Resolution Investors' latest strategy promises to outperform by backing leaders in decarbonisation
A new global equity fund is aiming to outperform the MSCI World Index by 2 to 3 percentage points, net of fees, by investing exclusively in companies leading the transition to a low-carbon economy, according to a statement from Resolution Investors LLP.
The firm, founded by former Generation Investment Management executives, has launched its flagship Core Global Equity strategy with US$25m in startup capital and expects to reach US$200m within the first year, as reported by Bloomberg.
Resolution’s strategy is designed to bridge the gap between quality and climate alignment, uniting disciplined fundamental analysis with strict climate criteria to deliver superior risk-adjusted returns.
The fund will hold a concentrated portfolio of about 30 publicly traded companies, including Taiwan Semiconductor Manufacturing Co., Microsoft Corp., Alphabet Inc., and Aon Plc, with a focus on those driving decarbonisation or enabling others to cut emissions or adapt to climate change, as outlined in the firm’s press release.
The Core Global Equity strategy is registered as an Article 9 product under the European Union’s Sustainable Finance Disclosure Regulation (SFDR), the strictest green investment category, and will offer daily liquidity.
Resolution also intends to launch a US onshore vehicle within a year, according to the firm.
Portfolio Manager David Lowish, a former partner at Generation, described the climate transition as “a major event,” noting that change often happens faster than expected and warning that investors who fail to adapt may face “very big losses,” as stated in an interview with Bloomberg.
Lowish also noted that climate investing has evolved, with earlier strategies focused on green small-caps struggling as interest rates rose, and more recent moves into large-cap climate leaders falling short.
He refers to the current approach as “climate investing 3.0,” where allocators are “demanding and discerning” about portfolio content.
Andrew Mobbs, co-portfolio manager, explained that institutional investors have historically faced a choice between large-cap transition leaders lacking rigorous sustainability analysis and small-cap solution providers with limited attention to company quality or diversification.
Resolution’s approach, he said, is designed to deliver durable alpha by combining quality and climate alignment.
Akhil Monappa, another co-portfolio manager, emphasized that the strategy applies a “quality lens and a strict risk discipline,” investing only in companies that are strong businesses today and are preparing for a low-carbon future.
Rob Brown, director of Climate Research, added that climate is a “mandatory attribute” for investment eligibility, with the firm investing only in companies with verifiable and substantial dedication to carbon reduction or whose products and services directly address climate challenges.
The launch comes amid rising demand for green stocks, with the S&P Global Clean Energy Transition Index up nearly 40 percent since the end of December, compared to a roughly 15 percent gain in the S&P 500 Index, as reported by Bloomberg.
Resolution has also entered a strategic partnership with Harrington Cooper, a boutique asset-raising firm and minority equity partner, which operates an Irish management company and UCITS fund platform.
Resolution’s founding team includes experienced portfolio managers and analysts with backgrounds at Generation Investment Management and Atlas Impact Partners.
The team’s collective expertise in public equities and climate investing underpins the firm’s conviction that decarbonisation will reshape industries and markets, creating significant opportunities for structural alpha.
