WHEB Sustainable Impact Fund

Investing in industries of the future, solving sustainability challenges for the world

November 2022 - Monthly REPORT

COP27 – more of a floor than a ceiling


Global equities experienced their first back-to-back monthly gains since the start of 2022, as investors bet that inflation has peaked and that the US Federal Reserve will slow the pace of monetary tightening. The Fund outperformed the benchmark over the month, which respectively returned +5.9% and +2.1%. In this month’s commentary, Seb Beloe looks at whether there is any scope for optimism following the recently concluded COP27 climate negotiation.

We recently held a Portfolio and Investment Update webinar, along with Q&A for shareholders, which is available below for your review. CPD points are applicable for Australian Financial Planners HERE. 


Top Holdings (alphabetically)

Advanced Drainage Systems Inc
United States
Advanced Drainage Systems is a leading provider of stormwater management systems in the US. It is the leading manufacturer of high performance thermoplastic corrugated pipe, providing a comprehensive suite of water management products and superior drainage solutions for use in the underground construction and infrastructure marketplace. The company's products are generally lighter, more durable, more cost effective and easier to install than comparable alternatives made with traditional materials.
United States
Information Technology
Ansys is a market leader in multiphysics engineering simulation software for product design and optimisation. The company follows a strategy of Pervasive Engineering Simulation to enable innovation. Its software accelerates product time to market, improves engineering and optimises product quality and safety for a variety of products including fuel efficient cars and planes, wind turbines as well as medical technology and consumer products.
United States
Health Care
Danaher is a diversified business that designs, manufactures and sells laboratory equipment and consumables to clinical and medical laboratories including microscopes, analytical software and imaging and molecular devices. These tools are used in the development of new drugs and for diagnosing critically ill patients. In addition, the company also designs, manufactures and sells equipment to test and treat water (incl. UV water treatment systems). Overall, Danaher's products offer improved efficiency and reliability.
Globus Medical Inc
United States
Health Care
Globus Medical is a best-in-class spinal medical technology company headquartered in Pennsylvania, US. It has a large portfolio of solutions to promote healing in patients with musculoskeletal disorders. A newer, fast growing segment called "Enabling Technologies" centres around ExcelsiusGPS, the world's first robotic navigation platform which supports surgeons in spinal operations. The company was founded in 2003.
United States
Health Care
ICON is a clinical research organisation (CRO) which provides outsourced development services on a global basis to the pharmaceutical, biotechnology and medical device industries. The company's mission is to accelerate the development of drugs and devices that save lives and improve the quality of life. ICON specialises in the strategic development, management and analysis of programmes to support all stages of the of the clinical development process.
United States
Linde Plc produces and distributes industrial gases. The company operates globally supplying oxygen, hydrogen and other gases to a very wide range of downstream markets including into manufacturing industries, petrochemical and electronics industries. The gases are used in a variety of applications including in making manufacturing processes more efficient and in reducing harmful emissions. The company is establishing a strong presence in the green hydrogen market and also sells oxygen and other gases into the healthcare sector.
Power Integrations Inc
United States
Information Technology
Power Integrations is a pure-play manufacturer of integrated power-conversion components. Unlike traditional power conversion solutions requiring dozens of components, the company's integrated solutions reduce the bill of materials and the size of the integrated circuit board. Power Integrations has strong market positions across a range of end markets including industrials and renewable energy, and a leading position in consumer appliances in particular.
Silicon Laboratories INC
United States
Information Technology
Silicon Laboratories designs and develops analog semiconductors and other electronic components that are used to control and connect devices. The company has particular expertise in ultra-lower power devices. It also develops and sells technologies that play a critical role in the 'internet of things' (IoT) which enables greater efficiencies through closer analysis and control of electrical equipment used in the automotive, communications, home and industrial automation, power and retail sectors.
United States
Health Care
Steris provides a variety of products and services to the healthcare industry including specifically to hospitals, medical device manufacturers, pharmaceutical and biotechnology businesses as well as for food safety and industrial markets. The company's main areas of activity are in providing hygiene, sterilisation and anti-microbial treatment services to these end markets in order to ensure a safe and hygienic operating environment.
Trane Technologies PLC
United States
Trane is a world leader in air conditioning systems and services. The company serves engineers, contractors and business owners across an array of markets including education, healthcare, government and manufacturing. It also provides climate-controlled transport solutions to the food and medical industries. It also has an offering in the heat pump space which brings a 300% efficiency gain compared with the system it would replace.

