Andrew Dykes, Deputy Chairman of the Global Sustainability Trust, explains why scale as well as experience counted when choosing an investment manager.

Deciding to create an investment trust that will invest in opportunities and initiatives across global private markets in order to help accelerate the UN’s Sustainable Development Goals is one thing. Identifying a fund manager with the relevant expertise and resources to run it is a whole different challenge.

For such an innovative investment proposition, it’s natural to assume we might have selected a small, specialist manager focused solely on sustainable investing. But we chose to take a different route.

Private markets leader Aberdeen Standard Investments, the second-largest active asset manager in the UK, was chosen partly because of its scale of operations.

Essentially, if you’re going to invest in private, unquoted assets that aren’t widely covered by analysts and brokers, then you need an investment manager with the breadth and depth of resources to be on the ground, across markets, finding opportunities for itself.

Aberdeen Standard Investments is one of the 10 largest managers of private market investments in the world. It has over £67 billion* invested across private equity, real estate, infrastructure, natural resources and private credit – and 400 dedicated private market professionals located in 21 offices across the world. So it is well placed to identify and get access to the commercial projects, funds and companies worldwide that are helping to tackle issues such as climate change, pollution and poverty.

The firm also has an established track record in sustainable investing. It has integrated environmental, social and governance (ESG) factors into its investment processes for a wide range of asset classes, both public and private. What’s more this ESG integration applies across core portfolios, not just specialist ESG, SRI or impact mandates.

Impact reporting

This existing focus on ESG has led to another advantage. Some of Aberdeen Standard Investments’ clients already ask for their regular portfolio reports to incorporate analysis into the ESG impact of their investments. As such, the firm’s methodology for impact reporting was well advanced.

For the Global Sustainability Trust, it’s vital that we can measure and report on each investment’s environmental and/or social impact as well as its financial performance – the so-called ‘double bottom line’. Lots more work is still needed to determine how impact reporting can be delivered for a multi-asset private market portfolio. But Aberdeen Standard Investments seems to be ahead of many of its peers in seeing how it can be done.

*As at 30 June 2018.

Opening up There were other reasons for choosing Aberdeen Standard Investments: its long experience of managing investment trusts; its disciplined process for evaluating and investing in private market investments.

Also notable was the firm-wide support for an investment proposition that has the potential to transform sustainable investment by enabling ordinary investors to put their money into the private market projects, funds and companies where it can make the biggest difference.

If you are going to open up private market-based sustainable investing to more people, you need a big partner to help you do it. By choosing to work with a global and highly-resourced asset manager like Aberdeen Standard Investments, we hope that process is ready to take a big step forward.

Important Information

Risk factors you should consider prior to investing:

  • The value of investments and the income from them can fall and investors may get back less than the amount invested.
  • Past performance is not a guide to future results.
  • The Company’s investment portfolio may not achieve the desired positive measurable environmental and/or social impact.
  • The Company’s investments are inherently illiquid.
  • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years.
  • There is no guarantee that the market price of the Company’s shares will fully reflect their underlying Net Asset Value.
  • An investment in the Company is only suitable for investors who are capable of evaluating the merits and risks of such an investment

 and who have sufficient resources to bear any loss which might result from such an investment.

  • The success of the Company will depend, amongst other things, on the Investment Manager’s ability to identify, acquire and realise investments in accordance with the Company’s investment objective and policy. This, in turn, will depend on the ability of the Investment Manager to apply its investment processes in a way which is capable of identifying suitable investments for the Company to invest in. There can be no assurance that the Investment Manager will be able to do so or that the Company will be able to invest its assets on attractive terms or generate any investment returns for Shareholders or avoid investment losses.

The Company is an alternative investment fund for the purposes of the AIFM Directive and has appointed Aberdeen Fund Managers Limited as its alternative investment fund manager.

Domicile and legal form: The Company - The Global Sustainability Trust plc was incorporated and registered in Scotland on 17 April 2018 as a public company limited by shares under the Companies Act with registered number SC594582.

Typical investor

The Directors believe that the typical investors for whom an investment in the Company is appropriate are private investors and institutional investors investing for capital growth and seeking exposure to a diversified global portfolio, primarily consisting of Private Market Investments, which

aims to create positive measurable environmental and social impact. An investment in the Company is only suitable for persons capable of evaluating the risks and merits of such an investment and who have sufficient resources to bear any loss which may result from the investment. Potential investors should consider with care whether an investment in the Company is suitable for them in the light of their personal circumstances and the financial resources available to them.

Investors may wish to consult an independent financial adviser who specialises in advising on the acquisition of shares and other securities before making an investment.

The AIFM and Investment Manager

Under the terms of the Management Agreement, the Company has appointed Aberdeen Fund Managers Limited as the Company’s alternative investment fund manager for the purposes of the AIFM Directive. The AIFM has delegated portfolio management to Standard Life Investments Limited as Investment Manager.

Other important information:

Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1XL. Registered in Scotland No. 108419.

An investment company should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments.

Aberdeen Standard Investments is a brand of the investment businesses of Aberdeen Asset Management and Standard Life Investments.

We recommend that you seek financial advice prior to making an investment decision.

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Issue Date: 06 Dec 2018