Within the SDG Engagement Equity capability, both attractive investment fundamentals and the potential for a constructive engagement programme are equal pre-requisites for investment. This is well-illustrated through our exposure to Alliant, an integrated utility company supplying electricity and natural gas to retail and wholesale customers in the US.
Alliant is attractive from an investment perspective. As a well-managed, diversified utility company serving an economically diverse region, it has a clear plan outlined for capital expenditure and operates in a favourable regulatory environment. The increasing number of different renewable energy sources, coupled with the declining role of coal-producing energy sources over time, offers the company the potential to increase its rate base – something we believe has not been sufficiently recognised and valued by the market.
The firm also offers engagement potential. Alliant is on course to transform the energy mix it uses to generate electricity and has achieved positive progress in delivering cleaner and cheaper energy to its customers. By investing to expand its clean-energy capacity, battery technology and infrastructure, the company should be able to transition away from its historically predominantly fossil-fuel (and principally coal) electricity generation.
Since we invested in Alliant, we have engaged with multiple individuals in the business. We are pleased with how receptive the management team has been, as well as – more pertinently – the progress made in a short period of time. Our engagements with Alliant focus on:
- Transitioning its energy-generation mix away from fossil fuels and towards renewable energy.
- Concretely satisfying the needs of its customers with a consequential improvement in performance-satisfaction surveys.
To dive into the details of Alliant's theory of change, our engagement progress to date and our next steps, read the full case study.