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10 years ago
“We have reached a defining moment in human history… We are the first generation that can end poverty, the last that can take steps to avoid the worst impacts of climate change”
Ban Ki-moon
Ban Ki-moon, then United Nations (UN) secretary general, spoke these powerful words a decade ago as he launched the UN’s Sustainable Development Goals. That same year, the famous Paris Agreement became a landmark international accord on climate change.
Secretary Ban continued by saying that all parts of society needed to work together to achieve these ambitious goals. We agreed. We also foresaw a massive opportunity for investors.
In 2015, we began work on Positive Change, launching it in 2017. At that time, we were pioneering in seeking exceptional growth companies that could deliver both prosperity for our investors and a broader contribution to people and the planet. We’ve spent the better part of a decade on this mission. Our core philosophy has remained unchanged: exceptional returns and a positive impact.
Pioneering is not easy. Much has shifted around us. In this paper, we explore why, ten years from the UN’s agenda-setting speech, and eight years since we launched Positive Change, we remain as committed as ever to our mission, and as confident as ever in our ability to deliver great returns over the next decade. Even if the backdrop looks quite different, our ability to find exceptional companies should conquer all.
But first, let’s step back and look at what has been an extraordinary period for impact investors.
Then…
Back in 2015, capital was cheap and abundant, enabling a new wave of innovative businesses and business models to challenge the status quo and grow rapidly. Barack Obama was still the US president; the UK had not left the European Union and western societies continued to tread the same broadly centrist political path that had guided post-war progress. Apple was the world’s most valuable company, and speculation was rife as to whether any name could reach the heady heights of a trillion dollars. Generative AI, as we know it today, was a mere glint in the eye of a few developers.
At that time, the challenges seemed great and there was clearly a degree of scepticism that doing good and doing well could go hand in hand. But there was also an air of optimism and a sense of progress.
Our opportunity set expanded as new companies, providing solutions, came to market: roughly 400 new biotechs were listed in the US between 2015 and the start of the pandemic. Clients were willing to commit assets to this bold new form of investment, with net-investor flows into ESG-focused ‘sustainable’ products growing 27 per cent per annum on average from 2015 to 2021.
And now
“Drill baby Drill”
Donald Trump
Donald Trump’s words during his 2024 presidential campaign have been echoing down both Wall Street and Main Street. They are, some say, the death knell of impact or sustainable investment.
And President Trump has translated his words into action. His ‘Unleashing American Energy’ executive order and ‘One Big Beautiful Bill’ have removed some funding for clean energy development, boosted fossil fuels and changed the playing field for many healthcare companies.
The implementation of these policies has so far been less severe than some had feared. However, the changing backdrop for impactful companies in the world’s largest market has been marked and the ripple effects are being felt across the global investment industry.
All of this is a trifle compared to April 2025’s ‘Liberation Day’ tariffs. These signalled an apparent step change in protectionism, and perhaps started to change the global economic order as we’ve understood it since the landmark 1944 Bretton Woods agreement.
Beyond America, barely a week goes by without the escalation of adverse developments that seem to have followed the end of the pandemic, the Russian invasion of Ukraine and now the tragic Middle East conflict.
We face a more fragile and fragmented world. Inflation and the post-Covid hangover have raised the cost of capital and strained government budgets, so investments in costly areas such as renewable energy infrastructure, tax breaks or subsidies have taken a back seat. People feel poorer, and Paris Agreement pledges (nationally determined contributions or NDCs) have been challenging to fund.
So what? Greed is good, and sin is back?
The flurry of activity during 2025 follows an already turbulent time for those investing in a sustainable future in every sense of the word. Once riding high, these headwinds have affected impact and sustainable funds – in aggregate, they have not outperformed the global stock market over three-year and five-year periods, ours included.
This environment has, understandably, given rise to increasing scepticism. Those who could not see beyond oil and gas, tobacco and defence to generate returns have had a shot in the arm of late. Meanwhile, clean energy, biotech and pharma have been out of favour: the S&P Global Clean Energy Transition Index is essentially flat on a five-year view, and the MSCI World Healthcare Index has returned less than half of the broad global index.
For those familiar with the Gartner Hype Cycle, it’s perhaps a good rubric to help us take stock of where we’ve been over the past few years. As expectations for impactful companies have come down sharply off the peak of inflated expectations (in some cases), there has been a natural sorting of the wheat from the chaff, and we think a higher-quality, more sustainable range of investment opportunities awaits.
Gartner hype cycle
But fundamentally, these trends are transient, not structural. The core facet of our philosophy remains unchallenged: investing in growth companies delivers the best returns over time.
Companies delivering double digit earnings growth over long periods have consistently outperformed. Finding these is our focus.
