From humble beginnings in socially responsible investing, Parnassus has grown into a boutique leader in the field that continues to evolve. Under the strategic direction of CEO Ben Allen, the roughly USD 50 billion (as of February 2024) firm has undergone considerable changes to modernize its lineup and better align its strategies to specific investment styles. For instance, in late 2022, it launched a large-growth strategy. The firm now manages five US equity funds and one US fixed-income fund, all of which follow environmental, social, and governance (ESG) mandates.
To account for the adjustments and boost investment team capacity, the firm has been thoughtful about building out its team. As senior analysts transitioned into portfolio management roles, Parnassus hired a handful of investment personnel to help fill in coverage responsibilities. It added to support functions including research operations and marketing. Parnassus has also leveraged its relationship with majority owner AMG to incentivize top talent: The firm has offered portfolio managers equity, which should help with retention. The firm has also embraced changes to its restricted list, notably removing the exclusion of nuclear power companies. These are sensible moves for this sustainability-focused firm to stay competitive in the rapidly evolving space.