Investing in quality: our ‘big five’
Companies selected for the DD Funds must comply with the DoubleDividend ‘big five’ criteria.
1. Sustainability
Sustainability makes a positive contribution to a company’s risk-return profile. Sustainable companies have a long-term focus and are more innovative..
2. Business model
A strong business model is crucial for the long term. We prefer companies with a strong brand, a solid market position and high margins.
3. Management and track record
A company and its management must have a proven track record when it comes to revenue and profit growth.
4. Balance sheet
A strong balance sheet is extremely important. It provides a buffer to get through tough times unscathed and opportunities to invest sufficiently in the company’s own business model.
5. Valuation
Paying a reasonable price for an investment is important with a view to achieving the targeted return.
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Quality
Investing in quality ensures that the investment portfolio is resilient.
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Sustainability
Sustainability makes a positive contribution to the risk-return profile of an investment portfolio. See also the 2020 Sustainability Report (Dutch only).
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Long-term focus
The value of the investments is determined in the long term.
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An eye for risk
Risk is the permanent loss of capital in view of the investment perspective and not the interim volatility.
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No benchmark
Focused on achieving an absolute return, not outperforming a benchmark.
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Realistic return
Focused on achieving a realistic return while taking risks into account.
For DoubleDividend, being more sustainable means responding to the following three global challenges:
CLIMATE
Global warming as a result of CO2 emissions increases the risk of extreme weather (droughts, floods, forest fires) and has important consequences for global food security, well-being and safety, among other things.
ECOSYSTEMS
The degradation of ecosystems leads to pollution, scarcity of important raw materials and the loss of biodiversity due to polluting and unnecessarily raw-material-intensive business processes, deforestation and overfishing.
WELL-BEING
Well-being relates to public health, poverty and malnutrition, inadequate education, gender inequality, the quality of health care, inequality in the workplace, and corruption.
Integration of ESG1 and Sustainable Development Goals
The 17 Sustainable Development Goals (SDGs) can be ranked under the three global abovementioned challenges. The SDGs are part of the United Nations 2030 Agenda for Sustainable Development and are, in our opinion, a good starting point for a broad sustainability agenda. Because of this focus the SDGs have been included in our sustainability analysis.
1 ESG stands for environmental, social and governance aspects.
CLIMATE
ECOSYSTEMS
WELL-BEING