Rolling ten-year periods (1989–2024)
As always, stepping back and looking at the longer term provides better perspectives on the trends and transformations that will truly reward investors with a long enough time horizon.
Ethics and economics
Last year, we wrote in Positive Change in a New Paradigm about our focus on deep transitions and the idea that the world’s largest and most profitable companies reflect the wants and needs of the time. That thinking still holds.
The Deep Transitions project posits that society has seen five surges in technological development since the 1700s. The first of these surges created the first deep transition centred around industrialisation. We are now approaching a second deep transition, which places society on a path towards a more sustainable future.
First and second deep transitions
This will manifest in various ways and present us with a range of opportunities. Let’s explore a few.
Energy
“We will make electricity so cheap, that only the rich will burn candles”
Thomas A. Eddison, Inventor, 1879
While global carbon emissions are rising, there are signs that we’re effectively managing to decouple gross domestic product (GDP) growth from fossil fuels – carbon emissions are now rising more slowly than global growth, thanks to the increase of renewables in the energy mix and new technologies enabling greater energy efficiency.
Together, this powerful combination should unlock lower carbon emissions and radically different economic underpinnings for global growth: powering industry using free and abundant energy is undoubtedly better than digging finite resources out of the earth and burning them.
% of total electricity generated by solar and wind
Hours of work for an hour of bright light
(1000 lumen–h)
To harness these benefits, we need to electrify.
In 1882, Thomas Edison established the world’s first commercially successful electricity grid in Manhattan. It was small (covering only one square mile), but it heralded the start of a revolution that would see more than 11 million kilometres of transmission and distribution lines constructed in the US alone.
That seems remarkable, but it is dwarfed by the challenge ahead: we now require electrical investment on an unprecedented scale. We must build more infrastructure in the next 30 years than in the previous 140 years. We also need to reconfigure grids to handle an entirely different energy generation pattern as renewable energy becomes an increasing part of the energy mix.
This feels daunting, but thanks to innovation, it’s achievable. The challenge provides investment opportunities, but you need to be smart about where you look for them. Passive investing carries particular risks here, as policy shifts and falling renewable costs might benefit society but not always shareholders.
Instead, we’re actively hunting for high-quality opportunities that will benefit from the massive infrastructure spending needed and are not reliant on subsidies to prosper. So, we’ve purchased shares in Prysmian.
This company makes cables about the thickness of your arm, capable of carrying up to 525,000 volts, the kind of power required to link offshore windfarms to national grids. For context, the kettle in your kitchen uses about 230 volts, which helps illustrate the extraordinary scale and precision involved.
And that’s where the competitive advantage lies. Prysmian is the leader in large-scale, high-voltage direct current (HvDC) projects, particularly subsea (undersea) connections, where its reputation, manufacturing scale and technical expertise set it apart. This is an established, profitable company with greater long-term growth potential than the market appreciates – impact and growth come in all shapes and sizes.
Healthcare
“Nothing in life is to be feared, it is only to be understood. Now is the time to understand more, so that we may fear less”
Marie Curie
Our understanding of diseases and ability to find new treatments is advancing at a never-before-seen pace. Yes, healthcare is another area where negative sentiment has prevailed, aside from the isolated excitement for glucagon-like peptide-1 (GLP1) treatments for diabetes and weight loss.
Capital availability whiplash, vaccine misinformation and an announced stance of aggressively reducing drug pricing in the US have left shareholders wary of both big pharma and smaller biotech names. We’ve certainly learned a few lessons here along the way. But we have kept searching and sharpened our lens.
We’re looking for companies with great technologies that provide better treatments than ever before, a strong management team that can execute commercially and resilient financial characteristics. The earlier-stage healthcare names in our portfolio all have at least three years of cash on hand to fund operations, which gives us confidence that they can survive and thrive in a more competitive environment.
Sadly, non-communicable diseases (such as cardiovascular, cancer and diabetes) now dominate the global health burden, surpassing infectious diseases and accounting for roughly 75 per cent of all deaths globally.
Alnylam Pharmaceuticals, a trailblazer in RNA interference (RNAi) therapeutics, a method for silencing disease-causing genes, has already transformed care for patients with rare genetic diseases. Now it’s leveraging its world-leading RNAi platform, ambitiously expanding into prevalent conditions such as Alzheimer’s and hypertension. Off the back of its bold vision and relentless innovation, Alnylam has delivered a remarkable 58 per cent compound annual revenue growth (CAGR) over the past five years.
Recent purchase Procept is growing at 75% 4 year revenue AGR, thanks to its innovative robotic-based technology, which improves treatments for male prostate conditions.
