Ahead of the marcus evans Elite Summit 2019, read here an interview with Oliver N. Hagedorn where he discusses how sustainable investing will become mainstream and highlights the three aspects investors should look at

1. Interview with: Oliver N. Hagedorn,
Chief Executive Officer, avesco
Financial Services AG
“Sustainable investing is the only way
forward. We have no alternative but to
consider sustainable investing now,”
according to Oliver N. Hagedorn, Chief
Executive Officer, avesco Financial
Services AG.
avesco Financial Services AG is a fund
manager at the marcus evans Elite
Summit 2019, taking place in
Montreux, Switzerland, 12 - 14 June.
Why do family offices and private
wealth managers need to focus on
sustainable investing today?
The importance of sustainable invest-
ments is steadily increasing. We live in
a world of increasing interest in the
environmental and social consequences
of business and trade. The behaviour of
corporations is scrutinised more and
more rigorously, and so the impetus for
making investments in and supporting
organisations that have a positive
impact on society will surely continue to
strengthen. As social awareness and
pressure increases, it seems inevitable
that the whole range of investors,
including family offices and private
wealth managers will look to increase
their exposure to, or use of, products
that satisfy certain sustainability criteria
in one way or another.
Does sustainable investing translate
to more profit or less risk? How do
these assets correlate with others
in the portfolio?
Numerous studies have proven that
sustainable investments generate
outperformance and less risk for
investors, yet some wrongly believe
otherwise. This is possibly due to the
way traditional rating agencies evaluate
sustainable investments, which is no
different from their traditional approach
for other investments. Usually financial
analysts research and evaluate each
company and score them. Those with a
poor environmental, social and
governance (ESG) score get a red flag,
but nobody knows how to interpret the
ESG score outcome. What is the
difference between a score of 72 or 74?
Therefore a meaningful comparison
between the ESG scored assets and
others in the portfolio can be difficult.
With our sustainability methodology we
aim to clarify and add transparency to
the process.
What types of assets or industries
does your fund focus on?
Our Sustainable Hidden Champions
Fund (SHC) is an equity fund investing
in small/mid-cap stocks. We invest in
sustainable “hidden champions”
companies. In Germany there are 3.2
million companies, from the large mega
caps to the small local companies, but
only 1,350 are considered to be hidden
champions. These companies are
internationally focused and produce 25
percent of German exports. Although
they operate in more than 100
countries, they are mostly unknown to
the public as most of them run niche
B2B business models. They are a small
group in a large universe of small and
mid-cap companies. There are just
2,700 hidden champions worldwide,
only around ten percent of them are
listed.
We do not select industries. We look for
real hidden champions, companies who
are market leaders in their field and
based in D-A-CH region (Germany,
Austria, Switzerland). The 59 companies
in our portfolio are spread across 35
different industries. Compared to other
companies, they are more innovative,
have more patents, stronger client
relationships and extremely high
barriers of entry.
How do you find these hidden
champions? What is your methodol-
ogy for evaluating these compa-
nies?
There is no index or list of hidden
champions. It took us two years just to
define the universe of listed hidden
champions, by talking to institutions
that were doing research in this field.
Having developed a shortlist of
companies, we evaluate how sustain-
able their business models are using a
methodology we invented ourselves,
combining and scoring the three aspects
financial, environmental and social. We
take a holistic approach and look at all
three areas together, which are equally
necessary for a company to thrive and
sustain. Two additional factors are
added to the analysis: a risk assess-
ment and a governance analysis to
derive at our final sustainability score.
Our approach is qualitative, we go
beyond the checklist-scoring process of
most rating agencies. A deep under-
standing of the business model and the
supply and distribution chains is crucial
so that we can conduct meaningful
interviews and give relevant feedback
on the sustainability of the company.
The evaluation process takes about 80
hours per company and leaves us with a
sound holistic view of the sustainability
of the candidate.
Any final thoughts?
Sustainable investing means less risk,
which in the long run results in
outperformance. It also delivers a
second benefit which is a contribution to
society, the climate, the workforce, your
neighbours and indeed to everyone.
Sustainable
investing is
the only way
forward
How to Succeed in Sustainable Investing

2. The Investment Network –
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Please note that the Summit is a
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number of participants strictly
limited.
About the Elite Summit 2019
The Elite Summit is the premium forum bringing top tier buyers and sellers
together. The Summit offers the independent advisors of wealthy private investors
and international fund and asset managers an intimate environment for focused
discussion of the key new drivers shaping wealth management asset allocation.
Taking place at the Fairmont Le Montreux Palace, Montreux, Switzerland, 12 - 14
June, the Summit includes presentations on understanding the markets to
anticipate the future, exploring the alternative investment market, ensuring the
successful execution of the family vision and principles, and creating firm family
succession.
www.elitesummit.com
Contact
Sarin Kouyoumdjian-Gurunlian, Press Manager, marcus evans, Summits Division
Tel: + 357 22 849 313
Email: press@marcusevanscy.com
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About avesco Financial Services AG
Licenced by Bafin since 1999, avesco Financial Services AG is a financial services provider specialized in sustainable asset
management. Located in Berlin, avesco designs and manages high-performance sustainable and impact-oriented investments.
Public funds, special funds and alternative investment funds called AIF belong to the company’s portfolio. Product innovations such
as the Sustainable Hidden Champions Equity or the European Social Innovation and Impact Fund enable investors to benefit from
financial performance and provable contributions, while tackling the world's biggest challenges, such as climate change.
www.avesco.de
About marcus evans Summits
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strategies and solutions. Held at exclusive locations around the world, these events provide attendees with a unique opportunity to
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For more information, please visit: www.marcusevans.com
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To view the web version of this interview, please click here:
https://events.marcusevans-events.com/elite2019-oliver-hagedorn