- Kempen
- Kempen Lux Sustainable European Small Cap Fund Class BN
Kempen Lux Sustainable European Small-Cap Fund - Class BN
Profile
The portfolio construction process involves a disciplined end to end framework initially utilizing proprietary in-house stock filters screening for high quality and attractively valued stocks. Thereafter,
fundamental in-house research is carried out to identify high conviction investment ideas. The end result is a portfolio of 30-50 stocks, well diversified across all regions and sectors.
On 10 September 2019 Kempen (Lux) European Small-cap Fund was incorporated into Kempen (Lux) Sustainable Small-cap Fund. You can find more information under the Documents tab.
Management team
Performance per 2021-03-31 (rebased)
Performance per 2021-03-31
Fund | Benchmark | |
---|---|---|
1 month | 5.8 % | 5.1 % |
3 months | 10.3 % | 9.7 % |
This year | 10.3 % | 9.7 % |
2018 | -18.3 % | -15.9 % |
2019 | 28.8 % | 31.4 % |
2020 | 0.2 % | 4.6 % |
1 year (on annual basis) | 58.8 % | 61.2 % |
3 years (on annual basis) i | 6.5 % | 9.2 % |
5 years (on annual basis) i | 6.4 % | 10.4 % |
Since inception (on annual basis) i | 10.9 % | 10.5 % |
Key figures
Total fund size | EUR 124.21 M 2021-03-31 |
Share class size | EUR 76.85 M 2021-03-31 |
Number of shares | 1,626,630 2021-03-31 |
Net Asset Value i | EUR 48.40 2021-04-15 |
Turnover rate | 55.71 % |
Morningstar rating â„¢ | |
Fund characteristics per 2021-03-31
Fund | Benchmark | |
---|---|---|
Number of holdings | 46 | 965 |
Dividend yield i | 1.68 % | 1.64 % |
Weighted average market capitalization i | EUR 3,311 M | EUR 3,218 M |
P/E ratio i | 16.47 | |
Active share i | 92.57 % |
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English.
The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.
Developments per 2021-03-31
Despite the further increase of the 10-year US interest rate and the fact that a growing number of countries are extending COVID-19 lockdown measures, stock markets continued to rise in March. Now that all companies have published their annual figures, financial markets’ focus will shift to macroeconomic data, vaccination progress, central bank policies and government stimulus programs. The published annual results confirm that the majority of companies have successfully managed through the COVID-19 crisis and have used the crisis to put their house in order. Given the light at the end of the COVID-19 tunnel, we expect an increasing number of acquisitions by companies in the coming period. The combination of overall healthy company balance sheets, in some cases on the back of additional equity being raised, cheap financing and competitors who are possibly in financial difficulties as a result of COVID-19 provide a fruitful basis for this.
During the month we added Alliance Pharma, Beazley, Bekaert and Travis Perkins to the portfolio and exited positions in Greggs and SimCorp. Following the regulatory approval of COVID-19 vaccines the scenario of normalization of global economies in the course of FY21 looks increasingly likely. However the short-term challenges remain largely unchanged as daily statistics on new COVID-19 infections and hospitalization rates show that the virus is everything but contained. Although medium-term prospects are encouraging, short-term challenges remain. Financial markets can therefore remain volatile, especially as hurdles like availability of the vaccine and logistics determine the speed and shape of the recovery. Despite the recent strong move in stock markets we still see attractive long-term potential for our portfolio holdings but remain focused on near-term earnings risks and balance sheet strength. As flagged earlier we continue to focus on the margin of safety in our valuations.
In March El.En, Arcadis and Signify delivered the strongest contribution to the portfolio. El.En shares were up 27% in March on the back of very strong results and outlook for 2021. Despite a sales drop of 14% in the first half, the company managed to report 2% sales growth for the full year. Profitability declined as the mix shifted more towards the lower margin Industrial activities. For 2021 El.En expects over 10% revenue growth, while we also believe that the long-term prospects of El.En are very healthy on the back of continued investment in R&D. Arcadis (+23.1%) shares performed strongly during the month. In our view multiple broker upgrades were the main driver behind this development. The company also appointed its first Chief Sustainability Officer during the period. While Infrastructure is a relatively small part of Arcadis activities in North America, we believe that news flow around President Biden’s $2 trillion infrastructure plan also supported the sentiment around the share price. Signify traded 22% higher in March, without company specific news. With a double digit free cashflow yield, the shares didn’t reflect the strong sustainability credentials and operational track record of the company. The company is a sustainable leader. This is not only visible through its products that contribute to lower energy consumption for the end-user but also in its own operations which are already carbon neutral. We believe that this is a major achievement for a company with a global manufacturing and logistics footprint. At the end of February the company started the share repurchase program to cover performance share plans.
