Tech for good – enabling sustainable business
The Alphinity Global Sustainable Equity Fund is committed to supporting companies that do good and do it well. We invest in companies that offer attractive financial returns, have strong Environmental, Social and Governance (ESG) practices and make a positive impact on society by contributing to the United Nations Sustainable Development Goals (SDGs).
We believe that technology is a force for good. Well known technology companies like Microsoft and Apple can have a direct positive impact on society via their contributions to digital infrastructure and digital inclusion. However, the role of technology in sustainability is much broader than just than the IT sector. Technology can also be a powerful force for good by enabling companies in non-tech sectors to operate in a more sustainable way.
The following analysis looks at how technology drives sustainability across sectors including consumer, health care, financials and industrials. Stock examples include MercadoLibre, Deere, United Health, Bumble, Schneider Electric, Erste Group and Volvo.
SDG No.1 No Proverty: MercadoLibre – Digital inclusion and poverty reduction
Digital inclusion and financial inclusion are critical components of poverty reduction. MercadoLibre is the largest e-commerce and payments stock in Latin America (LatAm) with an impressive 32% market share. MELI’s payments business started as a complement to the marketplace business but has grown to include a suite of platforms (MercadoPago, MercadoFondo and MercadoCredito) all of which facilitate the democratisation of payments and financial inclusion in LatAm.
SDG No.2 Zero Hunger: Deere – Agricultural technology and food security
SDG 2 calls for ending hunger, achieving food security, improving nutrition and promoting sustainable agriculture. As the global leader in precision agriculture, Deere is using IoT and data analytics to help farmers streamline their operations, enhance profitability and ultimately improve their ability to feed the world.
SDG No.3 Good Health and Well-being: UnitedHealth – Creating a health eco-system via technology
UNH is the largest Managed Care Organisation in the US with operations including insurance, pharmacy benefit management, data analytics and clinics. The company’s Optum business unit applies market leading information, data analytics, technology and clinical insights to help improve overall health system performance. During COVID, Optum has become one of the largest providers of digital behavioural care services in the US with more than 10,000 care providers using the company’s virtual visit platform.
SDG No.5 Gender Equality: Bumble – An online dating platform based on gender equality
Bumble is the parent company of Bumble and Badoo, two of the world’s highest-grossing dating apps with millions of users worldwide. The Bumble platform enables people to connect and build equitable and healthy relationships. The Bumble app was one of the first dating apps built with women at the centre and has become a leading online tool in the quest for gender equality. Bumble’s monthly downloads exceed 1.5 million.
SDG No.10 Reduced Inequalities: Erste Group – Reducing inequalities in CEE
Erste is one of the leading banks in Central and Eastern Europe (CEE). Despite macroeconomic improvement in the few last decades, significant inequalities persist in the region and many people continue to live in poverty. Erste has a well-respected digital platform (George) and has become a trusted provider of financial literacy in CEE. Erste also has strong social banking activities that have delivered EUR400m of loans into social development areas.
SDG No.11 Sustainable Cities and Communities: Volvo – Delivering EV solutions for sustainable transportation
Volvo is playing a leading role in the transition towards low carbon transport by developing a wide range of electric and hydrogen compatible buses, trucks and construction equipment. Volvo aims to have a 100% carbon-free vehicle offering by 2040. These advances in clean vehicle technology are facilitating the shift towards fossil-free transportation in sustainable cities.
SDG No.13 Climate Action: Tesla – Disrupting multiple industries through innovation
Tesla is accelerating the world’s transition to sustainable energy via tech-led solutions. The Tesla ecosystem now spans EVs, Assisted Driving (AD), AI, robotics, battery solutions, energy infrastructure and a unique set of solar solutions. Tesla’s individual product innovations have already significantly disrupted the traditional auto industry, and put together, they have the potential to completely change the global transportation and renewable energy sectors.
Summary and Conclusion
Technology is a force for good both directly via digital infrastructure and digital inclusion and indirectly via enabling companies in non-tech sectors to operate in a more sustainable way. There are many global stocks in consumer, health care, financials and industrials where technology is facilitating a move towards a sustainable future. These are the stocks in which the Alphinity Global Sustainable Equity Fund aims to invest. Do good. Do it well.
Author: Mary Manning, Global Portfolio Manager
Want more information?
Fidante Partners Adviser Services | p: 1800 195 853 | e: email@example.com | w: www.fidante.com.au
Fidante Partners Investor Services | p: 13 51 53 | e: firstname.lastname@example.org | w: www.fidante.com.au
Alphinity Investment Management | e: email@example.com
This material has been prepared by Alphinity Investment Management ABN 12 140 833 709 AFSL 356 895 (Alphinity), the investment manager of Alphinity Global Sustainable Equity Fund (Fund), for wholesale investors only. Fidante Partners Limited ABN 94 002 835 592 AFSL 234668 (Fidante) is a member of the Challenger Limited group of companies (Challenger Group) and is the responsible entity of the Fund(s). Other than information which is identified as sourced from Fidante in relation to the Fund, Fidante is not responsible for the information in this material, including any statements of opinion. It is general information only and is not intended to provide you with financial advice or take into account your objectives, financial situation or needs. Investors should consider whether the information is suitable to their circumstances. The Product Disclosure Statement and Target Market Determination available at www.fidante.com should be considered before making an investment decision. To the extent permitted by law, no liability is accepted for any loss or damage as a result of reliance on this information. Past performance is not a reliable indicator of future performance. Fidante is not an authorised deposit-taking institution (ADI) for the purpose of the Banking Act 1959 (Cth), and its obligations do not represent deposits or liabilities of an ADI in the Challenger Group (Challenger ADI) and no Challenger ADI provides a guarantee or otherwise provides assurance in respect of the obligations of Fidante. Investments in the Fund are subject to investment risk, including possible delays in repayment and loss of income or principal invested. Accordingly, the performance, the repayment of capital or any particular rate of return on your investments are not guaranteed by any member of the Challenger Group.