Sector Breakdown

Capitalisation Breakdown

Region Breakdown

WHEB Sustainability Themes


Performance Table

WHEB Sustainable Impact Fund 5.9% -15.5% 4.2% 6.5%
Strategy (partial simulation – see below) 5.8%
MSCI World Total Return Index (net, AUD unhedged) 2.1% -5.6% 7.9% 10.1% 6.8%

Swipe horizontally to see all columns

Fund & Strategy Performance


Market Review

Global equities experienced their first back-to-back monthly gains since the start of 2022, as investors bet that inflation has peaked and that the US Federal Reserve will slow the pace of monetary tightening.

Remarks from the Federal Reserve chair Jay Powell, signalling that the US central bank would slow the pace of interest rate rises in December, delivered a boost for markets on the last day of the month. The Fed is now expected to raise interest rates by 0.5% rather than 0.75% at its December meeting.

The European equity market fared better this month. Greater fiscal support from governments and a mild autumn have helped to ensure gas storage facilities are still at full capacity, improving the region’s economic outlook.

There was also investor optimism that China will begin to ease its strict zero-Covid policies that have held back economic growth.

The rally has been cyclical in nature with Industrial & Material stocks performing particularly well. Value outperformed growth.

Fund Review

The Fund outperformed the benchmark over the month, which respectively returned +5.9% and +2.1%.

Health, Sustainable Transport and Cleaner Energy were the best performing themes.

Infineon Technologies was the best performing stock. The company makes efficient power semiconductors with a market-leading position in the automotive end-market. The company updated its long-term operating targets, upgrading both sales and margin expectations.

Solar Edge, Fisher and Paykel and Silicon Labs also performed well.

The strategy, which only invests in companies providing solutions to sustainability challenges, does not hold certain mega-cap technology stocks including Apple, Tesla & Amazon – this was a tailwind for performance. For the same reason, the strategy does not invest in Financials and this underweight was a headwind.

Our mid-cap bias was supportive for performance as was the investment team’s stock selection.


Overall, the earnings season has highlighted pockets of weakening demand. We are also seeing attention start to turn to 2023, where companies are generally flagging a lack of visibility on growth rates as we come out of the post-Covid recovery period. Interest rate expectations are coming down, although there is likely to be continued volatility as winter approaches and the market continues to feel the effects of the energy crisis.

The portfolio is unlikely to be immune to the industrial and consumer demand environments. However, we are confident our holdings are well positioned to capture the impact-driven growth opportunities in their industries over the longer-term.


COP27 – more of a floor than a ceiling

So Rishi Sunak did eventually bow to pressure and join other world leaders at the second most attended climate negotiations of all time. But as global attention now drifts across the Arabian Peninsula from Sharm El-Sheikh to Qatar, what was ultimately achieved at this year’s climate talks?

Some important steps forward

There were clearly some important successes that came out of the COP27 negotiations including, most obviously, the establishment of a ‘Loss and Damage’ fund. This looked impossible just a few years ago, but perhaps spurred by the appalling flood damage in Pakistan and Nigeria, delegates did commit to establish a pooled fund to support action in countries most affected by climate change.  Key operational decisions such as what criteria triggers a payout, and the size and source of contributions, will be hammered out between now and the end of COP28. The fact that developed countries still haven’t fulfilled previous commitments to provide US$100bn a year to help developing countries clearly doesn’t bode well. A recent report also indicated that these countries will likely need as much as US$1 trillion per annum.

There were other good things as well. China and the US are again formally talking about how to galvanise global support for more aggressive action and ‘Brazil is back’ with President-elect Lula committing to reversing damage to the Amazon rainforest.

Improved targets

There were even some increased commitments. The EU managed to eke out a 2% increase in the ambition of its 2030 emission reductions target and Mexico raised its target – albeit against a ‘business as usual’ scenario – from 22% to 35% and even offered to extend this to a 40% cut by 2030 contingent on international support.

Following on from the US$8.5bn deal struck in Glasgow to finance the early retirement of coal power plants in South Africa, Indonesia also announced a US$20bn deal to accelerate the retirement of their own coal plants. This will ensure a peaking of Indonesian power sector emissions by 2030 and net zero carbon emissions by 2040 – a decade earlier than the previous deadline.  Vietnam is reported to be the next in the queue for a similar type of deal.

Disappointment and missed opportunities

And yet, the overall mood at the end of the conference was still of disappointment. Alok Sharma, the UK’s outgoing President of COP was visibly angry as the session came to an end. “Emissions peaking before 2025 as the science tells us is necessary? Not in this text. Clear follow-through on the phase-down of coal? Not in this text. Clear commitment to phase out all fossil fuels? Not in this text”, he protested.

