Positive impact investment: any experience with inyova or BAS?

Hi,

I’m quite a beginner in the investment world and would be interested in placing my money. I however do not want to place my money in a major bank and want to make only sustainable, conscious, positive impace investments, even though it’s less money-making and more risky (less diversified).

I discovered inyova and see that BAS, where I have my bank account, propose a “ABS Living Values – Balanced Fund” any experience with these? What would you advise? Any other sustainable/conscious fund to recommend knowing that greenwashed ETFs like UBS and Credit Suisse’s are not an option to me?

Many thanks!

Almost all ESG ETFs are, more or less, greenwashed. The criteria for each ETF are different, but if you go for larger ETFs (total invested money AUM, more than 500 stocks), most probably you’ll have some companies in the ETF which you personally would not pick.

Some ESG ETFs still have tobacco companies in it, some are ok with nuclear stuff. It really depends.

I understand that you want to invest in sustainable assets, but you really need to check each ETF for yourself. ESG ETFs might also underperform traditional large ETFs.

On another note: where do you put companies like Roche, Novartis and Nestle (to stay with CH companies)? Are those sustainable and conscious for you? Some people might say yes, others wouldn’t buy it all.

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Thanks for the answer and the tips! I saw that Inyova allows you to choose specificially in which companies you wanted your money invested which is what seemed appealing to me.

I’m indeed among those who wouldn’t buy Roche, Novartis, Nestle & co :slight_smile:

I do understand it from a personal point of view. I’m also not a fan of those companies.

The problem is: how much do you want to underperform with your investments? If Inoya allows you to specify the companies, you are doing some sort of stock picking. Which will be good for you, because those companies allign with your values, but it doesn’t mean it’s a good investment.

I would have to check again where I read it, but more than one blogger said that it might be better to just invest to the whole market and let the market seed out the bad companies.

Some more links for you (didn’t read the articles, just a quick Google search): The World May Be Better Off Without ESG Investing, FT - The ESG investing industry is dangerous and ESG Is Not ‘Ethical Investing.’ And That’s OK.

One more comment: a lot of big ETF providers are using the ESG hype to earn more money. ESG ETFs are usually more expensive than traditional ETFs.

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I have no experience with both, but I quickly checked.

Both are pretty expensive, from my point of view. Inoya charges you 1.2% per year up to 50k, 1% per year up to 150k, 0.8% per year up to 500k and 0.6% per year up to 5M. That’s a LOT more than what you pay for a traditional world ETF. Inoya will be fine, because they get their fees every year, regardless if your assets perform well or not.

For the “ABS Living Values – Balanced Fund” - only 70M AUM and 1.48% TER. That’s a pretty high TER. Also, United Health and Fresenius as 2 of their top 10 holdings (could only see the top 10).

So, both are expensive and will most probably underperform traditional ETFs. I’m sure there are better ways to invest sustainable/conscious.

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Since this thread is about ESG, I assume you wouldn’t buy / are not fans of these 3 companies due to ESG reasons. correct?
Speaking against Nestle would be due to breastfeeding/baby-formula scandal and their water business.

But why Roche (& Novartis)? It rates near the top re ESG & sustainability criteria for pharma companies.
Is this about being against Big Pharma or Pharma out of principle?

Just because I’m not a fan of their business practices doesn’t mean I wouldn’t buy those companies.

I guess if you take a really objective point of view, then almost all big companies / enterprises have their issues. Some more, some less. Almost none of those companies got so big by being environmentally friendly or conscious.

I guess I would have to check the ESG & sustainability criteria which is used for pharma. In general, I’m not a big fan of pharma. I know we have some people here in the forum who work for those companies, and that’s ok. My personal opinion is that most pharma companies care more about keeping people sick than actually really caring about a better world. What would all those companies do if, miraculously, all beings on this planet were healthy?

I’d have to check where I read it (could be here in this forum, somewhere else, or by checking the balance sheets of Roche/Novartis), but the average revenue per person at Roche is roughly 400k per year. I know that developing new medicines costs a lot of money, but don’t let us fool ourselves: the development is mainly done from a business point of view. Once the medicine development is finished, it’s a cash cow. Which we are all paying (even if we are healthy) by constantly increasing prices for health care.

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I would like to believe a science-based pharma would bring the best product for the patient life that science allows, not for the best product profit over the product lifetime.
Pharma can certainly be accused of prioritising high-profit diseases over low-profit though.
And of course pharma sales & marketing do their bit to optimise profits, but I can’t imagine a pharma R&D adapting a healing product to a lesser functioning product, or “hiding” a healing product to maintain sales of a lesser product (lesser as in doesn’t heal, but needs to be taken long-term).

Revenue at Riche errm i mean Roche seems to 700k p.a. per employee. But at Google it’s 2M, so they are lagging.
It’s capitalism, and pharma isn’t a NPO as much as any hospital in CH isn’t. Pharma is capital-intensive and the cash-cow part is limited to patent-life (max. 20y).

I just don’t understand what company is really going to be “holy” re ESG, except for the local Bio-Vegetable Farm, who notabene sells the vegetables at no profit.

And I understand it’s all relative and in the end a way to promote the companies making an effort relative to others, and in this case, I would probably put Swiss Pharma companies in the good/better pot.

Thanks for the link. The article is from 2010, and referring to 700k USD. Maybe 400k CHF per employee today would still be right. As I said: I don’t remember where I read it. Still, it’s A LOT of money per employee.

That’s what I said earlier: if the company is huge, it didn’t get to the top by following ESG rules very closely. On the other hand: where’s the fine line between making profit and do a conscous business. We all have to earn money to be able to have a home and eat.

No worries, that’s fine with me. It wasn’t my intention to say that Swiss Pharma is bad or evil. I have my opinion on it, and I’m sure that a lot of people working at those companies have very good intentions and want to help humanity. Which is nice for the shareholders, because that’s what earns them money :slightly_smiling_face:

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Actually there is some example. Some medecine has not been opened for a treatment because it was much cheaper to produce than an existing, more expensive treatment (from the same company of course). Trying to find the source again, but kind of difficult to google…

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For those interested I just found this:

Apparently it will also be broadcast on RTS 1 on Thursday March 10th (on Temps présent). Hope it brings some interesting insights.

The ABS Living Values fund and the one develloped by ethos fund (which i think is now integrated in BCV) are more interesting than traditionnal ESG rated fund if you want to have an impact with your investment : they use their voting right (when they weight enough in the vote) to implement changes in agreement with their respective ethic charts. You can consult what they voted during the previous board meetings.

I think they mainly votes in swiss boards, because of their small AUM, but this is a very interesting approach, especially since they do that transparently (instead of blacrock and vanguard voting without concerns about anything else than their own interests…).

This explain the high TER, which is something inevitable if the management is active and if you choose to favor some impact over max ROI.

Otherwise, you can buy ABS bank shares, which are used in social projects. You can look up what they do with the money on ABS website.

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If you want to invest in the eurozone, there are several website where you can p2p bond invest in developement project. lendosphere.com is interesting, as it involves renewable energy

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