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Sustainability for us

For the past two years, Catella has deepened her work on sustainability. The basis of our investment philosophy and process lies in the belief in a connection between a sustainable business model and endurance in the company's profitability and growth.

Today’s global challenges are fertile ground for both profitable business models and new circumstances. We are able to transform this into value creation in our funds. As portfolio managers, we seek out erroneous pricing in the market. By taking greater account of a company’s sustainability profile, we turn another stone and thereby enhance our ability to identify underestimated structural trends or overestimated cyclical trends. We believe that we improve the accuracy of our assessment, and that this helps us to avoid a number of undesirable risks. Consequently, sustainability and value creation go hand in hand at Catella Fonder, and benefit our fund unitholders.

A greater focus on sustainability influences our investments in several ways. We analyse the business opportunities and sustainability-related risks of each company, giving us a better understanding of its long-term qualities. This analysis enables us to identify specific sustainability-related investments. In our absolute return funds, we select and take larger positions in sustainability-driven companies, and take short positions in companies with unsustainable characteristics. We completely avoid investments in controversial products and services, and in companies that violate international conventions. Last but not least, we work on advocacy with companies that we believe have the potential to improve. 

Catella Sverige Aktiv Hållbarhet is our flagship when it comes to sustainability. This fund puts an emphasis on companies that have sustainability as part of their business concept, and has a higher threshold for companies to exclude. For our other funds, we have clarified and improved the sustainability processes, and we now have exclusion thresholds for all funds and work with corporate advocacy for all our holdings.

We also want to highlight Catella Hedgefond, which is currently one of Sweden’s largest hedge funds and has sustainability as an integral part of the investment process. This fund entirely avoids investments in sectors that we consider harmful to health or the environment, such as tobacco, alcohol, commercial gambling, weapons and pornography. And when it comes to fossil fuels, we have completely excluded companies that are involved in coal production. In addition, we set higher sustainability requirements for companies that are involved in production and services before we make an investment.

How sustainability is creating value at Catella

Opportunities and risks
  • All companies have varying degrees of exposure to sustainability risks.
  • A focus on sustainability issues can improve our accuracy in assessing a company’s growth and results.
Selection and short selling
  • We seek out companies that are driven by a sustainability trend.
  • For absolute return products, a greater focus on sustainability risks can lead to interesting short positions.
  • Sustainability only creates value in combination with financial analysis.
Clear thresholds
  • We draw a clear threshold for companies that produce goods and services that are associated with harmful health and environmental effects.
  • The funds are screened twice a year by an external company.
  • Third-party assessment of each company’s sustainability work.
Ownership dialogue
  • Ongoing dialogue with all our holdings.
  • In-depth dialogue with companies when we are a large shareholder, and ESG risks are low even though the business model is particularly at risk.
  • Prioritised depending on the size and scope of the challenges facing the company.

Risk information

Investments in fund units are associated with risk. Past performance is no guarantee of future returns. The money invested in a fund can increase and decrease in value and it is not certain that you will get back the full amount invested. No consideration is given to inflation. The Catella Balanserad, Catella Credit Opportunity and Catella Hedgefond funds are special funds under the Swedish Alternative Investment Fund Managers Act (SFS 2013:561) (AIFM). Catella Sverige Aktiv Hållbarhet and Catella Småbolagsfond may use derivatives, and the value of the funds may vary significantly over time. The value of Catella Sverige Hållbart Beta may vary significantly over time. Catella Avkastningsfond may use derivatives and may have a larger proportion of the fund invested in bonds and other debt instruments issued by individual national and local authorities and within the EEA than other investment funds, in accordance with Chapter 5, Article 8 of the Swedish Investment Funds Act (SFS 2004:46). Catella Nordic Long Short Equity and Catella Nordic Corporate Bond Flex may use derivatives and may have a greater proportion of the funds invested in bonds and other debt instruments issued by individual national and local authorities and within the EEA than other investment funds. For more details, complete prospectuses, key investor information, and annual and half-yearly reports, please refer to our website at catella.se/fonder or phone +46 8 614 25 00.

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