B.E.S.T Sustainable European Fund
The B.E.S.T Sustainable European Fund aims to grow the value of your investment by investing primarily in shares of European companies whose underlying future earnings power is not yet understood by the market, creating an opportunity, or as we call it, valuation anomaly. These anomalies can by captured through a longer-term investment horizon of 3-5 years. This means the trading costs or portfolio turnover will be lower than average. The fund will invest across countries, sectors and market capitalisation in search of the best ideas across the European continent. The investment process caters for thoughtful investors who wish to incorporate Environmental, Social and Governance (ESG) issues when making investment decisions. The fund considers a wide variety of criteria to determine the companies eligible for investment; the approach – and its name - is explained as follows:
B – Business and Financial
E – Environmental and Ecological
S – Social
T – Transparency and Governance
We believe that looking at these factors can give a better perspective on the likely sustainability of a company’s strategy and therefore its ability to deliver rewards for shareholders via both capital appreciation and dividend income. If a company shows scant regard for its stakeholders or its environment, there is a potentially greater risk that this will eventually result in a major problem that risks impairing capital permanently. By the same token, we expect that companies which are focused on these criteria as a matter of course have the potential to produce better returns in the long term.
Companies recommended for the fund are assessed across a wide variety of environmental, social and governance factors. We also apply our own exclusion criteria for sectors such as alcohol, tobacco, armaments and pornography where we wish to avoid exposure. As well as these exclusionary filters, the fund seeks to favour positive business practices by investing in companies that benefit the environment and wider society. We feel that this blend of positive and negative criteria is essential and allows us to capture the key concerns of investors.
At Castlefield, we take our role as shareholders very seriously and realise the importance of effective stewardship in encouraging good corporate practices. This means that we will exercise our voting rights wherever possible and seek to engage with companies to advocate suitable policies. We believe that good corporate governance at investee companies will be of long term benefit to the value of our investments.
In summary, the fund’s objective is the long term generation of shareholder return through a concentrated portfolio of high conviction ideas from European countries, which demonstrate strong ESG practises.
Important material to read before you apply: