Sustainable
Europe ex-UK Equity

Targeting companies undergoing transformative change

Reasons to invest

Positive outcomes

Connect performance with positive outcomes for people, the planet and investors

Focus on sustainability

Focus on companies leading the global sustainability transition

Long-term change

Target profitable businesses capitalising on underappreciated long-term change

Access skilled stock-picking

Access skilled stock-picking, thematic investing and world-leading engagement teams

Proprietary ESG analysis

Benefit from innovative, proprietary ESG analysis that delves deeper than mainstream ratings

Strategy overview

James Rutherford

Our high-conviction stock selection exploits the power of change over the long term.

James Rutherford
- Head of European Equities and Lead Manager

Why Sustainable Europe ex-UK?

Businesses driving the sustainable transition operate on the right side of social and environmental change. We seek those that are built on strong foundations: purposeful, resilient, innovative companies in control of their own destinies – consistently generating cash flow and profits through products, services and activities that help create a better world.

Sustainable investing seeks long-term financial outperformance and social and environment change benefiting current and future generations. By focusing on companies whose activities are aligned with clear environmental and social themes, the team is able to build a portfolio of compelling long-term investments that benefit people and the planet.

Markets can be relatively efficient over the short term, but they struggle to discount positive change over the medium and long term. This means quality businesses helping to improve society and the environment often have better long-term performance prospects than those that fail to adapt to the challenges we face today.

How we invest

Fundamental, bottom-up
Quality, not quantity
Sustainability framework

Investment philosophy

We believe that fundamental investing through a sustainability lens creates a long-term, concentrated portfolio of quality investments.

Investment philosophy infographic

Investment process

  • Following the initial screen where we apply our exclusions, we coordinate inputs from several sources. We draw together our thematic research, inputs from company meetings, sustainability assessment and appraisal of positive change at the company. The focus is on identifying companies that are either pivoting their businesses or already helping address the challenges faced by society, thereby driving long-term structural change.
  • We undertake fundamental analysis and investigate the sources of enduring change. We meet company management to further understand the fundamental, sustainability and ESG factors. The team uses a variety of valuation techniques that vary by industry and time, including a proprietary cash flow model. The team ultimately seeks companies that are significantly mis-priced by the market.
  • The portfolio consists of 30-50 stocks, position sizes reflecting liquidity and our conviction, usually between 1% and 5% weights. All holdings are held at positive weights compared to the index.
Eu equities capabilities page investment process

Team

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Chi Chan

Chi Chan, ACA

Portfolio Manager, European Equities, Federated Hermes Limited

James Rutherford

James Rutherford

Head of European Equities and Lead Portfolio Manager, Federated Hermes Limited

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Product Information

For the latest performance and vital information – including prices, key facts, identifiers and ratings

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Insights

Read our latest portfolio perspectives

Our Purpose

To deliver Sustainable Wealth Creation

Like all our investment capabilities, Federated Hermes Sustainable Europe ex-UK aims to deliver Sustainable Wealth Creation: the generation of wealth through investments that enrich investors, society and the environment over the long term.

Our business provides three equally powerful pathways to achieving this aim. Federated Hermes Sustainable Europe ex-UK Equity features in the Sustainable route.

Active ESG on blue background

Responsible, active investing for long-term performance.

Sustainable on green background

Thematic and values-based approaches for sustainable outcomes.

Federated Hermes
Sustainable Europe ex-UK Equity

Impact on orange background

Mission-led investment strategies to create positive impact.