Elsewhere, Insulet and Dexcom are transforming the lives of diabetics, a condition that affects more than 800 million people worldwide. Dexcom’s devices provide real-time insights that reduce the need for finger-prick tests and help prevent complications, while Insulet’s tubeless pumps make insulin delivery easier and more discreet. By addressing such a widespread and pressing healthcare need with transformative technologies, they are not only improving patient outcomes but also represent compelling long-term investments.
So, our relentless search for ideas across this sector has helped us find an array of opportunities.
Financial inclusion
“Increases in economic freedom have gone hand in hand with increases in political and civil freedom and have led to increased prosperity; competitive capitalism and freedom have been inseparable”
Milton Friedman, Capitalism and Freedom, 1962
Friedman was not wrong: economic freedom and access to capital are basic needs. You’d be forgiven for missing the fact that access to finance globally has quietly transformed over the past decade. Between 2011 and 2021, the number of adults without access to finance decreased from 2.5 billion to 1.4 billion.
As a result, over three-quarters of adults worldwide now have a bank account and access to formal financial services. The World Bank notes that mobile phones have been a key enabler of this trend. The elusive aim of reducing poverty through access to finance remains, but the progress already achieved shows what is possible.
Worldwide, 86 percent of adults own mobile phones, though smartphones are less common in some regions than others
Adults with a phone (%), 2024
MercadoLibre, NuBank and Grab in our portfolio are at the forefront of enabling these trends and reaping the rewards for doing so. In fact, companies in the Positive Change portfolio collectively provided access to financial tools for more than 469 million people.
Grab is a great example of the need to search beyond the obvious for truly impactful companies that also make money. It’s Southeast Asia’s largest ride-hailing and food delivery platform. So why is Indonesia’s Uber an impact platform? Grab has expanded into financial services, and its platform creates access to growth opportunities for micro and small enterprises.
To test our impact thesis, we asked independent impact consultancy 60 Decibels to survey users of digital platforms in Grab’s key markets. The results were striking. Responses across the board of 85–95 per cent plus showed that access to mobile financial services improved quality of life, helped people withstand financial shocks and grow their businesses. This proves that digital platforms can deliver both financial inclusion and opportunity at scale.
Foundational innovation
But here’s the rub. All of the above examples are powered or supercharged by technology. Serious technology. Since the inception of Positive Change, we’ve held the shares of ASML and TSMC, whose equipment and fabs make the chips that power the robots, models, phones and servers of every one of those companies. We think their unique roles in the ecosystem mean, undoubtedly, the world would be worse off without them. We’re not afraid to invest where we see real impact, even if it’s less obvious to measure.
More recently, we’ve started to seriously engage in trying to understand artificial intelligence (AI) impacts. We don’t want to be outside of transformations, looking in with a sceptical eye as progress passes us by. The core of our philosophy is about being part of the change and accepting that there is no such thing as a perfect company.
We’re glad to see an increased focus within the impact community on systems change, which aims to better understand how we can create fundamental changes in complex systems with long-lasting effects.
Foundational technology, those fundamental innovations that unlock new possibilities and transform society by serving as a base for future advancements, is undoubtedly part of this.
Therefore, this year we’ve taken a position in Microsoft. Its cloud computing and AI services have the potential to accelerate progress across many industries and support more sustainable and inclusive growth. At the same time, we recognise the challenges of investing in such large technology companies. For us, the case rests on thoughtful impact analysis and a belief in humanity’s ability to harness technology for good.
Conclusion
“It is not easy to be a pioneer – but oh, it is fascinating! I would not trade one moment”
Elizabeth Blackwell, the first female doctor in the US
Thomas Edison, Marie Curie and Elizabeth Blackwell were born in the mid-1800s (Milton Friedman was a bit younger, a mere whippersnapper born in 1912). They saw the age of modernity ushered in with the turn of the 20th century and the transformational changes that ushered in the dominance of capital market behemoths such as Standard Oil (the precursor to Exxon) and AT&T, which were to generate huge change (for good and ill) and a lot of wealth creation over the next century. All were doing something new.
We’re witnessing shifts within our own age, and we know where the world’s next most important companies will come from.
For those of us at the vanguard, managing our clients’ capital and channelling it towards growth enterprises that can help end poverty, avert climate change and make the world healthier remain a huge privilege and an exciting opportunity.
Pioneering is not easy. But the rewards are enormous.
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The views expressed should not be considered as advice or a recommendation to buy, sell or hold a particular investment. They reflect opinion and should not be taken as statements of fact nor should any reliance be placed on them when making investment decisions.
This communication was produced and approved in October 2025 and has not been updated subsequently. It represents views held at the time of writing and may not reflect current thinking.
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