RobecoSAM Global SDG Equities F EUR

Michiel Plakman is Lead Portfolio Manager and member of the Global Equity team. He is responsible for fundamental global equities with a focus on SDG investing and on companies in information technology, real estate and portfolio construction. He has been in this role since 2009. Previously, he was responsible for managing the Robeco IT Equities fund within the TMT team. Prior to joining Robeco in 1999, he worked as a Portfolio Manager Japan at Achmea Global Investors (PVF Pensioenen). From 1995 to 1996 he was Portfolio Manager European Equities at KPN Pension Fund. He holds a Master's in Econometrics from Vrije Universiteit Amsterdam and he is a CFA® charterholder. Christoph Wolfensberger is a portfolio manager at Robeco within the Global Equity team with over 10 years of experience in Sustainability Investing. He is also the deputy portfolio manager for the Global SDG Equities strategy.  Prior, Christoph was also a Quantitative Analyst covering Sustainability/Impact Investing within Robeco’s Products & Engineering Team with a strong focus on customized solutions as well as portfolio optimizations. Prior to joining in 2011, he served as an Intern on the ESG Research team for six months. He holds a Master’s of Science Degree in Chemistry and Business Studies from the University of Zurich.

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 advance the United Nations Sustainable Development Goals (SDGs). SDG and sustainability considerations are incorporated in the investment process by the means of a target universe, exclusions and ESG integration. The fund solely invests in stocks issued by companies with a medium or high positive impact on the SDGs. The impact of issuers on the SDGs is determined by applying Robeco's internally developed three-step SDG Framework. The outcome is a quantified contribution expressed as an SDG score, considering both the contribution to the SDGs (positive, neutral or negative) and the extent of this contribution (high, medium or low). Furthermore, the fund does not invest in stock issuers that are in breach of international norms or where activities have been deemed detrimental to society following Robeco's exclusion policy. 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 policy.

In April, the MSCI World Index increased by 1.8% (in USD), with consumer staples, energy and healthcare being the top-performing sectors, while materials and information technology were the worst performing ones. Following an in-line US March Core CPI read, US 23Q1 GDP QoQ growth came in at 1.1%, well below expectations (1.9%), dragged down by weak business investment, while personal consumption experienced a strong (3.7%) growth. At the same time, jobless claims rose less than expected, while the 23Q1 Core PCE Price Index experienced 4.9% growth (vs. 4.4% in 22Q4). The tightness in the labor market does not leave any room to the Fed and a 25 bps increase during its next meeting is almost a certainty. On the corporate front, large US banks and US mega cap tech names both published good quarterly results. Overall, a bit more than half of the S&P 500 companies have published their 23Q1 results, with the greatest majority of them beating expectations on both the top line and bottom line.

Based on transaction prices, the fund's return was 0.74%. Over the last month, the fund outperformed the MSCI World, which was mainly driven by positive stock selection, especially within financials and healthcare. Two of the mega-cap names – Meta and Apple – that we cannot own due to SDG considerations, continue to drag substantially on a relative basis, while not owning Tesla contributed positively over April. Among the largest detractors, were two of our semiconductor companies, On Semiconductor and Infineon. After the strong rally that started in October, further fueled by good Q1 results and guidance uplifts by the latter, concerns about a peaking cycle for automotive chips are rising. Among the largest contributors was AstraZeneca, which reported solid Q1 numbers, driven to a good extent by oncology (Imfinzi), but more importantly, it announced positive developments within its pipeline, which we regard as one of the strongest across the pharma industry. Another large contributor was Unilever, which had a strong start into the year, driven by strong pricing and better-than-expected volumes.

Economic conditions remain challenging, with high stress levels within the banking system, a continuation of the Fed's hiking cycle, inflation remaining very elevated, a still inverted yield curve, and strongly positive yearly benchmark contributions coming mostly from mega-cap companies, including all FAANG stocks. Based on history, we still believe that the market is too optimistic and continues to underestimate the stickiness of inflation at the current very elevated levels. Further, we saw the first cracks in the system triggered by rapidly increased interest rates and wonder what's coming next. With market valuations remaining above depressed levels and the balance of risks for global equity markets overall still looking skewed to the downside, it is hard to get overly excited and hence we maintain our defensive positioning. In the meantime, we continue to look for companies whose risk-return profile turned attractive due to overreactions in the market and we remain confident in our bottom-up approach that focuses on picking companies with strong over-the-cycle fundamentals and resilient business models to identify high-quality stocks at attractive valuations.