The companies with the worst contribution to the portfolio in March were Coats, Fagron and Software AG. Whereas Coats (-6.8%) reported 2020 results which were ahead of expectations, net debt was lower and the dividend restored, the company continues to be impacted by the lockdowns. Also higher material and freight costs will impact the pace of recovery for Coats. We believe that Coats is well placed to gain further market share, but as in the past years Coats hasn’t shown material revenue growth it seems like the market is not willing to price this in yet. Fagron (-4.3%) shares were held back from the risk of increasing competition. A newspaper article at the start of the month covered the M&A appetite of competitors like Ceban and Ace Pharmaceuticals while the former would also be for sale itself. Later on in the month it was announced that Ceban had made an investment in Belgian peer Magis Pharma. So, there clearly seems to be activity in the competitive environment and it remains to be seen how Fagron will be affected going forward. For now, it is estimated that Ceban and Ace generated relevant revenues of respectively €12m and €15m while Fagron reported 2020 revenues of €267m in its EMEA region. At the end of February Software AG (-2.5%) hosted a capital markets day, where management was confident on their mid-term ambitions. But as 2021 earnings will show another earnings decline the recovery in the two years thereafter needs to be very steep and relies on an acceleration of bookings growth. Although the company has more visibility on bookings growth than ever before, as renewals from existing customers will be supportive, the market is not willing to pay for this yet. We believe that if Software reaches its 2023 targets, with more to come thereafter, the company is one of the cheapest software companies in our investable universe with a very attractive growth profile.
ESG commentary
Corporate governance is a crucial engagement theme during the global proxy voting season. In the first half of the year companies hold their annual general meetings (AGMs) and ask their shareholders to vote on a number of proposals. This is the time when companies can nominate new directors to the board and also submit new incentive plans. We actively engage with portfolio companies on themes such as independence of directors, board gender diversity and the long-term alignment of interests of directors with the company stakeholders. Such governance engagements often take several years. For example, we initiated an engagement with the semiconductor producer BESI in 2019 in order to limit the board's discretion to remunerate management. This year the company has implemented the feedback of shareholders and introduced measurable performance targets for the previously discretionary grant.
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English.
The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.
Performance per 2021-03-31 (rebased)
Performance per 2021-03-31
Fund | Benchmark | |
---|---|---|
1 month | 5.8 % | 5.1 % |
3 months | 10.3 % | 9.7 % |
This year | 10.3 % | 9.7 % |
2018 | -18.3 % | -15.9 % |
2019 | 28.8 % | 31.4 % |
2020 | 0.2 % | 4.6 % |
1 year (on annual basis) | 58.8 % | 61.2 % |
3 years (on annual basis) i | 6.5 % | 9.2 % |
5 years (on annual basis) i | 6.4 % | 10.4 % |
Since inception (on annual basis) i | 10.9 % | 10.5 % |
Dividends
Distributing | Yes |
Last dividend | EUR 0.50 |
Ex-date last dividend | 2021-01-14 |
Number of distributions per year | 2 |
Dividend calendar |
Risk analysis (ex post) per 2021-03-31
3 years | Since inception | |
---|---|---|
Maximum drawdown i | -30.36 % | -62.09 % |
Tracking error i | 5.04 % | 5.10 % |
Information ratio i | -0.54 | 0.07 |
Beta i | 1.03 | 0.99 |
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English.
The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.
Top 5 contribution (2021-03-31)
Contribution i | Performance i | |
---|---|---|
El. En. | 0.56 % | 26.57 % |
Arcadis | 0.53 % | 23.16 % |
Signify | 0.40 % | 21.85 % |
Hill & Smith | 0.37 % | 17.94 % |
ASR Nederland | 0.36 % | 10.37 % |
Bottom 5 contribution (2021-03-31)
Contribution i | Performance i | |
---|---|---|
Coats | -0.17 % | -6.71 % |
Fagron | -0.08 % | -4.25 % |
Software | -0.06 % | -2.37 % |
Euronext | -0.06 % | -3.70 % |
Hibernia Reit | -0.04 % | -1.95 % |
Geographic allocation (2021-03-31)
Top 10 holdings (2021-03-31)
Sector allocation (2021-03-31)
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English.
