reynolds. Shawn, great to have you back with us and for starters could you share a little bit more about the fund? How it got started and some of the key highlights?
Shawn Reynolds: Yeah, great to see you Jenna. I think it's pretty clear that balancing the demands of the global environment with that of a burgeoning global population growth is really the imperative of our time. If you think about population growth growing to 10 billion by 2050, that's an extra roughly 30% increase in population and there has to be new innovations, new technology, new business models that can actually address meeting those economic needs, those economic goals of that new population, while also sustaining the environment. So we've been working on this for a number of years and we really think that the VanEck Environmental Sustainability Fund addresses all the opportunities that are emerging from these new businesses, from these new technologies.
Jenna Dagenhart: Yeah, you raise some important points. We can't ignore the growing global population. How do you balance environmental sustainability with satisfying that economic demand?
Shawn Reynolds: We always use the term of dual sustainability and what that means, the concept of that is really, if you want to have a sustainable impact on the environment, you need to have a sustainable business model and a sustainable business that's around for the next five, ten to thirty years that continues to make that sustainable return on the environment.
Shawn Reynolds: We also talk about dual returns and when we think about returns there's financial returns and environmental returns. Financial returns are clear, the environmental returns we're also going to make clear through some of the data metrics that we're following and we're going to record and report.
Jenna Dagenhart: Yeah, I'd like to ask you a little bit more about that Shawn finally. How do you measure environmental impact and how does this fund stack up against the others out there that are also focused on sustainability? I understand you have your own series of metrics called CLAW?
Shawn Reynolds: Yes, and I also think it's very important to point out that this fund is very comprehensive in terms of its approach to environmental sustainability. There's lots and lots of focus on emissions, on clean energy. We look at this from a very comprehensive, holistic approach that looks at land use, land degradation, water quality, water availability, water security, as well as emissions. You have to look at the whole picture when you're talking about environmental sustainability which clearly gets into poverty and hunger issues and nutritious issues and so it's very broad but it's also very focused on those companies that have strategies that are directly focused on that.
Shawn Reynolds: We've looked at many different platforms and reporting metrics with regards to the environmental diagnostics of companies and what we've really come back to is something that we think is very practical, very simple, and very transparent. Where we look at a number of raw data metrics, there's no subjectiveness around it. On each of those four factors that you mentioned, climate, land, air and water, and we incorporate those into our normal conversations, our normal due diligence with these companies and we think that this portfolio, it is really standing out in terms of its relative comparisons relative to the broader market as well as relative to some of its peers which as I say really focus on emissions and we really like to include the land and the water piece in particular that we think is quite differential.
Jenna Dagenhart: Well Shawn, always great to have you with us and congratulations on the fund launch.
Shawn Reynolds: Great. Thanks for having us.
Jenna Dagenhart: And thanks for watching. Once again, that was Portfolio Manager Shawn Reynolds, and if you'd like to receive more updates on sustainable investing from VanEck's experts, please visit vaneck.com/subscribe. I'm Jenna Dagenhart with Asset TV.
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