6 Mega trends shaping sustainable investment

Investment Philosophy

The Seer Mega Trends Fund aims to generate capital growth over the medium to longer term and is a multi-thematic fund focused on sustainable investing.

Seer has identified 6 Mega Trends that will critically shape our future including: agriculture, food, water; the rise of the individual; globalisation; energy; disruptive technology and healthcare. The Seer Mega Trends Fund invests in a diverse portfolio of global companies providing solutions to these trends.

The portfolio is actively managed and stock selection is based on deep research integrating financial factors with environmental, social and governance factors.

AGRICULTURE, FOOD, WATER

AGRICULTURE, FOOD, WATER

By 2050, demand for agricultural products and food will increase by 35% and water by 40%. New technologies and methods will help increase land productivity and adaption to environmental changes. Technology improvements will also better monitor groundwater and see a new generation of opportunities with wastewater treatment plants.

THE RISE OF THE INDIVIDUAL

THE RISE OF THE INDIVIDUAL

Advances in technology and education have helped empower individuals. By 2030, 60% of the world’s population will be middle class and 80% of that middle class will reside in development regions. As overall global population increases combined with economic development, we will see more consumers as well as consumption patterns improving in line with growing wealth.

GLOBALISATION

GLOBALISATION

Globalisation will continue to facilitate and deepen the wide diffusion of intelligence, the opening of new markets and industries through science, technology and innovation. This presents opportunities in business R&D, value chain specialisation and concentration, business standards and workforce mobility.

ENERGY

ENERGY

By 2050, demand for energy will rise by 50%. New R&D will improve monitoring, management and efficient productivity of natural resources to meet growing population and demand.

DISRUPTIVE TECHNOLOGY

DISRUPTIVE TECHNOLOGY

The pace of technology disruption implies that behaviours and expectations are also rapidly changing meaning there are no boundaries or borders in delivering new services, experiences and changing industry workforce practices.

HEALTHCARE

HEALTHCARE

The fastest growing segment of world population is the 65+ age group (estimated to grow by 390,000,000 by 2030). It’s estimated this growth could be 390,000,000 by 2030. New technologies will dominate health research agendas and will also influence product and service development to assist the elderly to live longer and more independently.

Our Investment Approach

McKinsey believes that future technology transformations they’ve identified will have  an economic impact of between $14 trillion to

$US 33
trillion

per annum by 2025

Science, technology and Innovation focused

Science, technology and innovation (STI) underpins the 6 Mega Trends. Improved outcomes through STI will result in improvements in;

  • Economic growth through increased productivity and industrialisation
  • Overall health and wellbeing through availability of new and essential drugs
  • Food security through sustainable and improved agricultural technologies
  • Renewable energy through natural resource management to meet growing world population and demand

There are a number of forces continuously shaping STI including improved globalisation of shared innovative ideas, new entrants to the STI stage along with their contemporary innovative skills as well as slower moving forces such as structural changes to the world economy. We recognise the evolving nature of STI and we will find real investment opportunities for our clients within the 6 Mega Trends we’ve identified as shaping the future.

Sustainable, Responsible and Impact Investing

We use Sustainable, Responsible and Impact Investing (SRI) because this approach considers the impact a business has in terms of Environmental, Social and Corporate Governance (ESG) criteria to generate long-term competitive financial returns and positive societal impact for investors.

Often, it’s considered ‘sustainable’ because a positively rated ESG company that is vigorous in its contribution to sustaining the environment and a healthy society, should also be a sustainable and resilient business in the long term. We want to invest in businesses that focus not just on the financials and the economic environment but also focus on how their operations could create a better society and address ‘social trends’ that are evolving to develop a better world in which we all live. For example, in a world with a growing global population, such ‘social trends’ would include society’s growing demand for better air quality, water supply management, efficient energy production, quality agricultural produce and facilitation of workforce equality and mobility including better business standards and ethics.

We believe that ESG issues can have a material impact on the future success and profitability of business. We have incorporated ESG issues at all stages of analysis.

The growth in the broader SRI market in Australia and New Zealand is accelerating, growing 247% from 2014 to 2016 to reach

516
billion

The RIAA has reported that

9 in 10

Australians expect their superannuation or other investments to be invested responsibly and ethically.

We take an Active Engagement approach to investing

Where appropriate, we will engage with companies and other stakeholders to generate additional insights into a company’s practices and issues. We may exercise influence in order to include corporate management and performance or the direction of future policy to promote sustainable development and create favourable operation environments for companies we invest in.

We intend on producing an Annual Impact Report which measures, calculates and reports on the extent of positive social and environmental impact from our investment strategy.

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