Investment Selection Process
The assets of our clients are invested in companies that make a positive contribution to a sustainable quality of life while achieving a fair market rate of return. A multistage selection process is followed that leads to Forma Futura's investment universe. From a global pool of more than 10,000 companies, about 250 meet our strict criteria.
1. External Basic Review
Our research partner, Sustainalytics, analyzes and evaluates approximately 10,000 companies worldwide on the basis of around 160 sustainability criteria. Forma Futura selects companies which are within the best 15 percent in an industry in terms of their sustainability performance (best-in-class approach).
2. In-house Financial Analysis
Our team of financial specialists, which is independent of the sustainability research team, performs an independent financial analysis. Only companies that appear to be financially attractive investments enter into the next stage of the selection process.
3. In-house Proprietary Sustainability Analysis
In the next step, Forma Futura’s proprietary approach to sustainability is applied. Our sustainability research team analyzes the candidate companies and selects those companies that make the greatest possible contribution to improving the sustainable quality of life. The approach consists of:
- detailed, qualitative company analysis
- the application of the exclusion criteria
- active and specific contact with the company
- discussion and evaluation of companies in the investment selection panel (sustainability team and top management)
- continuous monitoring and evaluation of any controversial business activities
The entire Forma Futura methodology for analyzing a sustainable quality of life is based not only on numerous sustainability criteria, but also on the extensive, deep and interdisciplinary experience of our team.
Since its foundation in 2006, Forma Futura has applied the "fossil energy" exclusion criterion to all assets under management. Companies involved in exploration, production, refining and/or energy generation are excluded.
The shares of investments in total assets under management in sectors with high climate relevance as of December 31, 2020 are:
Fossil Energy (oil, gas, coal): 0%, Aviation: 0%, Automotive: 2.4%.
Forma Futura Investment Universe
As a result of these rigorous analyses, an investment universe of about 250 companies is created in whom Forma Futura can invest in stocks and bonds. This allows clients to broadly diversify across sectors and regions of the world. For the sake of further diversification, we can also invest in funds qualified by our sustainability analyses.
Individual Client Portfolio
After determining the client's risk capacity and risk tolerance through discussions with our client, the appropriate investment profile and reference currency is defined. Based on this information, an individual portfolio is prepared and managed for each client.
Balthasar BänningerDeputy Head Sustainability Research
«Sustainability, for me, is the key to a future life worth living. Through my job at Forma Futura, I can make my own personal contribution to this objective.»