These objectives were supported by over eighty countries at the talks but were ultimately left out of the final agreement. What’s more, new language was included that emphasised the role of ‘low carbon energy’. A term widely understood to represent an effort to include support for natural gas in future emission reduction initiatives.  Many commentators pointed the finger at the army of fossil-fuel lobbyists at the talks.

A floor not a ceiling

Ultimately though, the COP process should not be seen as setting a ceiling for ambition on climate, but rather as a floor. With 192 countries required to agree unanimously on the outcome the bar is set quite low and, notwithstanding the emotional scenes in Paris in 2015, it is rarely sensible to look to the COP process for hope. There is still scope for optimism, but for that you are better off looking at the actions of leading businesses, cities, communities… and investors. These groups have become not just powerful advocates for change, but also agents for real progress on the ground.


  • AMP North
  • ANZ Grow Wrap
  • Asgard eWrap
  • BT Panorama
  • BT Wrap
  • Centric
  • CFS FirstWrap
  • FNZ
  • HUB24
  • IOOF
  • MLC Wrap
  • Macquarie Wrap
  • Netwealth
  • Mason Stevens
  • OneVue
  • Praemium
  • Powerwrap
  • uXchange




  • FEES * Management Fee: 1.35%
  • Minimum initial investment $10,000
  • FUM AT MONTH END A$ 268.1m
  • FUND INCEPTION DATE 31 October 2007

Fund Managers

Ted Franks

Partner, Head of Investment

Seb Beloe

Partner, Head of Research


The Pengana WHEB Sustainable Impact Fund invests in companies with activities providing solutions to sustainability challenges. WHEB have identified critical environmental and social challenges facing the global population over coming decades including a growing and ageing population, increasing resource scarcity, urbanisation and globalisation. The Fund invests in companies providing solutions to these sustainability challenges via nine sustainable investment themes – five of these are environmental (cleaner energy, environmental services, resource efficiency, sustainable transport and water management) and four are social (education, health, safety and well-being). WHEB’s mission is ‘to advance sustainability and create prosperity through positive impact investments.’


Harding Loevner International Fund
Harding Loevner International Fund
Axiom International Ethical Fund
Axiom International Ethical Fund
Axiom International Ethical Fund (Hedged)
Axiom International Ethical Fund (Hedged)
Australian Equities Fund
Australian Equities Fund
High Conviction Property Securities Fund
High Conviction Property Securities Fund
Global Small Companies Fund
Global Small Companies Fund
WHEB Sustainable Impact Fund
WHEB Sustainable Impact Fund
Emerging Companies Fund
Emerging Companies Fund
High Conviction Equities Fund
High Conviction Equities Fund
Pengana International Equities Limited (ASX: PIA)
Pengana International Equities Limited (ASX: PIA)
Private Equity Trust (ASX: PE1)
Private Equity Trust (ASX: PE1)
Alpha Israel Fund
Alpha Israel Fund
Pengana Diversified Private Credit Fund
Pengana Diversified Private Credit Fund

1. From August 2017, performance figures are those of the Pengana WHEB Sustainable Impact Fund’s class A units (net of fees and including reinvestment of distributions). The strategy’s AUD performance between January 2006 and July 2017 has been simulated by Pengana from the monthly net GBP returns of the Henderson Industries of the Future Fund (from 1 January 2006 to 31 December 2011) and the FP WHEB Sustainability Fund (from 30 April 2012 to 31 July 2017). This was done by: 1) converting the GBP denominated net returns to AUD using FactSet’s month-end FX rates (London 4PM); 2) adding back the relevant fund’s monthly ongoing charge figure; then 3) deducting the Pengana WHEB Sustainable Impact Fund’s management fee of 1.35% p.a. The WHEB Listed Equity strategy did not operate between 1 January 2012 and 29 April 2012 – during this period returns are zeroed. The Henderson Industries of the Future Fund’s and the FP WHEB Sustainability Fund’s GBP net track record data is historical. No allowance has been made for buy/sell spreads. Please refer to the PDS for information regarding risks. Past performance is not a reliable indicator of future performance. The value of the investment can go up or down.
2. The Fund incepted on 31 October 2007 as the Hunter Hall Global Deep Green Trust. The Fund was relaunched on 1 August 2017 as the Pengana WHEB Sustainable Impact Fund employing the WHEB Listed Equity strategy. This strategy was first employed on 1 January 2006 by the Henderson Industries of the Future Fund and currently by the FP WHEB Sustainability Fund.
3. Annualised standard deviation since inception.
4. Relative to MSCI World Total Return Index (net, AUD unhedged)
* For further information regarding fees please see the PDS available on our website.