Sustainable investing quarterly update

The first quarter of 2025 was a highly eventful one for investors. This comes on the back of the number of years where investors have struggled to pick up a primary trend.

Five years ago, oil prices were negative and interest rates were close to 0, and we've spent a number of years going through the transition to getting back to what may be considered more normal times.

As soon as we've reached this point, we've effectively got a new list of issues to deal with. So at the start of this year, this new AI company, DeepSeek, came along and questioned whether AI will be a strong investment theme for many companies listed in the US.

Equally, there is a big rotation into European assets, as Germany, in particular, tore up his fiscal rule book and decided that it was going to actually stimulate it on the European economy. And if that wasn't enough, then obviously Donald Trump has come along and decided that he will enact tariffs on countries that he feels has unfair terms of trade with the United States.

In the midst of all that, some things have remained constant. So sustainable investing, which we think is predicated on societal progress, environmental progress, innovation, continues to do well.

The corporates we invest in are involved in digitizing the economy. They're involved in making lives healthier, and they're involved in building out much of the infrastructure that the world needs going forward.

So in some respects, it's been a two-sided world that sustainable investors have lived in. On one side, the geopolitics and the macro issues are very prominent and very noticeable and in the short term, very influential. But in the long term, as we've always said, we think macro doesn't beat micro and that over the long term, bottom up stock picking and individual companies will find a way through.

Going forward in terms of what we expect to see for the rest of the year, clearly it will remain a period of time with volatility, particularly as trade wars and tariffs are resolved.

But we also expect the companies we invest in to innovate, to adapt in many ways, the same ways that they did through COVID and ultimately deliver good growth for their investors.