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Investing in methods to combat climate change and acquiring financial benefits.

Addressing climate change stands as a significant hurdle in our current era. Sven Stoll, our featured writer, also dives into this issue within the realm of the so-called climate industry.

Aiding in climate preservation while earning profits.
Aiding in climate preservation while earning profits.

Investing in methods to combat climate change and acquiring financial benefits.

In the realm of sustainable investing, two funds have caught the eye of environmentally-conscious investors: LBBW Global Warming R and Ökoworld Klima C.

The LBBW Global Warming R fund, managed by Christian Keidel, invests in large players such as Danaher, Microsoft, ASML, Nvidia, Thermo Fisher Scientific, and others. With a fund volume of €130 million in 2019, the fund's focus spans across technology, chemistry, health, financial services, and renewable energy sectors. The individual stocks are selected using a multi-stage process involving fundamental analysis and a sustainability rating agency (ISS). Exclusion criteria such as child labor and violations of human and labor rights are mandatory for investments in the LBBW Global Warming R fund.

This year, the fund has achieved a gain of 22 percent, although it has been less volatile compared to the performance period, falling short of the 346 percent gain over ten years achieved by Ökoworld Klima C. The Ökoworld Klima C fund, on the other hand, primarily invests in companies making a tangible contribution to the climate turnaround. The portfolio is dominated by medium-sized and smaller values, with the largest position being the American auto parts retailer LKQ.

One of the top positions in Ökoworld Klima C is the French pharmaceutical and laboratory supplier Sartorius Stedim Biotech. This company offers solutions for producing medicines safely, quickly, and economically. Another notable investment is Waste Management Inc., which, with a market capitalization typically around tens of billions of euros, is a large-cap company.

The positive side effects of the Covid-19 pandemic have shown that if humanity can change its lifestyle in the long term, global warming may be stopped. NASA satellite images show that the virus-fighting measures have led to significant air improvement in China, and nitrogen values in northern Italy were significantly lower than last year due to the pandemic.

However, researchers predict further temperature increases, more droughts, natural disasters, and increased unpredictability of the climate due to the greenhouse effect. Glaciers in the Arctic are disappearing, sea levels are rising, oceans are warming, and more water is evaporating. The global population of freshwater animals has decreased by almost 90 percent since 1970, and the number of flying insects in Germany has halved in the past 30 years.

The individual stocks in the LBBW Global Warming R fund are identified and selected with a focus on companies that combat climate change. This growing trend towards sustainable investment solutions is evident in the LBBW Global Warming R fund being a product of the Baden-Württemberg state bank.

As the world continues to grapple with climate change, sustainable investments like LBBW Global Warming R and Ökoworld Klima C offer a promising avenue for individuals and institutions to contribute to the fight against global warming while also seeking financial returns.

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