Mumbai/Dubai – May 31, 2022: India’s first and only true-to-label, Sustainability-led equity investment product, Earthwise India Strategy (EIS), has delivered annualised returns of 36.6% since its inception in January 2020 – doing so by investing in a diversified portfolio of 25-30 stocks chosen on the basis of their contribution to the theme of “sustainable economic growth”.
By comprehensively beating the benchmark NIFTY100 index, EIS has demonstrated that it is possible to both “do good” and “make money” at the same time. EIS’s portfolio has the best-in-class sustainability characteristics among any diversified equity portfolio in the Indian market.
Earthwise Investors have now published a first-of-its-kind Sustainability Report for EIS. The report presents a summary of the sustainability characteristics of the EIS portfolio and their comparison with the broader market (represented by the NIFTY 100 index) for the 2021 reporting cycle. The report is based on Earthwise’s proprietary “Net Sustainability Positioning” (NSP) Framework. The NSP Framework is organised around five themes: Climate resilience, Resource efficiency, Human capital, Impact on communities and Inclusion & Access. Within each theme, Earthwise has identified different “influencing factors” that capture the various facets of the theme considered as most relevant to India’s socio-economic context.
According to the report, During the 2021 reporting cycle, the GHG intensity of EIS portfolio was 1,447 tonnes for billion rupees of EBITDA. In comparison, the NIFTY 100 constituents produced GHG emissions of 59,473 tonnes for producing the same EBITDA. The GHG footprint of EIS portfolio was a mere 2.6% of that of the NIFTY 100.
Similarly, the EIS portfolio companies during the same period used 240 MWh of non-renewable energy for producing one billion rupees of EBITDA, while the NIFTY 100 constituents used 17,011 MWh of non- renewable energy for producing the same EBITDA. Even the water intensity of EIS portfolio stood at only 2.7% of that of NIFTY 100.
Among social factors, the jobs’ intensity of EIS portfolio was 53% higher than that of NIFTY 100. In terms of diversity, on average, the EIS portfolio companies had 50% more diverse workforce than that of NIFTY 100 constituents.
EIS’s Sustainability Report is the first time that an Indian equity scheme has compiled, analysed and reported detailed sustainability data for its portfolio. By doing so, it has set the benchmark for other ESG / Sustainability-themed schemes and funds. They need to demonstrate to investors that for them ESG/sustainability is not merely a labelling exercise.
Anshul Rai, Founder of Earthwise Investors, says that the mission of EIS is to bring sustainability centre-stage in sustainable investing. “At Earthwise, our mission is to generate long-term wealth by investing in a sustainable future. The results achieved by EIS in 2021 reporting period are a testament to this mission. They demonstrate that investing based on the theme of sustainability is a great investment proposition for the long term. EIS makes that opportunity available to all investors, big or small.”