At ODIN, we believe that a companies’ value-creation is impacted by their ability and willingness to operate in a sustainable manner. To understand how environmental and social factors affect the companies in our portfolios, we have entered a strategic collaboration with Sustainalytics, one of the world’s leading research firms focused on ESG. The collaboration is a long-term commitment that enhances ODIN’s internal ESG competency.
Environmental, social and governance (ESG) refers to the three main areas of concern when measuring the sustainability, risk and ethical impact of investments.
“An extensive selection process resulted in us entering a long-term collaboration with Sustainalytics. The quality of their services and an ambition to grow with the client led us to our decision,” says Jarle Sjo, who is a Portfolio Manager in ODIN.
The agreement with Sustainalytics makes it possible for ODIN to integrate ESG into its investment process. The firm’s portfolio managers now have the necessary resources to include ESG as one of several critical screening criteria in their work on finding the best investments for ODIN’s portfolios. Additionally, the portfolio managers will be able to measure the risk in existing portfolios in terms of how responsible and sustainable the companies they have invested in are.
“We have now gained access to high-quality analyses that safeguard our investment philosophy. These are analyses that few other fund companies in the market currently have access to. One effect of the collaboration between ODIN and Sustainalytics is that Sustainalytics enhances its research coverage in the Nordic market. Sustainalytics will shortly have full coverage of all companies on the main indexes in Norway, Sweden and Finland,” says Jarle Sjo.
“In working with ODIN, Sustainalytics continues to strengthen our ties with Nordic investors, global leaders in responsible investing,” says Michael Jantzi, the CEO of Sustainalytics. “ODIN’s continued commitment to further ESG integration not only generates value for its clients but also contributes to the creation of sustainable capital markets globally.”
Prefers dialogue over exclusion
ODIN’s long-term and concentrated portfolios incentivise the firm to identify and integrate ESG factors in its current investment research.
“ODIN is a long-term investor, and it is therefore important to us to continuously ensure that the companies we invest in are operating in a manner that is sustainable in the long term. Because of that, ESG is a central part of our investment process; it ensures that ODIN invests in high-quality companies,” says Jarle Sjo.
“We have ongoing contact with the management of the companies we invest in, in order to ensure that the company is managed in a sustainability manner. We believe that close cooperation and consistent dialogue with the companies is a far more constructive approach, as compared to an exclusion philosophy,” says Jarle Sjo.
ODIN Fund Management’s goal for the collaboration is to enhance its internal competence regarding ESG issues. The collaboration with Sustainalytics also entails expanded opportunities to tailor ESG products based on the preferences and values of different target groups.