The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.
Ongoing charges
Management fee i | 0.750 % |
Service fee i | 0.20 % |
Taxe d'abonnement i | 0.05 % |
Expected ongoing charges i | 1.00 % |
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English.
The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.
Share class details
Share class | BN i |
Investor type | Private |
Distributing | Yes |
Benchmark i | MSCI Europe Small Cap Total Return Index |
Investment category | Small-caps |
Universum | Sustainable European Small- & Mid-caps |
Inception date | 2013-11-07 |
Domicile | Luxembourg |
May be offered to all investors in | Belgium, Luxembourg, Switzerland, The Netherlands, United Kingdom |
UCITS status i | Yes |
Status | Open-end i |
Base currency | EUR |
Share class currency | EUR |
Management company | Kempen Capital Management N.V. |
Depositary and custodian | J.P. Morgan Bank Luxembourg S.A. |
Morningstar rating â„¢ | |
Tradability
Minimum subscription | Initial subscription € 1 |
Listed | no |
Subscription/Redemption Frequency | Daily |
ISIN i | LU0927663905 |
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English.
The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.
Factsheets
Annual Reports
Semi- Annual Reports
Key Investor Information
Sustainability related disclosures
Formal documents other
Other
Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English.
The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.
Kempen's vision & mission
Kempen Capital Management is an asset manager that believes in stewardship and investment focusing on the long-term for the benefit of all stakeholders. Value creation is at the heart of the services we provide to our clients. We believe that being an engaged shareholder on environmental, social and governance (ESG) issues and retaining a long-term focus, is critical to helping our clients to preserve and create sustainable wealth that has positive real world impact and economic returns.
Kempen wide approach to responsible investment
We are committed to create sustainable alpha. The four pillars of our ESG-policy are:
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ESG integration: Ensuring sustainability risks and opportunities are adequately considered in our investment analysis and processes.
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Exclusion & avoidance: Not investing in companies involved in controversial activities or conduct.
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Active ownership: Being responsible stewards of our clients’ capital and using our influence through engagement and voting to improve corporate behaviour on specific ESG issues and achieve positive change
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Positive impact: Investing with an objective to achieve positive real world outcomes and impact, such as contributing to the UN Sustainable Development Goals.
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To put our mission and vision into practice we engage with our investee companies on a wide array of strategic, financial, and ESG topics. As an active owner we use our influence to improve our investee companies’ ESG performance. This helps us address some of the most pressing and important sustainability issues facing business and the world. Our focus themes for engagement are: human rights, labour rights, climate change and governance.
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Through collaboration with other investors and industry think tanks we contribute to the development of principles and standards of corporate responsibility both at sector levels, as well as investee company level.
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Our full voting records are available here.
Climate change
As a long-term investor, we believe climate change represents a systemic risk facing the economy, society and environment. We want to consider the risks and opportunities this presents to our investments in the coming decades. We have therefore set a long-term commitment (2050), a mid-term ambition (2030) and short-term objectives (2025).
- 2050 commitment: Net-zero investor. Â
- 2030 ambition: To align with a Paris Agreement pathway (listed and non-listed investments) and Dutch Klimaatakkoord.Â
- 2025 objectives: To align with a pathway towards achieving the Paris Agreement (listed investments) and Dutch Klimaatakkoord goals.[1]
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The Kempen climate change policy can be found here (under climate change policy).
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[1]We use carbon intensity as a metric to come to the pathway of net-zero emissions. As we care about the direction of travel and reduction of carbon emissions in the economy, it might be that the actual reducing trend may deviate from the suggested average trend line. The pathway is derived from the pathway of the EU Benchmarks.
OUR FUND APPROACH TO RESPONSIBLE INVESTMENT
The investment objective of Kempen (Lux) Sustainable European Small-cap Fund is to offer investors the opportunity to invest in an actively and professionally managed portfolio of smaller listed European companies, while at the same time complying with strict exclusion and sustainability criteria.
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By 2025, we aim to align with a pathway towards achieving the Paris Agreement and Dutch Klimaatakkoord goals for our portfolio, as well as the EU Climate Transition Benchmark[2].
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Kempen’s ESG policy is implemented in our fund’s investment process by the following pillars: Exclusion, Integration and Active ownership.
