Triodos SICAV I consists of four Luxembourg-based subfunds that are distributed in The Netherlands, Belgium Luxembourg and Germany.
The four funds invest in shares and bonds of multinational companies that distinguish themselves by their good social and environmental policies and socially responsible management.
In addition, bond investments include State bonds from countries that meet Triodos Investment Management criteria that safeguard the solidity of the fund in terms of liquidity risk and return on investment.
Another objective of Triodos SICAV I is to encourage companies to continually improve their sustainability performance.
Triodos Sustainable Equity Fund (Europe)
Triodos Sustainable Equity Fund, a subfund of Triodos SICAV I, is distributed in The Netherlands, Belgium, Germany and Luxembourg and invests in the shares of multinational companies worldwide.
In 2011 the stock market was confronted with increasing fears about debt issues in the Eurozone. This sentiment also impacted the fund.
The fund realised a return of -5.0% after costs, which is 1.2% higher than its benchmark before costs. The total net assets of the fund decreased 7.7% to EUR 167 million.
Triodos Sustainable Bond Fund (Europe)
Triodos Sustainable Bond Fund, a subfund of Triodos SICAV I, is distributed in The Netherlands, Belgium, France, Germany, Denmark and Luxembourg.
The fund invests in Euro denominated bonds of multinational companies globally and, since 1 April 2010, in Euro denominated country bonds.
There was increasing uncertainty about country bonds in 2011 during the Eurocrisis. Against this backdrop the fund realised a return of 4.5% after costs, 0.1% below its benchmark before costs, while the total net assets of the fund increased by 1.9% to EUR 143 million in 2011.
Triodos Sustainable Mixed Fund (Europe)
Triodos Sustainable Mixed Fund is a subfund of Triodos SICAV I. The fund maintained a defensive investment strategy for most of the year, investing a relatively large proportion of its money in bonds. In 2011 it was awarded a 4th star by rating-agency Morningstar
Performance was in line with the benchmark and realised a return of 1.4% after costs, outperforming its benchmark before costs by 0.9%. Total net assets at year end were EUR 62 million.
Triodos Sustainable Pioneer Fund (Europe)
Triodos Sustainable Pioneer Fund is a subfund of Triodos SICAV I. The fund invests in companies that are pioneers in climate protection, clean planet, promoting healthy people and corporate social responsibility.
The fund realised a return of -20.3% after costs, which is 6.0% lower than its benchmark before costs. Total net assets decreased 19.5% to EUR 37 million.
Promoting corporate social responsibility produced positive results in 2011.
During the year Triodos Investment Management made use of voting rights on behalf of the Triodos Sustainable Pioneer Fund at 106 shareholding meetings. The companies were informed about Triodos Bank’s voting topics in advance of these meetings allowing organisations to take steps to address them.
In addition to 216 feedback letters sent to all the companies it researched, Triodos Investment Management started dialogue with more than 150 multinational companies, leading to a number of significant improvements in their corporate social responsibility policies and performance.
Through this work, Triodos Bank demonstrated that sustainable investment on the stock market is crucial to encouraging sustainable corporate behaviour.
Socially Responsible Investment Funds Prospects for 2012
Developments in the economy and financial markets will, to a considerable degree, be determined by political decisions, in 2012. Decisions about budget cuts in response to the European crisis are likely to have far-reaching consequences.
The associated economic and financial risks, will continue to strongly influence investor sentiment in global stockmarkets. For many investors this leads them to look for financially healthy companies with defensive growth-qualities.
The Triodos Sustainability Funds aim to anticipate short-term risks and long term opportunities. And to build this knowledge in to funds which reflect themes of ’healthy people’, ‘clean planet’ and ’climate protection’. High quality companies can be found within these themes, in growth-markets such as personal care, organic food, water-treatment, recycling and energy-efficiency.
Nominal returns on government bonds in countries with a high credit-rating were at an historic low at the end of 2011, with negative inflation corrected returns.
Taking into consideration a further decrease of inflation, and a further slowdown in economic growth, the interest rates could remain low for some time to come. In the light of continuing insecurities the funds will continue to favour bonds from countries considered ’safe’ and financially robust companies.