Raphael Pitoun, portfolio manager for the Trium Sustainable Innovators Equity fund at Trium Capital, reveals why the team will continue to avoid large tech names.
“The main feature of 2023 was the concentration of returns at historically high levels coined the ‘Magnificent Seven’. Contrary to most sustainable strategies, investing in most of the Magnificent Seven does not make sense from an ESG perspective. We favour companies with long term and sustainable growth prospects at reasonable price.
“We are positioned to benefit from investment in companies whose revenue is boosted by multi-year secular trends and innovations, combined with hefty margins. These companies are positioned across health monitoring, resource preservation or product simulation.
“We will continue to avoid large tech names because of ESG concerns. We see growing evidence that social media, for example, has a negative impact on health and society, particularly mental health issues, education and democracy.
“It remains to be seen to what extent government policies towards energy transition and carbon preservation will be maintained. The US elections are an important catalyst as Trump has stated that he would roll back current policies if he were elected. More broadly, there are key elections in many parts of the world that would decide whether climate change will continue to remain a priority in the next few years.”