Our commitment

At Lombard Odier, we believe that sustainability is set to generate future returns. Our clients asked us to consider and deliver social and environmental benefits, not just financial profit. That’s why we have made a commitment to sustainable investing. Our commitment also reflects the growing regulations aspire to implement COP 21¹ objectives, particularly in Europe. As a result, we have decided to factor in sustainable development into all of our products over the next two years.

A global approach

How do we define sustainability? There is no widely recognised global or even regional classification system. Some banks talk about environmental, social and governance (ESG) factors, others call it responsible investment, socially responsible investment (SRI) or impact investing. At Lombard Odier, sustainable investment means investing in stable and efficient companies that respect their partner ecosystem– regulators, shareholders, employees, clients, suppliers, resources and the environment. What’s more, they are able to weather changes in the global economy. These companies have the capacity to help create a more sustainable social model. Our selection process is built around our three-pillar approach: companies are required to have a combination of 1) a sustainable financial model, 2) sustainable business practices and 3) a sustainable business model suitable for generating strong long-term returns.

Proven credentials spanning more than two decades

The Lombard Odier Group is clearly a leader in sustainable investment, as demonstrated by our history, our tools, our technology platform and the commitment of our partners. We first developed sustainable ESG analytical models in 1997. In the early 2000s, we championed the development of impact investing in conjunction with Blue Orchard, before going on to develop our own impact fund. We became a signatory to the United Nations Principles for Responsible Investment (UN PRI) in 2007. After developing in-house tools to calculate ESG scores, we went further, evaluating how serious companies are about their processes and commitments using the CAR method, which rates awareness, action and results. We have also established partnerships with recognised sustainability advocates such as Generation and AIM (Affirmative Investment Management) in order to create thematic and impact funds. More recently, we qualified for B Corp certification and made another significant commitment by signing up to the UN Global Compact.

After developing in-house tools to calculate ESG scores, we went further, evaluating how serious companies are about their processes and commitments using the CAR method, which rates awareness, action and results.

Long-term growth for our clients

We believe that sustainability factors will boost investment returns. This makes complete sense to us. Any company that considers the long-term consequences of its actions is more likely to see revenue growth and stand the test of time. The Smith School of Enterprise and the Environment at the University of Oxford has proven just that. In a literature review of over 40 research papers, it found that sound sustainable practices improved share prices in 80% of cases.

Our Managing Partners published a manifesto in autumn 2018 in which they reiterated their commitment to sustainable investment. Our asset management unit, LOIM, has fully integrated the sustainability process across all funds, as has our private bank. As a result, we are able to offer our private clients bespoke sustainable investment solutions and to create portfolios that reflect their personal values.

¹ COP 21 refers to the international climate change agreement signed by 195 countries at the United Nations Climate Change Conference in 2015.