Evli implements exclusion to global equity fund strategy

Jonathan Boyd
Evli implements exclusion to global equity fund strategy

Finnish manager Evli has announced its new Evli Global X fund will apply stricter exclusion critieria to firms active in areas such as alcohol, weapons and firearms and tobacco, in response to growing client demand.

Additionally, the fund will exclude companies in the gambling, coal, nuclear power, adult entertainment and GMO fields, although coal companies may still be considered if they have “a plausible plan for reducing the use of coal in future”. (Coal divestments are the focus of a number of investor campaigns currently, for example: http://www.investmenteurope.net/regions/germany/after-hannover-re-blackrock-next-in-focus-for-coal-divestment-campaign/)

The Global X strategy sits alongside the Evli Global fund. Both apply a value approach, looking to invest in companies that generate cashlow with strong debt coverage and that Evli’s managers consider to be underpriced versus the market. The strategy uses bottom-up stockpicking as part of its active management. Portfolio managers on the Global X fund are Wihelm Bruun and Marjaana Haataja.

Kim Pessala, CEO of Evli Fund Management Company, said there was a clear increasing client demand for funds with an exclusion policy.

Evli as a group applies ESG integration into all investment processes, but this tends to be focused on engagement rather than outright exclusion. The one area where automatic exclusion is applied is to manufacturers of “controversial weapons” notes Outi Helenius, head of Responsibility at Evli Bank.