AXA IM: No need to choose between biodiversity impact and financial returns

AXA IM: No need to choose between biodiversity impact and financial returns

12 juli 2024

Impact beleggen Biodiversiteit
Klimaat (19) zee water biodiversiteit

Over 50% of global GDP is dependent on nature and its services. Biodiversity loss could cost the economy $5 trillion, writes, Anna Väänänen, Head of Listed Impact Equity at AXA IM.

'Biodiversity boosts our planet’s resilience against threats not only to global economies, but to our continued existence, such as flooding, food scarcity and infectious diseases. Its loss poses major economic risks; higher material costs combined with disruptions to operations, supply chains and livelihoods.'

Anna Väänänen emphasizes: 'We believe that innovative companies with sound business models providing commercial solutions to preserve nature will be the winners of the biodiversity transition. Investors don’t have to choose between positive biodiversity impact and strong financial returns - financial sustainability underpins both of these goals.'

She goes on to describing AXA IM’s biodiversity strategy that focuses on companies that provide scalable solutions to preserve nature, viewing biodiversity not just as a risk, but as a significant investment opportunity.

'Our listed equity Biodiversity impact strategy aims to generate positive measurable impact in two principal ways: by investing in listed companies which are making a positive contribution to the funds targeted UN SDGs based on AXA IM’s bespoke impact framework, and through our long-term engagement and reporting activities which enable us to monitor our progress towards the biodiversity strategy’s impact objective. Compared to impact investment in private markets, which generates positive social or environmental projects often on a local level, listed equities can provide scalable and commercial solutions that can generate positive change on a global level, transforming whole sections of society and the economy.'

Väänänen describes that AXA IM 'does not consider biodiversity as a risk factor but as an investment opportunity to identify companies that can mitigate biodiversity loss either through innovative products and services, and/or to a lesser extent operational activities. Our investment approach is designed to identify the winners of the biodiversity transition: companies that drive positive impact on the targeted SDGs by providing scalable solutions and generate strong financial returns.'

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