Since 1991, the Acuity Clean Environment Equity Fund has provided investors with growth opportunities in leading environmental companies.
A Unique Opportunity
The environment has emerged as a key policy issue confronting governments
around the world. Increasingly stringent pollution targets are driving
innovation and creating new market opportunities for companies that provide
environmental solutions. Our many years of research in this area has highlighted
a number of key environmental themes that provide a compelling context in
which to apply Acuity's growth oriented investment approach. At Acuity, we
believe that those companies that can offer proprietary advantages over the
long term will deliver superior earnings and cash flow growth.
The Acuity Clean Environment Equity Fund
The Acuity Clean Environment Equity Fund focuses on resource
optimization and sustainability. The investment opportunity in environmental
companies has become increasingly attractive in recent years. Driven by a
number of significant developments, such as rising commodity prices, climate
change and technological advances, global demand for environmental products
and services has grown dramatically.
The Acuity Clean Environment Equity Fund has acquired a reputation for
innovation and investment success over the long term. This Fund provides
long term capital appreciation by investing in a targeted portfolio of equity
securities that are leading innovators in the provision of product and service
solutions to key environmental issues as defined by the Fund.
Key Environmental Investment Themes
Most of the investment opportunities
identified through our analysis can be captured within the four key environmental themes outlined below.
Energy and Power Solutions
- Issue: Global economic growth and dwindling supplies have resulted in significant price increases for key energy commodities. In addition, climate change is forcing significant innovation in energy consumption patterns.
- Opportunity: In this context, energy efficiency and alternative energy solutions are becoming increasingly important.We anticipate significant growth opportunities for companies that offer alternative energy (wind, solar, biofuel etc.) and process efficiency solutions over the next few decades.
Waste Management and Pollution Controls
- Issue: Reduction, handling and disposal of final waste materials are of critical importance in all industrial sectors given the potential for penalties and long term liability.
- Opportunity: As standards for waste emissions become more stringent in all jurisdictions, opportunities are emerging for technologies that reduce the quantity of waste for removal, and which render the remaining waste safer for handling and disposal. Over the long term, therefore, we expect to see continued strength in the market for companies with pollution control equipment.
Water and Wastewater Solutions
- Issue: According to estimates by the United Nations, approximately one third of the global population is currently living in water-scarce areas. Through climate change and population growth, however, it is predicted that this figure will rise significantly.
- Opportunity: Mounting concerns over the availability and quality of water leads us to anticipate that water stress will be a top policy issue for governments over the next few years.We therefore believe that favourable regulatory developments for the water sector are increasingly likely to provide opportunities for water purification, waste water treatment and desalination technologies.
Environment Health and Safety.
- Issue: Higher population density in urban areas and transportation
efficiencies have raised concerns regarding the potential for increased illness
and death from the spread of infectious diseases. In addition, aging industrial
infrastructure in developed nations require a greater focus on occupational
health, safety and environmental (HSE) practices.
- Opportunity: As awareness over the potential impact of infectious diseases grows, we believe there will be opportunities for investment in companies that develop more efficacious anti-viral drugs and vaccines, as well as those that provide health services and sanitation technologies.We also expect HSE solutions providers, including those who provide onsite emergency response, testing equipment, and training to benefit from higher environmental and safety standards.
Our Commitment
UNEP Finance Initiative
Acuity was selected as the only Canadian member of the United Nations' Environment Programme Asset Management Working Group. This unique group was established in part to advise the UN on integration of environmental criteria within institutional investment management.
For more information, please visit: http://www.unepfi.org/work_streams/investment/amwg/index.html
Acuity has been a lead sponsor of Earth day since 1998 and has co-sponsored speaking arrangements by thought leaders such as Sir Nicholas Stern, Dr. Gro Harlem Brundtland, Arnold Schwarzenegger, and David Suzuki.
Credentials are Key
Acuity Investment Management Inc., founded in 1990 has gained a well-earned
reputation for disciplined investment management of Canadian and global
portfolios. Using a team approach, Acuity successfully manages four fund
families - Acuity Mutual Funds, Acuity Clean Environment Mutual Fund, Acuity
Social Values Mutual Funds, and Acuity Pooled Funds - in addition to closed end
funds, pension, institutional and private portfolios. Acuity's success on behalf
of the Clean Environment Equity Fund has been the result of experienced
management, rigorous research and the agility and insight necessary to take
advantage of market opportunities. The Acuity Investment Team shares a unique
combination of financial and scientific expertise, allowing them to analyze
companies from a technological, environmental and financial perspective.
©2008 Acuity Funds Ltd.
