UBS Asset Management has launched a longer-term investment initiative for private clients after hitting further milestones in thematic and sustainable investing.
The new Future of… program will publish regular white papers on challenges that resonate strongly with clients and provide associated investment solutions across public and private markets. The themes will have a strong sustainable component, but will venture beyond pure sustainability considerations.
The first offering in the series is Future of Waste, which is launched today. The world wastes roughly 30% of its food, at a cost of USD 1 trillion a year, while 10% of people go hungry around the world. Plastic waste in the sea could outweigh fish by 2050 if current practices continue. UBS's Future of Waste white paper and investment offering present opportunities to mitigate costs and issues associated with waste and target a compelling financial return.
The expansion of UBS's private client investment offering follows its continued successes in thematic and sustainable investing. The UBS Oncology Impact fund - which at its launch was the largest ever healthcare impact investment - recorded donation of $4m, with $2m going to the UBS Optimus Foundation and $2m to the American Association for Cancer Research.
UBS can also reveal that its 100% sustainable cross-asset portfolio, the first offering of its kind for private clients, recently passed $10bn in invested assets. The portfolio launched roughly two years ago with just over $1bn under management.
The Future of Waste white paper offers waste reduction solutions that can increase businesses' financial returns. It helps investors identify equities and bonds of waste management companies, as well as firms that generate material levels of waste but reduce it more effectively. It also outlines a new framework for waste reduction bonds - just 4% of green bonds actively address waste.
It is authored by UBS GWM's chief investment officer and features input from UBS's Industry Leader Network and contributions from: Urs Wietlisbach, co-founder of Partners Group; Marc Zornes, founder of Winnow and UBS Global Visionary; Donald Sadoway, professor at MIT, co-founder at Ambri, and UBS Global Visionary Alumnus.
The Future of Waste offering encompasses investments from UBS and third parties, including: individual stocks and bonds; liquid funds whose constituents outperform on waste metrics; private market funds where specific portfolio companies address waste; direct investments; and companies which outperform on waste and pollution metrics as assessed by UBS's Advice SI facility.
It will also bolster its research this year by utilising UBS Evidence Lab's new Deep Theme Explorer. This tool expands search terms into themes by identifying other terms or phrases that often occur alongside them. It then searches across publications to reveal how frequently the theme appears and what the sentiment around it is over time.