While you’re reading, keep in mind that this article is not financial advice or a recommendation to invest. You should only invest if it’s right for your situation. Also remember that all investments go up and down in value over time, so you may not get back what you put in.
What’s the idea behind a fund specifically targeted at enhancing the wellbeing of children?
The idea actually came from UNICEF – they approached us with the suggestion of a fund focused on child wellbeing.
The theme of child safety and wellbeing really resonates with people – and with Triodos especially. It feels like a logical extension of our mission to help create a society that promotes the quality of life of all its members. You can join us for ‘Let’s talk impact’ in April where we will explore this topic further.
Register here to join us on 25 April 2024
So the question wasn’t whether we should have a fund which invests in child wellbeing, but whether we could build a fund which does this. Once we realised that it was possible, we saw that it produced a very different investment portfolio.
Compared to our existing funds (which we call our impact investments) which focus a lot on the environment, this focuses much more on society. As a result, there’s more exposure to other sectors such as, education, health, and food. If you hold other Triodos impact investments already, this new fund can fit in with minimal overlap.
How did you approach the investment strategy of the Future Generations Fund?
As we were working with UNICEF, we took inspiration from them. UNICEF’s strategic plan establishes five goal areas related to children’s rights and well-being. These say that every child, including adolescents, should be able to access:
- Affordable healthy food and healthcare
- Quality education
- Equal opportunity and inclusion
- A clean and safe environment
- Protection from violence and exploitation
Some of these themes are very easy to translate into investment opportunities. For example, organisations related to food and healthcare that benefit children. But there are lots of investment angles and solutions.
For example, a clean and safe environment for children can be supported by organisations that help provide clean water, sanitation and affordable housing. Equal opportunity can be supported by telecoms services that allow children and adolescents to access the internet and education.
How do you decide which investments make it into the Future Generations Fund?
In some cases, the positive impact for children is obvious. A great example is OrthoPediatrics: the world’s first company to produce orthopaedic devices (for bones, muscles and joints) specifically for children.
But in other cases, especially those that are environmentally focused, there’s an argument that the organisation could fit into one of our other funds. Especially the Pioneer Impact fund because, like the Future Generations Fund, it also invests in small-to-medium-sized companies.
We try to avoid having too much overlap between our different funds, so we take a pragmatic approach. In deciding which investments belong in the Future Generations Fund, we try to think about where the investment is crucial for children – and where children stand to lose the most.
For example, telecoms companies are vital for connection and education, but they might not have a major impact on children in European countries as it’s readily available. But in Latin American and African countries they could make a real difference. The fund currently invests a company doing exactly this: Millicom.
See what the Future Generations Fund Invests in
How are you engaging with companies to get child welfare on the agenda?
Child welfare is still a very new topic for companies to consider when thinking about environmental, social and governance (ESG) issues. Many organisations will say that they’ve never been asked about it before and don’t know what to do. It can be a tricky path to forge, but I’ve seen a lot of ESG issues start this way and then gain momentum.
For example, carbon emissions weren’t something that companies thought about until a few investors started asking the question. Over time, more and more investors started asking about it, and now it’s very much on the corporate agenda. We’re hoping that the same will happen with child welfare – and the Future Generations Fund represents an opportunity for investors to amplify this movement.
We’re still learning how to get companies to understand and engage with child welfare. To encourage intergenerational perspectives, we try to get them to see the world through children’s eyes. Many people on company boards have children or grandchildren, and getting them to see things through their perspective makes it more tangible.
When I think about what kind of world I want my two girls to grow up in, I think of a liveable and more equal planet.
Can you think of any organisations within the Future Generations Fund that really stand out?
Whenever I’m asked that question, I say that it’s like being asked to choose between my 34 children as they’re all important to me!
One that stands out is SOBI (Swedish Orphan Biovitrum AB). When I think about this company, I get goosebumps. They’re a biopharmaceutical company that aims to transforms the lives of people with rare and debilitating diseases. They’ve developed a vaccine to help protect against RSV (Respiratory syncytial virus), a virus that affects a lot of young people.
Unfortunately, my daughter caught the virus and was nearly hospitalised. When you have an 18-month-old with a disease like that, it’s the scariest thing in the world. So to have a company in portfolio that can help prevent these events, gives me a good feeling.But it’s not just the emotional side of things. The vaccine itself is doing really well and SOBI has been performing strongly since we have added it to the portfolio.
What’s your message to potential investors?
The first thing is that this fund is a great way to invest your money in a differentiated, but still well diversified portfolio. You’re unlikely to find another fund that mirrors ours, so you’re investing in new areas and impact.
Second, I’d reiterate that we all need to start trying to see the world through the perspective of the children and young people on this planet. The importance of child wellbeing isn’t limited to today, but for their future which we’re not there for. We need to make decisions that help them to thrive – and the Future Generations Fund fits well into that.
Neither UNICEF, nor its partner in Luxembourg, Comité luxembourgeois pour l’UNICEF, is acting as an investment adviser and neither of them has had or will have any role in the design, structuring, development, management or operation of the Triodos Future Generations Fund. UNICEF, and the Comité luxembourgeois pour l’UNICEF, have not been and will not be involved in the management of the Triodos Future Generations Fund, including its investments decisions. Neither UNICEF nor the Comité luxembourgeois pour l’UNICEF has endorsed Triodos IM, Triodos SICAV I, the Triodos Future Generations Fund or any investment by the Fund. UNICEF and the Comité luxembourgeois pour l’UNICEF make no recommendation as to investment in the Triodos Future Generations Fund. The sole role of UNICEF, and the Comité luxembourgeois pour l’UNICEF, is to receive the donation from Triodos IM and apply such donation to UNICEF’s programmes for children. UNICEF and the Comité luxembourgeois pour l’UNICEF will have no liability to the Triodos Future Generations Fund or investors in the Fund in relation to investments in the Fund, the performance of the Fund or otherwise in connection with the Fund. UNICEF is immune under international law from every form of legal process.
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