Kempen European Sustainable Equity Fund NV

Profile

Kempen European Sustainable Equity Fund NV (KESEF) is primarily created for long-term investors and offers the opportunity to invest in a diversified portfolio of European publicly traded shares of companies open to stakeholders and environmental, social and governance criteria in their strategy. KESEF aims to select investments focusing on long-term and sustainable growth.

Investments in the fund are screened by an independent data provider to assess compliance with environmental, social and governance (ESG) criteria. KESEF will only invest in companies with an ESG rating of at least BB or a similar rating. On June 28, 2021, the name of this fund was changed from Kempen European Sustainable Value Creation Fund NV into Kempen European Sustainable Equity Fund NV.

 

On 16 December 2022  Kempen Capital Management N.V. has merged this fund with the equivalent Luxembourg fund. Purchases and sales of shares can be done from the Luxembourg fund. More information on the Luxembourg based fund can be found here.

More information on the merger can be found here.

Management team

Ivo Kuiper, Herman Kleeven, Richard Klijnstra, Mark Oud, Martijn Kleinbussink, Raoul Martin

Performance per 2022-11-30 (rebased)

No chart data available

Performance per 2022-11-30

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  Fund Benchmark
1 month 4.8 % 6.9 %
3 months 3.0 % 6.4 %
This year -14.8 % -6.2 %
2019 29.9 % 26.0 %
2020 5.1 % -3.3 %
2021 32.3 % 25.1 %
1 year (on annual basis) -10.2 % -1.0 %
3 years (on annual basis) i 6.0 % 5.0 %
5 years (on annual basis) i 6.8 % 5.2 %
Since inception (on annual basis) i 6.8 % 5.2 %
Performance is shown after deduction of ongoing charges and including the reinvestment of dividend that has been paid out. The performance figures shown in the graph are rebased. The value of your investments may fluctuate. Past performance provides no guarantee for the future.
More information can be found on the documents page of this fund

Key figures

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Total fund size
EUR 334.75 M 2022-11-30
Share class size
EUR 334.75 M 2022-11-30
Number of shares
2,665,671 2022-11-30
Net Asset Value i
EUR 123.80 2022-12-16
Transaction price i
EUR 124.25 2022-12-09

Fund characteristics per 2022-11-30

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  Fund Benchmark
Number of holdings 32 427
Dividend yield i 2.50 % 3.19 %
Weighted average market capitalization i EUR 73,976 M EUR 91,558 M
P/E ratio i 19.47
Active share i 83.68 %
Kempen Capital Management N.V. (KCM) is the management company of Kempen European Sustainable Equity Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Developments per 2022-11-30

The fund earned a net return of 4.8% in November versus a return on the MSCI Europe Index of 6.9%. This brings the net return over the year so far to -14.8% versus a return on the MSCI Europe Index of -6.2%.

Since its inception the fund has outperformed the benchmark (6.8% versus 5.2% for the MSCI Europe Index) including on a 3-year basis (6.0% versus 5.0% for the MSCI Europe Index).

The technology and healthcare sectors made the largest positive contributions to the return, while the biggest negative contribution came from the consumer discretionary sector. The allocation and selection effects were negative for the month.

ASML, EssilorLuxottica and Allianz accounted for the largest positive contributions to the result. Chip machine manufacturer ASML held an investor day at which it explained its long-term plans in more detail. As of 2025, the company forecasts annual capital expenditure of EUR1.5 billion, an increase of 50% versus the target it set a year ago. The expenditure is aimed at financing a considerable expansion of production capacity. ASML is now planning to manufacture about 90 units of its high-grade EUV lithography tools in 2025, 50% more than expected.

Lonza, NN Group and Roche made the biggest negative contributions to the result. Roche, a Swiss pharmaceutical company, published disappointing results on an experimental drug against Alzheimer’s disease called Gantenerumab. The drug, which was designed to slow cognitive decline, failed to meet its goals in two closely-monitored clinical trials, a discouraging development that underlines the challenges of developing treatments for this disease that causes memory loss.

No changes were made to the portfolio in November.


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What kind of companies do we seek?

We seek profitable companies undergoing structural growth that will create shareholder value in the long term alongside a clear social mandate.

