RobecoSAM Biodiversity Equities D EUR

David Thomas is Portfolio Manager of the RobecoSAM Biodiversity Equities strategy. Prior to joining Robeco in 2022, he was a portfolio manager at Ellerston Capital, managing multiple strategies, including a fund for one of the world’s largest sovereign wealth asset owners. David brings 28 years of experience in financial markets having worked for global corporations, including Price Waterhouse Coopers, Macquarie Bank, Morgan Stanley and CLSA. His expertise in equity markets with special focus on the consumer and IT sectors has been honed over multiple roles, both in Sydney and London. David holds a Bachelor of Business from Swinburne University and successfully completed the leadership program at Harvard Business School. Aaron Re’em is Co-Portfolio Manager of the RobecoSAM Biodiversity Equities strategy and has been instrumental in developing this new thematic strategy within Robeco thanks to his strong background combining environmental, thematic and investment experience. Aaron was previously a Senior Equity Analyst covering consumer, industrials and materials stocks and supported multiple strategies across a range of Robeco’s Thematic and Sustainable Investment funds. Before joining Robeco in 2015, he was a senior analyst in Trucost’s investment research team, where he started his career in 2011 integrating fundamental environmental and ecosystem services analysis into equity research. Aaron earned his Bachelor of Science in Mathematics at the University of Bristol and is a CFA® Charterholder.

The fund is established in Luxembourg and is subject to the Luxembourg tax laws and regulations. The fund is not liable to pay any corporation, income, dividend or capital gains tax in Luxembourg. The fund is subject to an annual subscription tax ('tax d'abonnement') in Luxembourg, which amounts to 0.05% of the net asset value of the fund. This tax is included in the net asset value of the fund. The fund can in principle use the Luxembourg treaty network to partially recover any withholding tax on its income.

The fiscal consequences of investing in this fund depend on the investor's personal situation. For private investors in the Netherlands real interest and dividend income or capital gains received on their investments are not relevant for tax purposes. Each year investors pay income tax on the value of their net assets as at 1 January if and inasmuch as such net assets exceed the investor’s tax-free allowance. Any amount invested in the fund forms part of the investor's net assets. Private investors who are resident outside the Netherlands will not be taxed in the Netherlands on their investments in the fund. However, such investors may be taxed in their country of residence on any income from an investment in this fund based on the applicable national fiscal laws. Other fiscal rules apply to legal entities or professional investors. We advise investors to consult their financial or tax adviser about the tax consequences of an investment in this fund in their specific circumstances before deciding to invest in the fund.

The fund's sustainable investment objective is to support the sustainable use of natural resources and ecosystem services that help to reduce Biodiversity threats or restore natural habitats. This is achieved by incorporating sustainability considerations in the investment process by the means of a target universe definition, exclusions, ESG integration, and voting. The fund only invests in companies that have a significant thematic fit as per Robeco's thematic universe methodology. Through screening on both Robeco's internally developed SDG Framework and Robeco’s exclusion policy, the fund does not invest in issuers that have a negative impact on the SDGs, are in breach of international norms or where products have been deemed controversial. Financially material ESG factors are integrated in the bottom-up fundamental investment analysis to assess existing and potential ESG risks and opportunities. In addition, where a stock issuer is flagged for breaching international standards in the ongoing monitoring, the issuer will become subject to exclusion. Lastly, the fund makes use of shareholder rights and applies proxy voting in accordance with Robeco's proxy voting policyThe following sections display the ESG-metrics for this fund along with short descriptions. For more information please visit the sustainability-related disclosures.The index used for all sustainability visuals is based on MSCI World Index TRN.

October, a month that can create headlines for all the wrong reasons, started well, but quickly unraveled as war broke out in the Middle East. The markets are struggling with many, albeit familiar, challenges. The Israel-Hamas war has sparked oil-driven inflation fears, Chinese consumers are acting as if the country is in recession despite decent economic data, and a very subdued corporate earnings outlook have pressured markets. By the time dust settled on the trick-or-treaters, global equity markets had suffered one of their worst months in 2023, with the MSCI World falling more than 3%. Consumer Discretionary was the worst-performing sector as confidence plummeted across the globe. Investors appear particularly nervous regarding small caps, with a focus on capital preservation rather than accumulation. The Russell 2000 Index fell 7% for the month, more than double the broader market, racking up losses of 17% in the last three months alone.

Based on transaction prices, the fund's return was -6.09%. The strategy's performance for the month was below the general market and the investable universe. One of the top-performing stocks in the portfolio for the month was Danone, up 7.4% on the back of strong results, particularly in European dairy and sales guidance upgrades. Japan-based retailer Ryohin Keikaku also had a strong month (up 9.6%), continuing its stellar run this year. On the flip side, Norwegian recycler TOMRA struggled throughout the month (down 28%), which had a material impact on performance. Hit by a cyberattack in mid-July, the pressure was compounded when it delivered a muddled set of 23Q3 results. The long-term collection growth drivers remain firmly in place, but short-term question marks over management execution are likely to leave investors on the sidelines.

Global markets have now had three back-to-back months of negative performance. Within consumer staples, the fund's largest sector exposure, concerns over the impact of the GLP-1 have been weighing on the packaged food sub-industry performance, but in general, the fund is not overly exposed to this category. Industrials, particularly in the mid-cap space, also struggled in October as economic uncertainty met market jitters. These sizable moves in share prices opened up opportunities during the month and so we have been fairly active across the portfolio. We added incrementally to positions in Valmont, Darling and Campbell Soup on weakness. In addition, we continued to build our position in Clearwater Paper. We reduced our position in Renewi prior to the post-bid correction as valuation upside closed. In addition, we took profits in Sprouts Farmers Market after a strong run and cut both Kimberly-Clark and Avery Dennison on valuation grounds.