ESG investors are focused on sustainable and socially responsible. Hence, they expect an ESG scheme to tick all the right boxes when it comes to building a portfolio of stocks of companies that score high in all three components i.e. Environmental, Social and Governance. Companies with low ESG scores are less likely to receive funding from ESG investors. The focus here is not just to earn capital appreciation, but to also invest with the hope of reducing carbon footprint by excluding companies that heavily contribute to global warming and climate change.
What is Axis ESG Equity Fund?
Axis ESG Equity Fund is an open ended equity scheme investing in companies demonstrating sustainable practices across Environment, Social and Governance (ESG) themes. The fund will invest up to 30% in global sustainable companies. It will invest directly in overseas securities with a focus on developed markets with a high level of ESG maturity.
Axis ESG Equity Fund
aims at excluding sectors and industries that are considered damaging from a societal point of view. This includes exclusion of companies dealing tobacco and liquor, excluding defence stocks, etc. Axis ESG Equity Fund product may be suitable for investors who are seeking capital appreciation over the long term and for those who wish to invest in companies demonstrating sustainable practices across Environment, Social and Governance (ESG) parameters.
Axis’s Approach towards ESG investing
Axis understands ESG analysis and realises how important it is for the ESG scores to be enough. The fund house only considers quality companies that can generate sustainable growth. The fund house believes that only companies that run for the long term and companies who take account of their impact on all stakeholders may be able to sustain supernormal growth and returns.
ESG is a rational leeway to Axis’s philosophy which supports the organization’s extensive background research on quality companies that can deliver sustainable growth over the long term. The idea of choosing companies with high ESG scores is to successfully integrate ESG valuation in the overall Axis investment process and to launch a dedicated thematic ESG Fund that focuses on ESG issues while constructing the portfolio.
How is ESG incorporated at Axis?
- Axis embraces a proprietary, forward-looking and dynamic view of ESG based on a qualitative assessment of each company
- The process is created in discussion with Schroders – incorporating global best practices
- All companies are evaluated by Axis using a standardized framework that uses data as well as analyst assessments
Benefits of investing in Axis ESG Equity Fund
- Axis ESG Equity Fund is a diversified equity fund that invests in companies across market capitalization, with an emphasis on ESG
- Axis ESG Equity Fund is aims to offer investors an ideal mix of equities to provide long term returns while minimizing risks associated with market volatility
- Axis ESG Equity Fund is constantly endeavours to invest in quality companies with high growth prospects with an aim to deliver risk adjusted returns for investors
The ESG process designed under Schroder’s inputs entails –
- A detailed ESG assessment on stock inclusion in the universe
- An annual stock-level ESG review to capture changes to the operating environment
- A review of specific ESG issue faced by any company in the universe
- Active engagement with management for improved disclosures and proxy voting
Consider starting a SIP in ESG funds
A Systematic Investment Plan is an investment tool where ESG investors can invest small fixed amounts at regular intervals over the course of a stipulated time period.
Here’s a simple example to help you understand how you can create wealth by starting a SIP in Axis ESG Equity Fund –
Say you want to build a corpus worth 12 lakhs using Axis ESG Equity Fund over the course of 10 years. You can do so by starting a monthly SIP of Rs. 10,000 in Axis ESG Equity Fund. At the end of your SIP investing journey, not only will you have built a corpus of Rs. 12 lakhs, but you might also be able to earn some capital appreciation over the invested amount.
SIP investors are even known to benefit from the power of compounding and rupee cost averaging. When you start a monthly SIP, every month on a fixed date a predetermined amount is auto-debited and transferred to the fund. One can target their long term financial goals by disciplinarily investing in Axis ESG Equity Fund via SIP.
Axis ESG Equity Fund
An Open ended equity scheme investing in companies demonstrating sustainable practices across Environment, Social and Governance (ESG) theme
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
