SDG investing: towards a sustainable future

SDG securities: how we choose companies

Companies committed to the UN Sustainable Development Goals can benefit from attractive growth opportunities and competitive advantages. According to the UN, they are expected to generate 12 trillion US dollars in GDP by 2030 and create 380 million new jobs by then. With the SDG analysis we use to invest in SDG securities, we discover companies that are still undervalued in the market. As the first step, we exclude all companies that violate an exclusion criterion. In the second step, we evaluate the influence on sustainability topics according to the UN's Sustainable Development Goals (UN SDGs) and filter for companies with a positive effect using our proprietary SDG framework, which links products and services to relevant sustainability goals (SDG leaders). Green bonds, social bonds or sustainable bonds are also possible. In the third step, we analyse these companies in a thorough, substantiated manner. Only companies that pass all three tests are included as SDG leaders in our Sustainable investment universe. Because the market still offers too little choice for a broadly diversified portfolio of SDG securities despite strong growth, we supplement our Sustainable investment universe with companies with an above-average ESG score (ESG leaders).

SDG investments: how we select countries

We also analyse states and SSAs (Sovereigns, Supranationals and Agencies) according to SDG and ESG criteria and invest in green bonds, social bonds or sustainable bonds (SDG leaders). Green bonds finance, for example, solar and wind power plants, other renewable energies, sustainable waste and water management or climate-efficient buildings and transport solutions. Social bonds are used to finance access to education, health, financial services, drinking water or low-cost housing, for example. Sustainable bonds finance activities to reduce negative effects on the environment as well as on society. Because the market for these bonds still offers too little choice for a broadly diversified portfolio despite strong growth, we supplement our Sustainable investment universe with countries that are among the best third of all countries according to our ESG score (ESG leaders).

The United Nations' Sustainable Development Goals

The 17 Sustainable Development Goals (SDGs) are the core of Agenda 2030. They combine economic, social and environmental aspects and bring together poverty reduction and sustainable development for the first time. The goals are to be achieved worldwide by 2030. All UN member states, including Switzerland, are required to implement these goals at the national level. With the Sustainable Development Goals, the UN also aims to create incentives for non-state actors to play their part.

The 17 Sustainable Development Goals in detail