Skip to content
  • For Financial Professionals in the US Change
  • Contact Us
    • Subscriptions
      • Select Preferences
      • Log in
search bar
Janus Henderson Investors
  • Products
        • Investment Options

        • Mutual Funds
        • ETFs
        • Managed Accounts
        • Variable Insurance
        • Filter By

        • Equities
        • Fixed Income
        • Multi-Asset
        • View

        • Prices and Performance
        • Morningstar Fee Levels
        • Mutual Fund Distributions
        • Product Literature
        • View All Funds
  • Insights
        • Knowledge Shared

        • Explore our insights

        • Blog News Feed

        • Abandon Your Doubts
          Not Your Goals

          Uncertainty can cause investors to question their investment strategy. But with the right perspective, it’s possible to look past today’s uncertainty and stay focused on long-term objectives.

        • Learn More
        • Global Perspectives
          Recurring global market views and research
        • Portfolio Construction
          Actionable asset allocation insights from our strategists
        • For Your Practice and Your Clients
          Expertise on matters unique to your business and to your clients
        • Investment Viewpoints
          Updates and outlooks from our investment teams
        • Wealth Management & Retirement
          Unique wealth planning strategies and timely insights in the DC marketplace to stay ahead
        • View All Insights
        • Telescope Insights
        • Timely views on market events and the latest thinking from Janus Henderson.

        • View All Posts
  • Resources
        • Our Resources

        • Our Knowledge Labs Program

        • Choose Your Goals

        • Knowledge Labs
        • Webcast Series
        • Podcasts
        • Connect with Your Clients
        • Professional Development
          Resources to enhance your performance and grow your practice.
        • Wealth Management
          Discover wealth planning and tax strategies for your complete spectrum of clients.
        • Portfolio Construction and Strategy
          Form a partnership with Janus Henderson and gain access to analytical resources.
        • Defined Contribution
          Stay informed about the latest defined contribution strategies.
        • Client Acquisition
        • Client Loyalty
        • Team and Personal Effectiveness
        • Compliance and Regulatory
        • Portfolio Strategy
  • About Us
        • About Janus Henderson Investors

        • Our people

        • Environmental, Social and Governance (ESG)

        • Who We Are
        • Our Investment Capabilities
        • Connecting With Our Clients
        • We provide access to some of the industry’s most talented and innovative thinkers.


          Meet our teams
        • Find out how environmental, social and governance (ESG) considerations are embedded within our organization and investment principles.

          Learn more
{{banner.link_text}}
For Financial Professionals in the US

Knowledge. Shared Blog

October 26, 2020

Quick Views Coronavirus Environmental Social Governance (ESG) Technology

Global Sustainable Equity: News and Opportunities (October 2020)

  • Hamish Chamberlayne, CFA
    Hamish Chamberlayne, CFA
    Head of Global Sustainable Equities | Portfolio Manager

Hamish Chamberlayne, Portfolio Manager and Head of Global Sustainable Equities, highlights key sustainable news stories for the third quarter of 2020.

Key Takeaways

  • Both the European Union (EU) and the Chinese government have announced further steps toward carbon reduction, with the EU outlining their intention to reduce carbon emissions by 55% by 2030 and China targeting carbon neutrality by 2060.
  • Over the quarter, the MSCI World Index saw the technology sector outperform while the energy sector plummeted by more than 15%.
  • Rapid adoption of digital trends is contributing to a reduction in some of the negative environmental impacts caused by economic activity, but we believe there is still an urgent need to accelerate investment in the low-carbon energy transition.

During the lockdown, it has been hard at times to comprehend the monumental effect COVID-19 has had on the global economy by driving us indoors and online at a rate never before seen. While  digitization has been a major investment trend for several years, the pandemic has undeniably accelerated it, and we believe digitization will be one of the dominant drivers of investment returns over the next decade.

Closely linked to digitization is the transition toward low-carbon energy. This trend has also been supported this year through political commitment toward investment in renewable energy, electrification of transport, energy efficient technologies and sustainable infrastructure. We have been encouraged to see governmental fiscal stimulus targeted toward green projects.

Political Steps Toward a Low-Carbon World

The European Union (EU) has earmarked 30% of its €750 billion COVID-19 recovery package toward sustainable projects including renewable energy and storage, sustainable buildings and public transport. There was further positive momentum from the incoming EU president, who outlined ambitions to reduce emissions by at least 55% by 2030 instead of the 40% previously targeted.

In other welcome news, China committed to peaking its carbon emissions by 2030 and achieving carbon neutrality by 2060. China is the world’s second-largest economy and the largest emitter of CO2, so the announcement is a huge step toward a sustainable global economy. We hope these goals can be quickly met and surpassed.

We have also seen more than 20 countries implement end dates for the sale of internal combustion engines. There is a broad trend to bring forward decarbonization goals from a vague mid-century point toward a highly visible 2030 target date, which sets us up for a decade of innovation.

