Creating a structured biodiversity note
Distributed by JP Morgan
Case Study
Impact Cubed created a bespoke portfolio designed to align with key biodiversity drivers as defined by the IPBES.
Background:
A leading wealth manager wanted to align more closely with its clients' values on environment and nature.
Solution:
We used SmartESG to create a risk-optimised portfolio that
positively aligns with key IPBES biodiversity drivers.
Biodiversity pillars:
The Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) – considered to be the most comprehensive global biodiversity assessment to date – found direct drivers that accounted for more than 90% of nature loss in the past 50 years:
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Land & sea use change
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Natural resource exploitation
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Climate change
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Pollution
Outcome:
The resulting structured note has some notable impact outcomes:
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91% environmentally good revenue vs 12% in ACWI benchmark
-
15 SDGs more positively aligned to than ACWI benchmark
Backcast parameters:
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Monthly returns
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Price returns
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Local currency
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3-year period
Annualised volatility:
Biodiversity note - 16.5%
ACWI - 16.9%
