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Impax Global Environmental Markets Instl PGINX Fund Analysis

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Impax Announces Changes at Its Climate and Leaders Strategies; Ratings Unchanged

null Ronald van Genderen

Ronald van Genderen

Analyst Note

Impax has announced several changes that affect the portfolio management teams for its Climate and Leaders strategies. Impax Climate strategy: Bruce Jenkyn-Jones Chief Investment Officer, Listed Investments Bruce Jenkyn-Jones will be stepping down as co-portfolio manager of the Climate strategy, effective July 1, 2024. He will be succeeded by Sanjeev Lakhani, who will join Jon Forster and Fotis Chatzimichalakis as a comanager. In recent years, Jenkyn-Jones had been focusing more on his leadership role and had been stepping back from portfolio management responsibilities. For example, in October 2021, he relinquished his responsibilities on the Leaders, Water and Asian Environmental Markets strategies. Lakhani joined Impax in 2023 with 15 years of experience both in analyst and portfolio manager capacities. Jenkyn-Jones is a very experienced and long-tenured manager with over 30 years of experience, largely gained at Impax, which he joined in 1999. He managed the Impax Specialist strategy, an environmental market-oriented strategy from which the climate strategy has been derived, since its inception in 2016. His direct involvement with this strategy will be missed, but his expertise and oversight will remain available in his role as CIO. Additionally, Forster will remain at the helm, and he boasts an equally long tenure and vast investment experience in environmental markets. Also, given that Impax strategies are managed in a team-based approach, it is reassuring to know that the three managers on this strategy can leverage a highly regarded and comprehensive team with a high level of environmental market expertise. The Climate strategy, which we cover through the BNP Paribas Climate Impact fund, carries a People Pillar rating of High and a Process Pillar rating of Above Average. Despite the strategy losing a very seasoned and knowledgeable manager, we are comforted because his oversight and knowledge is not lost for the team and the equally experienced Forster remains at the helm. We keep the broader team in high regard, given the comprehensive resources and the high level of environmental market expertise. We are therefore retaining the Pillar ratings and Morningstar Medalist Ratings. Impax Leaders strategy: Hubert Aarts Hubert Aarts will retire in December 2025, after 17 years with Impax and over 30 years in the industry. He currently serves as a comanager on Impax’s Leaders and Water strategies and is one of the two deputy chief investment officers, listed equities. He was involved with developing the Leaders strategy in 2008 and has been comanager since inception, which makes him one of the most experienced and longest-tenured managers in the sector equity ecology Morningstar Category. Aarts is managing the Leaders strategy together with two comanagers, Siddharth Jha and David Winborne, who will remain at the helm. Impax will appoint a replacement for Aarts before he retires. The upcoming retirement of Aarts means a loss of a very experienced portfolio manager for the Leaders strategy, but this has never been a one-man show. With Winborne and Jha, the strategy remains in capable hands, and the firm has plenty of time to find a suitable replacement for Aarts, given that his retirement is planned well in advance. The remaining comanagers will also keep the support of Impax’s highly regarded and comprehensive listed equity team, which has a high level of environmental market expertise. Finally, as of Sept. 30, 2024, Aarts will be stepping down as deputy CIO, listed equities, although he will continue to act as an adviser to Impax’s listed investments leadership team and lead its macro strategy research until he retires in December 2025. The Leaders strategy is covered through several vehicles, including Impax Sustainable Leaders Fund in Australia, BNP Paribas Global Environmental and Impax Environmental Leaders in Europe, and Impax Global Environmental Markets in the US. The strategy earns Above Average People and Process Pillar ratings, and these are kept unchanged following the upcoming retirement of Aarts. His departure is well-planned, giving room for a solid transition plan, and he leaves the strategy in the trusted hands of his current two comanagers, while a replacement for Aarts will be announced before his retirement. Finally, the remaining team continues to leverage the support of Impax’s outstanding listed equity team. Charles French Impax has appointed Charles French as co-chief investment officer, listed investments. French joined Impax in July 2022 as deputy chief investment officer and is one of the comanagers on the Global Social Leaders strategy, which was launched in 2023. Prior to joining Impax, French worked for 21 years at Newton Investment Management, where he lastly served as the firm’s deputy chief investment officer, providing leadership and oversight to a global investment team. As of April 1, 2024, he is jointly responsible alongside Jenkyn-Jones for Impax’s listed equity and fixed-income teams. French will focus on evolving the operating model of Impax’s investment platform, overseeing the growth of Impax’s fixed-income proposition, as well as the further development of research.

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