The best results are achieved if the interests of all the stakeholders are aligned. This requires not only products and services but also operations to be in line with the wishes and requirements of society (licence to operate). Moreover, the companies need to have sufficient opportunities for growth to be able to invest at an attractive return (innovation and expansion). In order to sustain earnings growth over the long term, companies need to enjoy sustainable competitive advantages compared to existing and new competitors (strong strategic position).

The role of management

We expect management to pursue a long-term strategy in addition to conducting sound day-to-day management. The risks and opportunities relating to ESG need to be clearly incorporated, backed up by sensible investment plans that respond to long-term trends and match the company’s strategic positioning and growth opportunities.

Quality and valuation

We believe the selected companies are above-average quality in terms of strategy and operations and are capable of creating long-term value for all stakeholders. Depending on the absolute valuation of their equities, they could form an interesting long-term addition to the portfolio.

 

ESG

ESG MSCI ratings

The portfolio has a clear overweight in the leaders (AAA/AA) and does not invest in the laggards (B/CCC).

Source: MSCI

 

KCM versus Sustainalytics ESG risk rating

The portfolio is not invested in companies with a high or severe ESG risk according to the KCM risk rating.

Source: Sustainalytics. KESVC* according to KCM ESG risk rating, KESVC** and MSCI Europe according to Sustainalytics ESG risk rating

 

SDG Solutions Exposure

The SDG Solutions Assessment identifies a product or service category’s contribution or obstruction towards attaining each of 15 individual sustainability objectives. A company has a score between -10 (significant obstruction) and +10 (significant contribution). The SDG Solutions score for the portfolio is 3.25 versus 0.67 for the benchmark.

Source: ISS

Kempen Capital Management N.V. (KCM) is the management company of Kempen European Sustainable Equity Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Performance per 2022-11-30 (rebased)

No chart data available

Performance per 2022-11-30

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  Fund Benchmark
1 month 4.8 % 6.9 %
3 months 3.0 % 6.4 %
This year -14.8 % -6.2 %
2019 29.9 % 26.0 %
2020 5.1 % -3.3 %
2021 32.3 % 25.1 %
1 year (on annual basis) -10.2 % -1.0 %
3 years (on annual basis) i 6.0 % 5.0 %
5 years (on annual basis) i 6.8 % 5.2 %
Since inception (on annual basis) i 6.8 % 5.2 %
Performance is shown after deduction of ongoing charges and including the reinvestment of dividend that has been paid out. The performance figures shown in the graph are rebased. The value of your investments may fluctuate. Past performance provides no guarantee for the future.

Dividends

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Distributing
Yes
Last dividend
EUR 5.80
Ex-date last dividend
2022-11-24
Number of distributions per year
1
Dividend calendar

Risk analysis (ex post) per 2022-11-30

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  3 years Since inception
Maximum drawdown i -18.85 % -18.85 %
Kempen Capital Management N.V. (KCM) is the management company of Kempen European Sustainable Equity Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Top 5 contribution (2022-11-30)

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  Contribution i Performance i
ASML 0.77 % 17.73 %
EssilorLuxottica 0.50 % 10.57 %
Allianz 0.47 % 12.16 %
BE Semiconductor Industries 0.38 % 17.17 %
Siemens Healthineers 0.37 % 8.76 %

Bottom 5 contribution (2022-11-30)

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  Contribution i Performance i
Roche Holding -0.28 % -6.68 %
Nationale Nederlanden Group -0.21 % -5.20 %
Lonza -0.15 % -4.10 %
Vodafone Group -0.14 % -6.50 %
RELX -0.05 % -2.18 %

Geographic allocation (2022-11-30)

29.9 %
United Kingdom
16.9 %
Germany
13.9 %
Netherlands
10.9 %
Denmark
10.1 %
France
9.8 %
Switzerland
4.5 %
Sweden
4.0 %
Ireland
2.5 %
Norway
Total
103 %

Top 10 holdings (2022-11-30)

5.1 %
EssilorLuxottica
4.9 %
Novo Nordisk
4.9 %
SAP
4.8 %
ASML
4.6 %
AstraZeneca
4.6 %
Siemens Healthineers
4.5 %
Assa Abloy
4.4 %
Allianz
4.0 %
Nationale Nederlanden Group
4.0 %
Roche Holding
Total
45.7 %

Sector allocation (2022-11-30)

21.7 %
Health Care
14.4 %
Industrial Goods & Services
12.3 %
Technology
11.7 %
Insurance
7.9 %
Food & Beverage
7.5 %
Chemicals
5.1 %
Basic Resources
5.1 %
Automobiles & Parts
5.0 %
Personal & Household Goods
4.0 %
Retail
3.6 %
Financial Services
2.3 %
Travel & Leisure
2.2 %
Telecommunications
Total
103 %
Kempen Capital Management N.V. (KCM) is the management company of Kempen European Sustainable Equity Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

 

SWING FACTORS

An overview of the current swing factors are available here.

