Food for thought
The biggest change to the portfolio of late is increased investment in food, agriculture and forestry, which has risen from “low, single digits” a couple of years ago to the current 12% weighting.
Driven by tech-related advances in food testing and organic produce, this is expected to continue in the coming years as “the agriculture value chain goes through a transformation towards more sustainable businesses”, says the fund manager.
Meanwhile, the collapsing oil price in 2014 has been good for the sector, with performance up in energy efficiency and particularly strong momentum in water.
The portfolio also has limited exposure to Brexit-affected stock, less than 5%, while the fallout of Donald Trump’s election as US president – a man who has called man-made climate change a hoax – are “more nuanced”.
Last month, reports emerged that Trump’s administration was looking to dismantle the EPA, which Jenkyn-Jones admits “does not help renewable energy”.
However, the president’s focus on job creation and infrastructure will be good for water and hazardous waste, something the market has already priced in.
Jenkyn-Jones concludes: “In the US, there are more jobs today in wind and solar than there are in the coal industry. Although the [Trump] rhetoric is not favourable for renewables, he needs to recognise what the implications would be if he removes support for renewable energy.”
Biography
Bruce Jenkyn-Jones joined Impax in 1999 and has developed the listed equity business. He has an active role in the day-to-day management of all Impax-listed equity portfolios and is on the portfolio construction team for all strategies. Before joining the company, he worked as a utilities analyst at Bankers Trust and as an environmental consultant for Environmental Resources Management.
He has an MBA from IESE (Barcelona), an MSc in environmental technology from Imperial College and a degree in chemistry from Oxford.