The third quarter saw economic activity around the world begin to thaw as governments were required to balance the need to reopen countries with continuing to manage the COVID-19 pandemic. Against this backdrop, global equity markets ended the quarter higher; the MSCI World Index delivered a total return of 7.9% in U.S. dollar terms. The best-performing sectors were information technology, consumer discretionary and industrials, whereas the energy, financial and real estate sectors underperformed, with the energy sector falling by more than 15%.1

Can Digitization Reduce the Environmental Harm Caused by Economic Activity?

The world’s struggle to ease lockdown restrictions is continuing to impact parts of the economy that rely on getting people together physically. Counter to that, we are seeing digitization accelerate. While this phenomenon has been spurred on by COVID-19, we expect that many of these digital trends will persist as people embrace the ease of use, enhanced productivity and efficiency that digitization offers.

Despite the encouraging adoption of digital trends, which we regard as being complementary to reducing the negative environmental impacts of economic activity, the increasing frequency and severity of climate-related events reminds us of the urgent need to accelerate investment in the low-carbon energy transition. Fortunately, the pandemic does not appear to have had a significant negative impact on this front. There is real momentum building behind this transition, thanks to exciting business innovation in clean energy technologies combined with strong regulatory support from many governments.

Nowhere was this innovation more evident than in Tesla’s recent update, which mapped out a clear investment plan to accelerate adoption of electric vehicles and clean energy. By 2030, Tesla’s goal is to have multiple terawatts of battery production in place to allow 20 million affordable electric vehicles to be produced annually as well as large scale energy storage installations to support renewable energy systems. We anticipate that Tesla’s ambitious vision will catalyze a further step up in investment across the broader automotive and energy industries.

2020 has been a challenging year, but we are optimistic that the global economy will emerge from this pandemic more resilient – and on a more sustainable trajectory – than before. Instead of undermining it, we are hopeful that this crisis will serve to underline the attractiveness of sustainable investing and how it leads to better outcomes, not only for investors but also for the environment and society.

 

1Morningstar, as at 30 September 2020. Net Asset Value (NAV) to NAV, gross income reinvested where applicable.

Knowledge. Shared
Blog

Back to all Blog Posts

Related Posts

China: What Can Investors Expect in the Year of the Metal Ox?
January 2021
Global Perspectives China Coronavirus Investment Outlooks

China: What Can Investors Expect in the Year of the Metal Ox?

Read More

ESG in 2021: Closing the Expectations Gap
January 2021
Global Perspectives Environmental Social Governance (ESG) Investment Outlooks

ESG in 2021: Closing the Expectations Gap

Read More

Subscribe for relevant insights delivered straight to your inbox

I want to subscribe
  • United States
  • Financial Professionals
  • Individual Investor
  • Institutional
  • US Offshore
  • Investor Relations
  • Media Center
  • Careers
  • Foundation
  • Contact Us
  • Privacy
  • Legal
  • Terms of Use
  • Facebook
  • Twitter
  • LinkedIn
  • YouTube
  • Podcast
Use of third party names, marks or logos is purely for illustrative purposes and does not imply any association between any third party and Janus Henderson Investors, nor any endorsement or recommendation by or of any third party. Unless stated otherwise, trademarks are the exclusive property of their respective owners.
The opinions and views expressed are as of the date published and are subject to change. They are for information purposes only and should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation to buy, sell or hold any security, investment strategy or market sector. No forecasts can be guaranteed. Opinions and examples are meant as an illustration of broader themes, are not an indication of trading intent and may not reflect the views of others in the organization. It is not intended to indicate or imply that any illustration/example mentioned is now or was ever held in any portfolio. Janus Henderson Group plc through its subsidiaries may manage investment products with a financial interest in securities mentioned herein and any comments should not be construed as a reflection on the past or future profitability. There is no guarantee that the information supplied is accurate, complete, or timely, nor are there any warranties with regards to the results obtained from its use. Past performance is no guarantee of future results. Investing involves risk, including the possible loss of principal and fluctuation of value.
Environmental, Social and Governance (ESG) or sustainable investing considers factors beyond traditional financial analysis. This may limit available investments and cause performance and exposures to differ from, and potentially be more concentrated in certain areas than, the broader market.
Janus Henderson Group plc ©

C-1020-34599 10-15-21

Close Notification
You are now leaving janushenderson.com

You are now leaving our site and entering a website not operated by or affiliated with Janus Henderson Investors. While we aim to point you to useful external websites, we cannot be responsible for their content, opinions, advice or accuracy, even if you utilise the services on the linked site to invest in our products.

The protection of your personal information on other websites is not governed by Janus Henderson Investors privacy policy and Janus Henderson Investors cannot be responsible for the privacy policies utilised on such third party sites, nor for the implementation of such policies by those third parties.

You should review the Terms and Conditions of third party websites and contact the operators of such sites if you have any queries.

You are now leaving Janus Henderson's website and will be redirected to the website of the Securities and Exchange Commission (the "SEC"). Money market funds are required to provide the SEC with a monthly electronic filing of more detailed portfolio holdings information on Form N-MFP.

Janus Henderson is not responsible for the content, accuracy or timeliness and does not make any warranties, express or implied, with regard to the information obtained from other websites. This link should not be construed as either a recommendation or offer to by or sell any securities.

Region

Country

Language

What type of investor are you?