Octopus Investments launches new sustainable fund to invest in companies looking to address the world’s biggest problems

Octopus Investments, part of Octopus Group, has launched the FP Octopus UK Future Generations Fund.

This fund will invest in businesses that are working hard to tackle some of the world’s greatest challenges with the goal of creating a more sustainable future for our planet and people. These include climate change, revitalising healthcare industries, and empowering people using digital infrastructure.

Building on Octopus’ strong track record investing across the market cap spectrum, the fund will take a multi cap approach, providing patient capital to deliver long term growth. Octopus has a long-established team with a demonstrable track record of impressive returns, investing throughout the market cap scale, from £10 million to over £100 billion in market cap.

10% of the annual management charge will be donated to Octopus Giving, the charitable foundation set up by Octopus in 2014, which supports UK based charities addressing the same challenges.

The fund will be managed by Dominic Weller, a Citywire AA rated manager. Dominic is a member of the Responsible Investment Committee at Octopus and has helped shape the company’s approach to sustainable investing. Richard Power and Chris McVey, who are the lead managers for the FP Octopus UK Micro Cap Growth Fund and the FP Octopus UK Multi Cap Income Fund respectively, will be co-managers. Dominic is also a co-manager of both these funds.

It’s the first retail fund from Octopus that has launched with a sustainable investment mandate since the business was founded in 2000. It will take advantage of Octopus’ expertise as one of the UK’s leading investors in smaller companies to provide support to these businesses which are urgently in need of capital, while having the opportunity to invest across the full UK market spectrum.

Commenting on the launch, Dominic Weller, said:

“So far, most of the ESG and sustainability focused funds to launch have shown a bias towards investing in larger companies. Limited and flawed ESG data especially on smaller companies exacerbates this problem and has led to many funds avoiding companies which do not tick the right boxes altogether. This is a missed opportunity.

“We want to give our investors an opportunity to help shape the future of our world by providing much needed capital to great companies that are looking to make a positive contribution by addressing problems for our and future generations. It’s also critical that investors better understand the companies they are invested in, as this will help unlock more patient capital for those companies that really need it.

“By investing in these exceptional businesses, we believe we can achieve long-term capital growth for investors within a sustainable and transparent framework that aligns with UN Sustainable Development Goals.

“Octopus has long-established expertise in finding attractive businesses with strong fundamentals, regardless of their size. We think this gives us a good a platform to deliver value for our investors while also allowing them to make a real difference with their money.”

Octopus will undertake its own research and the fund will help fill the gap by backing innovating companies whose activities align with the United Nations Sustainable Development Goals. These companies will look to solve problems within one of three sustainability themes, which Octopus believes address some of the world’s most urgent issues for current and future generations.

The three sustainability themes for the Fund:

  • ‘Building a sustainable planet’ – tackling the climate emergency by investing in and supporting companies at the forefront of clean energy & sustainable consumption.
  • ‘Empowering people’ – investing in business which reimagine the future, innovate and make a difference in people’s daily lives.
  • ‘Revitalising healthcare’ – improving the health and wellbeing of people around the world by investing in modern healthcare industries.

To make it easier for investors to understand the actions of the investee companies, this fund will provide transparent and easy to understand data as well a comprehensive annual report, detailing the positive contributions that companies within the portfolio are making.

The offer period for the new Fund is now open, with an annual management charge (AMC) of 0.85%, depending on the share class, and an ongoing charges figure (OCF) of 1.50%.

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