• Men restoring a boat

    Sustainable investment pays off for the long term

Sustainable asset management

Sustainable investments are on the rise. Our bank has been involved in this special segment of environmental, social, and governance (ESG) investments for years.

Sustainable investment has become increasingly important in recent years. In Germany, Austria, and Switzerland, for instance, this investment segment recorded annual growth of 30% between 2005 and 2016, reaching about 420 billion Euros in volume.

The LLB Österreich investment office has engaged in environmental, social, and governance (ESG) investing since 2010. As part of our sustainable investment process, we can offer the following ESG methods: exclusion criteria, best-in-class approach, and portfolios with an optimised carbon footprint. Depending on individual needs, investors can select or combine a suitable ESG method and implement it in their own investment process.

Exclusion criteria: Here, controversial services and products are defined that companies, sectors, or countries may not engage in if they want to remain in the ESG investment universe. Criteria may be defined according to international standards (OECD, UN, ILO) or the investor's own canon of values. Within this framework, controversial services, manufacturing processes, or products can be indexed and excluded. These include animal experiments and industrial agriculture, for example. Arms production and trading, the nuclear industry, or the extraction of fossil fuels and raw materials as well as child labour, production conditions, and ecological product qualities are also generally among the exclusion criteria.

Portfolios with optimised carbon footprint: A sustainable investment strategy can also be implemented and expanded by taking the carbon footprint into account. The sum of the total CO2 emissions of the individual securities in a portfolio is regularly monitored. Depending on investors' wishes, this total carbon balance can be kept below a threshold value by restructuring the portfolio.

A sustainable investment strategy offers additional advantages alongside ethical and moral aspects: the inclusion of non-financial criteria results in a more comprehensive company analysis. As a rule, this provides an even more holistic picture of individual companies. Company-specific opportunities and risks are also evaluated and examined, which often cannot be determined on the basis of fundamental data. This makes it possible, for example, to identify potential reputational risks or competitive advantages. Furthermore, the occurrence of a sustainability risk can have a negative impact on the value of an investment and thus also on the return of the financial products.

In addition, an investment in individually tailored sustainability concepts can also pay off even more clearly in the long term. Companies with a good (already existing) balance between ecological and economic corporate governance are often more future-oriented and sustainable. This is why they often achieve very positive marks when it comes to customer acceptance and loyalty. These companies should therefore also be able to achieve better long-term performance, from which you as an investor can benefit in a targeted way.

Please note: This information is a marketing notification that has been prepared by Liechtensteinische Landesbank (Österreich) AG and all of its subsidiaries (LLB Invest KAG, LLB Immo KAG, LLB Realitäten KAG and Private Equity GmbH) exclusively for general information purposes. Publication, reproduction or disclosure of this information without approval from Liechtensteinische Landesbank (Österreich) AG and its subsidiaries is prohibited. It was not prepared in compliance with the legal provisions on promoting the independence of financial analyses and is not subject to the trading ban following the distribution of financial analyses. This document constitutes no financial analyses, no investment recommendation and no investment advice. It contains neither an offer to conclude a contract on an investment service or ancillary service nor a request to make an offer to conclude a contract on an investment service or ancillary service or to carry out other transactions. To the extent that this notification refers to products for which a prospectus must be published as prescribed by capital market law regulations, this information in no way replaces the prospectus, which is published by the relevant issuer. 

Every capital investment involves a risk. In some circumstances it may lead to a total loss of the capital employed. Performance in the past does not promise future returns. As not every transaction is suitable for every investor, investors should consult their own advisors for financial, legal, tax or other questions (including, but not limited to legal or tax counsel).