Ongoing charges

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Management fee i
0.500 %
Service fee i
0.10 %
Expected ongoing charges i
0.60 %
Ongoing charges last financial year i
0.60 %
The ongoing charges figure of the last financial year relates to 2020/2021.
Kempen Capital Management N.V. (KCM) is the management company of Kempen European Sustainable Equity Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

Share class details

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Share class
N
Investor type
Institutional & Private
Distributing
Yes
Benchmark i
MSCI Europe Net Total Return Index
Investment category
Sustainable Equity
Universe
European equities
Inception date
2017-11-13
Domicile
Netherlands
May be offered to all investors in
Netherlands
UCITS status i
Yes
Status
Open-end i
Base currency
EUR
Share class currency
EUR
Administrator
BNP Paribas S.A., Netherlands Branch
Management company
Van Lanschot Kempen Investment Management NV
Depositary and custodian
BNP Paribas S.A., Netherlands Branch

Tradability

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Listed
yes, listed on the NAV Trading Facility of Euronext
Subscription/Redemption Frequency
Daily
ISIN i
NL0012512958
Kempen Capital Management N.V. (KCM) is the management company of Kempen European Sustainable Equity Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.

No sustainable investment objective

The Kempen European  Sustainable Equity Fund (the “Fund”) falls under the scope of article 8 of the SFDR which means that the Fund promotes environmental and/or social characteristics. While it does not have as its objective a sustainable investment, it will have a minimum proportion of 4% of sustainable investments. The Fund considers principle adverse impact on sustainability factors.

The product excludes at least 20% of the investment universe through the application of strict exclusion criteria. These take into account international standards, such as the UN Global Compact framework, the OECD Guidelines for Multinational Enterprises, the UN Guiding Principles for Business and Human Rights, and our Principles for Responsible Investment commitments. The Fund applies additional exclusion criteria based on product involvement and business conduct. Furthermore, the Fund excludes companies with low ESG ratings.

The Fund uses a combination of principal adverse impact indicators and exclusion criteria to ensure the sustainable investments do not significantly harm any of the sustainable investment objectives. Furthermore, we monitor the number of severe controversies and take this broad set of indicators into account in the portfolio construction, when integrating ESG factors and when executing our active ownership activities.Â

Environmental or social characteristics of the financial product

The Fund promotes environmental characteristics related to:
• Climate change mitigation and climate change adaptation in line with the Paris Climate Agreement; Â
• The protection of biodiversity and ecosystems; Â
• The transition to a circular economy.Â

The Fund promotes social characteristics related to:Â
• Decent work;Â
• Adequate living standards and wellbeing for end-users; Â
• Other social topics such as gender equality and broader diversity matters.  Â
 Â
The environmental characteristics promoted by the Fund seek to contribute to achievement of the climate goals of the Paris Agreement and the National Climate Agreement of the Netherlands (‘Klimaatakkoord’). This decarbonization pathway encompasses short-term (2025) objectives, a mid-term (2030) ambition and a long-term commitment to be net zero by 2050. Although there has been no index designated as a reference benchmark, by 2025 the Fund aims to have a carbon intensity that is below the EU Paris Aligned (EU PAB) pathway. This pathway assumes a carbon intensity that is 50% lower than the MSCI Europe Total Return Net Index (the “Benchmark”) in 2019 with a subsequent 7% annual reduction. Â

Investment strategy

The Fund primarily aims to generate a better long-term total return than the MSCI Europe Net TR Index in euro, comprising capital gains or losses plus net dividend. Our ESG-policy, described in the ESG Policy & Process document, is aimed at the promotion of environmental and/or social characteristics. This ESG policy is implemented in our strategy’s investment process across four pillars: Exclusion, ESG Integration, Active ownership and Positive impact.Â

Before and after selecting the asset, we apply adequate (ESG) due diligence measures. This can help to enhance long-term risk adjusted returns for investors, in accordance with the investment objectives of the Fund. We  look at each company on a case-by-case basis, taking into account both material risks in a given industry and the company’s respective risk exposure, practices and disclosure. This includes:Â
- an assessment of good governance practices. The investee companies are rated for governance aspects using external research and internal assessments.Â
- the company’s exposure to past controversies and future ESG opportunities
Based on fundamental ESG analysis we form an opinion on the quality of a company’s ESG profile and award a score (1-5).

