We have met Benji Dawes before when we were researching the Ethical Strategy which they jointly manage. This meeting was with the co-manager, Jon Hudson, to understand how the two work together and pull out some of the differences between the strategies.
There is an overlap between holdings on the two funds of around 80%. The strategies follow the same process, focusing on high quality companies with proven models and are cash generative. The challenge for them as managers is finding those companies that can deliver on that. They have always worked with an ESG lens because they believe that delivers good companies. It was this background that led them to taking over the Ethical Strategy.
Although they do not have the same constraints as the Ethical Fund, they do have a moral overlay. They own Flutter Entertainment within this strategy as they believe this is a well-managed book making company. They also own IG trading platform where the incentives within the company are for the clients to make money. These are companies they are happy to own in the Growth Fund but across both strategies they don’t own the likes of Shell and BP as they believe there are too many structural challenges. The same is also true of tobacco….read more