Search this website. You can use fund codes to locate specific funds

SDG Engagement Equity commentary: Huhtamaki

The SDG Engagement Equity strategy focuses on attractive companies with the potential – through engagement aligned with the Sustainable Development Goals (SDGs) – to generate outcomes that benefit people, the planet and investors. Here we demonstrate how we are engaging with current holding Huhtamaki to create positive impacts on society.

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 Huhtamaki, a Finnish consumer packaging company.

From an investment perspective, Huhtamaki operates in areas where it believes it has leadership or leadership potential. In the consumer packaging industry, there are decent barriers to entry, some of which include manufacturing and distribution footprint, manufacturing knowhow and product innovation and quality. Although many of its products are not technologically complex to make, Huhtamaki has strong pedigree in producing large volumes of products and meeting tough customer demands for quality and service. The company also has a good return profile and a strong management track record.

Meanwhile, our engagement case focuses on opportunities across three pillars: a company’s supply chain, its direct operations, and its products and services.  We have been engaging Huhtamaki on:

  1. The company’s sourcing of fiber (supply chain)
  2. The provision of decent work and resource efficient operations (direct operations)
  3. Investments in innovations which are more environmentally friendly both in terms of material usage and end-use recyclability (products)

Responding to the coronavirus

In response to the global coronavirus pandemic, Huhtamaki has suspended its dividend. In addition, as a result of coronavirus-related demand reduction, it repurposed one of its factories in Northern Ireland, giving it capacity to produce 4m face shields per week for the UK’s National Health Service (NHS) – and it has since replicated this activity across other sites to reach 10m units per week.

To dive into the details of Huhtamaki’s theory of change, our engagement progress to date and our next steps, read the full commentary here.

Risk profile
  • Nothing in this document constitutes a solicitation or offer to any person to buy or sell any related securities or financial instruments.
  • Past performance is not a reliable indicator of future results and targets are not guaranteed.

More Insights

Weekly Credit Insight
The market sell-off earlier this year has driven a convergence between yields in the US and the rest of the world.
Adapting to the new normal: crisis management, housing and the future of real estate
How can property managers adapt to the new reality of socially distanced spaces?
Asia ex-Japan Strategy Update: June 2020
Jonathan Pines, Lead Manager, gives an update on the Hermes Asia ex-Japan Strategy in June 2020.
Sharpe Thinking
Markets are weighing up the future in order to make sense of the new normal.
Tackling the climate crisis
Climate change is the defining challenge of our time and we are at a defining moment.
Credit: Industry Insights
Joe Howes, Credit Analyst, shares his fundamental views on telecoms, media and tower companies.