Proportion of investments

Information about the proportion of investments with environmental or social characteristics is available in the annex II of this product. Â

Monitoring of environmental or social characteristics

The holdings are screened quarterly for compliance with Kempen’s ESG criteria. The screening process allows Kempen to monitor the ESG performance of all companies in the fund. It also encourages engagement on potential issues identified. Furthermore, the results of the screening feeds into quarterly challenging sessions between ESG specialists and portfolio managers. These sessions are used to assess whether ESG risks and opportunities are sufficiently reflected in the investment decision making process of Kempen.

Methodologies

Principal Adverse Impact Indicators are monitored at individual holding level and at the portfolio level.Â

Kempen ESG Score serves as input throughout the investment process (exclusion, integration in the valuation models, engagement). Scores are based on 21 ESG risk factors, which are selected based on their materiality per industry.Â

Carbon emission intensity is used as the key carbon metric. We calculate carbon intensity based on revenues (weighted average carbon intensity), which we use for our commitment, ambition and objectives.Â

EU Taxonomy alignment is measured by turnover, for which we use a combination of actual data from investee companies and estimates on EU Taxonomy alignment made by a third party provider.Â

Engagement Milestones are used in order to measure engagement success. All engagement contacts are recorded and classified: Milestone 1 (company is informed), Milestone 2 (company acknowledges request), Milestone 3 (company commits to improve), up until Milestone 4 (proof of improvement).

Data sources and processing

External data providers include (but are not limited to)Â
- Institutional Shareholder Services (ISS), used for proxy voting, governance research, carbon data and Sustainable Development Goals data;Â
- MSCI ESG Research: used for company ESG Ratings, product involvement data, principal adverse indicators and to assess the degree to which the investments are in environmentally sustainable economic activities under the EU Taxonomy, measured by turnover;Â
- Sustainalytics: used for ESG Risk Ratings and product involvement data.Â
Internal as well as external data is collected and processed in several data analytics (including FactSet, PowerBI, Tableau) and internal compliance systems (including ThinkFolio).

Exclusion criteria

  Kempen criteria Additional criteria
Business conduct
Human Rights
Labour
Environment
Anti Corruption
Product involvement
Controversial Weapons
Tobacco
Thermal Coal
Tar Sands
Adult Entertainment
Alcohol
Animal Welfare & GMO
Gambling
Power Generation Nuclear
Power Generation Carbon Intensive
(Un)conventional Oil & Gas Extraction
Weaponry

Fund carbon emission targets

Limitations to methodologies and data

Externally provided ESG data is far from perfect. Therefore we conduct rigorous due diligence of the data used in our ESG processes to ensure the limitations will not affect the environmental and social characteristics. To ensure data quality we regularly engage with portfolio companies and third party vendors. Limitations include, but are not limited to discrepancies between company reported data and data provided by third parties, inconsistencies across data vendors, market cap bias and modelling assumptions.

Due diligence

Before a company is invested in, Portfolio Managers perform a due diligence on potential ESG risks and principal adverse impact indicators, opportunities, as well as potential past controversies. ESG due diligence is integrated in the different stages of the investment process (screening of the investable universe, fundamental research & portfolio management). ESG specialists challenge the portfolio managers on the implementation of the ESG process on a quarterly basis.
Kempen Capital Management N.V. (KCM) is the management company of Kempen European Sustainable Equity Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.
Kempen Capital Management N.V. (KCM) is the management company of Kempen European Sustainable Equity Fund N.V. (the “Fund”). KCM is authorised as a management company and regulated by the Dutch Authority for the Financial Markets (AFM). The Fund is registered under the license of KCM at the Dutch Authority for the Financial Markets (AFM).

The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch) and the prospectus (available in English). These documents are available on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English. The value of your investment may fluctuate. Past performance provides no guarantee for the future.