Celebrating London Climate Action Week, this article features as part of IFA Magazine’s editorial campaign throughout this week, which aims to highlight key issues, news and views in the field of climate action.
In celebration of this year’s Climate Action Week (25th June – 3rd July 2022), Ollie Beckett, Portfolio Manager, The European Smaller Companies Trust, says smaller European companies with strong ESG characteristics are an attractive investment opportunity. Ollie comments:
“Smaller companies across Europe have strong environmental, social and governance characteristics (ESG). But interestingly they are often poor at presenting what they do in these areas because they are more focused on the operations of their business and have limited resources for PR and investor relations. This leaves our market laden with hidden ESG opportunities. In The European Smaller Companies Trust PLC we have considerable exposure to companies that can easily benefit from the premium attached to ESG companies once they improve the presentation of their activities. This will come in time. Smaller companies are predisposed to grow more quickly and this high growth fosters strong investment returns. Yet valuations are inexpensive by comparison to slower-growing large companies. This is not to say that large cap companies should not form part of an investor’s portfolio – far from it. Our contention is that smaller European must be part of the mix too – not overlooked. The asset class remains very attractive with the opportunity to uncover good investments in the years ahead”