Do you want to invest in social progress? Here’s how.

  • 31 May 2022 (5 min read)

Catch up with Anne Tolmunen, Portfolio Manager, AXA IM Equities

What does ‘investing in social progress’ mean?

Investing in social progress means seeking to identify the areas of society which provide the most fundamental social needs and actively investing to improve the equality of access globally. In this insight, we refer to the United Nations (UN) Sustainable Development Goals (SDGs), more than half of which have a social dimension.1

We identify and invest in companies that contribute to these SDG targets. In our strategy there are 3 main sub themes:

  1. Social and economic inclusion
  2. Protection of people, access to health care, physical protection and prevention.
  3. Social elevation.

In practical terms, what kind of companies are we talking about?

The investment opportunities here are very diverse. Investments are made in all regions and in many industries. For example, Capitec Bank is a bank in South Africa's emerging markets which offers its services at a lower cost than the country's banks, increasing access to basic financial services. It has also invested heavily in digital technology as its bank accounts are increasingly accessed via a mobile phone.

Within Europe, the company Eurofins Scientific has a network of analytical laboratories and works on the prevention and detection of infections.2

Can we seek performance from investing in social progress?

Yes. We believe that we are at an inflection point where there are certain structural trends which can generate extra financial value, in addition to financial performance over the long term. These aims are not incompatible. Real investment opportunities can be found from the growing democratisation of technology, a trend from which new business models are emerging. There are many innovations in the medical and healthcare space. Within emerging markets, the middle class is expanding and becoming increasingly capable to spend more on their needs.

Why does AXA IM believe in investing in social progress?

At AXA IM, we believe in the importance of equality of access to key societal needs and have been investing in the social sector for 30 years. As a responsible investor, we seek opportunities which drive social progress within our global community. We have reached the point where there are real and increasing opportunities and business models that will create financial and extra financial value over the long term. That is why we have invested in more resources and analysts to develop our social impact management skills within our comprehensive suite of responsible investment capabilities.

Who can invest in social progress?

Social progress is available to investors large and small, and anyone who is prepared to invest for the long term and cares about their social footprint. This is the case with more and more clients, with particular concern about social inequality growing amongst the younger generations.

What is the key takeaway point about investing in social progress?

Positive impact management is on the rise, so now is the time to consider adding impact investments to portfolios. We hope the social aspect will follow the path of the environmental aspect and attract more enthusiasm for this very important subject. Due to the effects of COVID-19, the issues caused by social inequality has moved to the top of the priorities of governments, businesses, and also citizens.

  • Full details about the SDGs are available on the UN website: The Sustainable Development Agenda - United Nations Sustainable Development
  • References to companies are for illustrative purposes only and should not be viewed as investment recommendations.

Related Articles

Equities

China equity: Record derating calls for revaluation

  • by Aidan Yao , William Chuang
  • 16 May 2022 (5 min read)
Equities

What investors need to know about the clean economy

  • by AXA Investment Managers
  • 17 March 2021 (5 min read)
Equities

Global Technology strategy: As of January, our investments have delivered encouraging earnings results for Q4 2020

  • by Jeremy Gleeson
  • 08 February 2021 (5 min read)

    Disclaimer

    This website is published by AXA Investment Managers Australia Ltd (ABN 47 107 346 841 AFSL 273320) (“AXA IM Australia”) and is intended only for professional investors, sophisticated investors and wholesale clients as defined in the Corporations Act 2001 (Cth).

    This publication is for informational purposes only and does not constitute investment research or financial analysis relating to transactions in financial instruments, nor does it constitute on the part of AXA Investment Managers or its affiliated companies an offer to buy or sell any investments, products or services, and should not be considered as solicitation or investment, legal or tax advice, a recommendation for an investment strategy or a personalized recommendation to buy or sell securities.

    Market commentary on the website has been prepared for general informational purposes by the authors, who are part of AXA Investment Managers. This market commentary reflects the views of the authors, and statements in it may differ from the views of others in AXA Investment Managers.

    Due to its simplification, this publication is partial and opinions, estimates and forecasts herein are subjective and subject to change without notice. There is no guarantee forecasts made will come to pass. Data, figures, declarations, analysis, predictions and other information in this publication is provided based on our state of knowledge at the time of creation of this publication. Whilst every care is taken, no representation or warranty (including liability towards third parties), express or implied, is made as to the accuracy, reliability or completeness of the information contained herein. Reliance upon information in this material is at the sole discretion of the recipient. This material does not contain sufficient information to support an investment decision.

    All investment involves risk , including the loss of capital. The value of investments and the income from them can fluctuate and investors may not get back the amount originally invested.