IMP Matrix Rating: B2
What: Generation is a fund management company founded by Al Gore and David Blood. Its Global and Asia equity funds invest in publicly-listed system-positive companies whose businesses are consistent with a clean, fair, and prosperous society. Its definition of sustainability lies in the strength of its assessment of two factors: business quality and management quality. When a company is well run, it is found to be sustainable and act in the best interests of its stakeholders, as well as providing investors with superior financial returns. The sectors Generation focuses on include: smart mobility, sustainable consumption, energy innovation, industrial and enterprise efficiency, financial innovation, health and wellbeing, and food systems transformation.
Who: The fund invests in publicly listed companies, therefore stakeholders are all people and the environment affected by such companies.
How Much Impact: Generation does not unfortunately publish an impact report for their public equity funds (they do for their private funds, which we’re not invested into). Given that in public equities there is little investor additionality, most of its impact comes from its engagement with companies, which is also quite low key, given that they already invest in ESG-positive companies and therefore there isn’t much scope for “activist” investing.
Our Contribution: Negligible, we are one of many investors in a highly oversubscribed vehicle.
Impact Risk: Given that the impact is negligible, the only remaining risk we can think of is that Generation is not fast enough to capture the shift from sustainability to the need of a regenerative economy, and misses out on both the opportunity to engage with companies on it, as well as on financial performance.
Sample Investment: Top 10 holdings as of July 31st 2020 were: 1) Generation Global Equity Fund: Alphabet, Baxter, Cognizant, Charles Schwab, Henry Schein, Dentsply Sirona, Palo Alto Networks, Becton Dickinson and Co., TE Connectivity, Gartner; 2) Generation Asia Fund: Alibaba, Tencent, Taiwan Semiconductor, Texas Instruments, Cognizant, Techtronic, Adidas, HDFC Bank, United Overseas Bank, Infosys.