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[2] The EU Benchmarks consists of two climate benchmarks, Climate Transition Benchmark and Paris Aligned Benchmark, which have the aim to reach net-zero emissions by 2050 - in line with the 1.5?C scenarios from the IPCC. As we care about the direction of travel and reduction of carbon emissions in the economy, it might be that the actual reducing trend may deviate from the average pathway. We use carbon intensity (based on Revenues) as the forward-looking climate metric.
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Exclusion & Avoidance
In line with the general Kempen policy, the European Sustainable Small-cap Fund excludes all companies on the KCM Exclusion- or Avoidance list.
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Companies that ‘Fail’ or are on ‘Watchlist’ marked against the criteria of the United Nations Global Compact are excluded.
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We determine a company’s ESG score (1-5) and exclude companies with a score of 1. Companies with a score of 2 are excluded on a comply or explain basis.
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The Sustainable European Small-cap Fund also excludes companies based on additional sustainability criteria as listed in the table below.
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More information on our exclusion criteria and thresholds can be found here.
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 | KEMPEN CRITERIA | ADDITIONAL SUSTAINABILITY CRITERIA |
Business Conduct x    Human Rights x    Labour x    Environment x    Anti-corruption Product Involvement x    Controversial Weapons x ��   Tobacco x    Thermal coal x    Tar sands x    Adult Entertainment x    Alcohol x    Animal Welfare & GMO x    Gambling x    Power Generation       Nuclear x    Power Generation       Carbon Intensive x    (Un)conventional Oil &       Gas Extraction x    Weaponry |  V V V V  V V V V             |           V V V V V  V  V  V |
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ESG integration
In the investment process we assess the ESG profile of a company. We assess each company on a case-by-case basis, taking into account material risks in a given industry in combination with the company’s respective risk exposure, practices and disclosure.
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A lower score (1-5) requires a higher return as used in our Discounted Cash Flow (DCF) models. If ESG risks are deemed too severe, an investment in the company will be avoided and/or existing holdings will be sold.
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On a quarterly basis, the Kempen Responsible Investment team screens the holdings of the Kempen Sustainable European Small-cap Fund and discusses the findings with the portfolio managers.
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Active ownership: Engagement
As active investors we perform comprehensive engagements with our portfolio companies with the objective to unlock value and reduce risk.
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Our engagement process defines clear objectives of which the progress and result is tracked and well documented. If at any stage the company refuses to cooperate, divestment has to be considered.
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In the first half of 2019, we engaged with 13 companies on strategic, environmental, social and governance issues.
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Active ownership: Voting
Exercising our voting rights is also an essential part of our responsible investment philosophy. ISS provides us with voting recommendations based on our own voting and governance policy. Items are further analyzed on a case by case basis.
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Often, we inform the company about our voting intention ahead of the meeting and, where there is a recommendation to vote against management, we ask the company to clarify their viewpoints. After careful analysis, we form our own opinion and vote accordingly.
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Our full voting records are available here.
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Risks
For more information about the mid and long term risks associated with the investments:
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Although Kempen Capital Management N.V.’s information providers, including without limitation, MSCI ESG Research LLC and its affiliates (the “ESG Partiesâ€), obtain information from sources they consider reliable, none of the ESG Parties warrants or guarantees the originality, accuracy and/or completeness of any data herein. None of the ESG Parties makes any express or implied warranties of any kind, and the ESG Parties hereby expressly disclaim all warranties of merchantability and fitness for a particular purpose, with respect to any data herein. None of the ESG Parties shall have any liability for any errors or omissions in connection with any data herein. Further, without limiting any of the foregoing, in no event shall any of the ESG Parties have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages.
ESG Report






Paying agent and representative in Switzerland is RBC Investor Services Bank S.A., Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH-8027 Zurich. The Sub-Fund is registered with the Dutch Authority for the Financial Markets (AFM) under the license of the Fund.
The information in this document provides insufficient information for an investment decision. Please read the Key Investor Document (available in Dutch, English and several other languages, see website) and the prospectus (available in English). These documents as well as annual report, semi-annual report and the articles of incorporation of the Fund are available free of charge at the registered office of the Fund located at 6H, route de Trèves, L-2633 Senningerberg, Luxembourg, at the offices of the representative in Switzerland and on the website of KCM (www.kempen.com/en/asset-management). The information on the website is (partly) available in Dutch and English.
The Sub-Fund is registered for offering in a limited number of countries. The countries where the Sub-Fund is registered can be found on the website. The value of your investment may fluctuate. Past performance provides no guarantee for the future. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units.