Prioritising sustainable investment gives purpose to family wealth – Mona Shah
Strong social and environmental focus essential to building good businesses – Steve Klinsky
Invest offshore for the right reasons and don’t be surprised if emerging markets outperform in the medium term
The Key Role of Advisers in Succession Planning
Two minutes with Mat Powley, Director, Private Capital InvestmentPublished on 30 Jan 2020
Private equity: well placed to take advantage of the opportunities that arise from market dislocations
Private equity appeals to a broad range of investors. From entrepreneurs who have a natural connection with family owned, founder led businesses to the younger generation of investors who are interested in an exciting, fast growth asset class. It resonates well with multi-generational families seeking exclusive access to attractive private businesses.
Preservation of wealth is number one for our clients. Its creation is a close second. As part of a broader investment portfolio, private equity can provide both. Protection of capital is layered into our investment principles across all strategies and, for those who have the ability and willingness to accept illiquidity, private equity is an important component of a diversified portfolio.
Private equity continues to outperform over public market investing. We are ten years into a bull market, meaning prices are high. A lot of capital has been raised and competition is elevated. While not immune to this, we believe private equity should continue to perform favourably. Given the nature of the asset class, it is well placed to take advantage of the opportunities that arise from market dislocations. We operate in a tough environment but the opportunity is there, for those willing to do the work.
The younger generation shows a clear preference for sustainable investments. It is an area of great interest to our clients. In the private equity space, it should be approached with caution. Five years ago managers in the US would openly admit to not having any ESG or SRI policies in place. This has changed, but investors should be wary of ‘greenwashing’. Identifying opportunities which demonstrate both measurable impact and meaningful returns, requires a lot of research. We have a growing number of very interesting impact opportunities in our portfolio pipeline from financial inclusion to healthcare and we continue to explore this space.
We are sector agnostic. One of our top fund managers is a highly experienced, leading software investor who knows the technology space inside and out. But we also invest with generalist managers - experts in sourcing and transacting attractive deals whatever the industry. Sector specialists can be hit disproportionately depending on the economic cycle. That’s where generalists play an important role.
Mat is a Director within the Private Capital Investment team. He is responsible for selecting private capital fund investments and managing existing manager relationships. He joined the Group in 2009 having previously worked for BNP Paribas in London and State Street Trust Company in Toronto.
Watch Mat Powley talk about private capital investments
The opinions or views expressed are for information purposes only and are subject to change without notice. This information is not intended as promotional material, an offer to sell or a solicitation to buy investments or services. We do not intend for this information to constitute advice, or a personal recommendation, and it should not be relied on as such to enter into a transaction or for any investment decision. Whilst every effort is made to ensure that the information provided is accurate and up to date, some of the information may be rendered inaccurate in the future due to any changes. All investments risk the loss of capital. The value of investments may go down as well as up and you may not receive back the full value of your initial investment. Past performance should not be used as a guide to future performance. Unquoted investments may be difficult to realise at a reasonable price should there not be an active market in the equity of those investments and, in some circumstances, they may be difficult to realise at any price. © Copyright Stonehage Fleming Investment Management Ltd 2020. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, on any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without prior written permission.